Chinese leader Xi Jinping has instructed to significantly increase cooperation with Russia in the energy and trade sectors, despite public attempts to move away from Russia. According to The Wall Street Journal, Beijing thus indicates its long-term stake on cooperation with Russia.
The publication claims that the PRC government should develop a whole plan to expand cooperation, which involves increasing the import of oil and gas from Russia, as well as agricultural products, the creation of joint energy projects, in particular in the Arctic. A separate item in the plan is investment in the transport infrastructure of Russia, which, apparently, should help increase the volume of deliveries. We are talking about ports and railway projects.
The increase in trade between countries will be accompanied by an increase in the share of settlements in national currencies. According to the WSJ, this is positive for Russia, as it reduces sanctions risks, while for China it increases the importance of the yuan as an international currency. Beijing has been working in this direction for a long time – for example, similar agreements were recently reached during negotiations with Saudi Arabia.
“Xi is strengthening China’s relationship with Russia largely independent of the Russian invasion. Relations may well become even closer, ”says Yun Sun, director of the China program at the Stimson Center.
At the same time, the publication notes that China still adheres to a cautious position, trying to walk the fine line between supporting the Russian invasion and condemning the war in Ukraine. China is trying to extract the maximum benefit from Russia's weak position, and also not to bring relations with the US and the EU to a catastrophe, since the state is extremely dependent on Western technologies. A clear evidence of this position was the statement following the visit to Beijing by German Chancellor Olaf Scholz, in which Xi Jinping declared the use of nuclear weapons unacceptable. Similar rhetoric comes from the Chinese Foreign Ministry: the Foreign Ministry notes that close relations between Russia and China are built on the principles of "non-alliance, non-confrontation and non-targeting of third parties."
“This is not to say that China is giving up on Russia, but it does suggest that China now finds it acceptable to snub Russia. China's dominance in relations is growing,” Sun said.
Russia, on the other hand, is becoming increasingly dependent on China as the only strategic partner and the largest market for its products. In 2021, trade turnover between the countries reached $146.9 billion compared to $95.3 billion in 2014. At the end of 2022, the parties expect a new record – around $200 billion. This figure is presented as a breakthrough in bilateral cooperation, but it was possible to achieve it due to Western sanctions, which deprived Russian companies of premium European sales markets, due to which most Russian goods are now going to China discount.