Some recent changes in Sino-Russian relations deserve attention.
Russia’s Sputnik news agency reported on September 8, that Li Zhanshu, chairman of the Standing Committee of the National People’s Congress, met Russian President Vladimir Putin when he attended the Eastern Economic Forum in Vladivostok. Official CCP media such as Xinhua News Agency and People’s Daily strangely only reported on Li’s attendance at the forum, without mentioning the meeting between the two.
When Putin met with Li, some people on social media commented that for the CCP, it didn’t do much harm, just an insult. Vladivostok was originally a Chinese territory. The Chiang Kai-shek government signed the Sino-Soviet Pact in 1945, making it clear that China had sovereignty over Vladivostok and would take it back in 1995. However, after the CCP seized power, leader Jiang Zemin reached agreements in 1991 and 2001 to hand over 400,000 square kilometers of land, including Vladivostok, to Russia.
Surprisingly, the official CCP media did not report on Li’s meeting with the Russian leader, perhaps because they were worried about evoking memories of former leader Jiang Zemin’s treason. Some believe this shows that there are still different viewpoints within the CCP regarding Sino-Russian relations, according to Sound Of Hope. Whether Xi Jinping will actually visit Uzbekistan and meet with Putin before the 20th National Congress, as the Russian side has announced, is the key to observing the direction of China and Russia, as well as the political situation in Zhongnanhai.
In addition, Russia’s state-owned Gazprom, announced on September 6 that it has reached an agreement with PetroChina to pay its natural gas bills based on a 50-50 split between the ruble and yuan.
The outside world believes that the CCP’s purpose is to help Russia escape Western sanctions, while removing dollarization and improving the status of the yuan.
However, Wu Jialong, a Taiwanese senior economic and political commentator, said in an interview with Sound Of Hope on September 8 that such an agreement can only be limited to China and Russia. He said that to move toward eliminating the US dollar in the energy sector, it would depend on key countries such as Saudi Arabia and Turkey.
Wu said that trying to de-dollarize the energy sector is a big deal and Saudi Arabia, which is a major player will not go for it because it has signed agreements with the United States to use the dollar and all funds from oil transactions would be deposited in U.S. banks and in return the U.S. would provide Saudi Arabia with military protection.
Wu said that if the CCP wants to replace the dollar, the first thing to ask is whether the CCP has the ability to provide military aid to Saudi Arabia. The answer is no, thus, there can be no non-US dollar energy trade. Although China is the world’s largest energy importer, it does not have the power to decide which currency to use for transactions. The de-dollarization in energy trading therefore can only be done between China and Russia.
Hong Kong’s senior commentator on current affairs, Tang Pu (Samp) said that the international influence of the yuan and the ruble is very modest. For example, last year, the yuan accounted for only 2.7% of global currency payments, by contrast, the US dollar was as high as 40.5%, and the euro was 36.7%.
Samp added, relatively speaking, the ruble’s status is lower than that of the yuan, “That’s why Russia has a greater incentive to lure the CCP to this pirate ship. If the CCP steps up, they will not stay warm together, but will sink together to the bottom of the ocean.”
Wu also believes that the Sino-Russian settlement agreement confirms the alliance, as well as U.S. accusations that China and Russia support each other in foreign aggression: “At present, both sides are planning for the worst, and the U.S. knows that sooner or later the CCP will go to war. Both of them are currently preparing for war. The U.S. predicts war will break out in 2027. But the latest information is that the CCP will not wait long avoiding the U.S. and Taiwan having time to prepare for war. The war might break out next year, after the 20th National Congress of the CCP.”