Carnegie Moscow Center
There may be tensions in the Beijing-Moscow partnership, but reverse migration trends among Chinese workers prove that worries about China’s potential conquest of the Russian Far East are unfounded.
The Kremlin is still anxious about the expansion of Chinese influence in Central Asia, which is why it has turned the Shanghai Cooperation Organization, set up in order to work out widely accepted rules of the game for Eurasia, into a useless bureaucracy. Now, Beijing can develop relations with other SCO members without worrying about what Moscow thinks.
In its clumsy attempt to exploit the vulnerabilities of the Sino-Russian axis, the Trump administration misunderstands not only the strength of relations, but also its own desirability as a useful ally.
It will take years for Russia to increase trade with China. To do so, Russia will need to strengthen its institutions, overcome non-tariff barriers to the Chinese market, and enhance its reputation among Chinese investors.
At the Belt Road Forum in Beijing, Vladimir Putin once again reaffirmed his personal relations with Xi Jinping without getting into economic specifics. But still, the Russian President managed to get special attention. Russia needs to be satisfied with its political gains from the forum.
The Sino-Russian swap agreement of 2014 was signed right before a major geo-political crisis and the depreciation of the Russian currency. Although the idea of an escape from the U.S. dollar in bilateral payments is quite positive, the deal could not help improve bilateral trade and investment.
Russian companies are optimistic that the sale of cheap grain and high-quality sweets will help create a climate of “comprehensive strategic cooperation” with China. However, they face completion in the Chinese market from more familiar food brands from the U.S., Australia and New Zealand.
Sino-Russian relations do not constitute a new axis of like-minded authoritarian regimes that want to challenge the West by default. But it’s an example of how tactical and opportunistic cooperation of non-Western powers seeking to boost their influence on the international stage comes at expense of the Western-led international order.
State-sector reform is crucial for the long-term prospects of the Chinese economy, but it remains unclear how Russia's experience in dealing with the state sector could be of any use to Beijing.