China, Russia strengthen ties amid tensions with West

Putin secures energy deals and other trade agreements worth $50 billion; Xi emphasises 'friends forever' outlook for the two nations

Photo by: Reuters
Photo by: Reuters

Chinese President Xi Jinping shakes hands with his Russian counterpart Vladimir Putin during a signing ceremony after their meeting in Beijing, China, on June 25, 2016.

Chinese President Xi Jinping and his Russian counterpart Vladimir Putin promised closer cooperation and oversaw a series of deals Saturday, as the two countries deepen ties in the face of growing tensions with the West. 

According to RT, the Russian state-funded news organisation, the deals worth $50 billion were also facilitated by a contingent accompanying Putin, including Kremlin administration head Sergey Ivanov, five deputy prime ministers, Gazprom and Rosneft oil and gas companies heads.

In what was Putin's fourth trip to China since Xi became president in 2013, the two men laid emphasis on their shared outlook which mirrors the countries' converging trade, investment and geopolitical interests.

"Russia and China stick to points of view which are very close to each other or are almost the same in the international arena," Putin said.

The Russian leader added the two had discussed "strengthening together the fight against international terrorism," the nuclear issue on the Korean peninsula, Syria, and stability in the South China Sea.

Russian President Vladimir Putin and his Chinese counterpart Xi Jinping attend a welcome ceremony outside the Great Hall of the People in Beijing, China, on June 25, 2016. (Reuters)

Russia and China have been brought together by mutual geopolitical concerns, among them wariness of the United States.

The two countries often vote as a pair on the UN Security Council, where both hold a veto, sometimes in opposition to Western powers on issues such as Syria.

China has raised tensions with its neighbours and the US over its claims to virtually all of the South China Sea, where it has built militarised artificial islands to bolster its claims in the contested but strategically vital region.

In this May 6, 2016 file photo, soldiers from the Chinese People's Liberation Army (PLA) Navy watch as the USS Blue Ridge arrives at a port in Shanghai. (AP)

Russia’s annexation of Ukraine's Crimea peninsula and support for other Ukrainian separatist movements have led to the worst East-West standoff since the Cold War.

A statement on the Kremlin website from the two governments called on nations to strictly abide by the norms of international law, keep military capabilities at the minimum level required for national security and refrain from steps aimed at expanding existing military-political alliances.

The statement criticised the deployment of anti-missile systems in Europe and Asia, saying those who deploy them often acted under false pretences.

It did not mention specific countries, but it comes at a time when Russia and NATO are at loggerheads over the western alliance's build-up of capabilities in eastern Europe, including missile defence. NATO says its actions are a necessary response to Russia's intervention in Ukraine.

On North Korea, both countries agreed the stalled six-party talks process remained the best way to achieve the denuclearisation of the Korean peninsula, and that all sides should create conditions for talks to resume.

People walk past a television screen reporting news of North Korea's latest Musudan missile test, at a railway station in Seoul on June 23, 2016. (AFP)

Permanent 'friends'

Xi emphasised 2016 marked the 15th anniversary of the China-Russia treaty of friendship and hoped the two countries might remain "friends forever".

"President Putin and I equally agree that when faced with international circumstances that are increasingly complex and changing, we must persist even harder in maintaining the spirit of the Sino-Russian strategic partnership and cooperation," he said.

Chinese President Xi Jinping and his Russian counterpart Vladimir Putin attend a meeting in Beijing, China, on June 25, 2016. (Reuters)

Xi and Putin signed two joint statements themselves, one "to strengthen global strategic stability" and one to promote the development of information and cyberspace.

Xi called for closer cooperation between news agencies in Russia and China so both countries could "together increase the influence" of their media on world public opinion.

Under Xi, Communist China has mounted crackdowns on dissidents and tightened restrictions on the media, while critics accuse Putin's Russia of rights abuses.

Energy, trade deals

At loggerheads with the West, Moscow is seeking to refocus its gas and oil exports from Europe—its main energy market—towards Asia and is diligently building an energy alliance with Beijing.

The two sides signed over 30 cooperation deals in areas such as trade, infrastructure, foreign affairs, technology and innovation, agriculture, finance, energy, sports and the media. Putin said 58 different deals worth a total of around $50 billion were currently in discussion, adding the two countries will seek to secure an agreement on building a high-speed rail line in Russia by the end of the year.

Notably, Russian oil giant Rosneft inked a deal with China Petrochemical Corporation (Sinopec) on developing a gas processing and petrochemical plant in East Siberia, as China seeks energy to fuel its economic growth.

In addition, Rosneft agreed with China National Chemical Corporation (ChemChina) that ChemChina would take a 40 per cent stake in Rosneft's planned petrochemical complex VNHK in Russia's Far East.

The deal would help Rosneft finance the project and get access to the markets of the Asia-Pacific region, the Russian firm said in a statement.

They also signed a new one-year contract under which Rosneft could supply up to 2.4 million tonnes of crude oil to ChemChina between August 1, 2016, and July 31, 2017.

Rosneft and Beijing Enterprises Group Company Limited agreed to the key terms of a potential sale of a 20 per cent stake in Rosneft's oil producing subsidiary, Verkhnechonskneftegaz, to a unit of Beijing Gas Group. In May, Russia was China's largest crude oil supplier, surpassing Saudi Arabia.

Rosneft CEO Igor Sechin said his company did not plan to reduce its crude supplies to China and would defend its market position amid competition with Saudi Arabia, Qatar, Iraq, and Iran.

"We will stick to the volumes we have agreed on. It's around 40 million tonnes (per year)," TASS news agency quoted Sechin as saying.

Russia was China's largest crude oil supplier in May for a third month in a row, having surpassed imports from Saudi Arabia.

The countries' central banks also signed a memorandum of understanding on setting up a yuan clearing mechanism in Russia to benefit to cross-border trade and investment.

TRTWorld and agencies