The Ukrainian crisis is likely to push Russia to develop a crucial relationship with China, and it’s also probable that the US will cozy up more with China to balance against Russia, both of which benefit China, Chinese expert Andrew Leung told RT.
Western sanctions in, do you think Russia and China will become
countries are at the cusp of a possible Eurasia century. I say this
because the interests of both countries are beginning to converge.
China is the second-largest economy, external oriented, wants a lot
of energy and resources, and Russia has them in abundance. Of course
China wants to expand its market worldwide and to establish trading
relationships across the globe. A deep sea port, for example, in
Crimea would be a very good pivot for China towards Central Europe,
Eastern Europe, as well as the Mediterranean. And also because of
geopolitical concentration, supplies of energy from Russia overland
to China would be much safer than transporting China’s energy
through the ports in Iran where events will be beyond China’s
control, or through the Malacca strait controlled by the US Seventh
fleet. So transportation of energy through Russia and Central Asia
would be of strategic importance to China, and then, of course,
Russia’s energy supplies would be placed in a very good position.
And both countries share common interests in developing relationships
with Central Asia.
kind of cooperation between Russia and China are we likely to see?
relationship is both economic as well geopolitical. I have just
explained the economic side. The geopolitical side is because, first
of all, energy security for China avoiding transporting the energy
and resources through areas which are likely to be controlled by the
world superpower, America, for example in the Malacca strait which is
very narrow. And then transporting energy through Central Asia and
Russia will be safer for China. Also the Ukrainian crisis is likely
to push Russia more towards China as a balance against America. It’s
also likely to push America more towards China to balance against
Russia. So China would be in a very advantageous position to develop
crucial relationship with Russia. When we look at current so-called
sanctions, American sanctions on Russia, and Russia has already
signed a deal tripling the amount of energy sale from Russia to China
by 2018, so that by that time China will become the largest customer
of Russian energy. This is a huge volume of trade and of course trade
demands a payment system, and, because of possible sanctions, Russia
is likely to make use of Union Pay, China’s payment system. And of
course these huge energy contracts are likely to be priced outside
the US dollar; it’s likely to use the renminbi and that of course
will tally with China’s desire to internationalize renminbi. So
there are many areas in which the two countries interests converge.
willing to create its own payment system to rival MasterCard and
Visa. Some experts also suggest that Russia should cooperate with
China and use the Chinese system. Plus there are talks of forming a
new regional currency. How likely is any of this to come to fruition?
course some sanctions have already been imposed, against certain
Russian individuals, against some money flows, the world’s money
flow is controlled now by Western dominated financial institutions
and of course the US dollar, so that’s why there could be
opportunities for Russia to make use of China’s payment system.
China's Union Pay is already the world’s second-largest by volume
and third-largest by share, double the American Express share. So
this is an opportunity. But one big thing is the reference to
developing the Russian Far East. Now the Russian Far East is a vast
land mass with tremendous reserve of resources and you need a buyer,
you need a country that needs these resources, and China is of course
a very good partner. China is exporting its infrastructure
capabilities across the globe, and China’s infrastructure
facilities, finance coupled with companies could help develop the
Russian Far East.
serious would the impact of the Western sanctions against Russia be?
not so worrying and in fact there is money outflow from Russia. I
think the data suggest that the outflow during the past couple of
months is equal to the outflow for the entire last year. And, of
course, the Russian ruble has been affected, although it has recently