Yahoo Finance China's economic partnership with Russia is so lopsided that Putin needs the help of the US — but he'd never admit that, think tank says
Russia's "no limits" partnership with China is hurting its own economy, one think tank says.
It says that's because China has been altering its trade connections against Russia's interests.
The think tank says the relationship is so imbalanced that Russia may need the US's help — though Putin would never admit it.
Moscow's friendship with Beijing is at the expense of its own economy – so much so that Russia needs the US to counterbalance its relations with China, according to the Council on Foreign Relations (CFR).
"Isolated from the West, Moscow has fallen ever deeper in Beijing's embrace. Although the Kremlin touts its close strategic alignment and 'no limits' friendship with China, the reality is not so rosy," Thomas Graham, a distinguished fellow at the New York-based think tank said in a recent op-ed for Foreign Affairs.
That comes as Russia and China have worked to knit their economies closer, with both nations announcing a "no limits" strategic partnership in early 2022, just before Russia began its "special military operation" of Ukraine. That partnership has led to a boom in trade between the two countries, which hit an all-time high of $190 billion in 2022, according to data from the Chinese General Administration of Customs.
But the think tank argues that much of the partnership has been more to Beijing's benefit than it has been to Moscow. Though China is one of Russia's only reliable trading partners at the moment, the nation has neglected to make major investments in Russia, Graham noted.
Beijing also appears to be prioritizing its own economic interests, such as by using its relationship with Russia to trim other trade ties on terms "inordinately" favorable to itself, Graham said. He says the nation has also worked to expand its connections elsewhere in Asia, which are actually coming at Russia's expense.
Not to mention, China is more powerful than Russia economically and militarily. The nation's economy is ranked the world's largest by real GDP, according to the Central Intelligence Agency, and about six times the size of Russia's, per 2021 CIA estimates. China is also home to the world's largest military, with around 3 million on active duty, according to an estimate from the US Defense Intelligence Agency.
Moscow has been working to expand some of its relationships as well, such as with India, another top trading partner. But those connections are still smaller by comparison. And Russia's economy now appears to be so dependent on China, that the nation needs the help of the US to counterbalance it, Graham said.
"If Russia wants to avoid strategic subordination to China, it cannot rely on inchoate multilateral groupings that have little chance of rivaling Western-dominated global institutions. Nor can Russia count on highly transactional bilateral relations with countries weaker than itself. The only genuine option, then, is the West," he added.
Graham notes, however, is unlikely to ever acknowledge this: The Russian president has been known to deny or otherwise rebuke any signs of economic weakness in the nation. At Russia's Eastern Economic Forum, Putin claimed that the Russia wasn't facing any "absolutely insurmountable" problems, despite inflation accelerating well-above the central bank's target rate.
"Putin will never acknowledge this reality. His anti-Americanism is too deeply entrenched, and he has lashed his fate to Chinese President Xi Jingping too tight, to seek an opening with the United States, even if it is strategically beneficial," Graham added.
Western economists have forecasted a far grimmer future ahead for Russia, whose economy has been spiraling amid western sanctions and its costly invasion of Ukraine. In particular, the nation is becoming increasingly at the mercy of China, with some experts warning that Russia could eventually become China's "vassal state."
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