CED Policy Brief: What to Expect from Xi Jinping’s Visit to Moscow

Xi Jinping arrives in Moscow Monday for a visit of profound geo-political and economic significance, perhaps of equal, if not more, significance than when the two leaders met a year ago, just prior to the invasion of Ukraine and pronounced their friendship without limits. Despite the frustration that the Russian invasion did not go as swiftly or successfully as planned and Ukraine has become a war of attrition, expect China and Russia to double down on the war effort and their bilateral relationship. They will likely try to leverage the crisis to enhance China’s global leadership role as a peace broker and Russia’s message that it is not isolated and remains an important global power to be reckoned with.??

• The visit is important for what bilateral agreements may result as lifeline support to keep Russia afloat and able to prosecute the war in Ukraine despite extraordinary western sanctions. For Russia, China’s continued trade in dual use capabilities, such as drones and military spare parts and semi-conductors, is critical for its war effort and its energy trade has played a significant role in replacing Europe’s trade, particularly in oil and natural gas. More direct Chinese military support with the provision of weapons, according to US officials, is what Russia is seeking to help breakthrough the current battlefield stalemate. The US has informed China such support would be met with a strong response. Watch this space. For China, Russia, as a reliable, land-transported energy supplier, is central to Xi’s economic recovery and growth goals.??
• The meeting is equally important for the symbolism of a more dominant global leadership role for Xi Jinping, with a peace plan for Ukraine a central part of the discussions in Moscow. It serves as a global platform to criticize and blame the US and NATO for the Ukraine crisis. For Russia, the meeting sends an important global message for Putin that the West has not succeeded in isolating him or Russia as a major power, especially on the heels of the International Criminal Court issuing a warrant for his arrest for human rights violations. And, for both parties, it sends an important message about the linchpin role the China-Russia relationship will continue to play as a counter-weight to US and western global leadership. Leveraging the current crisis to provide an alternative to the US dominated global economic order and the west’s democratic governance model, is a strategic goal shared by Russia and China.

What Xi Jinping will seek to accomplish:

For Xi, this meeting is as much about leveraging the current crisis to further diminish US global leadership and to develop an alternative international order. Chinese Minister of Foreign affairs Qin Gang said on Friday, echoing Xi Jinping that Xi “will have an in-depth exchange of views with President Putin on bilateral relations and major international and regional issues of common concern… Currently the world is entering a new period of turbulence and reform with the accelerated evolution of changes of the century. As permanent members of the UN Security Council and important major countries, the significance and impact of the China-Russia relations go far beyond the bilateral sphere.”??

A failed Russia is not in China’s interests. Despite whatever consternation China may have about Russia’s inability to achieve its goals in Ukraine at far less cost, it is in China’s geo-political interests to ensure that Russia does not buckle under the weight of sanctions. To do that, Xi needs to accelerate the transition to an alternative economic order, where the dollar is not the dominant global currency and the role of international institutions, preferential to western economic and governance principles, is challenged.?

Positioning China as a broker for peace in Ukraine, whether or not Xi can achieve the goal, plays an important role in attaining both of Xi’s primary objectives—shoring up Russia and elevating China’s global leadership. Xi will be arriving in Moscow on the cusp of having successfully asserted China’s leadership role in the Middle East, long an area of US influence, with the brokered Saudi-Iran détente. In Moscow he will discuss in detail, China’s Ukraine peace plan, smartly taking advantage of a leadership vacuum for a peace broker that the US cannot fill. While the plan has been met with skepticism from the US and NATO, If successful, it will lock in Russia’s territorial gains in Ukraine and position Russia well for either a counteroffensive at a time of its choosing or, at a minimum, constrain Ukraine’s recovery and development.?

Russia is also China’s main source of energy that can be transported via land routes, giving it primary significance as a principal supplier of energy. More and more of that trade is being conducted in yuans and those transactions are expected to increase, which helps alleviate the full impact of sanctions on financial transactions while at the same time increasing the use of the yuan in international trade.??

What Russia seeks to accomplish:

Putin’s goals are also two-fold. Russia needs China to continue to fill the shortfall in trade with the west that has been crippled by sanctions. Both sides have signaled trade ties will continue to grow. China’s overall trade with Russia hit a record high level of $190 billion in 2022 a 30% increase on the year before, with Russia becoming a major source of China’s imports of oil, natural gas and coal. For Russia, China has become a critical source of microchips, drones, mechanical and electrical products as well as cars and auto parts. Growing this bilateral trade relationship is a top priority.?

But, equally important for Putin both at home and abroad, is demonstrating that Russia is not isolated, as a result of a failed Ukraine invasion, and has important relationships beyond pariah states such as North Korea and Iran. His relationship with China and his close relationship with XI Jinping is the most powerful symbol of Russia’s importance on the global stage. When extending the invitation, Putin said the visit could “demonstrate to the whole world the strength of the Russian-Chinese ties” and become “the main political event of the year in bilateral relations.”

For Putin, his relationship with Xi is his strongest card. He has met with Xi more than 38 times since Xi came to power in 2013. While the two leaders share a global world view and strategic objectives, they also share a strong bond of respect and friendship, which is a game changing pillar of support for Putin both at home and abroad.??

What to watch for:

The Moscow meeting will be an important indicator of the duration and direction of the war in Ukraine and the consequent impact on the global economy. The war is an important driver of inflation and the danger of recession but even beyond the immediate economic fallout from the war, it is accelerating the pace of China and Russia’s combined efforts to divide the global economy and leverage the crisis to diminish the leadership role of the US and its allies and the dominance of the US in the global economy.??