Putin escalation leaves China’s Xi with tough balancing act

While most diplomats at an emergency United Nations Security Council meeting condemned Vladimir Putin's government for escalating tensions with Ukraine, China's envoy carefully avoided any mention of Russia. 

"All parties concerned must exercise restraint and avoid any action that may fuel tensions," Ambassador Zhang Jun said late Monday as part of a six-sentence statement. "The current situation in Ukraine is a result of many complex factors," he added. "China always makes its own position, according to the merits of the matter itself."

The brief remarks contrasted with a lengthy joint statement earlier this month following Putin's first in-person meeting with Xi Jinping in two years. Afterward the Chinese leader backed Russia's demand for binding security guarantees from the US and NATO in the standoff over Ukraine -- providing vital support for Putin as he confronted the West.

Yet now Xi's government is striking a more nuanced tone as fears grow of an invasion despite repeated Russian denials. Over the weekend, Foreign Minister Wang Yi said China upheld Ukraine's right to "sovereignty, independence and territorial integrity" even while blasting the West for "creating panic." 

Following Putin's move on Monday to recognize two self-proclaimed separatist republics in eastern Ukraine, Wang Yi urged all parties to protect the principle of the United Nations charter during a phone call with US Secretary of State Antony Blinken. Chinese Foreign Ministry spokesman Wang Wenbin later called on all involved to "deescalate the situation through dialogue and negotiation."

"China will have to walk a fine line in this crisis," said Noah Barkin, an expert on Europe-China relations at US research firm Rhodium Group. "It will want to avoid openly criticizing Russia's actions in Ukraine, while affirming its support for the principles of territorial integrity and non-interference. The hotter the conflict in Ukraine gets, the more difficult it will be for Beijing to walk this line."

Beijing is making clear it doesn't want to be directly associated with Moscow's moves, said Bonnie Glaser, director of the Asia program at the German Marshall Fund of the United States.

"The costs of doing so, in terms of relations with the US and Europe, and its global reputation, are too high," she said. 

For Xi, the crisis marks a test of his efforts to portray China as a responsible global leader. While Putin is known for military adventurism, China has regularly claimed to uphold an international order backed by UN agencies while condemning the US and its allies as rogues for imposing targeted financial sanctions. 

US President Joe Biden on Tuesday announced new sanctions targeting Russia's sale of sovereign debt abroad and the country's elites, while warning of more to come if Russia takes more territory. Earlier the White House cautioned Beijing that a destabilizing conflict between Russia and Ukraine would affect Chinese interests around the world.

Political Sensitivities

One major concern for China is stability in a sensitive political year. Later in 2022, Xi is expected to secure a precedent-breaking third term in office at a twice-a-decade party meeting at which top Communist Party leaders are vying for promotions. 

Crude oil prices have rallied to near $100 a barrel, and sanctions on Russian oil exports will only push prices higher. China is the world's top consumer of commodities, while Russia is a major producer of oil, gas, aluminum and wheat.

"Beijing has little desire to see USD100/barrel oil, any effects from secondary sanctions or a deterioration in its relations with key trading partners in Europe," said Christian Le Miere, founder of strategic advisory firm Arcipel who was formerly a senior fellow at London-based research group IISS. 

China also doesn't want to appear to be supporting separatist movements. Xi's government has long blamed the US for fomenting unrest in places like Xinjiang, Tibet and Hong Kong, and regularly calls on the West to avoid supporting independence backers in Taiwan. 

'Awkward Situation'

The situation in Ukraine creates a potentially messy precedent for China's own claims to Taiwan, which is governed as a de facto sovereign nation. While China may support Russia's move to incorporate lost territory, Moscow's recognition of independence for two breakaway areas of Ukraine could also create a precedent for Western nations to recognize Taiwan, according to Chong Ja Ian, an associate professor at the National University of Singapore.

"Russia's actions and statements create an awkward situation for the PRC," he said, referring to China. "Beijing seems to be very cautious about how it frames these issues, emphasizing instead the need for peace."

The comments by China's foreign minister backing Ukraine's sovereignty should be interpreted as Beijing having "major reservations" about Putin's actions, according to Shi Yinhong, professor of international relations at Beijing's Renmin University. But, he added, China won't publicly criticize Russia or downgrade the relationship.

It's "pretty obvious" that China isn't ready to bear all the diplomatic costs if Russia invades, said Jakub Jakobowski, a senior fellow with the China Programme at the Centre for Eastern Studies in Warsaw. "Still, their general support for Moscow's demands and a lack of condemnation is certainly a wink to the Russians."

Disclaimer: This article first appeared on Bloomberg and is published by special syndication arrangement.