Destabilizing speculation

A strategic partnership short of strategy – The diplomat

The recent bilateral summit between Presidents Joe Biden and Vladimir Putin has sparked a geopolitical craze for the summits. On June 24, German Chancellor Angela Merkel and French President Emmanuel Macron launched a spectacularly ill-conceived program efforts to secure an EU-Russia summit that immediately collapsed. The next day, the Chinese Foreign Ministry announced a videoconference between Putin and Xi Jinping scheduled for June 28. The question was what, exactly, they intended to talk about and if there are any significant bilateral initiatives to be announced or discerned underway.

Video conferencing made for decent theater. The two leaders marked the next 20th anniversary of the bilateral signing of the 2001 friendship treaty of their nations and went through the traditional list of thematic priorities: the extension of the said treaty, the reaffirmation of the value of the strategic partnership, declarations boilerplate on the Belt and Road Initiative and the Greater Eurasia Partnership of Russia, and the same for the Northern Sea Route. Nowhere, however, has there been a public declaration of significant new political development relating to a wide range of areas of mutual interest.

Even more revealing was Putin’s need to avoid the obvious fact that the two leaders could not meet in person due to the Russian state’s resounding failure in handling COVID-19 and distributing vaccines. None of the agenda items that matter now have been presented to the cameras. The Russian reading of the event has, however note concerns on the destabilizing effects of American withdrawals from international arms control agreements.

Elephants in the room

The US withdrawal from Afghanistan is an area of ​​common interest for Moscow and Beijing. Both governments were comfortable with a status quo that blocked large U.S. spending commitments, the deployment of U.S. air power, and a large U.S. detachment capable of regularly deploying outside of Kabul and key air bases to support the United States. ANSF against the Taliban. Biden took Moscow on the wrong foot by announcing the withdrawal, although the term must be tempered by the fact that it is now planned to leave 650 soldiers in Kabul, an agreement that the United States will continue to financially support the government of President Ashraf Ghani and air capabilities on the horizon will be parked to Al-Udeid in Qatar to support military action in the country. Yet the Taliban have gained significant ground over the past two months and Afghan government troops are now try regularly flee through Uzbek and Tajik in search of safety.

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The lack of a joint declaration on Afghanistan at the recent Putin-Xi summit likely reflects the high degree of ambivalence between the two governments regarding the conflict. Russia has intensified its military contacts with the Uzbek and Tajik governments and deployed more troops in Tajikistan. As China has expanded its security partnerships and border presence, it has not communicated any policy changes. At the same time, Russia has visibly retreated as the “ordering” power when it comes to regional initiatives. Following a border fight between Kyrgyz and Tajik forces over undefined territory in the Osh region, China hosted foreign ministers from the six states of Central Asia discuss Afghanistan and regional economic development without any attempt to include Russia. Moscow has never even organized a trilateral meeting or similar initiative between the national leaders.

The economic future of Belarus is much less of a concern for Beijing – and more of a concern for Moscow. The weight of US and European sanctions is not enough to sink the economy, but the loss of access to the EU’s capital markets and the sanctions targeted at its refineries have pushed Russian companies to cut off oil supplies and Minsk to rely on russian banks and Russian financial markets to borrow more. Why should Beijing care? Belarus is an entry point for rail shipments passing through Russia to Europe, although Ukrainian importers are start using Russian routes from China as well. Belarus is by no means a priority for China in Eastern Europe, but it does at least have a role in the network of interconnectivity that China has promoted as an economic panacea for Eurasia’s growth. over the past eight years. Yet, based on the Putin-Xi meeting, it is clear that Belarus does not deserve any meaningful public statement.

Viral loads

On the biggest global problem right now – public health responses to COVID-19 – China and Russia could hardly be more divergent. Russia’s vaccination campaign has been a huge failure. Only 15-16% of the population has received at least one dose since the mass vaccinations began in January and the current wave, made worse by the Delta variant, is overwhelming hospitals and bringing the relative increase in mortality levels to all-time highs not seen since 1947. Even the Kremlin has openly acknowledged that its own 60 percent vaccination target for the fall cannot be reached That much.

China, on the other hand, has managed to lock down quickly when needed in response to local outbreaks and, despite doubts about the effectiveness of its vaccines, has fully vaccinated over 220 million people with a significant increase in vaccinations since early April and the rollout has gone well so far.

China and Russia have managed to “overcome” the effect of the pandemic on their economies through their exports. US stimulus measures and European safety nets have allowed Western consumers to shift their spending from services to durable goods as a new cycle in commodity prices begins, increasing the value of non-oil resource exports and gas from Russia. But the recovery in Chinese consumption was a little weaker than the recovery in its exports, with now signs of a slowdown as credit conditions have been tightened to curb speculation and help manage the influx of capital into the country since the start of the pandemic. The recovery in consumption in Russia is evaporating under the weight of high inflation, limited state support to households and the new wave of viruses. Despite Moscow’s assumption that the size of the Chinese economy would be enough to compensate for the continued weakness of EU economies since the global financial crisis, this will clearly not be the case in the coming year.

The Biden Boom and Europe’s green dreams

These summits are not just a function of bilateral or multilateral agendas between nations. They are influenced by the ebb and flow of global markets, regulations and money. The scale of the US stimulus has made the US, not China, the engine of global growth today, and an ongoing EU initiative to impose tariffs on carbon-intensive imports forced Putin to set up a national decarbonization strategy for this month of October. Market size matters, but marginal market growth matters just as much when assessing the ability of different countries to influence standards, rules and business practices. Concretely, there is a renewed impetus in the West, if it is unevenly distributed, which begins to weigh on the internal political economy of Russia.

China is a natural partner of Russia in the race to decarbonize. It makes a majority of solar panels in the world, refines half of the world’s cobalt, has a lot of industrial know-how and experience in building competitive manufacturing supply chains for renewable inputs, and would benefit from playing a proactive role in carbon decarbonization plans. oil exporters. Still, there was no attempt to signal coordination or interest in future cooperation during Monday’s conversation. China’s National Emissions Trading System failed to launch before the initial goal of end-June set by the government and the issue has just been put on the political agenda in Moscow, with the word that Anatoly Chubais could be given responsibility for the management of Russia’s national carbon trading system.

The Sino-Russian relationship, which in no way resembles an “alliance”, will continue to endure and, in some respects, to deepen. Chinese companies are still interested in Russia’s human capital and natural resources, and Russian companies and investors want to find growth in the Chinese market. The Putin-Xi meeting, however, emphasized performance rather than substance, constrained by domestic political considerations and the scope of the two countries’ mutual interests. There is a feeling that there is no clear consensus on what the order in Central Asia and Eurasia should look like, nor any attempt to show that it is not just the democracies of the world that are talking a game. villain about coordinating climate efforts. Instead, China and Russia repeatedly continue to focus on presenting a united front against US and transatlantic power domination – without thinking about what that power is actually doing at the moment.

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