Western sanctions are bringing Russia’s economy to its knees – the leader of the world’s second largest economy is standing by Putin’s side: China’s dictator Xi Jinping (68).
But can Xi really help the Kremlin dictator Vladimir Putin (69) – and does he even want to? dr Nadine Godehardt, China expert at the Stiftung Wissenschaft und Politik, on BILD: “There are repeated reports that the sanctions are driving Putin into the arms of Xi, but I don’t think China is welcoming Russia with open arms.”
So far, Xi does not appear to have found a clear line on how to deal with the sanctions. dr Godehardt: “What I can imagine is that China will continue to publicly criticize the sanctions, but will let its own companies decide how to deal with them. We see that the first banks are ending business with Russia.” Only the two largest state banks in the country, the Chinese Bank of Industry and Commerce and the Bank of China, no longer grant trade credits for Russian goods.
Max J. Zenglein, chief economist at the China research institute Merics, on BILD: “China’s opportunities to support Russia economically are also limited. Access to foreign technologies will not be compromised. China will give Russia a lifeline, but not a lifeboat. Support will be contained and China will not jeopardize its own economic policy priorities. Energy purchases and central bank support are just such areas.”
Xi cannot help Putin, only exploit him
But even where it would be in Xi Jinping’s interest to help Russia, there is not much he can do, at least for now. US President Biden’s gas and oil embargo will free up more than 600,000 barrels a day – actually a good opportunity for Xi to satisfy his country’s thirst for energy.
▶︎ But: “It is unlikely that China will be able to buy any more Russian gas or oil simply because of the lack of infrastructure. Most of Russia’s gas and oil pipelines go to the West and not to China,” says Dr. Godehardt.
In the long term, however, that would be possible, stresses Max Zenglein: “Nothing happens overnight. This is about commitments and the expansion of energy supplies, as agreed at the beginning of February.”
In fact, China might be more likely to exploit Russia’s weakness to bolster its supply of raw materials and energy over the long term. Xi is considering letting his state-owned companies invest in conglomerates like Gazprom or aluminum giant Rusal, as “Bloomberg‘ reported citing insiders. Should a deal be reached, it would not be a sign of China’s support for the Kremlin, the insiders stress.
Because: “China’s support is more like a sober business transaction than a warm friendship,” says chief economist Zenglein.
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