The recent strengthening of the relationship between China and Russia has a common motive: to contain US pressure. However, Beijing’s support for Moscow, at a time when the Russian economy is under heavy sanctions, must be limited by China’s own interests, such as not losing access to the American market, says Kishore Mahbubani, a senior researcher at the Asian Research Institute.
“China has banks that deal only in yuan, with no connection with dollars. These banks cannot be targeted by US sanctions. But the Chinese need to be careful to ensure that their companies do not come into conflict with US sanctions,” he says.
Mahbubani points out that the Chinese should be looking closely at how the punishments against Russia are being applied, to think about how to protect themselves from similar measures in the future. “China will accelerate its efforts to reduce dependence on the dollar and make itself less vulnerable to US sanctions. The more you use the dollar as a weapon, the more you create incentives for countries to move away from it.”
A former Singaporean diplomat who headed the UN Security Council, Mahbunani, 73, is the author of several books on the geopolitics of Asia. His most recent title, “Has China Won?” (ed. Intrinseca), was launched in Brazil in 2021.
He talked to sheet by video call from Singapore.
How do you assess the recent rapprochement between China and Russia? Both countries are under great pressure from the US. As China grows stronger, it is natural for the US to try to stop it. It’s been a stony rule of geopolitics for 2,000 years. In the case of Russia, there is a very difficult relationship with the US, because it feels that the Americans are expanding NATO in their backyard. The two countries have their own problems with the US and may try to cooperate with each other.
By combining efforts, they can increase the pressure on the United States. So a strong partnership between the two is understandable. But it is important to emphasize that this relationship is not a defense partnership like NATO, where there are automatic mechanisms of mutual defense.
The partnership is strong according to the convergence of interests. China still believes in the territorial integrity of countries, but it is not in China’s interest to see Russia collapse, because if that happens, China will be left alone to deal with the US. But at the same time, it is to China’s advantage that Russia diverts US attention in a way.
How far can China go to help Russia, on issues like dealing with sanctions, for example? China trades much more with the US than with Russia. And the American market is much more important to China than the Russian one.
So, on the one hand, I think China will comply with sanctions where necessary, as in Chinese banks that trade in dollars. If they trade with Russian banks, they could be sanctioned as well. At the same time, China has banks that deal only in yuan, with no connection with dollars. These banks cannot be targeted by US sanctions. They are not required by international law to enforce US sanctions against Russia, because they are bilateral, not multilateral, sanctions. But the Chinese need to be careful to ensure their companies do not run afoul of US sanctions.
Can China remain neutral in this conflict? China is trying to play a mediating role. It’s a very important thing, because there are few parties today who can talk to Russia and Ukraine and have the trust of both. India can play a similar role as well.
Could the conflict change the balance of power between the US and China in the future? It’s too early to say. You might have a scenario where Russia completely fails and collapses as a result of the failed invasion of Ukraine. The Soviet Union collapsed in part because of its failure to invade Afghanistan. Or you can have a scenario where Russia wins and comes out stronger.
Despite that, one thing we can say is that China is studying, very carefully, every sanction applied by the US to Russia and moving on to the next logical question: how would China respond to a similar sanction? For example, one of the most damaging sanctions is the freezing of the Russian Central Bank’s foreign reserves. This had never been done before. And China’s reserves are much, much larger than Russia’s.
In this sense, I think that China will accelerate its efforts to reduce dependence on the dollar in its international trade, to make itself less vulnerable to US sanctions. The more you use the dollar as a weapon, the more you create incentives for countries to move away from it. And if the dollar loses its role as a currency for global reserves, the US will lose its exorbitant privilege and will no longer be able to live beyond its means, as it has been doing.
What can Brazil and other countries do to try to resolve this crisis? It is important for the rest of the world to speak more clearly and explain to the US and Europe that efforts to expand NATO into Ukraine are very reckless. In theory, of course, the people of Ukraine have a sovereign right to decide their type of government. But there are geopolitical realities that need to be taken into account. The big lesson from Ukraine is that when countries like Russia and China say very clearly that there are red lines that must not be crossed, they must be respected if you want to prevent war.
The world today needs powerful countries like India, Brazil and other BRICS to play a mediating role. I support Brazil’s effort to become a permanent member of the UN Security Council. And the best way for Brazil to improve its campaign for that is to get involved in major international responsibilities, such as trying to prevent a conflict like the one in Ukraine.
Could Russia’s eventual success in taking Ukraine spur China to try something on Taiwan? The situations are very different. Ukraine is an independent country, member of the UN, and with sovereignty recognized by most countries. Taiwan is not recognized as a sovereign and independent country by most countries. And many governments that have established diplomatic relations with China, such as Brazil, recognize that China and Taiwan belong to the same country. In this sense, you would not have the same impact generated by Russia’s invasion of Ukraine. At the same time, China will be very careful and will not recklessly start a war on Taiwan unless Taiwan resolves to declare independence.
And how do you see the US approaching Australia, Japan and India, with the formation of the Quad group? Could this bother China? The Quad is a very strange group. Officially, he denies being a defense alliance against China. He says he has other goals, such as sharing vaccines, but no one doubts that it is a club designed to counterbalance China.
The question is, is it better to try this with three or four countries? Or create larger multilateral groups like Asean [Associação de Nações do Sudeste Asiático] are you trying to do? Asean has sought to include China in multilateral groups, and experience shows that when you include China, talk to it, you are more likely to have China as a responsible member of the global system, rather than trying to exclude or isolate it. -there. It’s a wiser approach.
It’s like the European Union model, of bringing countries together to avoid conflicts between them. Yes, but ASEAN is a much weaker regional organization than the EU, although it has been more successful in preventing wars and conflicts in the region. In the last 30 years, we have seen more wars in and around Europe, such as in the former Yugoslavia, Libya, and now Ukraine.
The European Union has been very good at preserving peace within its borders, but very bad at sharing that peace with its neighbours. In this the EU can learn lessons from us. Asean has been very good at creating and integrating countries and their large neighbors into more cooperative structures. Its East Asia Summit meetings include the US, Russia, China, Japan, India, South Korea, Australia and New Zealand. It’s a better approach for the world to be inspired by.
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Kishore Mahbubani, 73
Born in Singapore, he was the country’s diplomat from 1971 to 2004 and held posts in the US and the UN, where he chaired the Security Council. Afterwards, he became a professor at the National University of Singapore and a researcher at the Asia Research Institute. He has written eight books on international relations, including “Has China Won?”.
