TOOLBAR Print Story Add Comments Email a friend Watch this writer

Font size:

Beijing, China — China and Russia are supreme practitioners of realpolitik. They have made impressive displays of their close bilateral ties and common purpose toward the outside world. They are pleased when Western policymakers ponder the implications of the Dragon and the Bear seeing eye-to-eye. But, as large neighbors with a long history as both friends and foes, each still casts a wary eye upon the other.

The Sino-Russian "strategic partnership" forged in 1996 offered symbolic political support to counter American preeminence in the geopolitical economy during its heyday in the late twentieth century. Improving economic ties to enrich state prowess was not a factor in the initial equation.

Commerce consisted mainly of border guards bribed to turn a blind eye while Russian raw materials were bartered for Chinese consumer goods. Trade volume dropped in the first two years of the alliance, from US$6.8 billion in 1996 to US$5.5 billion in 1998.

Beijing and Moscow are authoritarian administrations sharing a political philosophy marked by a low threshold of tolerance toward domestic dissent. They share a concern with the maintenance of power, and an utter disregard for what other governments do as long as it does not impinge upon their perceived vital interests.

During Chinese President Hu Jintao's state visit to Russia in late March, kicking off activities for the "Year of China in Russia," he and his counterpart Vladimir Putin issued a joint statement reaffirming the spirit and principles of the Sino-Russian Good-Neighborly Treaty of Friendship and Cooperation, including "mutual support on major issues concerning independence, sovereignty and territorial integrity."

The two countries' shared values also extend into foreign policy. According to the Hu-Putin statement, "Continued strengthening of Sino-Russian cooperation in an all-round way conforms to the supreme interests of the two countries and is also conducive to safeguarding peace and stability in the Asia-Pacific region and the world at large." The leaders of China and Russia listed a dozen different issues on which they have similar interests, including the intention to create a "multipolar world" and achieve "democratization of international relations."

The two countries reiterated blasé boilerplate regarding the Middle East and the situations in Iraq and Afghanistan. Meetings did not result in new initiatives on curbing Iran or North Korea's nuclear ambitions. They touched upon reform of the U.N. Security Council plus calls for all countries to ratify conventions on nuclear terrorism, peaceful use of outer space, weapons proliferation, and new threats stemming from Internet technology.

However one component of Sino-Russian efforts to create a new international order is worth watching: the Shanghai Cooperation Organization, which shows signs of becoming Eurasia's version of the erstwhile Warsaw Pact. Instead of defunct communist ideology gluing it together, the bloc is slowly binding by national interests in economic development and collective security mechanisms independent of Western influence.

The SCO consists of former Soviet republics bordering China in Central Asia (except for Uzbekistan) as well as Russia. The Chinese created the group and fund the bulk of its activities. India, Iran and Pakistan have expressed interest in joining. A joint military exercise within the SCO framework is scheduled this summer on Russian soil to combat the "three evils" member states face: terrorism, extremism, and separatism.

While the Sino-Russian alliance still functions as a stopgap designed to hamstring U.S. hegemony, the strategic dynamics determining the future direction of bilateral collaboration have dramatically changed.

China's strengths as an aggressive trading nation -- its export-oriented factories with abundant cheap labor, ever-increasing levels of technological expertise, copious foreign reserves, an alluring domestic market, and government policies explicitly focused on securing resources -- might generate sufficient momentum to overcome its welter of internal weaknesses and thus pose an independent challenge to U.S. preeminence as the geopolitical economy evolves.

Russia plays a pivotal strategic role in its economic relationship with China despite profound misgivings about its vulnerability as a junior partner, one that mainly supplies raw materials and buys Chinese finished products. One example of the structural trade imbalance in manufacturing in 2006 was machinery and electronic goods. Russian exports accounted for only US$247 million of the US$5.85 billion total sales volume.

Exports are dominated by natural resources like minerals, timber, and energy. Oil and petrochemicals alone accounted for 54 percent of exports to China last year. The country also earns revenues as a supplier of foreign military hardware, mainly through licensing agreements.

While the total bilateral trade volume of US$33.4 billion in 2006 was rigged to tip slightly in Russia's favor, both sides are acutely aware that the asymmetric composition of trade generates mutual friction and suspicion. The Russians think economic domination by China is a precursor to territorial expansion. China believes foot dragging on promised oil and gas pipeline construction is Russia's way of spoiling its continued expansion.

Hu Jintao's statements during his three-day visit probably reinforced rather than allayed Russian worries about Chinese trade prowess taking aim at the country and its resources. Despite expressions of "sincerity" about their political partnership, and saying trade was "of mutual benefit with a view to a win-win situation," Hu had announced before leaving Beijing that China's target was to double bilateral trade volume to US$60-80 billion by 2010.

In Moscow, Hu said he wanted to strengthen cooperation in infrastructure construction, energy, and raw material processing, expand regional trade links, and implement an agreement encouraging and protecting inter-governmental investment.

Chinese and Russian companies signed US$4.3 billion worth of contracts at the start of the largest trade fair China had ever mounted in a foreign country. Firms from China inked four deals, buying more than US$500 million of machinery and electronic goods from Russia, while Russians firms signed six contracts worth over $1.1 billion to buy Chinese machines and electronics.

However, on the major objective of Russia ramping up oil and gas pipeline construction, China came away empty-handed, getting only promises that Russia would increase oil shipments by rail this year beyond the 320,000 barrels it sent per day in 2006.

While China is the world's second-largest consumer of oil and Russia is the second-largest producer, the fact that Saudi Arabia, Angola and Iran supply more energy to China than its neighbor speaks volumes on the current extent of their "strategic partnership."