China's Ukraine Puzzle

Why Does the War Require a Balanced Approach?

China is in a geopolitical bind as a result of Russia's war in Ukraine. On the one hand, the crisis has interrupted billions of dollars in Chinese trade, heightened East Asian tensions, and intensified political fragmentation in China by separating people into pro- and anti-Russia parties. On the other hand, China believes the US provoked Russia by supporting NATO expansion and is concerned that the US will try to prolong the conflict in Ukraine in order to suffocate Russia. Beijing sees little benefit in joining the chorus of nations criticizing Moscow.

Whatever China says or does in reaction to Russian President Vladimir Putin's decision to conduct war in Ukraine, Washington's containment strategy toward Beijing is unlikely to change. Russia, as China's largest and most militarily capable neighbor, is not a power Beijing wants to fight. As a result, Chinese authorities have avoided irritating any opposing power needlessly, abstaining from UN General Assembly votes to criticize Russia and carefully selecting official pronouncements regarding the war.

This balancing method comes at a price. China's refusal to denounce Russia has strained relations with some of its neighbors and isolated Beijing from many developing countries that have opposed Russia's conflict in Ukraine. It has also experienced economic expenses as a result of Russia's war, which could last for a long time. Nonetheless, China will most likely stick to this middle ground until the Ukraine war is ended in order to limit its strategic losses. If the US gives military assistance for a Taiwanese declaration of de jure independence, this might transform Beijing's calculus and force it to stand with Russia. In any case, Beijing will likely maintain its balancing act, as Washington's containment policy toward China makes it difficult for Beijing to support the US in the Ukraine conflict.

BINDING CAUGHT

Western governments have accused China of passively or actively backing Russia's military actions in Ukraine since the crisis began. The New York Times, for example, claimed in March that Russia had discussed its war plans with China before of the fight. However, as China's ambassador to the US, Qin Gang, pointed out in a March 15 op-ed in The Washington Post, China stood to lose a lot from Russia's actions: "There were almost 6,000 Chinese residents in Ukraine." China is Russia's and Ukraine's largest trading partner, as well as the world's largest importer of crude oil and natural gas. China does not benefit from the conflict between Russia and Ukraine. We would have done everything we could to avoid the problem if China had been aware of it."

In reality, Qin downplayed the war's negative consequences for China. The battle has roiled commodity markets and disrupted supply networks, costing Chinese businesses billions of dollars. Tsingshan Holding Group, a Chinese nickel behemoth, for example, lost $8 billion on ill-timed bets when the war caused nickel prices to skyrocket. War-related disruptions have also resulted in large-scale cancellations of Chinese export orders, as well as a reduction in Chinese industrial productivity. The China Manufacturing Purchasing Managers Index, which gauges economic activity in the manufacturing sector, fell by 0.7 percent in March, far worse than market analysts had predicted and the first monthly fall since August 2021, according to the National Bureau of Statistics.

Tensions between China and some of its neighbors have also risen as a result of the war. Many East Asian countries have employed hedging tactics to balance links to both powers as the competition between Washington and Beijing has grown. However, the turmoil in Ukraine has pushed some of these countries closer to the United States. Furthermore, the issue has provided Washington with a reason to authorize another $95 million in military aid to Taiwan, making it the third such package since President Joe Biden entered office. Not only has China's relationship with its neighbors deteriorated: in March, two-thirds of UN member nations voted to condemn Russia in a pair of UN General Assembly resolutions, with only five voting against and 35 abstaining. Many small and midsized countries, particularly in the developing world, will remember China's membership in the latter category.

To make matters worse, the war has strained relations between China and the US and its allies even further. Australia, Canada, Japan, and the United Kingdom have all stated that they will join the United States in slapping secondary penalties on Chinese businesses doing business with Russia as usual.

Finally, the conflict in Ukraine has exacerbated political polarization in China. Chinese individuals have formed competing camps on WeChat and other social media sites, one for Russia and the other against it. Soon after the fighting began, some anti-Russian Chinese internet users began revisiting the Treaty of Aigun, which gave Russia around 230,000 square miles of Chinese territory in 1858. Because of the political sensitivity of this historical event, Beijing has previously been leery of backing Russian territorial expansion aspirations. However, Beijing must take into account the anti-Russian feeling among some Chinese residents in this issue.

"TO THE FLAMES WITH FUEL"

Despite the war's bad consequences for China, Beijing refuses to accept Washington's stance on the conflict. The Chinese government has claimed that the US provoked Russia by pressing for NATO's eastward expansion since the crisis began. It now sees Washington as escalating the conflict on purpose in order to prolong it and damage both Russia and China. In a virtual call with US Secretary of State Antony Blinken on March 5, Chinese Foreign Minister Wang Yi stated that China opposes any actions that "add fuel to the flames" in Ukraine. Since then, Chinese politicians and journalists have repeated the phrase, emphasizing Beijing's mistrust of US objectives. For example, on March 30, the state-run People's Daily issued an editorial saying that the United States is "creating stronger impediments to a peaceful solution of this crisis" by "adding fuel to the fires."

The US has altered its purpose from resolving the conflict to prolonging it after failing to stop Russia from waging war in Ukraine with threats of severe economic sanctions. "This struggle will not be won in days or months either," Biden said in a speech in Poland on March 26. We must prepare ourselves for the long battle ahead." This was interpreted by Beijing as an admission that the White House's goal is no longer to terminate the war but to extend it in order to weaken and defeat Russia. When Russian and Ukrainian negotiators looked to be making headway toward a tentative peace proposal the next week, top US officials expressed skepticism about Russia's desire to stop bombing Kyiv and Chernihiv. "I don't read anything into it until I see what [Russia's] actions are," Biden said of the ostensible improvement. He informed Ukrainian President Volodymyr Zelensky the next day that the US planned to deliver an additional $500 million in direct budgetary aid to Ukraine. According to Beijing, the United States is increasing military aid to Ukraine in order to deny Russia a diplomatic exit for troop withdrawal. Last week's statement by US Defense Secretary Lloyd Austin that "we want to see Russia reduced to the point where it can't do the types of things it's done in invading Ukraine" has only strengthened China's belief that the US' objective is to undermine Russia, not to end the war quickly.

China also does not feel that reaching an agreement with Washington on the Ukraine conflict will significantly improve Sino-American relations. Even if Beijing joined the worldwide condemnation of Russia, the US policy of containment against China would remain unchanged. Some East Asian countries have publicly questioned whether Washington will maintain its focus on the Indo-Pacific while Europe is in crisis since the start of the war. The Biden administration has quickly reassured them in response. "Even as we confront Russia's malignant activities, the defense strategy describes how the department will act urgently to sustain and strengthen deterrence with the PRC as our most consequential strategic competitor and pacing challenge," Deputy Secretary of Defense Kathleen Hicks told reporters on March 28. Even though the US is focused on Ukraine, Biden informed Singaporean Prime Minister Lee Hsien Loong the next day that the US is "very supportive of moving quickly to implement the Indo-Pacific strategy."

Chinese policymakers saw little reason to expect that Washington would suddenly modify these goals even if Beijing distanced itself from Moscow. In their opinion, publicly denouncing Russia and agreeing with those implementing sanctions against it will only lead to secondary penalties being imposed on China. The US has already vowed to sanction Chinese businesses doing business with Russia. "We have a variety of instruments that we can deploy if we find foreign corporations, including those in China, doing their best to backfill U.S. export control regulations, to evade them, to get around them," US State Department spokesperson Ned Price told reporters on February 3.

The US increased diplomatic pressure on China after Russian forces crossed the border into Ukraine. Before meeting with Yang Jiechi, director of China's Office of the Central Commission for Foreign Affairs, US National Security Adviser Jake Sullivan told the media in mid-March: "We are communicating directly, privately to Beijing that large-scale sanctions evasion efforts or support to Russia to backfill them will absolutely have consequences."

THE CENTRAL WAY

This isn't the first time Beijing has found itself in the middle of a big power struggle. The People's Republic of China endured the most hostile international climate in its brief history between 1958 and 1971. It had to deal with simultaneous strategic threats from the US and the Soviet Union during this time. As a result, China's government has spent all of its economic resources preparing for a full-scale conflict with one of the two powers. To further protect its industrial base from attack, it relocated many industries from more industrialized eastern China to underdeveloped and mountainous western China, where they were hidden in manmade caverns. This massive industrial restructuring threw China into serious economic distress, resulting in acute commodities shortages and widespread poverty.

China's approach to the war in Ukraine was guided by its painful history, and it has strengthened its resolve to avoid becoming trapped between Washington and Moscow once more. To avoid offending Russia, official Chinese pronouncements have been meticulously calibrated. In a March interview, for example, Qin made it clear that Beijing wants to work with Moscow but does not back its war in Ukraine. "There is no forbidden zone for collaboration between China and Russia," he continued, "but there is a bottom line, which is the UN Charter's ideas and ideals." "We are not doing anything deliberately to circumvent the sanctions against Russia imposed by the US and the Europeans," Wang Lutong, director-general of European affairs at China's Foreign Ministry, said in a press conference on April 1, adding that "China is not a related party to the crisis in Ukraine."

China has taken a middle ground on Ukraine, refraining from offering military aid to Moscow while maintaining normal business relations, a decision that other countries have made as well. For example, India, a critical partner of the United States, has taken a similar posture, distinguishing between military and economic matters. Even several NATO countries have kept buying Russian gas to keep their homes warm this winter. If the war in Ukraine carries on, additional countries may adopt China's balancing stance in order to limit their own economic losses.

China, as the world's second-largest economy, aspires to play a significant role in determining global economic rules. However, given of the large military gap between it and the US, it has no aspiration to take a leadership role in global security concerns, particularly in matters of war. Creating a calm atmosphere conducive to China's economic development is still a top diplomatic priority. China is unlikely to depart from this path of peaceful growth as long as the US does not lend military assistance for a Taiwanese declaration of de jure independence.

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