Chinese strategic considerations have largely been ignored in analyses of Western measures against Russia following the country’s annexation of Crimea and support for separatist movements in Donetsk and Luhansk. This bipolar Cold-War strategic paradigm, a US-led coalition versus Russia, is completely untenable in the modern age, especially considering the re-emergence of China as a great power and growing Chinese assuredness of its position as one of the world’s paramount states.

Chinese intellectuals and government ministers are beginning to suggest that the deterioration of Russia’s economy in late 2014 and instability of the ruble pose a threat to China’s economy, prestige, and long-term strategy.  Chinese sources claim that significant ruble devaluation is causing difficulties for Chinese firms operating in Russia and that companies engaged in border trade are beginning to suffer. Russia’s weakness has led to the discontinuation of some cooperation agreements between Chinese and Russian companies, and Chinese prestige projects in central Asia such as the “Silk Road Economic Belt,” which depend on Russian assistance, might be jeopardized.

Although China’s diplomatic maxim is that it forms partnerships rather than alliances, Russia undoubtedly looms large in China’s strategic reckoning. Unlike the “US-China partnership” which resembles more of a conflict resolution forum, Chinese and Russian strategic objectives converge to a very great extent. Russia and China share a long land border, both are permanent members of the United Nations Security Council, the Shanghai Cooperation Organization (SCO), the BRICS Forum and the New Development Bank, and both regard currently existing western-dominated systems of world economic governance as obsolete.  Furthermore, both China and Russia have regularly expressed their dissatisfaction with Western encroachments into regions that they regard as their natural spheres of influence, with China denouncing the United States' alliance system in Asia as “Cold War thinking” aimed at containing China’s rise.

Chinese and Russian strategic objectives converge to a very great extent.

China thus far has adopted a slightly pro-Russian standpoint in the Ukraine dispute in accordance with the rest of the BRICS nations. China, Brazil, India and South Africa abstained from voting on UN resolutions relating to Crimea or Ukraine, and India issued a joint statement with Russia in December condemning sanctions imposed without the support of the UN Security Council. This is in keeping with China’s desire to minimize its international exposure along with the potential criticism of its activities as well as the hope that Russia might resist Western pressure alone without experiencing severe economic distress, currency volatility, or a blow to its prestige. Nevertheless, this scenario appears increasingly unlikely and Chinese perceptions of threats to its national interest in Russia might now compel it to engage more actively in the dispute, as indicated by recent ministerial pronouncements. In December, Chinese Foreign Minister Wang Yi expressed his confidence that Russia has the capability and wisdom to overcome its current economic predicament, but that China will do everything in its power to help Russia and supply aid should it be required. This sentiment was reinforced by Li Keqiang, who stated at a summit of SCO heads of government in Kazakhstan in December that all members states were in the same boat faced with the perilous state of the world economy and indicated his wish to see enhanced cooperation and greater investment by China in Russia.

According to Paul Krugman, Russia’s economic difficulties represent a classic currency crisis which hinders the country’s ability to service its foreign currency denominated debts. The standard prescription in previous crises was for a distressed country to request aid from the International Monetary Fund (IMF), which supplied emergency loans and organized credit forbearance subject to the adoption of appropriate reforms.  The IMF, dominated by the United States and Western European nations that have imposed sanctions against Russia, would almost certainly demand that Russia withdraw from Crimea and that it desist in its actions in Eastern Ukraine as a precondition of economic aid. Of course, withdrawal from Crimea would be an anathema to Vladimir Putin, who would in all likelihood seek to weather Russia’s economic difficulties without recourse to the IMF.

China has long expressed its dissatisfaction with the power of Washington-dominated global governance institutions such as the IMF and World Bank, which it considers tools of US foreign policy. Accordingly, China, in conjunction with the BRICS nations, is attempting to establish its own alternatives such as the New Development Bank (formerly known as the BRICS development bank). Of particular note is the Contingent Reserve Arrangement (CRA) of the new organization, which is intended to provide protection against liquidity pressures and currency crises, which might be useful to Russia in its present crisis. However, the CRA is planned to begin lending activities in 2016, which will likely prove too late to factor in the Ukraine dispute. However, this does not prevent China from helping Russia alone and the country has ample foreign currency reserves to do so.

China has long expressed its dissatisfaction with the power of Washington-dominated global governance institutions such as the IMF and World Bank, which it considers tools of US foreign policy.

Were China to decline to aid to Russia and Russia were forced to seek assistance from the IMF, China’s desire to limit the power of Washington-dominated institutions would be harmed. Furthermore, Chinese faintheartedness in supporting a close cooperation partner would probably dissuade other nations, particularly in the Global South, from contemplating soliciting aid from China in disputes with the United Sates and thus secure the strength of US-dominated world organizations for the foreseeable future. If Russia were to reject IMF terms and suffer a deep recession and if China were to deny aid, this would imperil Sino-Russian cooperation in prestige projects in central Asia and possibly eliminate Russia as a bulwark against US pressure. This is particularly worrying for China, which fears that the US pivot to Asia is a euphemism for an encirclement policy. Furthermore, the humiliation of Russia would signal Chinese timidity and impotence in Asia. Any regime change in Moscow precipitated by economic hardship might bring about reconciliation between Russia and the West, a very worrying strategic picture indeed for Beijing.  Direct support for Russia, such as the purchase of ruble-denominated assets or the provision of temporary loans, thereby thwarting Western sanctions, would likely stabilize trade with Russia and protect China’s economy. Additionally, support for Russia might enhance cooperation in central Asia and demonstrate China’s ability to circumvent the power the IMF although its relationship with the United States might deteriorate further and also leave China exposed to a Russian default on its debt. European considerations probably do not factor in the Chinese leadership’s reckoning due to the remoteness of the continent and the negligible influence of European nations in world affairs.

In any eventuality, announcements from China indicate that the country is seriously contemplating direct intervention on the side of Russia in the Ukraine dispute. If US-China détente was a critical factor in weakening the communist world during the Cold War, modern China, with the world’s second largest economy, US$3.89 trillion in foreign currency reserves, and population of 1.36 billion must undoubtedly be considered when assessing any dispute involving the United States and Russia. Just as disregarding China’s disposition prior to its entry into the Korean War precipitated disastrous consequences, similar neglect of China’s strategic interests in Russia by the West may prove to be a tactical blunder of the highest magnitude.