1. Skip to content
  2. Skip to main menu
  3. Skip to more DW sites

Friends in need?

Wan FangOctober 14, 2014

With ties between the Kremlin and the West reaching a freezing point and the Russian economy struggling under sanctions, Moscow has turned to Beijing and signed dozens of energy and finance deals.

Wladimir Putin und Li Keqiang
Image: Reuters/Alexei Nikolsky/RIA Novosti/Kremlin

"A friend in need is a friend indeed" - this proverb may be used to describe the current China-Russia relationship. Given the increasing number of economic sactions imposed by the EU and the US against Russia, Moscow is seeking Beijing's support more than ever, both politically and economically.

Against this backdrop, China's Premier Li Keqiang arrived in Russia on Sunday, October 12 for talks with Russian President Vladimir Putin and Prime Minister Dmitry Medvedev. This is Li's first official visit to Russia as Chinese premier and the second leg of his three-nation European tour.

Ukraine Separatisten Rebellen in Luhansk
The crisis in Ukraine has changed the dynamics of Western cooperation with RussiaImage: Reuters

Li's first stop was Germany, where he was greeted with military honors and welcomed by German Chancellor Angela Merkel who hopes the Chinese premier will help mediate in months-long crisis in Ukraine.

"I do not believe this will make a big difference," Margaret Klein, an expert at the German Institute for International and Security Affairs (SWP), told DW.

"The Chinese leadership could make it clear to Germany that Beijing is not interested in forming an anti-Western alliance with Russia. And China can certainly express some criticism to Russia such as the violation of treaties and international agreements which also affect or worry China."

On the other hand, says Klein, China has little interest in getting involved in such a conflict, as it could benefit greatly from the current situation. "Russia is forced to look towards China."

Natural allies?

Many analysts believe that Western sanctions have pushed Russia closer to its big neighbor. Both China and Russia have similar views in terms of dealing with the US hegemony, says Klein. However, China is not particularly enthusiastic about supporting Russia's ambitions to play a stronger role in the Asia-Pacific region. "China is likely to be more interested in a kind of G2-relation with the USA, while Russia is seeking to be on an equal footing with the great powers."

"The Sino-Russian relationship is at its all-time best since the two neighbors established the diplomatic ties 65 years ago," state-run news agency Xinhua reported. Moreover, as Putin hosted Chinese Premier Li Keqiang for high-profile talks, the Russian President praised growing economic ties with its "natural ally" Beijing.

According to data provided by Chinese authorities, trade between China and Russia reached 44.5 billion USD in the first half of 2014. "A remarkably small volume for two neighboring large countries," says Edward Chow, an international energy and national security expert at the US-based Center for Strategic and International Studies (CSIS).

"It will take many years before this trade volume can grow to a level comparable to Russia's energy trade with Europe and China's trade with the rest of the world." Chow said, adding that the risks of doing business with Russia have simply gone up considerably this year. "I expect this will be reflected in the economic negotiations between China and Russia."

'A strong and keen desire'

During Li's visit to Moscow on Monday, both nations signed a total of 38 deals, including a currency swap worth 150 billion Yuan (25 billion US dollars), a double tax treaty, a satellite-navigation accord, a high-speed rail cooperation and a further agreement linked to a 30-year gas supply deal signed in May worth 400 billion USD.

These agreements are seen as further evidence that Moscow's focus is yielding results. Meeting with his Russian counterpart, Li Keqiang praised the "strong and keen" desire on Russia's side to cooperate. "This year, despite sharp constraints hampering growth in international trade, trade between our countries continued to steadily increase from January through August … We hope and are confident that next year the volume of bilateral trade between Russia and China will hit the 100 billion USD mark."

Symbolbild Winter in der Ukraine - Gasstation in Russland
Both countries signed an agreement linked to a 30-year gas supply deal signed in MayImage: picture-alliance/dpa/Gerry PennyMaxim Shipenkov

However, energy expert Edward Chow told DW the fact that another agreement on the Russia-China gas deal had to be signed suggests that not everything had been previously settled.

"I note the Chinese side has been consistently more cautious on their comments regarding Russia's eagerness to proceed with a second gas pipeline via the so-called western route. There seem to have been no new breakthroughs on energy ties in the announcements," Chow said.