Beijing flexes its renewables muscles
U.S. sanctions Arctic LNG 2; no bilateral announcement on Power of Siberia-2
Xi and Putin, as expected, didn’t make an announcement on the Power of Siberia-2 pipeline, which has astonishingly poor project economics. Moscow and Beijing are undertaking efforts to develop alternative bilateral energy cooperation, as Reuters reported last week. The U.S. sanctioned Russia’s Arctic LNG 2 project, which could impact Chinese companies.
I wrote an analysis of the Xi-Putin meeting at The Diplomat. China’s emergence as a clean energy superpower will complicate ties with Moscow and, over the long term, pressure Russian export earnings. The energy transition will take a long time, but the bilateral meeting was an instance of Beijing publicly flexing its “renewables muscles” vis-à-vis Moscow.
The phrase “两国人民根本利益” (fundamental interests of both peoples) made it into the PRC’s readout of the Xi-Putin meeting. For more about that formulation, see here.
I have very limited bandwidth for the next month or so and likely won’t have an additional update, barring major developments. – Joe
Table of Contents
1) The War in Ukraine
2) Chinese media on the Israel – Hamas war
3) Bilateral political ties
4) Bilateral military ties/PRC military
5) China-Russia energy ties
6) Russian economy
7) Taiwan
1) The War in Ukraine
U.S., European officials broach topic of peace negotiations with Ukraine, sources say – NBC
The conversations have included very broad outlines of what Ukraine might need to give up to reach a deal with Russia.
U.S. and European officials have begun quietly talking to the Ukrainian government about what possible peace negotiations with Russia might entail to end the war, according to one current senior U.S. official and one former senior U.S. official familiar with the discussions.
2) Chinese media on the Israel – Hamas war
US faces dilemma on Gaza conflict – People’s Daily
Seeking strategic contraction from the Middle East is what the United States has tried to do for years, but the ongoing Israeli-Palestinian conflict has not only forced the US to increase its presence in the region, but may also bring challenges for its global strategy, analysts said.
Mounting casualties among Palestinian civilians, along with acute shortages of food, water, medicine and fuel, have intensified calls by global leaders for a pause in the fighting or a cease-fire.
[Comment: The PRC has been very selective about when it cares about civilian casualties, both in the war itself and more broadly. Also noteworthy, Beijing didn’t call for a cease fire in Ukraine in 2022.]
Gaza health authorities said on Friday that at least 9,061 people had been killed in Gaza since Israel launched its assault on the enclave of 2.3 million people in retaliation for deadly attacks by Hamas militants on southern Israel.
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The US firmly supports Israel not only for strategic interests, but also for cultural and religious links, Zhang said. However, as the sole superpower bragging about human rights and justice, the US will definitely face criticism or even become isolated if it fails to care for humanitarian crises or respect the UN framework.
3) Bilateral political ties
The readout of the Xi-Putin meeting was brief, but several aspects are worth noting. First, Xi doubled down on the importance of strengthening China-Russia relations. Xi stated that “developing the China-Russia comprehensive strategic partnership of coordination with ever-lasting good neighborliness and mutually beneficial cooperation is not an expediency, but a long-term commitment.” Xi’s emphasis on “long-term commitment” counters arguments that the China-Russia relationship is a marriage of convenience.
Notably, Xi did not use the term “new era” (新时代) when describing the China-Russia partnership, despite that phrase being officially stamped onto the moniker of the upgraded relationship in 2019.
In what may be an unprecedented public step in China-Russia relations, Beijing asserted its new role as a clean energy superpower vis-à-vis Moscow. Beijing repeatedly raised renewables to Putin, in an apparent effort to demonstrate Russia’s lack of leverage in negotiations over the Power of Siberia-2 pipeline and other hydrocarbons deals.
During Putin’s interview with a Chinese state media outlet, he was very pointedly asked only one question about energy, according to the Kremlin’s full transcript. Moreover, the host’s question specifically concerned only renewable energy, even though Russia’s energy exports nearly exclusively consist of hydrocarbons. The People’s Daily’s readout of the interview doesn’t even mention energy.
China-Russia cooperation not targeted at any third party: premier – People’s Daily
China-Russia cooperation is not targeted at any third party, nor will it be disturbed by any third party, Chinese Premier Li Qiang said here on Wednesday.
The two sides carry out bilateral cooperation with an aim to benefit their people, promote global development, and uphold fairness and justice, Li said when meeting with Russian Prime Minister Mikhail Mishustin on the sidelines of the 22nd Meeting of the Council of Heads of Government of the Shanghai Cooperation Organization (SCO) Member States.
Li said the recent meeting between President Xi Jinping and his Russian counterpart, Vladimir Putin, in Beijing has charted a new blueprint and opened up a new vision for the advancement of China-Russia relations.
Looking back at the founding aspiration of the Shanghai Cooperation Organization (SCO), its members were brought together to ensure that regional affairs are decided by regional countries through consultation, without interference from those outside the region, Chinese Premier Li Qiang said here Thursday.
During his speech at the 22nd Meeting of the Council of Heads of Government of the SCO Member States, Li called for jointly building a security barrier in the region and resolutely resisting external interference.
In his speech, Li said the SCO summit in July this year further reached important consensus, and identified key tasks on carrying forward the Shanghai Spirit and building a closer SCO community with a shared future, adding that China is willing to work with all parties to implement the spirit of the summit.
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Leaders including Kazakh Prime Minister Alikhan Smailov, Russian Prime Minister Mikhail Mishustin, Tajik Prime Minister Kokhir Rasulzoda, Uzbek Prime Minister Abdulla Aripov, Iran's First Vice President Mohammad Mokhber, Indian foreign minister, Pakistani foreign minister attended the meeting, together with Belarusian Prime Minister Roman Golovchenko and Mongolian Prime Minister Luvsannamsrai Oyun-Erdene, leaders of two observer states. Kyrgyz Prime Minister Akylbek Japarov hosted the meeting.
Comment: Notice in the above paragraph that the Indian and Pakistani foreign ministers weren’t named. This probably isn’t a careless typo, as the Chinese-language version also doesn’t name the Indian and Pakistani foreign ministers. The foreign ministers likely weren’t named due to diplomatic protocol, as they aren’t as high-ranking as a Prime Minister/second-in-command.
Mutual praise, buzzwords plus a few walkouts: Xi and Putin meet in Beijing – The Guardian
Vladimir Putin, speaking after Xi, praised the “successes” of “our Chinese friends”, saying China’s success was “really important for us”. The president added he looked forward to seeing China succeed in the future of its development initiatives.
Shortly before Putin starting speaking, a handful of European delegates, including former French prime minister Jean-Pierre Raffarin, walked out of the room, according to Reuters.
4) Bilateral military ties/PRC military
Risks of confusion, misperception, and escalation are all heightened by PRC comingling of nuclear and conventional missiles, or the “dispersal of mobile missile systems to hide sites” whereby it may be unclear which type of system is where at a given time.
The Russian Ministry of Defense issued a statement on the 19th on its website saying that two Russian Su-27 fighter jets intercepted three British military aircraft approaching the Russian border over the Black Sea that day.
The statement said that Russian airspace monitoring equipment detected three aerial targets approaching the Russian border over the Black Sea that day. Two Russian Su-27 fighter jets immediately took off for identification and confirmed that the targets were an RC-135 reconnaissance aircraft and two "Typhoon" fighter jets of the British Air Force. As the Russian fighter jets approached, the British military planes turned away from the Russian border.
The statement said that Russian fighter jets strictly abide by international airspace usage rules during flights.
5) China-Russia energy ties
China, top Russian energy firms discuss developing oil and gas fields -CNPC – Reuters
China is in talks with Russia's Rosneft (ROSN.MM), Gazprom (GAZP.MM) and Novatek (NVTK.MM) about the joint development of oil and gas fields and hydrocarbon trade, state-owned China National Petroleum Corporation (CNPC) said on Wednesday.
Russia is counting on a planned new pipeline to China as it seeks to make up for lost gas sales in Europe, but industry insiders see major political risks around a project that is overly dependent on one buyer and question whether it will justify the huge costs.
US Sanctions on Russian LNG Threaten Japan Gas Security Push – Bloomberg
US imposed measures on Arctic 2, in which Japan is an investor; The move will also test Japan’s relationship with G7 nations
Comment: China is a major investor in Russian LNG.
The Limits on China and Russia’s No Limits Partnership – The Wire China
Despite the warmth on show between Xi and Putin, Beijing has been careful about how far it supports Moscow.
In Chile, Chinese companies participated in preparations for the construction of the country’s first high-voltage direct current transmission line. This transmission line with a total length of approximately 1,350 kilometers will become an important achievement of the "Belt and Road" initiative jointly built by China and Chile and provide strong support for the country's green development.
Comment: This article was published on October 20th, after the Belt and Road Forum. China’s role in solar supply chains is well documented (see pg 18 of this useful IEA report, for instance), but transmission has received less attention. The West needs to get its act together on transmission, not just wind and solar.
6) Russian economy
According to a TASS report on the 4th, Russian Finance Minister Siluanov said on the same day that Russia’s economic growth rate will reach 2.8% in 2023.
Siluanov attended an international exhibition forum held in Moscow that day and said that the Russian economy will grow by 2.8% this year, "which has fully made up for the approximately 2% decline in the Russian economy last year."
7) Taiwan
Strange Animal Friends: Can Hou and Ko cooperate? – Taipology
Fundamentally the problem is this: for both the KMT and TPP, being on the bottom of the ticket is a terrible consolation prize that might be a Pyrrhic victory not better than losing. On the KMT side, conceding the presidency to the upstart TPP would consolidate their position as a permanent major party on the same footing as DPP and KMT. Since TPP takes more from KMT votes, it means allowing a permanent rival to ensconce themselves. On the TPP side, taking the vice presidency in a KMT administration, maybe with a few extra cabinet level positions thrown in, means losing their identity as a small but independent party. After that, they would only ever be thought of as a “wing party” of the KMT, much like the Taiwan Statebuilding Party and the New Power Party are thought of as “wings” of the DPP.
Until next time,
Joe
Joe Webster is a senior fellow at the Atlantic Council and editor of the China-Russia Report. This article represents his own personal opinion.
The China-Russia Report is an independent, nonpartisan newsletter covering political, economic, and security affairs within and between China and Russia. All articles, comments, op-eds, etc represent only the personal opinion of the author(s) and do not necessarily represent the position(s) of The China-Russia Report.