Caught between Russia and the West? China’s Struggle for a Position on Ukraine

While in Beijing, the National People’s Congress (NPC) is convening, and the Paralympics are taking place – Europe is at war. However, the Chinese leadership makes no mention of the “Ukraine Situation” in its working report at the NPC. This is not surprising since, over the past three weeks, China has been desperately struggling not to take sides too openly in a war where there is no such thing as a neutral position. The Chinese leadership’s dithering rhetoric has been a diplomatic balancing act. Ukraine has unexpectedly become China’s fundamental dilemma in the run-up to the 20^th Party Congress later this year.

The war between Russia and Ukraine comes at a time that could not be worse for China: The Olympic Winter Games were shadowed by Covid-19 and did not bring a similar soft-power effect as the Summer Games did in 2008. China’s economy is under pressure due to the pandemic, the unsolved problems in the property sector, and the long-known downsides of China’s heavily export-biased growth model. And now the war takes things up another notch.

China does not want to be drawn into a conflict, the outcome of which is highly uncertain. Especially since this year’s key political event, the 20^th Party Congress is drawing closer – and with it the widely expected third term of Xi Jinping as Party and State Leader.

Ahead of this important event, China’s leadership needs stability above all – social, political, economic, national, and international stability. Russia’s war, which China plays down by referring to it as the “Ukraine Situation (乌克兰局势),” makes it more difficult to maintain this stability. Even though it seems that senior Chinese leaders or even Xi Jinping himself may have had some knowledge about Russia’s imperial plans, it is hard to believe that they were fully aware of the extent of what was going to happen. Maybe China even underestimated how far Russia would really go and now has no intention of extending its friendship as an ally in a war.

China and Russia: no full-fledged “alliance of autocracies” for now

Things looked different one month ago. After Xi Jinping and Vladimir Putin met on February 4th in Beijing during the opening ceremony of the Winter Games and issued the Joint Statement of the Russian Federation and the People’s Republic of China on the International Relations Entering a New Era and the Global Sustainable Development, which promised a “friendship with no limits” and “no forbidden areas of cooperation,” one could have expected an “alliance of autocracies” even fit for war.

Instead of fully and openly supporting Russia in its self-waged war, however, China has committed itself to equivocation: The Chinese leadership has repeatedly emphasized (most recently at the press conference by Foreign Minister Wang Yi on March 7^th) territorial integrity and respect for sovereignty, as enshrined in the UN charter, as the principles of China’s foreign policy, explicitly including Ukraine. (Important side note: China has never formally recognized Russia’s annexation of Crimea in 2014, which took away an integral part of a sovereign nation. There is, obviously, some analogy to China’s Taiwan issue).

China shows ambiguous voting behaviour in UN organs…

When the United Nations Security Council issued a resolution against Russia, China did not join its “friend’s” veto as a permanent member but abstained, showing that their friendship indeed has its limits. China also abstained in the vote for a resolution condemning Russia’s actions passed by the UN General Assembly. However, it did vote against an urgent UN Human Rights Council debate.

Human rights are a red line for China and not up for discussion. Even more remarkable is that China did not vote against the resolution of the Human Rights Council in the end but abstained – again, leaving Russia with only Eritrea by its side. So, while China undoubtedly is in a quandary with Russia regarding the Ukraine crisis, it still uses this kind of diplomatic tool to keep at least some distance from the current situation.

… but it fully understands Russia’s security concerns, which mirror China’s own

Another red line for China is security interests in the neighbourhood of sovereign countries. While committing to the UN charter regarding national sovereignty, China simultaneously displays a high level of understanding for Russian security concerns in Europe, especially its fears of NATO at its doorstep. China sees itself faced with a similar situation in the Indo-Pacific with more and more Western countries adopting national strategies for this region, the goal of which China suspects to be containment – just as Russia claims to be the case with NATO’s Eastern enlargement.

China sees the US and its hegemonic ambitions at the core of these developments. On the sidelines of the National People’s Congress, Chinese foreign minister Wang Yi made this point very clear, even drawing an analogy to Russia’s situation in Europe: “The real goal of the US Indo-Pacific strategy is to establish an Indo-Pacific version of NATO. It seeks to maintain the US-led system of hegemony […].”

China, therefore, sees Russia as an important geopolitical partner against the US-dominated world order. The war will not change this in the long run. Still, in the short term, it adds reservation to the Sino-Russian relationship, even as Wang Yi called it “rock-solid” at his annual press conference on the sidelines of the NPC meeting.

China is treading on ever thinner ice in its relationship with the “West”…

After closely and sometimes incredulously watching China’s diplomatic juggling act during the Ukraine crisis over the past weeks, the “West” is getting increasingly impatient. Every time one thinks one hears China take a clear position in Russia’s favour (or not) in Chinese official’s statements on the “Ukraine situation,” it slips away through some side door, leaving open multiple interpretations of the stance China may or may not take in the end. The oxymoron “pro-Russian neutrality” has been used by some observers to describe this tactic.

Yet the Ukrainian foreign minister himself has uttered hopes for China to help negotiate a ceasefire. High Representative of the European Union for Foreign Affairs Josep Borrell has also explicitly urged China to finally take on the role of mediator. He was then criticized for this suggestion since China’s behaviour makes it questionable if it is really willing (and suitable) to mediate between Russia and Ukraine.

US Secretary of State Anthony Blinken, in a recent phone call with his Chinese counterpart, said that “the world is watching to see which nations stand up for the basic principles of freedom, self-determination, and sovereignty.” This could be interpreted as a thinly veiled threat against China. And if there is one thing China fears, it is being directly or indirectly caught in the crosshairs of the economic sanctions against Russia, which it has repeatedly condemned as “illegal” and “unilateral.”

… jeopardizing still close Sino-Western economic ties

While Russia certainly is important for China from a geopolitical point of view, China has little to gain from Russia in economic terms. Russia mainly offers raw materials, which are important, yes, but not impossible to substitute and certainly have no unique selling point. From an economic perspective, the “West,” with its intense trade relations with China and its partially more difficult-to-substitute technologies, is critical for China.

The US and EU alone (the core of the “West”) make up 25 percent of China’s trade volume, dwarfing Russia, at below three percent. The US and EU are also key players in China’s global FDI relations: The EU and the US account for roughly 11 percent of China’s outward FDI in 2020. Leaving out the “Hong Kong factor” and tax havens, they were the top-2 destinations. As for inward FDI, they were among the top-5 origins of investment in the same year at slightly above five percent of the total.

Despite talks and attempts of decoupling, China is still, at least to some degree, dependent on its economic relations with the West to access foreign capital and specific know-how for its green and digital transformation, to sell its still abundant export goods to customers with high purchasing power and sustain much needed economic growth and stability. In short, China cannot allow a severe blow to its relationship with the West in the run-up to the 20^th Party Congress later this year – and certainly not for Russia, no matter how full-bodied the Joint Declaration may sound.

Outlook: Is there a “face-saving” way out of the Ukraine crisis for China?

China’s dithering in the Ukraine crisis has already done some damage to its international image and will certainly overshadow Chinese attempts to take on a more active role. The fact that Wang Yi’s “rock-solid” comment sounded to Western ears like an “oath of revelation” to Russia hardly improves things. Xi Jinping’s promise, in his recent call with Olaf Scholz and Emmanuel Macron to provide aid to avoid a humanitarian catastrophe in Ukraine, maybe a speck of light, while his calling for a diplomatic solution and emphasizing China’s respect for national sovereignty and territorial integrity again lines up with China’s previous tactics.

The longer the war continues with all its brutality and cruelty, the harder it gets for China to continue this diplomatic tightrope walking act. Moreover, economically speaking, China could easily end up on the losing side in this war, as the impact on the world economy and global supply chains, and thus for China, could be severe.

For the time being, a way for China to get out of the “Ukraine situation” in an, at least halfway, face-saving way seems to be to finally put into practice the “constructive role” it has repeatedly promised. Acting not so much as a direct mediator between the two sides, but rather by actually throwing its full economic weight on the scale vis-à-vis Russia and thus increasing the pressure on the latter to end the war or at least negotiate a reliable ceasefire.

By doing this, China might still be able to actually play the role it claims for itself in the 21 century: that of a global superpower willing to live up to the responsibilities that come along with this role. China might even repair some of the damage inflicted upon its international reputation. At the time of finalizing this text, however, it does not seem that China is at this point – yet.

Find the full table with key events here.

Disclaimer: Current developments in the Ukraine crisis are evolving quickly and dynamically, changing on a daily basis. This text only reflects the situation up to the date it was finalized, which was March 9^th, 2022.

BIO NOTE

Cora is a senior expert in the Europe’s Future Program at the Bertelsmann Stiftung. Her research focus is foreign direct investment and international trade (especially the role of emerging economies). 

Read more on the geopolitical and economic impact of Russia’s invasion of Ukraine:

Agricultural Production in Ukraine and Russia: Economic Implications for Europe

Europe’s divided security

What are the economic implications for the Russian and European economies? The Russian war against Ukraine

SWIFT exclusion is fine, sanctioning the Russian Central Bank is better

20 anniversary of China’s WTO accession: How should the EU deal with the new superpower?

Follow all of the Bertelsmann Stiftung writings on this developing situation here