China and Russia: A New Cold War?
In July 2024, Russia and China performed joint naval drills in the South China Sea—a display of military might that featured the two countries practicing anti-missile exercises, sea strikes, and air defense. Taking place just days after NATO leaders issued scathing remarks urging China to pause its heightened economic support for Russia following the invasion of Ukraine, the coordinated military practice represented a future in which Russia and China’s interests become increasingly intertwined. These joint military exercises have increased in the past few months, including a week-long training called “Ocean-2024” in early September. The growing relationship between the two countries has garnered press attention and stirred whispers of a “new Cold War.” With NATO expanding to include Sweden and Finland in March 2024 and April 2023, respectively, many experts have raised the possibility of a growing global divide.
A new Cold War would be distinctly different from the Cold War of the 20th century, with China and Russia allied against the West, especially NATO. The Russo-Ukrainian War has exacerbated the divide between NATO and the new autocratic partnership. In early February 2022, a few weeks before the invasion, Russian President Vladimir Putin and Chinese President Xi Jinping declared that their two countries had a “no limits” alliance, setting the stage for bilateral trade and economic support. Both countries benefited from a flurry of trade, although the Russo-Ukrainian War means that Russia has more to gain from the relationship. China has already come to Russia’s aid, helping prop up its economy as heavy Western sanctions threatened to cut the country off from the global economy. This alliance could serve as a significant threat to the stability of the Western world.
While Putin and Xi continue to support each other technologically and economically, China is exporting much more to Russia than Russia is to China. In 2023, China comprised 38 percent of Russian imports, while Russia accounted for 5.1 percent of Chinese imports. Important questions remain about the future viability of this partnership. Can Xi continue to dance around the Russo-Ukrainian War, supporting Russia’s economy while maintaining an officially neutral stance? How durable will the partnership between Russia and China be as they face growing economic and geopolitical isolation, and is Russia’s increased dependence on China sustainable? If their alliance develops into a bona fide defense against NATO and US allies, how will a Sino-Russian union—forming a new ‘Iron Curtain’—shape the future of global diplomacy?
Strengthening Economic Ties
In 2023, trade between China and Russia reached US$240 billion, a 26.3 percent increase from the previous year and more than double from 2018 (US$107 billion). Collaborations like the 2012 Russia-China Investment Fund allow the countries to jointly invest in shared interests, notably Biren Technology, a potential NVIDIA rival. A 2019 deal between the Chinese cellular giant Huawei and Mobile TeleSystems (MTS), Russia’s largest mobile operator, enabled Huawei to develop 5G technology for commercial use in Russia despite bans in the United States and Europe. Furthermore, Huawei board chairman Guo Ping remarked on how important the partnership was for the governments of the respective countries, saying: “The fact that the president of Russia and [the Chinese president]…were present at the ceremony proves once again how important technology partnerships are for Russia and China.” The move and the resulting press releases highlighted how closely interlocked the two countries are within private industries and government coordination.
The booming trade between these two countries has been, in part, fueled by Russia’s invasion of Ukraine. China emerged as a critical trading partner for Russia after the West levied significant sanctions that threatened to cut Russia off from the global economy. Chinese exports to Russia skyrocketed following the invasion, with the value of Chinese vehicle parts and machinery imported by Russia soaring to roughly US$25 billion in 2023. China played a crucial role in providing alternative trading sources to Russian firms, which helped to prop up the Russian economy.
According to NATO, China has been covertly supplying military support to Russia in the form of microelectronics, semiconductors, and other goods that could conceivably be used by both civilians and the military. The Chinese government argued that these exports were simply “normal trade” and that NATO had to “stop hyping up the so-called China threat,” pointing to the West’s efforts to supply Ukraine with weapons. Chinese officials argue that the United States and Europe—not China—are over-involved in the conflict. The two governments continue to work closely, with joint military exercises dating back to 2005. From 2014 to 2023, Russia and China conducted between four and ten joint military training sessions per year.
Beyond economic, technological, and military partnerships, space exploration has become another point of collaboration between Russia and China. This alliance mirrors the Cold War when the race to the moon became a flashpoint between the Soviet Union and the United States. As of 2024, China and Russia have agreed to conduct multiple space projects, including a robotic mission to an asteroid, a permanent research base on the moon by 2030, and an automated nuclear reactor on the moon by 2035, which could sustain future bases. Since 2021, Russia and China have planned to jointly establish the International Lunar Research Station (ILRS) with two construction phases set to be completed by 2035 and 2050, respectively, according to the Chinese government. Russia announced in 2022 that it would depart the International Space Station (ISS) when the contract ended in 2024 and begin constructing an exclusive “Russian Orbital Service Station.” Although Russia confirmed in 2023 that it would instead remain involved with the ISS through 2028, NASA plans to discontinue the ISS in 2030. The dismantling of the ISS—a hallmark of international cooperation since the project was launched in 1998—undermines one of the last remaining areas of global dialogue and camaraderie.
In these collaborative initiatives, Russia and China leverage their strengths: Russia has superior nuclear knowledge and space experience, while China has more financial resources. However, their space collaboration also underscores the uneven power dynamic between the two countries. Struggling to fund ambitious space projects independently, Russia increasingly relies on China’s funding in space exploration. A straightforward comparison of their 2023 budgets for space programs—US$14.15 billion and US$3.41 billion for China and Russia, respectively—only proves the superiority of China’s resources.
The frequent drills conducted by the two countries’ militaries and their coordination on future projects demonstrate that they intend to remain close allies in the coming decades. However, this alliance is unequal. China has the upper hand in Chinese-Russian trade and space collaboration, and China provides Russia with crucial military supplies. Multiple forms of leverage over Russia position China to significantly influence the future of their relationship.
An Imbalanced Relationship
While China exports a variety of machinery, vehicle, and other goods to Russia, Russia almost exclusively exports crude oils and other mineral fuels to China. China’s trade surplus with Russia and this difference in trading materials demonstrate Russia’s dependence on China for trade, particularly during the war in Ukraine when Russia can look to few other countries for important manufactured and industrial goods.
Russia’s fossil fuel exports are a prominent example of this economic imbalance. Since Europe dramatically reduced Russian natural gas imports at the onset of the war in Ukraine, Putin has been eager to establish the Power of Siberia 2 natural gas pipeline to China—a buyer still willing to purchase Russian crude oil. The project has stalled for two years as China seeks to leverage its upper hand in trade to negotiate the lowest price possible. The pipeline encapsulates the relationship between Russia and China: Russia is dependent on China and China is attempting to capitalize on Russia’s isolation. That said, the rise of India as a trading partner for Russia—in July 2024, India surpassed China as the main consumer of Russian oil—could erode China’s leverage over Russia.
Despite fostering connections with Russia, China still relies on the West for trade. China’s top three export markets are the Association of Southeast Asian Nations (ASEAN) states, the European Union, and the United States, which imported US$523.7 billion, US$501.2 billion, and US$500.3 billion, respectively, in Chinese goods in 2023. Russia only imported US$111.0 billion in Chinese goods in 2023. Given the importance of maintaining trade with the West (United States and European Union) and Russia, the Chinese government has been careful not to sever relations with either side. On the issue of the war in Ukraine, Xi and his government have repeatedly said that China is neutral. Notably, China’s frequent export of ‘dual-use’ goods, which can be used for both military and civilian purposes, to Russia proves the country is trying to avoid directly supplying Russia with military equipment. In September 2023, Xi and US President Joe Biden headlined the Asia-Pacific Economic Cooperation (APEC) summit in San Francisco, further proving Xi’s eagerness to maintain a relationship with the West. In a nod to the “new Cold War” term, Biden said that the United States did not want to “contain China,” and Xi said, “China doesn’t want a cold war or a hot war with anyone.”
While Xi’s statement could be interpreted as a defensive claim that China has been entirely neutral throughout the war, his words and the APEC summit still suggest that China and the United States value each other. Xi and Biden’s statements indicate that both countries are aware of the possibility of a new Cold War and are actively working to lower tensions. The Russo-Ukrainian War adds another layer of complexity to the tense relationship between the West and China. However, Xi is working to maintain China’s relations with the West and Russia. He must play China’s future cards carefully to maintain both relationships or risk losing one.
Limits for a Potential Authoritarian Bloc
In 2022, Xi and Putin defined their relationship as one without limits. In a press release affirming their closeness, they announced that there were “no forbidden areas of cooperation.” While the statement generated anxiety about the future of their close-knit relationship, there is more complexity beyond the statement’s sweeping words.
While China and Russia’s growing trade ties may raise concerns, it is far from certain that these new economic connections will escalate military collaboration. The Russo-Ukrainian War has bolstered China economically while Russia confronts financial problems. The war dealt a blow to China’s renewable energy strategy and pushed the country towards coal sources to stabilize its energy economy. The war also caused Russia to withdraw from the Black Sea Grain Initiative in July 2023, with Russia complaining that the deal unfairly benefitted Ukraine. However, the deal overwhelmingly benefited China with an essential grain source, and Russia’s exodus questions the future security of China’s trading systems. Lastly, sanctions on Russia have posed challenges for China’s Belt and Road Initiative—a route connecting China to greater Europe—as countries can no longer ship goods via Russia, a country situated in the middle of the corridor. The impact of the war on China’s economy and foreign policy helps explain China’s hesitancy to officially side with Russia and risk isolation.
“New Cold War” may not be the most accurate term for Russia and China’s alliance. While Russia and China are perceived as main threats to the stability of the West, the reality is more nuanced than a simple dichotomous dynamic. Russia’s ability to provoke the West without the support of China is uncertain, especially considering China’s misgivings about the war and upper hand in trade and collaborative projects, including space programs. The nation’s reliance on the United States and the European Union for trade makes it hesitant to fully support Russia in the Russo-Ukrainian War or any possible new Cold War.
At APEC 2023, Xi opened with reconciliatory remarks: “For two large countries like China and the United States, turning their back on each other is not an option…Planet Earth is big enough for the two countries to succeed.” His words underscore China’s eagerness to maintain crucial relations and dispel murmurs of a tense standoff.
China and Russia are similar in that both present alternative government models to the West, but their similarities may end there. China has a more extensive and adaptable economy than Russia, a country burdened with sanctions and isolation amidst the Russo-Ukrainian War. The dynamics between China and Russia remain important to watch. Will Russia be able to counteract the power imbalances between the two countries to have more control in their relationship? Will Chinese economic leverage influence the war? For now, power imbalances and discordant international goals between Russia and China do not suggest a resurrected authoritarian bloc in a new Cold War.