A Russia-China Alliance Brewing?
April 12, 2013
On March 22nd, shortly after assuming
the post of President of the People’s Republic of China, Xi Jinping headed off to Moscow to
meet with Russian President Vladimir Putin. Observers were watching the
two leaders closely, looking to divine whether or not they could
overcome past divisions to achieve a new level of cooperation in
bilateral ties. What came out of the two leaders’ meeting and what does
it augur for the future of Sino-Russian relations?
Three
major areas appear to have been the focus: managing expectations about
the relationship; expanding bilateral trade in energy and arms; and
cooperation on international security affairs. Drawing on press reports
from China and Russia we have attempted to determine how much progress
was actually made on
these issues at the summit.
Framing
the relationship between Beijing and Moscow is an issue with both
domestic and international implications for both countries. Domestically, Beijing’s leaders want to convey to their people that China’s rise is accepted and respected by major world powers.
Similarly Russia, whose relations with major Western powers has
deteriorated since the re-election of President Putin, appreciates the
respect that comes from Xi Jinping’s selection of Moscow for his first
visit abroad as China’s new leader.
Bilaterally,
both Beijing and Moscow are looking to leverage their
relationship to enhance their leaders’ standing domestically and
maximize their influence among world powers. At the same time, they hope
to avoid the costs they would incur if other states felt the need to
counter-balance a renewed bond between Russia and China. Neither party
seeks a world where their relationship is viewed as the second coming of
the Sino-Soviet axis of the Cold War.
In the realm of bilateral energy trade,
China’s goal is to acquire as much cheap and reliable energy as
possible without relying too heavily on any single-nation source, which
could be disrupted by an unexpected bilateral crisis. For its part,
Moscow wants to retain as much leverage as possible over the price of
the natural
resources it sells and to avoid becoming dependent upon China as a
destination for its energy exports.
Even
in light of these differences, it is sometimes still surprising how
limited energy sector cooperation is between China and Russia, despite
Russia’s vast energy resources and China’s rapidly growing needs, the
geographic proximity of the two states, and the strategic advantage of
having an overland supply route invulnerable to U.S. Navy at-sea
interdiction. Russia is just the fourth largest supplier of oil to
China, supplying it with only 8% of its total oil imports. There is even
less cooperation in the area of natural gas.
That
may be changing. During the summit a great deal of fanfare was made
over the conclusion of a deal to construct a pipeline to ship natural
gas between the two
countries. This was followed by an announcement that Beijing will
extend a $2 billion line of credit to Russia’s politically
well-connected natural gas giant, Gazprom, which could expedite a
long-term supply contract.
Despite the progress, Rosneft CEO Igor Sechin said Russia and China still have not signed a final binding contact. The
hold up once again is the pricing structure for Russian gas exports.
Russia wants to set prices in line with the lucrative deals it has
signed with European nations, while China believes the price should be
set much lower. Disagreements about price have tripped up
negotiations on a number of previous occasions so it is still possible
the deal will fall apart before the end of 2013.
On
the arms front, Beijing wants to pay as little as
possible for advanced military technologies and hardware. Russia wants
to increase its arms sales to China, but wants to avoid any deals that
could compromise its own security.
Conflicting
media reports suggest that the two sides may have been discussing the
possibility of a resumption of major arms exports from Russia to China.
If such trade were to resume, it would mark a major breakthrough in
relations and possibly signal a return to the days when Russia was far
and away China’s biggest arms supplier. Between 1990 and 2007, 90% of China’s imported conventional weapons were supplied by Russia. At one time China accounted for 40% of Russia’s arms exports with
total sales approaching $30 billion.
After 2007 there was a notable decline in
Russian arms deliveries to China as China began asking not only for
military hardware, but also the design technology in its arms
purchases. Russia has been reluctant to agree
to these requests given China’s poor record in safeguarding intellectual
property and the possibility that China could use Russian technology
for its own arms sales to third countries such as Pakistan.
Reports
in the Chinese state-owned press have trumpeted a new deal under which
China would purchase 24 Su-35 fighter jets plus four Lada-class
submarines from
Russia, a deal that Russia’s official ITAR-TASS news agency has denied.
The Su-35 has more powerful and advanced engines that those currently
in Chinese fighters. Some press reports speculate that China wants to
adopt the Su-35 engine technology for the stealth fighters it is
developing. As was the case with energy, Russian officials
through the Russian press appear to be indicating that negotiations are
continuing with final results only likely to emerge by the end of the
year.
Finally, the two sides also appear to have conferred on a number of issues on which they share common positions or interests. These include an emphasis on the value of sovereignty in international
affairs; Syria; North Korea; Iran; and efforts to coordinate their positions on the establishment of a new international lending institution as an alternative to the International Monetary Fund and the World Bank.
Warning
that each country has a right to determine its own pathway to modernity
and development, President Xi called on third countries to respect
Chinese and Russian choices and to stay out of other countries’ internal
affairs, code language for telling the U.S. and European nations not to
comment on human rights in China or Russia. Stung by Western criticism over Russian human rights violations, President Putin likely values Chinese
comments suggesting that the international community should mind its own business.
On
Syria, North Korea, and Iran, the two sides share interests in
preventing these regimes from collapsing while avoiding the outbreak of
inter-state armed conflict. Both Beijing and Moscow are on record as
officially opposing the spread of nuclear weapons and sensitive
technologies to North Korea and Iran, though neither is particularly
enthusiastic about the use of stringent multilateral sanctions. Yet
adopting too soft a line on either North Korea or Iran risks raising ire
in Washington, Seoul, Tokyo and Middle Eastern capitals. Coordinating
their policy stances on these tricky issues of international
non-proliferation policy is a challenging, but important goal of
Chinese-Russian summitry.
Finally,
perhaps
the easiest point of cooperation for Beijing and Moscow is the
establishment of a “developing world” version of the IMF and World Bank
with the other BRICS countries. That plan was advanced at the latest BRICS summit just days after the two leaders met in Moscow. China’s rapid growth and Russia’s return to great power status provide
the two countries with an opportunity to articulate and defend an
alternative path to modernity and development. The creation of an
alternative set of international organizations by the BRICS countries,
which include Brazil, India and South Africa in addition to Russia and
China, could carry substantial diplomatic value for Beijing and Moscow.
It may allow them in both rhetoric and substance to align themselves
more
closely with the rest of the developing world.
In
conclusion, it is not clear whether Xi Jinping’s visit to Moscow
resulted in any strategically significant new agreements. Chinese
officials and the Chinese press during the summit issued a number of
statements that indicated major agreements had been signed in the areas
of energy and arms sales. However, according to the Russian press, these
initial reports were premature with a great deal of hard bargaining
still to come.
If Moscow and Beijing are able to consummate the major deals begun at the summit we are likely witnessing the start of a more
robust Sino-Russian relationship. On
the other hand, as we have seen in the recent past, historical
suspicions, mutual mistrust, and divergent strategic interests may once
again prevent the development of a deeper and more coordinated
Sino-Russian relationship.
Scott W. Harold and Lowell Schwartz are political scientists at the nonprofit, nonpartisan RAND Corporation.
Photo Credit: The Presidential Press and Information Office (Russia)
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