Considering the fact that Russia’s invasion of Ukraine came just 20 days after Russian president Vladimir Putin and Chinese President Xi Jinping declared that their friendship has “no limits,” many observers see China as a crucial player in the ongoing war. And with Russia reportedly asking for military aid from China and the U.S. repeatedly leaking intelligence that seems to put pressure on China, some analysts have suggested that the Russia-Ukraine war could become a new proxy war in the U.S.-China rivalry.
With so many variables at play, as well as both competing and aligning interests, the calculus for the world’s two biggest powers is extremely complicated. In the month since the invasion, the U.S. has led the charge on sweeping sanctions against Russia, severely crippling its economy and its access to international companies and finance. China, for its part, seems to be abiding by the sanctions even as its state-run media mimics Russian propaganda narratives about the war. Now, with the war entering its second month, EU leaders are calling on China to do more to stop Putin. Although China has tried to stay out of the spotlight — insisting that it is “not a party” to the situation — Beijing seems to be smack dab in the middle of the Russia-Ukraine war.
How can we make sense of China’s involvement, or lack thereof, in the Ukraine crisis? This week, The Wire reached out to 13 experts in an effort to understand how China views the conflict, what options it has when it comes to its relationship with Russia, and what might happen next.
I. HOW DOES CHINA SEE THE WAR IN UKRAINE?
Many experts note that the Chinese perception of the war in Ukraine is more complicated than the West can appreciate. Tuvia Gering, for instance, points out that there have been scholars like Shi Yinhong from Renmin University saying clearly that China’s international image is going to suffer by staying on the sidelines. Hu Wei, a prominent Shanghai scholar and vice chairman of the Public Policy Research Center affiliated with the State Council, wrote a widely circulated article calling on China to cut ties with Putin. At Tsinghua University, more than 200 graduates signed a petition calling Putin a warmonger. There has even been poetry by Yu Xiuhua: “I beg that poetry would stop a tank, that tear filled poems would be strong enough to stop even more.”
There are also responses that tend to blame the U.S. and the West for the situation. Fan Peng, director of the Contemporary Chinese Politics Research Office at the Chinese Academy of Social Sciences (CASS), for instance, pointed to the West’s history of aggression in the Global Times. Hua Chunying, spokesperson for the Foreign Ministry, first said that NATO owes China a “debt of blood” — a line that has been repeated by Xu Bu, the president of CIIS [China Institute of International Studies, a think tank under the Ministry of Foreign Affairs]. The leading economist Chen Wenling has even equated the U.S. and NATO to Hitler.
Officially, however, China insists it is “not a party” to the situation in Ukraine. It has proposed a six-point humanitarian aid solution for Ukraine, while declining to call the crisis a “war” or even a Russian “invasion.” How should we understand China’s attempt to stay “neutral” and the various responses to Ukraine? Yun Sun, Tuvia Gering and Tong Zhao weigh in.
Yun Sun
Yun Sun is the director of the China program at the Stimson Center, a Washington, D.C.-based think tank. She is an expert in Chinese foreign policy and U.S.-China relations.
Is China Really Neutral? China Thinks So.
“It’s really a question of reference point when we talk about neutrality. When the West thinks about neutrality, it is a neutrality between Russia and Ukraine. Russia invaded Ukraine — that’s just a fact — so if China is to be neutral, it will have to first acknowledge that as a fact. That’s the Western reference point.
But the Chinese reference point is different, because China has already aligned itself pretty closely to Russia. So, China is trying very hard to put distance between its position and the Russian position, but for China, neutrality means a pro-Russian neutrality. It is a neutrality between non-opposition to Russia, and support to Ukraine, which China is offering.
Think about it from another perspective: when China talks about sovereignty and territorial integrity, the U.S. thinks that this doesn’t mean anything, that these are just empty words. But if you were in China’s position, that’s like slapping the Russians in the face. Because it is very clear who China is talking about. That’s why the Chinese are feeling very uncomfortable: they’re asserting sovereignty and territorial integrity, but they’re not going to come out and condemn Russia.”
Tuvia Gering
Tuvia Gering is a research fellow at the Jerusalem Institute for Strategy and Security. He specializes in Chinese security and foreign policy, and he has been extensively documenting Chinese media’s response to the Ukraine crisis.
China Feels Under Attack, Causing Freeze, Flight and Fight Responses.
“The situation in Ukraine has been a geopolitical fever dream for China, where the ‘brain-dead NATO,’ as [French president Emmanuel] Macron put it three years ago, has risen up like Frankenstein’s monster. It’s the same for Germany’s hike in military spending, the EU Council approving a ‘strategic compass’ and talks about strengthening the transatlantic relationship. And then you have the West’s battery of sanctions, which have mutated and grown sharp fangs, wreaking havoc on the Russian economy and turning the country into an international pariah, not to mention the personal financial damages to its elite.
Watching all of this, China feels like it itself is under attack, and so you can understand the different responses coming out of China as freeze, flight and fight responses to the situation.
The first one is the freeze. China is like a gymnast in a circus. It walks on a very tight rope, balancing mutually exclusive interests, including good relations with Russia and good relations with the West [for trade reasons]. As it gets harder to balance, you get a freeze response, which is most evident in the censorship of Ukraine issues on Chinese social media. They are trying to freeze — or censor — opinions that might snowball and overwhelm the public opinion system.
The flight approach appears in a different way, mostly as distancing itself from Russia, saying that the conflict is not something that China wants to see. I think that’s genuine — they want to distance themselves from all this bloodiness. This flight response is seen by some Chinese intellectuals as stemming from zhongyong — the ‘doctrine of the mean,’ the Confucian idea that everything should be in moderation. They say it is in China’s civilizational genes, and in line with China’s diplomatic tradition — it emphasizes that it goes its own way and does not accept the dichotomous vision of the West, professing Chinese solutions and Chinese wisdom. They wouldn’t, as the U.S.-led West and NATO do, fan the flames by giving its friend matches (i.e., the military help Putin has reportedly asked for). China wants to see the flames turned down.
Finally, we have the fight response, which is the more offensive response that touches on the deflection of responsibility or the ‘whataboutisms’ regarding the U.S. and NATO aggression and unilateralism. These responses portray the U.S.-led West and NATO as the ‘root cause’ of the war, the ones committing the original sin. For example, Xinhua News Agency has accused the U.S. of attempting to start a new Cold War, saying the U.S. has exposed its true colors as an empire of lies, a callback to Ronald Reagan’s famous speech on the evil empire about the Soviet Union.
What is most consistent in these responses is that China still sees the U.S. as its main contradiction, to use Maoist language, and Ukraine did not change that.”
Tong Zhao
Tong Zhao is a senior fellow at the Carnegie Endowment for International Peace in Beijing. His research focuses on strategic security issues and Chinese nuclear policy.
China is Preparing for War — But Not in Ukraine.
“China won’t see eye-to-eye with the U.S. on the nature of the Ukraine war, because China sees the Ukraine war from a geopolitical perspective and China sees a China-Western confrontation as only a matter of time. It sees the sanctions on Russia as a joint Western effort to strangle Russia, after it was forced to defend its strategic needs. And if Western countries succeed, it would embolden them to do the same type of thing against China in the future. If that happens, Russia would be a reliable partner; Russia would be able to give key resources and bailout China.
This is why China is engaged in a power build up. Under the current leadership, China believes — in fact it has believed for a long time — that it must focus on national power and that there may be an eventual showdown since China is the rising power. Before [in the period of engagement], the West didn’t mind because China wasn’t able to challenge it. But now, western countries have become alarmed. The structural change is making them nervous. When is China going to replace them? Western countries now want to go after China.
So, the current Chinese leadership sees the U.S. as hegemonic and biased against China. There were efforts to make deals with the U.S., but after Trump and Biden, they all embrace this bias and hegemonic edge. We have to be prepared and to be ready for this — for the worst case scenario. China wants to be self-reliant so that, in a crisis, no one can coerce China.”
II. DOES CHINA’S RELATIONSHIP WITH RUSSIA REALLY HAVE NO LIMITS?
On February 4, Xi Jinping and Vladimir Putin put out a joint statement that said their friendship had ‘no limits.’ While some in the West have read this to mean China will eventually help Russia, either militarily or economically, and that a new world order of autocrats versus democracies is emerging, several experts we talked to noted there are interesting caveats. During the Cold War, for instance, Russia and China also weren’t democracies, and China only allied with the Soviets for about 10, very fraught years. Moreover, several experts noted, China has the memory of an expansionist Russia that resulted in border skirmishes; the Russians even colonized parts of China, such as Manchuria.
The current alliance, it seems, is more narrow than it once was. Today, it is about anti-Americanism, but as Rana Mitter noted, there is not much ‘emotional’ heft to it. Below, Nancy Qian, Rana Mitter, Logan Wright, Bonnie Glaser and Jude Blanchette analyze the economic, strategic, practical and ideological elements of the Sino-Russian relationship.
Nancy Qian
Nancy Qian is an economics professor at Northwestern University’s Kellogg School of Management. Her work focuses on the political determinants of economic development.
The Sino-Russian Economic Relationship is Not That Strong.
“Officially, there’s this alignment between China and Russia. Mostly, they are united in their desire to not let the U.S. take charge of their region and dictate their regional politics. But economically, there’s not that much of a complementary relationship, whereas there are huge complementarities between China and the West.
Even though China imports two important commodities — gas and food — across the border from Russia, Russia is only China’s 11th largest trade partner; it is totally dwarfed by other countries. With regards to food, for instance, the total amount of food that Russia can give to China is not that much. It can’t, for instance, offset China’s needs from Australia or Brazil, or other countries that are the main food exports to China. Ukraine, after all, is an important fruit exporter — that’s the irony of this situation.
And with regards to gas, China needs energy, and Russia has 26 percent of the world’s reserves. Because the two countries are territorially connected, they can build pipelines; they now have two, and they can potentially build more. But by that same token, Russian oil is nice for China to have in the short run, but it’s not that important in terms of a long-run strategy since China is trying to move away from oil.
So China is being, and should be, very cautious about alienating the U.S. and other allies. And what I see is that the Chinese policymakers are trying to create more space to maneuver domestically, as well as internationally. When the Chinese government says, ‘We just want to stay out of it, but we’re watching closely’ — I think that is a very truthful statement. And they are learning a lot by watching, especially about sanctions.
Economically, Russia is not a very diversified economy. But it is a net exporter of key subsistence commodities that people need to keep on living, like energy and food. So, with sanctions, the Russian people will become very poor, and the Russian economy will go into chaos very quickly. But people won’t starve for a while, as long as they keep domestic supply chains going. It’s an open question whether the government has the capacity, but if they do, they could go on for a while.
China is very different, because it has a very large and an extremely diversified economy. But it relies on food imports and energy imports. So, outside of these two key commodities, the economy itself won’t go into chaos nearly as quickly as Russia’s, but if those things are cut off, the Chinese people will suffer on a day-to-day basis. This is probably why the Chinese government has been trying to stock up. But there are 1.3 billion people, how much can you stock up?”
Rana Mitter
Rana Mitter is a Chinese history and politics professor at Oxford University, where he is also the director of the China Centre. He has written numerous books, including most recently, China’s Good War: How World War II Is Shaping a New Nationalism.
China Might As Well Get the Most Out of the Situation with Russia.
“It is true that China did not want this conflict. They said that very clearly. But, since it’s happened, the ideal scenario from China’s point of view is to put themselves in a position where, essentially, they’re the only people who have got Russia’s back, which doesn’t necessarily mean that they have to go all in, despite the statements about friendship without limits. It’s like one of those statements that has an asterisk saying ‘Terms and Conditions apply.’ And in this case, the terms and conditions can be intuited from looking at what happened on previous occasions, like after Crimea, when there was a brief period of sanctions on fossil fuels and China was willing to take oil and gas from Russia but negotiated a pretty good price on that. That same scenario could come around again: China continues to need energy. It has climate change goals, but in the short term, it’s been quite happy to take some of those Russian products.
In addition, there is the potential for further diplomacy in the medium term. Russia, for instance, has always been slightly reluctant to let China into the Arctic, which is something that China very much wants. (China calls itself ‘a near Arctic power.’) With Russia in a more vulnerable position, it might be more amenable to letting China in. Another example: right now, one of the other powers that abstained in the United Nations vote was India. One of the reasons is that 50 percent of India’s arms come from Russia. India also has a massive land border dispute with China. And I imagine that China would like to have the leverage to persuade Russia not to be as helpful to India as it has been, particularly since India is also a member of the Quad grouping (with Japan, Australia and the United States), which, although not explicitly aimed at China, seems to have constraining China’s options as one of its goals. So you can see geostrategic outcomes from a weakened Russia, but one that is still under Putin’s control, that will give China the opportunity to leverage its position.”
Logan Wright
Logan Wright is a Hong Kong-based partner at Rhodium Group, where he leads the firm’s China markets research work. He is also an adjunct fellow at the Center for Strategic and International Studies (CSIS), a Washington, D.C.-based think tank.
There’s a Difference Between Political China and Technocratic China.
“The Russian invasion and the subsequent sanctions have created this huge wedge between the political forces in China and technocratic elements in China. Political China now views the dollar as more of a Western weapon and access to dollar-clearing facilities as a potential vulnerability. Whereas to the technocratic forces, access to the dollar is absolutely essential for China’s long-term development, and there’s no way you could even think about disengaging.
It’s not a conflict, per se, because we know the political priorities will prevail, but that doesn’t mean that they just force the technocratic elements to comply. So, for instance, the rhetoric doesn’t change at the foreign ministry level — it looks like China is going to deepen higher level cooperation with Russia, and they’ll say that this transmits down to economic and trade cooperation. But the reality is it just doesn’t happen, because economic and trade decisions are actually made by multiple individual officials. Yes, there might be some big transactions that get pushed through the system, but the forces that are compelling China’s engagement with the rest of the world are just stronger.
Last week’s huge market selloff was a perfect illustration of this. All of a sudden, the message from the [Financial Stability and Development Committee] and [vice premier] Liu He’s office is basically, ‘We’re listening, we understand that the market is very concerned about these things.’ For foreign investors, the story in China has always been one of technocratic leadership. It’s when political priorities take precedence over those technocratic forces that we’ve seen the greatest market dislocations, such as with the tech regulations of the last year and the common prosperity campaign.
China’s relationship with Russia should be viewed with the same sort of lens. Yes, it might promote individual energy deals, and it might promote individual shipments if Russia requests something — but that’s not the basis of a stronger, sustained trade relationship or a stronger sustained financial relationship.”
Bonnie Glaser
Bonnie Glaser is the director of the Asia program at the German Marshall Fund of the United States in Washington, D.C.. She is an expert in Chinese foreign policy and Indo-Pacific security issues.
Russia Doesn’t Expect Much from China.
“I don’t think that Russia expects very much from China. Xi and Putin have a very good read on what the other side is willing to give, and they won’t ask for something the other side won’t give. So I don’t think Xi Jinping, in the past, has asked Russia to do something regarding Vietnam or India, for example, that he was unable to deliver, or will ask for more support on Taiwan than Russia’s able to deliver. They basically know what the limits are in their relationship, which is why it’s unlikely that Putin will ask for something specific from Xi.
There are still plenty of things that China is doing to support Russia, of course. If you look at the rhetoric about Russia’s legitimate security concerns or blaming NATO expansionism for the war — all of that is just leaning towards Russia’s version of the crisis. But in the last few days, there has been some cell phone footage on CCTV of some of the victims in Ukraine. We had not seen any sign of sympathy for Ukraine before — in fact, just the opposite — so this shift seems to be showing a little bit more balance, and by implication, that is a criticism of Russia. Something like that could not have happened in the propaganda department, unless it came from the very top.
So, to me, that’s China trying to position itself in a way that protects its interests, and Russia understands that.”
Jude Blanchette
Jude Blanchette is the Freeman Chair in China Studies at CSIS. Previously, he worked at The Conference Board’s China Center for Economics and Business in Beijing. He is the author of China’s New Red Guards: The Return of Radicalism and the Rebirth of Mao Zedong.
China is Not Going to Walk Away from Russia.
“The underlying logic for China’s support for Russia is about their core security interests. Their view is that the next five to 10 years is going to be typified by geopolitical rivalry. And in that environment, China does not have a lot of friends. Indeed, there’s no other great power as aligned with China’s worldview as Russia. So even with all the distrust in the relationship and the historical animosity between the two countries, they share a core overlapping worldview: cynicism and frustration with U.S. power and a shared concern about where the geopolitical environment is going. Their assessment is that the world is entering into a phase of increased containment by the West. And they’ve priced that in as being an enduring feature. They don’t see what walking away from Russia would get them with the United States; it won’t change the trajectory of their relationship. All it would mean is walking away from their only security partner, and handing the United States a win.
Think of China’s interests as a series of concentric circles.The first circle is China’s own security, which in this case entails ensuring that Russia comes out of this as the strong strategic partner that Xi Jinping was hoping for in Vladimir Putin. The second is ensuring that relations with Europe do not deteriorate. And third would be trying not to take on costs by the United States in terms of sanctions. Right now, China is involved in a tortured, diplomatic balancing act. But we shouldn’t assume that China’s relatively careful strategy now is enduring, because I think it will always be calibrated to their assessment of where Russia is.
The question we ought to be asking is: what happens two to three months down the road if there’s a protracted struggle in Ukraine and Russia’s economy has cratered? It seems that Putin is already going after security services, purging officials. By then, China’s likely to get very concerned about Putin’s hold on power, and the survival of the Russian government. At that point, things could change — when China starts to see its core security interest implicated in it. That could lead China to loosen up a bit on how strictly it’s abiding by Western sanctions while also calibrating, of course, because China doesn’t want to lose access to the U.S. dollar market.”
III. WHAT SHOULD CHINA DO NEXT? AND WHAT ROLE DOES THE WEST HAVE IN CHINA’S CALCULUS?
Many of the experts we talked with agreed: China is in a very uncomfortable position. Europe has united against Russia in a way few imagined it could, potentially hurting China’s much-needed relationship with Europe, and the sanctions placed on Russia have been so crippling that Adam Tooze says we really should call them ‘economic warfare.’ To further complicate things for China, its economy was facing several domestic, ‘made-in-China’ hurdles even before the war in Ukraine caused external pressures. While nearly everyone agreed that the war in Ukraine is bad for China, the experts below — Huang Yasheng, Zack Cooper, George Magnus, Joseph Torigian and Adam Tooze — have different ideas about the amount of leverage the West really has.
Huang Yasheng
Huang Yasheng teaches at MIT’s Sloan School of Management. He runs the school’s China Lab and India Lab and is the author of Capitalism with Chinese Characteristics. His recent op-ed is titled, “China’s Moment of Decision.”
It is in China’s Interest to Mediate Between Russia and Ukraine — and the U.S. Could Make That Happen.
“The economic fundamentals are super clear: the Chinese economy will suffer the longer this war lasts. And the longer and bloodier this war is, the less tenable for China to maintain its neutrality. I find it baffling that China does not use this window of neutrality to actively mediate between Ukraine and Russia. Germany, France, Turkey, and now Israel have all actively tried to intervene, and I think the Chinese intervention would be greatly welcomed and helpful as well. Qin Gang on “Face the Nation” said that condemning Russia is not helpful. Maybe he is right, but mediation will be helpful and China is in a unique position to do it.
The U.S. could even offer an off ramp on the trade war to elicit China’s help here. The trade war is counterproductive anyway, and it is too sweeping and generic in the way that Trump did it. It would benefit the U.S. to move away from the trade war, and it will alleviate some of the inflationary pressures here.”
Zack Cooper
Zack Cooper is a senior fellow at the American Enterprise Institute, where he focuses on U.S. strategy in Asia, and the co-director of the Alliance for Securing Democracy, a national security advocacy group. Previously, he worked at the National Security Council and Department of Defense.
Nothing is Likely to Change China’s Approach.
“Just two weeks ago, I thought it might be possible for China to shift its approach to Ukraine and Russia. It seems like Xi Jinping thought there was going to be a quick invasion that was going to be successful and Russia would effectively control Ukraine in 48 hours. When that didn’t happen, I thought that might be a window for China to change its approach.
But the diplomatic engagements, both in Rome and the Xi-Biden phone call, have not led to substantial breakthroughs. And, if anything, have probably caused more of a standstill in U.S.-China relations, especially as it comes to Ukraine.
What Chinese friends tell me in private is that, if the U.S. was going to offer something on Taiwan, then maybe China would cooperate on Ukraine. But that is never going to happen. There’s no way that the Biden administration is going to negotiate some degree of Chinese support in Ukraine, in exchange for backing away from U.S. military assistance to Taiwan. That’s just not in the cards. But that framing is part of what was challenging in the discussions. The U.S. isn’t going to give anything to China for changing its approach on Russia. Some Chinese colleagues then say, ‘Well, there’s no incentive for us to do this.’
To me, the incentive for China to change its approach is that China can avoid a huge amount of harm to its relationship, not so much with the U.S., but really with Europe. The incentives here are sticks from Europe, less than carrots from the United States.”
George Magnus
George Magnus is an independent economist and a research associate at Oxford’s China Centre. Previously, he was chief economist at UBS Bank, and he is the author of Red Flags: Why Xi’s China is in Jeopardy.
China is Facing Headwinds and Can’t Afford to Take Its Relationship with Europe for Granted.
“Even before the invasion of Ukraine, China’s economy was not in the best of shape. In fact, if you read into the entrails of the documentation from the Central Economic Work Conference in December and the documents that were presented at the National People’s Congress (NPC) at the beginning of this month, you can detect a very sober view about what the government thinks is going on in the economy. They have set a target of 5.5 percent growth, but I don’t think they think that it’s going to grow by 5 percent.
In other words, economically, things have been brewing for some time. And now, of course, the surge, by Chinese standards, of Covid infections is quite significant, and the sharp increase in prices in basic commodities — food and energy — which has been the result of the war with Ukraine. All of this is going to feed into the Chinese economy and take away from growth.
So, there’s a bit of a tussle going on between domestically-driven sources of slower economic growth and external shocks — and they’re reinforcing one another. My hunch is that this is something that the government is looking quite seriously at because stability was the watch word for 2022. The NPC was supposed to pave the way for a seamless transition to the Party Congress, but that stability is being threatened now because of both domestic and external developments.
My core position is that it would not be good for Xi Jinping if Putin were humiliated — it would reflect very badly on Xi’s judgment. We don’t know what angst there might be in the Party echelons about the path that Xi has trodden, so, if Putin were shown to be a loser in this fight, it’s not impossible that Xi’s position going into the Party Congress could be weakened.
But, in approaching the Ukraine issue, China also has to be mindful of the profound shift that has taken place, especially in Europe. The mood has changed since the 24th of February. I’m still trying to figure out what the implications might be, but China has to be careful not to imagine that nothing has changed because it clearly has. In the past, it’s always been the case that the EU could speak with one voice and member states could speak with another. But China’s relationship with central and eastern EU countries is now much more up in the air, pursuant to the invasion of Ukraine and given China’s ambivalent position of that.
China’s relationship with France, Germany and Italy could also be more complicated than it otherwise might have been because there’s a weariness now about geopolitics. Where previously there was a complacency, now it’s swinging the other way. We just don’t know how far.”
Joseph Torigian
Joseph Torigian is an assistant professor at American University, where he focuses on the politics of authoritarian regimes, specifically Russia and China. He is the author of the forthcoming book, Prestige, Manipulation, and Coercion: Elite Power Struggles in the Soviet Union and China after Stalin and Mao.
The U.S. is Trying to Put Pressure on the China-Russia Relationship — But China Still Has Wiggle Room.
“The most ideal situation for the United States would be for the Chinese to privately start communicating to the Russians their concerns about where things are going, although China would likely be extremely careful in this regard to avoid the sense that they are siding with the West. There are also other easier things that China could do — short of an open, complete rupture with the Russian Federation — such as attenuating their rhetorical support for Moscow or not backfilling the sanctions.
The United States is attempting to make it as black-and-white of a choice as possible for the Chinese, thereby putting pressure on the relationship. That policy so far has included communicating to news organizations intelligence findings that put China in a tough position, and being very proactive about warning the Chinese about the consequences for supporting the Russians.
Counterintuitively, the ability for Russia and China to manage the relationship today is probably easier than it was during the era of the formal Sino-Soviet alliance. In the 1950s, when the Russians and the Chinese were allies, the Chinese would often take risky, ambitious steps that hurt Moscow’s relations with the United States in a way that Soviet leader Nikita Khrushchev did not like. Khrushchev’s criticism of Chinese behavior and the sense in Beijing that Moscow was not going far enough in support were major causes for the Sino-Soviet split. The strategic partnership between Russia and China that exists now gives more leeway for the Chinese to say that they’re not actually obligated to do any particular thing. That means there’s more flexibility in the relationship than there was in the 1950s, when anything less than full throated support was seen as a betrayal.”
Adam Tooze
Adam Tooze is a history professor at Columbia University and the director of the European Institute. He is author of numerous books, including most recently, Shutdown: How COVID Shook the World’s Economy.
The West’s sanctions have proved the unipolarity of the global financial system — but that doesn’t necessarily change anything.
“Washington right now is trying to lay on Beijing that there is no respectable neutral position. But that’s a power move; it is not an objective fact about the world. This is something that we in the West are asserting relative to China, and China has every interest in the world in refusing that. Whatever China’s view is of Russia, the U.S. position is counter to the multi-center, pluralistic vision that China, since the 1990s, has argued for. China insists that the claim that there’s no neutral position implies a unipolar position from which you can define right and wrong — resisting that is essential to Beijing. And they will quite rightly point out that, although there were lot of countries that voted to sanction Russia in the U.N., countries representing more than 50 percent of the world’s population abstained, because India abstained. And America’s efforts to strong arm India into the position of saying there’s no neutrality here has not worked with India either.
Now where there is still unipolarity is in the global financial system. In watching the sanctions against Russia play out, what China has undoubtedly learned is that diversifying into Euros doesn’t help. What we’ve all learned is that the Western currency trap is actually a Euro-dollar trap in the triple sense of dollars, Euros and offshore dollars and Euros. They’re actually all part of the same currency system. If China were to plan military action against Taiwan, for instance, it would now no longer be under any illusions about the fact that its $3–4 trillion of U.S. assets are not safe — it would lose them. There’s really nowhere else to go. And to my mind, the fact that we are using financial instruments as tools of war [against Russia] means that we should no longer call them sanctions at all. They should just be called economic warfare.
Now, there’s a lot of talk about how the Ukraine crisis shows how strong the West is. But the U.S. and European sanctions by themselves tend to confirm Putin’s view of the world. They raise the cost of him doing what he’s going to do. They may speed up the pace at which he looks for an off ramp. And they will certainly increase the domestic pressure on him. But they don’t, by themselves, give us much hope of changing the game. In the end, Ukraine is going to be crushed, and we’re going to let Russia crush it. I may be wrong, but our position is, broadly speaking, that we will give the Ukrainians as much rope as they ask for. Ultimately, I don’t think China is afraid of the U.S. over Ukraine.”
Eliot Chen and Katrina Northrop contributed reporting.
