The recent concluding of the Beijing summit has drawn various expert opinions based on the joint statement between China and Russia, as well as the information released by official media outlets. Experts believe that the summit conveyed multiple negative signals to the world: while Putin seems to be preparing for a prolonged war, the Chinese Communist Party faces economic challenges due to significant risks in trading with Russia using the yuan.
President Xi Jinping held talks with Putin in Beijing on the morning of May 16 (Thursday). The public information revealed about the meeting primarily focused on economic and trade aspects, unrelated to the Russia-Ukraine conflict.
Both sides agreed to continue expanding bilateral trade, jointly maintaining the stability and security of industrial and supply chains. They also agreed to increase the share of local currencies in bilateral trade, financing, and other economic activities, improve the financial infrastructure of both countries, and facilitate settlement channels between businesses.
White House Press Secretary Karine Jean-Pierre stated during a press briefing on Thursday that the Biden administration officials did not notice any new content in the joint statement between China and Russia.
“We believe it is unacceptable for Chinese companies to assist Putin in launching a war against Ukraine,” Jean-Pierre said.
Professor Zheng Zhengbing from National Yunlin University of Science and Technology expressed on May 17 to Epoch Times that the global concern lies in the military alliance between the two countries rather than their economic and trade cooperation. While the official news mentions little about the military aspects, the military part still holds a considerable share within the ten-point joint statement.
In the joint statement, China and Russia reaffirmed their “non-alignment” status but deepened their “comprehensive strategic partnership.” The statement highlighted cooperation in areas such as economy, trade, energy, technology, and criticized the US multiple times for conducting joint exercises with China and Russia, and deploying land-based intermediate-range systems in the Asia-Pacific region.
Regarding the Russia-Ukraine conflict, the joint statement stated that Russia appreciates China’s objective and fair stance on the Ukraine issue and welcomes China’s constructive role in resolving the Ukraine crisis through political and diplomatic means. On the Taiwan issue, the document indicated that Russia supports China’s measures to uphold national sovereignty, territorial integrity, and achieve national unity.
Professor Zheng Zhengbing believes that Xi Jinping is currently in a dilemma. On one hand, he needs to stabilize the domestic situation for economic development and improve relations with the US and the EU. On the other hand, he has personal ambitions and close cooperation with Putin in the restructuring of the global new order.
He thinks that Xi and Putin both do not want to escalate global concerns about their military cooperation, so they particularly emphasize their cooperation in economic and trade. However, even discussing only economic and trade cooperation is already raising concerns among Western countries.
Associate Professor Shi-min Chen from National Taiwan University also told Epoch Times on May 17 that Russia still heavily relies on its trade with China. Xi Jinping naturally emphasizes the importance of friendship development because he does not want to discuss military issues too much. “He wants to please both sides. On one hand, he indirectly gives a lot of support to Russia so that Russia can continue to maintain its war effort. But on the other hand, Xi Jinping does not want the aid to Russia to affect relations with Western countries, especially European countries.”
The visit of Putin gave the impression to the outside world that he played a role of a helper to Xi Jinping in Beijing. Moreover, only State Councilor Shen Yi-xin was sent to pick up Putin. However, Xi Jinping welcomed Putin with great fanfare in the Zhongnanhai.
Zheng Zhengbing stated that before the war, Putin was Xi Jinping’s idol. During the war, Xi Jinping still has a lot to learn from Putin. But once the war broke out, due to Russia’s survival difficulties and military challenges, the situation reversed, and Putin demanded more from Xi Jinping.
“So it seems that Putin is now Xi Jinping’s little brother. Both points of view are valid, but it can be seen that their mutual dependence is very high, especially since both countries are involved in confrontation with the West. Despite Russia’s greater need for China at present, China also needs to ally with Russia.”
However, Zheng Zhengbing believes that Xi Jinping also values Russia significantly, as evident in the grand set-up of the red carpet and military parade. But he also wants to reduce military attention and highlight the importance of economic resources, which appears somewhat deceptive.
“Although the White House spokesperson said there was nothing new in the ten-point statement of the Xi-Putin meeting, in reality, these things have been the developments of significant global events over the past few years. Their cooperation has not stopped but has been increasing. The statements made during the meeting between Biden and Xi and the statements between China and Russia are vastly different.”
Shi-min Chen remarked on the State Councilor receiving Putin before, indicating a slight to Putin, making him seem like he is in a position of seeking help from China. “Last month, when Xi Jinping visited France, the French Prime Minister greeted him. If Russia is so important to China, even if Xi Jinping does not personally welcome Putin, he should at least send Vice President Han Zheng or the Chairman of the National People’s Congress.”
As for the grand reception of Putin by Xi Jinping at Zhongnanhai, using ceremonial cannons and laying a large red carpet, Shi-min Chen said it is a dual approach. “The whole world will see the moment when Putin steps onto Chinese territory, making Putin appear as just China’s junior brother. When Putin enters the Zhongnanhai, I will lay a lot of red carpets, balancing things out a bit. But the focus is on who greets Putin at the scene.”
On May 12, Putin’s first major action of his new term was replacing the longest-serving Defense Minister Shoigu with economist Belousov.
Zheng Zhengbing said that this economist has a solid background and was previously the Deputy Prime Minister, so his relationship with China is very close.
“You can see two signs: first, he (Putin) uses economists to plan the war, indicating that the future of the Russia-Ukraine war is a long and expansive direction. From a financial perspective, cost reductions will allow the war to continue in the long run. Secondly, he is an expert on China. This time Putin also brought him to China, so their cooperation will become more close. It is not a very positive signal.”
Zheng Zhengbing said that the participants in the China-Russia talks are essential figures from both countries, including representatives from defense and military as well as from economic and financial sectors. Putin even flew to Harbin to participate in the China-Russia Trade Fair, highlighting a more economic aspect, but in reality, economic cooperation also points toward military cooperation. Successful economic and trade cooperation will ensure Russia’s financial stability, escalate the war in Ukraine, and increase threats to Europe. Additionally, the statement mentions East Asia, Korea, and the Middle East, indicating that their military exercises need to escalate there, as well as cooperation in the Arctic and East Asia, along with intense economic cooperation, are unfavorable signals to the Western world or globally.
Regarding Putin appointing an economic expert as the Defense Minister, Shi-min Chen also stated that this signifies Russia’s intention to engage in a long-term war. “Putin intends to turn the entire Russian economy into one dominated by military industries, or a militaristic economy where the entire economy serves the military.”
The joint statement between China and Russia mentions the need to increase bilateral trade, strengthen the share of local currencies, and ensure smooth settlement channels between economic entities.
Zheng Zhengbing stated, “China has a huge foreign exchange reserve. In the future, if China wants to ally with Russia, attack Taiwan, or have geopolitical conflicts in the South China Sea or East Asia, similar to the model of the Ukraine war, the US and its Western allies will undoubtedly impose sanctions through SWIFT.”
“Both Russia and China are selling off dollars, reducing their dollar assets continually, and acquiring gold or assets other than those in the US or Europe.”
Currently, the global financial system is dominated by the dollar and the euro, accounting for nearly 90% of global currency transactions, with the remaining 10% divided among the Japanese yen, Swiss franc, or Chinese yuan. The largest trading system in the system is the SWIFT system, covering about 90% of global economic and trade activities. Under the shadow of the Russia-Ukraine war, if Russia and China hold assets or deposits abroad in dollars or euros, they will all be frozen.
Zheng Zhengbing said that at the onset of the Russia-Ukraine war, Russia and China sought to establish settlements using their local currencies beyond the dollar, including trading in renminbi or Russian rubles. However, the ruble’s influence is much lower than that of the renminbi. They also involved other countries like Saudi Arabia and other Middle Eastern countries, hoping to settle in renminbi.
“Recently, due to the very poor state of the Chinese economy, massive outflows of foreign capital have led to poor exports, causing the Renminbi’s value to be undervalued under global competitive turmoil, threatening its settlement system and the use of its currency. However, it seems that the efforts of the China-Russia alliance to use the China-Russia settlement system will continue.”
Shi-min Chen also mentioned that Russia has been excluded from the SWIFT mechanism for dollar settlement, so its trade with China is settled in renminbi. Russia now holds a lot of renminbi, but the problem is China’s economic slowdown and the imposition of tariff sanctions on China by the US, causing the renminbi to depreciate. “With a pile of renminbi owned by Russia, the currency value may drop substantially, potentially causing significant harm to the economy.”
On the eve of the Russia-Ukraine war, the joint statement following the meeting between the leaders of China and Russia on February 4, 2022, in Beijing indicated that the China-Russia relationship surpassed the military-political alliance model of the Cold War era. It mentioned that the two countries’ friendship has no boundaries, and their cooperation has no restricted areas, enhancing strategic cooperation not directed against a third country, and more. However, the joint statement by the leaders of China and Russia this time no longer includes the phrase “friendship has no boundaries, and cooperation has no restricted areas”.
Shi-min Chen stated, “Friendship has no boundaries, and cooperation has no restricted areas” is missing, and it describes China and Russia as not forming alliances, not being confrontational, not being aimed at third parties. “Not forming alliances means that the relationship between China and Russia has boundaries. Not being confrontational and not aimed at third parties mainly refer to the West, meaning being targeted at Europe. Xi Jinping wants to attract Europe to counter US pressure. So, the substance of this meeting compared to two years ago has regressed.”