China’s Ukraine Conundrum

Why the War Necessitates a Balancing Act

Russia’s war in Ukraine has produced a strategic predicament for China. On the one hand, the conflict has disrupted billions of dollars’ worth of Chinese trade, heightened tensions in East Asia, and deepened political polarization within China by dividing people into pro- and anti-Russia camps. On the other, China blames the United States for provoking Russia with its support for NATO expansion and worries that Washington will seek to prolong the conflict in Ukraine in order to bog down Russia. Beijing sees little to gain from joining the international chorus condemning Moscow.

Regardless of what China says or does in response to Russian President Vladimir Putin’s decision to wage war in Ukraine, Washington is unlikely to soften its strategy of containment toward Beijing. And as China’s largest and most militarily capable neighbor, Russia is not a power that Beijing wishes to antagonize. Chinese policymakers have therefore sought to avoid unnecessarily provoking either rival power—abstaining from votes to condemn Russia in the UN General Assembly and carefully selecting its official statements about the war.

This balancing strategy is not without costs. Refusing to condemn Russia has strained China’s relations with some of its neighbors and distanced Beijing from many developing nations that have lined up against Russia’s war in Ukraine. It has also incurred economic costs stemming from Russia’s war that could continue long into the future. Nonetheless, in order to minimize its strategic losses, China will likely hew to this middle path until the war in Ukraine is over. One thing that might shift Beijing’s calculus and push it to side with Russia is if the United States provides military support for a Taiwanese declaration of de jure independence. Barring that, Beijing will likely continue its balancing act, since Washington’s policy of containment toward China makes it very difficult for Beijing to side with the United States on the war in Ukraine.

CAUGHT IN A BIND
Since the beginning of the conflict, Western powers have accused China of passively or even actively supporting Russia’s military actions in Ukraine. In March, for instance, The New York Times reported unverified claims that Russia shared its war plans with China ahead of the conflict. But as Qin Gang, China’s ambassador to the United States, pointed out in a March 15 op-ed in The Washington Post, China had much to lose from Russia’s actions: “There were more than 6,000 Chinese citizens in Ukraine. China is the biggest trading partner of both Russia and Ukraine, and the largest importer of crude oil and natural gas in the world. Conflict between Russia and Ukraine does no good for China. Had China known about the imminent crisis, we would have tried our best to prevent it.”

In reality, Qin understated the war’s negative impact on China. The conflict has roiled commodities markets and disrupted supply chains, resulting in billions of dollars of losses for Chinese firms. The Chinese nickel titan Tsingshan Holding Group, for instance, lost $8 billion on ill-timed trades after the war dramatically caused the price of nickel to spike. War-related disruptions have also resulted in large-scale cancellations of Chinese export orders and weakened Chinese industrial productivity. According to the National Bureau of Statistics, the China Manufacturing Purchasing Managers Index—which tracks economic activity in the manufacturing sector—declined by 0.7 percent in March, a much worse performance than market analysts had forecast and the first monthly contraction since August 2021.

The war has also heightened tensions between China and some of its neighbors. As the rivalry between Washington and Beijing has intensified, many East Asian nations have adopted hedging strategies to balance ties to both powers. But the conflict in Ukraine has driven some of these countries to lean more heavily toward the United States. In addition, the conflict has given Washington an excuse to approve another $95 million in military aid to Taiwan—the third U.S. arms package that Taipei has received since U.S. President Joe Biden took office. And it is not just China’s relations with its neighbors that have suffered: in March, two-thirds of UN member states voted to condemn Russia in a pair of resolutions at the UN General Assembly while only five voted not to and 35 abstained. China’s presence in the latter group will be remembered by many small and midsized countries, especially in the developing world.

To make matters worse, the war has further strained relations between China and the United States and its allies. Australia, Canada, Japan and the United Kingdom have all said they will join the United States in imposing secondary sanctions on Chinese companies that continue to do business as usual with Russia.

Finally, the war in Ukraine has deepened political polarization within China itself. On WeChat and other social media platforms, Chinese citizens have coalesced into opposing camps, one for Russia and the other against. Soon after the conflict began, some anti-Russia Chinese netizens began rehashing the unfairness of the 1858 Treaty of Aigun, which ceded roughly 230,000 square miles of Chinese territory to Russia. The political sensitivity of this historical event has in the past made Beijing wary of supporting any Russian efforts at territorial expansion. In this case, however, Beijing must give sincere consideration to the anti-Russian sentiment among some Chinese citizens.

“FUEL TO THE FLAMES”
Despite the war’s negative impacts on China, however, Beijing is not prepared to accept Washington’s approach toward the conflict. Since the beginning of the conflict, the Chinese government has argued that the United States provoked Russia by pushing for NATO’s eastward expansion. It now sees Washington as deliberately escalating the war in order to perpetuate it, thereby weakening both Russia and China. In a virtual call on March 5, Chinese Foreign Minister Wang Yi told U.S. Secretary of State Antony Blinken that China opposes any moves that “add fuel to the flames” in Ukraine. Chinese leaders and journalists have since repeated the phrase, underscoring Beijing’s distrust of Washington’s intentions. On March 30, for instance, the state-run People’s Daily published an editorial arguing that by “adding fuel to the flames” the United States “is creating larger obstacles to a political solution of this crisis.”

Having failed to deter Russia from waging war in Ukraine with threats of severe economic sanctions, the United States has shifted its goal from ending the conflict to prolonging it. In a speech in Poland on March 26, Biden said, “This battle will not be won in days or months either. We need to steel ourselves for the long fight ahead.” To Beijing, this read as an admission that the White House no longer aims to end the war but rather to prolong it in order to weaken and defeat Russia. When the following week Russian and Ukrainian negotiators appeared to make progress toward a tentative peace plan, top U.S. officials expressed skepticism about Russia’s desire to curtail its military assault on the cities of Kyiv and Chernihiv. Of the supposed progress, Biden said, “I don’t read anything into it until I see what [Russia’s] actions are.” The next day, he told Ukrainian President Volodymyr Zelensky that the United States planned to provide Ukraine with an additional $500 million in direct budgetary aid. As Beijing sees it, Washington is scaling up military aid to Ukraine in order to deny Russia a diplomatic off ramp for troop withdrawal. U.S. Defense Secretary Lloyd Austin’s comment last week that “we want to see Russia weakened to the degree that it can’t do the kinds of things that it has done in invading Ukraine” has only deepened China’s conviction that the United States’ priority is to weaken Russia, not to seek a swift end to the war.

Beijing now sees Washington as deliberately escalating the war in order to perpetuate it.
Nor does China believe that seeking common ground with Washington on the war in Ukraine will meaningfully improve broader Sino-U.S. relations. Even if Beijing were to join in the international condemnation of Russia, the United States would not soften its containment policy against China. Since the start of the war, some East Asian countries have publicly questioned whether Washington will sustain its focus on the Indo-Pacific while Europe is in crisis. In response, the Biden administration has been quick to reassure them. On March 28, Deputy Secretary of Defense Kathleen Hicks told reporters: “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.” The next day, Biden told Singaporean Prime Minister Lee Hsien Loong that even though the United States is focused on Ukraine, it is “strongly supportive of moving rapidly to implement the Indo-Pacific strategy.”

Chinese leaders see no reason to believe that Washington would somehow shift these priorities even if Beijing distanced itself from Moscow. In their eyes, condemning Russia publicly and siding with those enforcing sanctions against it would only open the door for the United States to impose secondary sanctions on China itself. The United States has already threatened to punish Chinese companies that do business with Russia. On February 3, U.S. State Department spokesperson Ned Price told reporters: “We have an array of tools that we can deploy if we see foreign companies, including those in China, doing their best to backfill U.S. export control actions, to evade them, to get around them.”

After Russian troops crossed the border into Ukraine, the United States dialed up the diplomatic pressure on China. In mid-March, before U.S. National Security Adviser Jake Sullivan met with Yang Jiechi, the director of China’s Office of the Central Commission for Foreign Affairs, Sullivan told the media: “We are communicating directly, privately to Beijing, that there will absolutely be consequences for large-scale sanctions evasion efforts or support to Russia to backfill them.”

THE MIDDLE PATH
This is not the first time Beijing has found itself caught between major rival powers. Between 1958 and 1971, the People’s Republic of China faced the most hostile international environment in its brief history. During this period, it had to confront strategic threats from the United States and the Soviet Union simultaneously. In response, the Chinese government devoted all its economic resources to preparing for a full-scale war against one of the two powers. To better shield its industrial base from attack, it moved many factories from more developed areas in eastern China to underdeveloped and mountainous western areas, hiding them in artificial caves. This large-scale industrial reorganization plunged China into a significant economic hardship, causing severe commodity shortages and widespread poverty.

The memory of this awful history has informed China’s response to the war in Ukraine and hardened its commitment to avoid getting sandwiched between Washington and Moscow once again. Official Chinese statements have thus been finely calibrated to avoid provoking Russia. In an interview in March, for instance, Qin made clear that Beijing seeks a cooperative relationship with Moscow but does not support its war in Ukraine. “There is no forbidden zone for cooperation between China and Russia, but there is also a bottom line, which is the tenets and principles established in the UN Charter,” he said. In a press briefing on April 1, Wang Lutong, director-general of European affairs at China’s Foreign Ministry, sought to walk a similarly fine line: “We are not doing anything deliberately to circumvent the sanctions against Russia imposed by the US and the Europeans,” he said, adding that “China is not a related party to the crisis in Ukraine.”

In choosing a middle path on Ukraine, China has refrained from providing military aid to Moscow but maintained normal business relations with Russia, a decision that other countries have also made. For example, India—a strategic partner of the United States—has adopted a similar stance, drawing a clear distinction between military and economic affairs. Even some NATO countries have continued to buy Russian gas to heat homes through the winter. If the war in Ukraine drags on, more countries may start mimicking China’s balancing policy to minimize their own economic losses caused by the war.

As the world’s second-largest economic power, China intends to play an important role in shaping global economic norms. But it has no ambition to play a leading role in global security affairs, especially in matters of war, because of the huge military disparity between it and the United States. Shaping a peaceful environment favorable to China’s economic development remains an important diplomatic goal. As long as the United States does not offer military support for a Taiwanese declaration of de jure independence, China is unlikely to deviate from this path of peaceful development.

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