Putin to visit Beijing in bid to boost trade and ties as Russian economy struggles from Western sanctions.
Russian President Vladimir Putin will try to bolster trade and economic ties when he visits China on Saturday to meet Chinese President Xi Jinping, as Russia’s economy struggles amid Western sanctions and low oil prices.
Officials in Mr. Putin’s government have said they want to deepen trade ties with the Asia-Pacific region to offset a loss of foreign investment that resulted from U.S. and European sanctions following Moscow’s annexation of the Black Sea peninsula of Crimea. The penalties effectively curtailed Russia’s access to Western financing.
Mr. Putin’s China visit also comes at a sensitive diplomatic juncture for his Chinese counterpart. Chinese diplomats have been actively lobbying foreign governments to back Beijing’s denunciations of a coming international legal ruling that could contradict its sweeping claims over the South China Sea.
The Beijing discussions are scheduled to range from trade and investment to international issues, both governments say. The meetings will yield “several important political documents” and “pragmatic cooperation documents,” Chinese foreign ministry spokeswoman Hua Chunying said this week.
Observers say the discussions will likely include efforts to integrate China’s Silk Road Economic Belt initiative with the Russian-led Eurasian Economic Union and to strike deals over Russian energy exports and Chinese infrastructure investments, such as high-speed rail.
Last month, China agreed to provide loans valued at 400 billion rubles ($6.2 billion) for the development of a high-speed railway line between Moscow and Kazan, paving the way for a formal deal on the project this weekend. Some analysts also expect the two governments to advance a liquefied natural gas plant in the Russian Arctic, backed by $12 billion in loans from two Chinese state-owned banks.
“Deepening economic cooperation is a key issue for both countries,” particularly given recent woes blighting both the Chinese and Russian economies, said Chen Yurong, director of European-Central Asian studies of the China Institute of International Studies, a think tank run by China’s foreign ministry. “There’s a lot of mutually complementary investment opportunities, such as in energy, transportation and infrastructure development.”
Alexander Gabuev, a senior associate at the Moscow Carnegie Center, said the summits between the Russian and Chinese leaders are carefully calibrated as a display of partnership, bound by protocol that shows the leaders as equals. But Russia’s position, he added, was relatively vulnerable: Sanctions remain in place, Russia’s investment climate is poor and commodity prices are depressed.
“Russia is moving into this asymmetrical dependence, where it needs China much more than China needs Russia,” he said. “When it comes down to deals, they [the Chinese] can be really pretty harsh negotiators.”
Geopolitical horse-trading also is expected. Russia has drawn closer to China following Western sanctions imposed in 2014 over Moscow’s actions against Ukraine, and Beijing abstained from a U.N. General Assembly vote that called on nations not to recognize the annexation of Crimea. Analysts say China may seek some Russian reciprocation given Beijing’s own diplomatic difficulties in recent weeks.
The arbitration tribunal in The Hague is expected to issue a ruling soon on a case filed by the Philippines in 2013 to challenge Beijing’s maritime claims. Chinese officials have boycotted the proceedings and called it illegitimate. In recent months, they reiterated their refusal to recognize the tribunal’s authority, while trying to rally public and diplomatic support for their position.
Alexander Korolev, a research fellow who studies China-Russia relations at the Lee Kuan Yew School of Public Policy in Singapore, said Mr. Xi “will want something similar to what China demonstrated toward Russia during the Ukraine crisis, namely ‘business as usual’ on all fronts plus complete lack of explicit criticism and not joining any potential sanctions.”
Russian Foreign Minister Sergei Lavrov in April reiterated Moscow’s opposition to the “internationalization” of the South China Sea disputes, backing China’s preference to resolving territorial discord through one-to-one talks instead of multilateral mechanisms or third-party arbitration.
Yet Russia may be circumscribed by its own interests in Southeast Asia, where four governments have claims in the South China Sea that overlap with Beijing’s. Moscow maintains close links with Vietnam, one of China’s main rivals in the disputes, and has military ties with Malaysia, another claimant state. In return for Moscow’s backing, Mr. Putin could seek more Chinese investment in the Russian Far East and Siberia, particularly in transport and energy infrastructure.
“Support of China’s activity, or lack of criticism of thereof, in South China sea will not be free,” Mr. Korolev said. “There is a reason to expect Russia pushing for more deeds than words.”
By Chun Han Wong & Nathan Hodge