China and Russia are two world powers. One represents the most populous country in the world: 1,374 million inhabitants. The other is the largest in terms of surface area: 17 million km2. A common border of 4,200 km connects them. Both countries are members of the UN Permanent Council, while Sino-Russian relations have been excellent for several years. At the Beijing Olympics, Xi Jinping and Vladimir Putin voluntarily showed the friendship of their two nations to the eyes of the world. In this sense, he evokes the head of Chinese diplomacy Wang YI “a rock-solid Sino-Russian friendship”. It is clear that this increasingly strengthened alliance poses a threat to the Western world.
As the world’s second largest economy, China has for years been forging a strategic energy partnership with its neighbor Russia, which is especially rich in gas and oil. Remember, however, that Russia was only the 12th largest economic power in the world at the start of the war in Ukraine. Its GDP was lower than that of the Benelux countries (Netherlands, Belgium and Luxembourg). In other words, Russia’s power seemed at first a military order.
Bilateral economic relations between the two countries began in the late 1980s. Russia then took advantage of the Western embargo following the tragic events in Tiananmen Square to sell arms to its new partner. In addition, the two countries carried out joint military maneuvers in 2005 before celebrating with great vigor in June 2019 the 70th anniversary of their diplomatic relations. On this occasion, they used spectacular means to stage, in front of cameras around the world, the complicity and friendship that unites them.
China and Russia members of the Shanghai Cooperation Organization
Beijing is also increasing its strategic membership in global organizations. Thus, the Middle Kingdom is one of the member countries of the IMF, the World Health Organizations (WHO) and the World Trade Organization (WTO) and, as we have seen, the UN. China also runs four of its fifteen agencies, namely the FAO in charge of agriculture, the ITU in charge of telecommunications, the ICAO in the field of aviation and finally UNIDO for to industrial development.
At the same time, China is actively involved in the creation and development of its own cooperation agency: the Shanghai Cooperation Organization, known as the “SCO”. Founded in 2001 and based in Beijing, it is an intergovernmental alliance of economic associations. But its key role is to maintain regional stability and security. Thus, along with China, Russia was one of the six founding states with Kazakhstan, Uzbekistan, Kyrgyzstan and Tajikistan. India and Pakistan joined the organization in 2017. In addition, there are four observer states (Belarus, Mongolia, Iran and Afghanistan) and six discussion partners: Turkey, Azerbaijan, Nepal, Cambodia, Armenia and Sri Lanka. Lanka. The two official working languages are Chinese and … Russian.
A summit is held each year during which Member State leaders and observers define the main lines of sectoral association and alliance policies on defense, education, justice and tourism. Currently, Uzbek Vladimir Norov provides the General Secretariat, which must ensure good coordination between states.
In 2018, the total GDP of this group was valued at $ 18.5 billion, or 21.6% of world GDP. It contains more than a quarter of the earth’s surface on a planetary scale and more than 40% of the world’s population. From an energy point of view, the SCO countries account for more than half of the world’s known reserves of gas and uranium, a quarter of oil and 35% of coal. In short, the existence of this organization reflects a progressive shift of the axis of the world towards Asia.
The SCO also ensures that the non-interference of Western countries and in particular the United States in the affairs of its members is maintained. However, as it is not a kind of Eastern NATO, it does not have the equivalent of Article 5 of the Atlantic Alliance Charter, which states that a military attack on a member country systematically leads to a military response. of all its members. countries. Not content to sell them weapons, the Kremlin has, however, established military bases within OECS member countries to increase its influence in Asia.
It should be noted, however, that the Shanghai Cooperation Organization serves primarily Chinese interests, through the ambitious global project of “Silk Roads”, which especially affects high technology, transportation, energy. and agriculture. The SCO has also been involved in financing the largest European road linking Ridder in Kazakhstan with the French city of Calais, with a specific goal: to facilitate the flow of Chinese goods to Europe. China has always looked after its economic and geostrategic interests. He did not create, in 1996, the ancestor of the SCO, “Shanghai Five” to deal with the problems of demarcation of borders after the break-up of the USSR!
However, there are regional tensions and even escalations between OCS member countries. Take the example of Kashmir claiming both India and Pakistan. China is no stranger to this conflict either. This region is in fact one of the axes of the Chinese Silk Roads, which strained diplomatic relations between India and China. The latter two are also in conflict in Ladakh in the Himalayas. India accused China of colonizing national territories, the clashes took place in May 2020 at an altitude of more than 5,000 meters and cost the lives of several soldiers: 20 Indians and 4 Chinese.
Finally, there is a certain economic rivalry between Russia and China in terms of free monetary trade. This is illustrated by the action taken by Moscow within the member countries of the SCO in order to protect the ruble from a preponderance of the Chinese currency. In addition, Beijing covets the Eurasian Economic Union and the Organization of the Collective Security Treaty, two free trade areas in which the ruble is traded in large volumes.
From these tensions, both geopolitical and financial, arises a real complexity of the SCO because it also shows a genuine unitary will to counter Western influence. Thus, the two Sino-Russian powers certainly maintain cordial relations (because they are based on solid and growing collaborations) but not without mutual mistrust. Since the start of the war in Ukraine, which China observes at the prospect of a possible conflict with the island of Taiwan, exports and imports, however, have jumped between the two countries. China’s export volumes to Russia grew by 45% last February, according to Oddo BHF, compared to a 16% overall increase. At the same time, Beijing is taking advantage of cheap Russian barrels to boost its energy imports.
China’s ambiguous position on the invasion of Ukraine
This means that the ambiguous position of the Chinese state, which has not condemned the invasion of Ukraine, is of particular concern to Western countries. However, with trade between China and Europe and the United States far exceeding Sino-Russian volumes, China must ensure that it finds the right balance in its complex bilateral relations with Moscow. That is why the hypothesis of a double discourse coupled with a delicate balance for Beijing has its source in the fact that Russia has not been excluded from the Shanghai Cooperation Organization. This neutrality, not to mention collusion, is explained by a common desire to redesign the world order, at odds with the democratic and universal values of the West. One thing in common also links these two powers, the desire to counter the influence of the United States on a global scale.
Russia now relies on its allies to limit the significant impacts of international sanctions and prevent default. Foreign exchange reserves in euros or dollars from the Russian central bank have been frozen in Western countries. Of the $ 600 billion, only $ 150 billion would remain, but mostly in yuan, rupees and gold. Therefore, the Russian central institution no longer has access to most of its international reserves in euros and dollars. During this time, Beijing would have proceeded with the entry of capital of Russian companies in difficulty. The Chinese state is thus taking advantage of the current situation to establish itself in a weakened Russia. Therefore, both parties know how to identify areas of common interest for which cooperation is essential, especially in the space field. Thus, an agreement provides for the joint construction of a future lunar station. Another way to enter into direct competition with the United States.
That is why Beijing’s dubious attitude towards the Ukrainian war has made Washington react. U.S. Treasury Secretary Janet Yellen has warned China of threatening economic sanctions that would affect its exports to the West.
On the economic utility of Europe and the United States for China
China’s economic rise is a consequence of its inclusion in the global economy. Its integration into the World Trade Organization (WTO) in 2001 has allowed its economic development and increased growth over the last two decades. The Middle Kingdom is constantly increasing its international economic influence. This is how China managed to negotiate the payment in yuan of Saudi oil. According to the General Administration of Customs of China, the kingdom’s oil exports to China have accelerated over the past 30 years. Saudi Arabia was China’s largest supplier of crude oil last year, followed by Russia with 1.6 million barrels per day.
With the imposition of its currency, Beijing has also sought to demonstrate that it could be a perfectly credible currency of exchange on a global scale. The world’s factory, the United States’ largest economic partner and whose GDP is six times that of Russia, shines through its global economic and trade partnerships. Maintaining its growth, which has also shown signs of slowing down in recent years, first requires the sale of its products in Europe and the United States, hence the need not to suffer international sanctions. Conversely, imposing sanctions on Beijing would deprive Europe, the United States and the world of many goods and merchandise imported from China. Therefore, the act of balancing also depends on the West.