China pledges to support Russia in "core interests" – this is above all competition with the West

Russian Prime Minister Mikhail Mishustin has travelled to China for the first time. There, as always, he is among friends. Both countries conclude agreements on business and sport – as if there were no war.

Beijing/Munich – Russian Prime Minister Mikhail Mishustin has been sanctioned by the EU, the United States and other Western countries. In China, however, he can move among friends these days. His topic is the economic relations between the two countries, signed a few agreements and promoted the expansion of bilateral trade.

"Relations between Russia and China today are at an unprecedentedly high level," Mishustin told his counterpart Li Qiang in Beijing. "They are characterized by mutual respect for each other's interests and the desire to respond to challenges together," he praised. He blamed the "immense collective pressure from the West" for the challenges.

Not only Premier Li met publicly with Mishustin – the senior head of state Xi Jinping also received the prime minister. China is ready to continue to support those "core interests it shares with Russia," Xi said at the meeting, according to state media. This verbally restricts the scope of cooperation to common interests – and indicates that Beijing and Moscow sometimes have different interests. But the joint shaking of the Western-dominated world order is currently overshadowing all sorts of conflicts between the two sides.

The two countries should further improve their cooperation in the fields of economy, trade and investment and expand cooperation in the energy sector, Xi stressed. As always, he described Russian President Vladimir Putin as a "good friend" on state broadcaster CCTV.

Mishustin in China: As if there was no war in Ukraine

The visit shows once again that China is relying on business as usual with Russia despite the Ukraine war. The two states are demonstratively defying criticism and sanctions from the West. The EU, the US, the UK, Australia and Canada have imposed sanctions on Mishustin. Beijing, on the other hand, seals agreements with him. In Beijing, the two sides signed several declarations of intent on cooperation in areas such as investment, trade in services, sports and patents. No comments have been made on the Russian invasion or the Chinese 12-point paper on resolving the conflict. Obviously, the issue is not a high priority in Beijing.

What both clearly communicated is the will to cooperate in a normal and public way, and to do so as closely as possible. China is ready to take cooperation with Russia to a new level, Premier Li told Mishustin. At the meeting, he expressed confidence that Russia and China would reach the targeted bilateral trade volume of the equivalent of 200 billion US dollars earlier than planned – and possibly even exceed this target value.

Mishustin had already attended a Russian-Chinese economic forum in Shanghai on Tuesday with a number of Russian tycoons, which included Western-sanctioned entrepreneurs from the key sectors of fertilizers, steel and mining, according to Bloomberg. He also met Russian company representatives and visited a petrochemical research institute of the state-owned company Sinopec. Everything was quite normal, according to the message of the visit.

It's as if he's saying: Hey, it's all business as usual! Russian Prime Minister Mikhail Mishutsin visiting the renowned Tsinghua University in Beijing. © DMITRY ASTAKHOV/SPUTNIK/AFP

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Russia in crisis – growing dependence on China

Nevertheless, it was heard again and again in between that Moscow is definitely in crisis mode. Russia is increasingly feeling the burden of Western sanctions and is increasingly seeking support from Beijing. At the forum in Shanghai, Mishustin emphasized how much trade with China had helped his country reduce its "dependence on the dollar" – an issue that has only become acute as a result of Western sanctions against Moscow. Both countries are increasingly settling their trade in the Chinese currency, the yuan.

The yuan has thus practically become the reserve currency for Russia, while the West is blocking the Russian central bank's access to foreign exchange reserves abroad. Several Russian banks have also been excluded from the Swift international payment network. China, on the other hand, benefits from Moscow's situation, as it has long been pushing the yuan to friendly states as an alternative to the US dollar.

In general, Russia is far more dependent on a massive expansion of economic relations than China, which simply has many more options. True, Russian supplies of oil and natural gas to China have increased significantly since the beginning of the war. But analysts expect that China will not expand these imports any further. For example, Beijing has not yet given a commitment to a second gas pipeline from Russia to China called "Power of Siberia 2", with which Russia wants to supply 50 billion cubic meters of natural gas per year from the Yamal Peninsula in Western Siberia via Mongolia to China. Instead, Beijing is accelerating the construction of a long-delayed Central Asian pipeline to get gas from Turkmenistan.

Mishustin promotes Russia as China's economic partner

Mishustin also emphasized that Russia's farmers are ready to significantly increase agricultural exports to China. China had severely restricted agricultural imports, including from Russia, during the pandemic. Logistical problems are also currently hindering, among other things, wheat imports from Russia to the People's Republic. The memorandum of understanding signed in Beijing by the two countries therefore also includes a document on standards for grain exports. Conversely, China's exports to Russia rose 153 percent year-on-year to $9.6 billion in April, setting a new record.

Both countries are currently discussing the supply of technological equipment to Russia, according to the Russian news agency Interfax. Some of these are likely to be viewed with suspicion, especially in the USA – because many technological components can be used for both civilian and military purposes ('dual use'). So far, however, there have been no open arms deliveries from China.