The next test of China-Russia cooperation: containing the North Korea crisis

Andrew Hammond says the collaboration between Russia and China has often been exaggerated but the two have genuine interests to explore, including the creation of alternative financial institutions, energy exploration and preventing conflict in Korea

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Chinese Premier Li Keqiang shakes hands with Russian Prime Minister Dmitry Medvedev during a signing ceremony following their talks in St. Petersburg last November. Medvedev will be in China this week for talks that are likely to include energy and security issues. Photo: EPA

Published: 4:24pm, 30 Oct 2017Updated: 11:48pm, 10 Dec 2019

Russian Prime Minister Dmitry Medvedev is due to visit China this week to meet President Xi Jinping, Premier Li Keqiang and other senior officials. The trip will underline growing bilateral dialogue between Beijing and Moscow, including on key regional and global issues such as the Korean nuclear stand-off and the Syrian conflict.

The primary emphasis of the visit is to try to deepen the bilateral political and economic partnership. China and Russia already enjoy relatively extensive economic cooperation, in particular, which has warmed in several areas since the Ukraine crisis saw Moscow’s suspension from the G8.

China's President Xi Jinping meets then US president Barack Obama on the sidelines of a nuclear security summit in The Hague in March 2014 after Ukraine withdrew troops from Crimea, effectively yielding the peninsula to Russia. Obama’s administration took a firm line in response to the Russian invasion, including sanctions and the exclusion of Russia from the G8. Photo: Reuters

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Russia has announced plans for numerous cooperation projects with China, including a new method of interbank transfers, and a joint credit agency to create a shared financial and economic infrastructure allowing them to function independently of Western-dominated financial institutions.

They are also involved in creating alternative forums to the World Bank and International Monetary Fund, including the New Development Bank. This will finance infrastructure and other projects in the BRICS member states, and provide a related US$100 billion special currency reserve fund.

Moreover, the two have signed a US$400 billion natural gas supply deal which will involve a 3,200km pipeline from eastern Siberia to northeast China. They have agreed to construct a second major gas pipeline from western Siberia to China’s Xinjiang province.

Moscow has also opened parts of its upstream oil and gas sector to direct investment from Beijing. Moreover, Chinese firms have stepped in to provide Russian counterparts with technology, and Chinese banks have become an important source of loans for Russian businesses in the wake of Western sanctions.

Russian President Vladimir Putin (right) shakes hands with CEFC China Energy president Chan Chauto at an investment forum in Moscow on October 24. Photo: EPA-EFE