Filenews 4 March 2022
By Clara Ferreira Marques
Standing in the middle at a time of conflict is in itself inconvenient. Faced with a geopolitical conflict that is both brutal and far-reaching in its consequences, Beijing officials find that such an attitude may also, in the long run, prove impossible.
When Russia's President Vladimir Putin invaded Ukraine, he seems to have shocked Chinese officials, as well as the rest of the world. It is difficult to know for sure whether China's leader Xi Jinping was aware of the Russian plans, but China's representatives and state media were certainly left confused in trying to manage the events.
Balance on a tightrope
They tried to balance an elaborate ideological alignment with an aggressive act that violates the principles of territorial integrity and non-interference that are the declaratory foundations of Chinese diplomacy. This is before we look more broadly at China's ties with Ukraine and Eastern Europe - an important part of Beijing's Belt and Road initiative to expand Chinese trade, but also wider influence.
The result was an exercise in "cognitive discord", with a narrative that accepts Moscow's concerns about its security, blames the West for creating the problem, refuses to refer to "war" or "invasion" and "laments" the unprecedented punishment of Russia through sanctions - echoing all Russian arguments - while at the same time praising Ukraine's independence and trying to stay out of the ongoing economic war. Beijing has called on "both sides" to de-escalate the situation. At the same time, it has not proceeded to any open condemnation of Russia's invasion.
Limits
This position, perhaps best described as Russia-friendly neutrality, served Beijing in particular in 2014, after Putin's annexation of Crimea. However, it seems to have limits in 2022, as the Kremlin's aggression escalates to dramatic levels, trapping even Chinese citizens in Ukraine in the crossfire.
Meanwhile, the economic consequences are multiplying rapidly, leaving Russia increasingly detached from the global financial system. Chinese officials - careful students of the collapse of the Soviet Union - are well aware of Russia's ability to self-destruct economically and do not wish to torpedo their position in the global economy because of a political partner that has chosen to become an international pariah.
There have been signs of disapproval. Chinese Foreign Ministry spokesman Wang Wenbin, asked about the friendship with Russia on Monday, showed impressive rhetorical flexibility, but did not fail to mention that the two countries are strategic partners - not allies. On Tuesday, for the first time since the invasion, Chinese Foreign Minister Wang Yi spoke with his Ukrainian counterpart, expressing concern about the "damage done to civilians."
Igor Denisov, a senior researcher at the Institute of International Studies at MGIMO University in Moscow, argues that this phone call is not a major turning point, but a demonstration of Beijing's supposedly constructive role in the crisis and an attempt to help its citizens stranded in Ukraine. This is no small issue, since China, unlike many other countries, did not initially recommend the evacuation of its citizens from Ukraine, but instead refuted US warnings of an impending invasion.
Denisov, however, also points out that the more substantial and entrenched the West's position is, the less space China will have to support Moscow, in fear of secondary sanctions.
Margins
And there is much evidence that room for manoeuvre is quickly diminishing as more and more punitive measures pile up.
Firstly, on the geopolitical level. China may disagree with US definitions of democracy and related concepts and align itself with Putin's views on multipolarity, but it sees itself as an important factor in the global economic and political order and not as an external factor to it.
In a speech on Monday to mark the anniversary of US President Richard Nixon's 1972 visit to China, the Chinese foreign minister called for "the basic rules of international relations" to be respected, advocated the "aims and principles of the UN Charter" and called for improved relations and ties. "Since the door to China-US relations has been opened, it should not be closed again," Wang said. "Since the world has emerged from the Cold War, it should not see the creation of a new Iron Curtain."
Comments in official state newspapers echoed the same sentiment. These are not the words of a regime that is thinking of joining Putin against the whole world.
Money
Money speaks even louder. China is now exporting more to Russia as trade ties have strengthened over the past decade and has bought more hydrocarbons and other natural resources from its northern neighbour - they are the sticking point in their relationship, as seen with the gas that will be supplied through a new pipeline from the Russian Far East to China and agreed last month. All this has accelerated recently and now Beijing is building up stocks of all commodities.
The bottom line, however, is that Russia is still a small export market for China: 2% of shipments, compared to 17% of the U.S. share. Meanwhile, in imports, China has worked for years to diversify its energy supply, so while Russia is a major supplier, Beijing is not dependent on a single source of oil and gas — not, at least, in the way it needs the West as a source of access to technology and the dollar system.
The inflationary impact of Russian adventurism, at the same time, is already hurting China. This will be a point that will be particularly highlighted by Western diplomats, who hope to prevent China from softening the impact of the sanctions against the Putin regime.
Yes, Russia's demand for alternatives to the dollar and to the SWIFT financial transaction system will promote other surrogates, and China has been seeking for years to promote the yuan as a global currency. Such a structural change, however, cannot easily come soon.
Uncomfortably
China will continue its awkward balancing effort for the time being. It will use its state-owned development banks, which are less sensitive than its commercial financial institutions, to provide support, especially for large projects. It will, however, avoid encouraging state and private entities that are wary of both getting involved in sanctions and increased investment risk – there have not been exactly enthusiastic investors in Russia to date anyway.
Beijing will continue to call for an end to the violence and will say it understands Moscow's concerns, but will also exploit a friend in need, pushing Russia for attractive conditions on gas or wheat sales. Many officials in Beijing undoubtedly see room to profit politically from a situation that leaves the U.S. stuck in Europe and unable to focus on Asia.
But the longer the rampant violence continues, the more severe the sanctions become and the greater the economic risk to Beijing, the harder it will be to continue to stand in the midst of the conflict.
Source: BloombergOpinion
