Tag: xi jinping

Russia and China are being driven together as the chasm with the West deepens

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Chinese President Xi Jinping speaks with Russian President Vladimir Putin as leaders gather for a family photo during the Belt and Road Forum on Yanqi Lake, outside Beijing, China, May 15, 2017.

Damir Sagolj | Reuters

China and Russia are taking center stage this week as both countries look to deepen ties just as a chasm with the West, on a geopolitical and economic as well as military front, appears to be getting deeper, according to analysts.

A three-day state visit by Chinese President Xi Jinping to Moscow this week, which began Monday, was hailed by China and Russia’s presidents as the result of solid and cooperative relations between the two leaders and their respective nations, and comes after a determined drive over the last decade to strengthen diplomatic, defense and trade ties.

Ahead of the visit, President Vladimir Putin said in an article that “unlike some countries claiming hegemony and bringing discord to the global harmony, Russia and China are literally and figuratively building bridges” while his Chinese counterpart returned the favor, telling AFP he is “confident the visit will be fruitful and give new momentum to the healthy and stable development of Chinese-Russian relations.”

Xi’s visit to Moscow is something of a political coup for Russia given that it comes at a time when Russia has few high-powered friends left on the international stage, and little to show for its invasion of Ukraine.

Russian forces have made little tangible progress despite a year of fighting, and a largely isolated Moscow continues to labor under the weight of international sanctions. To add insult to injury, the International Criminal Court issued an arrest warrant for Putin on Friday, alleging that he is responsible for war crimes committed in Ukraine during the war.

Nonetheless, China and Russia have long shared similar geopolitical aims, such as a desire to see what they call a “multi-polar world” and the curbing of NATO’s military might, that unite them. And perhaps the most significant shared viewpoint of all is their mutual, long-standing distrust of the West.

A confluence of recent events — from the war in Ukraine to Western restrictions on semiconductor tech exports to China and, lately, a nuclear submarines deal between the U.S., U.K. and Australia that irked Beijing — has only served to bring the countries even closer together, according to analysts.

“If you look at the trajectory of China-Russia relations within the last decade, bilateral ties between the two countries have really developed tremendously,” Alicja Bachulska, policy fellow at the European Council on Foreign Relations (ECFR) told CNBC, saying that the process of developing ties had begun back in the 1990s.

“It’s basically about certain strategic interests, that are very close to both Beijing and Moscow at this point,” she added. “For both Russia and China, the main interest is to weaken the U.S.-led international order, that’s their primary goal, long term and short term.”

The Ukraine factor

For both China and Russia, the war in Ukraine is both a challenge to that U.S.-led world order and a way to undermine it, analysts note.

China has held back from openly supporting Russia’s war in Ukraine but it has also refused to condemn the invasion. Instead, it has echoed Moscow in criticizing the U.S. and NATO for what it sees as “fueling the fire” over Ukraine. It has also sought to carve out a niche for itself as peacemaker, calling on both sides to agree a cease-fire and come to the negotiating table for talks.

Behind the scenes, the West is concerned that Beijing could provide lethal weaponry to Russia to enable it to gain the upper hand in Ukraine, as U.S. intelligence suggested last month. Ukraine’s Western allies have signaled that any move to do so would be a red line and that, should Beijing cross it, there would be “consequences” in the form of sanctions placed on China.

Beijing has vehemently denied it is planning on supplying Russia with any military hardware. China’s foreign ministry spokesman Wang Wenbin said Monday, reiterating previous comments, that the West was supplying weapons to Ukraine, not China, telling reporters that “the U.S. side should stop fueling the fires and fanning the flames … and play a constructive role for a political solution to the crisis in Ukraine, not the other way around.”

China’s President Xi Jinping waves as he disembarks off his aircraft upon arrival at Moscow’s Vnukovo airport on March 20, 2023.

Anatoliy Zhdanov | Afp | Getty Images

China has denied it is planning to help Moscow militarily but analysts say Beijing is concerned over the war in Ukraine, noting that China views a Russian failure in Ukraine as a threat, given that it carries the risk of a potentially seismic political fallout back in Russia that in turn could harm Beijing.

“The worst case scenario for Beijing now is Russia’s complete failure in this war,” the ECFR’s Bachulska said.

“If they begin to think that Russia might fail — and that in the really worst-case nightmare scenario that there [could be then] a pro-democratic government in Moscow — for China, this would be a very threatening scenario,” she noted, seen as both a “direct threat to Beijing, and the stability of the CCP [Chinese Communist Party].”

This fear, she said, could sway China when it considers whether to offer Putin help in Ukraine. “They will probably be able to provide more support if they realize that the balance of power on the battlefield is against Russia,” Bachulska noted.

It’s highly likely that, should China help Russia in terms of weaponry or military technology, however, it will look to do it in a very covert way, analysts including Bachulska and those at the Institute for the Study of War have noted, such as using Belarus or other countries.

“Xi likely plans to discuss sanctions evasion schemes with Putin and Russian officials to support the sale and provision of Chinese equipment to Russia,” the ISW said in analysis ahead of the Xi-Putin summit, noting that it had previously assessed that during a recent meeting between the presidents of Belarus and China, agreements may have been signed that “facilitate Russian sanctions evasion by channeling Chinese products through Belarus.”

The ISW said Xi and Putin are “likely to discuss sanctions evasion schemes and Chinese interest in mediating a negotiated settlement to the war in Ukraine.”  CNBC contacted China’s Foreign Ministry for a response to the comments and is yet to receive a response.

Tech and trade wars

While possible military aid for China is something the West needs to watch closely, the depth and breadth of China’s loyalty toward Moscow is seen to be finite, with Beijing likely reluctant to risk major sanctions on its own economy just to help Russia.

On the other hand, analysts note that China, like Russia, has a vested interested in seeing the U.S. and wider West weakened, both geopolitically and diplomatically — for instance, if China can step in as a mediator in the conflict in Ukraine — and on an economic level, if the two nations can forge closer trade ties. This would come as the U.S. and Europe challenge China’s economic power, most recently with the introduction of sweeping export control rules aimed at restricting China’s ability to access advanced computing chips.

“Export controls on Chinese high tech — which reflect a policy of targeted containment — brings Xi closer to Putin in worldview and orientation,” Ian Bremmer,  founder and president of the Eurasia Group, told CNBC, adding: “I think that’s likely to be reflected in Xi’s statements when he … visits Putin in Moscow, and that’s going to be a big deal geopolitically,” Bremmer noted.

How Biden’s chip export restrictions hit chip stocks

While Russia might offer China a convenient trading and diplomatic partnership as other routes to Western markets look increasingly vulnerable, analysts note that the relationship between China and Russia is an imbalanced one.

“China doesn’t really need Russia,” Christopher Granville, managing director of global political research at TS Lombard, told CNBC. “Russia is a very tiny economy compared to China’s with the exception of some very specific things, such as its hydrocarbon exports and some aspects of its military industries,” he noted.

“What I would say though is that the U.S. pressing on China, especially in these trade wars and now tech wars, is a clear zero-sum project by the U.S. government to prevent China from reaching the frontier of key technologies, notably semiconductors,” he noted.

“It seems to me that as a result of the U.S. government’s zero-sum campaign to pull back China, to stop it getting ahead and keep it behind, is that suddenly the relationship with Russia becomes more valuable to China.”

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How a warrant for Putin puts new spin on Xi’s visit to Russia

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Chinese President Xi Jinping’s plans to meet with Russian President Vladimir Putin in Moscow next week highlighted China’s aspirations for a greater role on the world stage.

But they also revealed the perils of global diplomacy: Hours after March 17’s announcement of the trip, an international arrest warrant was issued for Mr. Putin on war crimes charges, taking at least some wind out of the sails of China’s big reveal.

The flurry of developments — which followed China’s brokering of an agreement between Saudi Arabia and Iran to resume diplomatic relations and its release of what it calls a “peace plan” for Ukraine — came as the Biden administration watches warily Beijing’s moves to assert itself more forcefully in international affairs.

U.S. President Joe Biden said on March 17 he believes the decision by the International Criminal Court in The Hague to charge Mr. Putin was “justified.”

Speaking to reporters as he left the White House for his Delaware home, he said Mr. Putin “clearly committed war crimes.” While the U.S. does not recognise the court, Mr. Biden said it “makes a very strong point” to call out the Russian leader for his actions in ordering the invasion of Ukraine.

Other U.S. officials privately expressed satisfaction that an international body had agreed with Washington’s assessment that Russia has committed war crimes and crimes against humanity in Ukraine.

Asked about the Xi-Putin meeting, Mr. Biden said, “Well, we’ll see when that meeting takes place.”

The Biden administration believes China’s desire to be seen as a broker for peace between Russia and Ukraine may be viewed more critically now that Mr. Putin is officially a war crime suspect, according to two U.S. officials. The officials, who spoke on condition of anonymity because they were not authorised to speak to the matter publicly, said the administration hopes the warrants will help mobilize heretofore neutral countries to weigh in on the conflict.

A look at the Xi-Putin meeting and how it may be affected by the warrant.

WHAT IS THE SIGNIFICANCE OF XI MEETING WITH PUTIN?

The visit to Russia will be Mr. Xi’s first foreign trip since being elected to an unprecedented third term as China’s President.

It comes as Beijing and Moscow have intensified ties in steps that began shortly before Russia’s invasion of Ukraine with a meeting between the two leaders in Beijing during last year’s Winter Olympics at which they declared a “no limits” partnership.

Since then, China has repeatedly sided with Russia in blocking international action against Moscow for the Ukraine conflict and, U.S. officials say, is considering supplying Russia with weapons to support the war.

But it has also tried to cast itself in a more neutral role, offering a peace plan that was essentially ignored.

The meeting in Moscow is likely to see the two sides recommit to their partnership, which both see as critical to countering what they consider undue and undeserved influence exerted by the U.S. and its Western allies.

WHAT IS THE SIGNIFICANCE OF THE ICC ARREST WARRANT ISSUED FOR PUTIN?

In the immediate term, the ICC’s warrant for Putin and one of his aides is unlikely to have a major impact on the meeting or China’s position toward Russia. Neither China nor Russia — nor the United States or Ukraine — has ratified the ICC’s founding treaty.

The U.S., beginning with the Clinton administration, has refused to join the court, fearing that its broad mandate could result in the prosecution of American troops or officials.

That means that none of the four countries formally recognises the court’s jurisdiction or is bound by its orders, although Ukraine has consented to allowing some ICC probes of crimes on its territory and the U.S. has cooperated with ICC investigations.

In addition, it is highly unlikely that Mr. Putin would travel to a country that would be bound by obligations to the ICC.

If he did, it is questionable whether that country would actually arrest him. There is precedent for those previously indicted, notably former Sudanese President Omar Bashir, to have visited ICC members without being detained.

However, the stain of the arrest warrant could well work against China and Russia in the court of public opinion and Putin’s international status may take a hit unless the charges are withdrawn or he is acquitted.

WHAT IS THE VIEW FROM WASHINGTON?

U.S. officials have not minced words when it comes to Mr. Xi’s planned visit to Moscow. White House National Security Council spokesman John Kirby called Beijing’s push for an immediate cease-fire in Ukraine a “ratification of Russian conquest” and warned that Russians could use a cease-fire to regroup their positions “so that they can restart attacks on Ukraine at a time of their choosing.”

“We do not believe that this is a step towards a just, durable peace,” he said. Mr. Biden’s National Security Adviser Jake Sullivan this week called on Mr. Xi to also speak with President Volodymyr Zelenskyy and the Ukrainian leader has also expressed interest in talks with Mr. Xi.

WHAT IS THE VIEW FROM KYIV?

Speaking before the ICC warrant was unveiled, Ukrainian analysts cautioned against falling into a potential trap ahead of the Xi-Putin meeting.

“We need to be aware that such peace talks are a trap for Ukraine and its diplomatic corps,” said Yurii Poita, who heads the Asia section at the Kyiv-based New Geopolitics Research Network.

“Under such conditions, these peace talks won’t be directed toward peace,” said Nataliia Butyrska, a Ukrainian analyst on politics related to Eastern Asia.

She said the visit reflects not so much China’s desire for peace but its desire to play a major role in whatever post-conflict settlement may be reached.

“China does not clearly distinguish between who is the aggressor and who is the victim. And when a country begins its peacekeeping activities or at least seeks to help the parties, not distinguishing this will affect objectivity,” Butyrska said. “From my perspective, China seeks to freeze the conflict.”

WHAT IS THE VIEW FROM MOSCOW?

Even if China stops short of providing military assistance to Russia as the U.S. and its allies fear, Moscow sees Mr. Xi’s visit as a powerful signal of Chinese backing that challenges Western efforts to isolate Russia and deal crippling blows to its economy.

Kremlin spokesman Yuri Ushakov noted that Mr. Putin and Xi have “very special friendly and trusting personal ties” and hailed Beijing’s peace plan.

“We highly appreciate the restrained, well-balanced position of the Chinese leadership on this issue,” Mr. Ushakov said.

Observers say that despite China’s posturing as a mediator, its refusal to condemn the Russian action leaves no doubt about where Beijing’s sympathy lies.

“The Chinese peace plan is a fig leaf to push back against some Western criticism on support for Russia,” said Alexander Gabuev, a senior fellow at the Carnegie Endowment for International Peace.

“The optics that it creates is that China has a peace plan, both parties of war endorsed it and were ready to explore the opportunities and then it was killed by the hostile West.”

WHAT IS THE VIEW FROM BEIJING?

Chinese officials have been boasting about their new-found clout in the international arena as their country’s foreign policy has become increasingly assertive under Mr. Xi.

In announcing the Xi-visit, China’s Foreign Ministry said Beijing’s ties with Moscow are a significant world force.

“As the world enters a new period of turbulence and change, as a permanent member of the U.N. Security Council and an important power, the significance and influence of China-Russia relations go far beyond the bilateral scope,” it said.

It called the visit “a journey of friendship, further deepening mutual trust and understanding between China and Russia, and consolidating the political foundation and public opinion foundation of friendship between the two peoples for generations.”

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Ground Zero | China’s massive Hainan bet

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On March 10, 2023, Xi Jinping officially began his precedent-defying third term, with the ceremonial National People’s Congress (NPC) confirming him as China’s President for the next five years. The first decade of the Xi era, which was defined by China’s return to one-man rule and the end of the collective leadership model, came to a close with three years of the ‘zero-COVID’ policy essentially walling China off from the rest of the world.

A decade into what Beijing has declared as “a new era” under Xi, China stands at a crossroads. Beijing is facing searching questions about its place in the world, and many observers, both within China and abroad, are asking if the reform era, which saw China opening up and integrating with the world, has ended. Three years of isolation only reinforced those perceptions.

A grand plan for Hainan

Forty years ago, China stood at a similar crossroads. In 1992, Deng Xiaoping embarked on a “southern tour” to give his stalled reforms a second wind from Shenzhen, just three years after the events at Tiananmen had shaken China and the world. Xi appeared to be taking a leaf out of the Deng play book when, right after last year’s NPC session, he decided to begin the last year of his second term with his own southern tour.

File photo of Chinese president Xi Jinping delivering a speech via video link in Hainan Province.
| Photo Credit:
AP

Xi headed even further south, to the island province of Hainan, where he called for accelerating plans to build what is being billed as China’s first “Free Trade Port” (FTP). That trip ended up going largely unnoticed given the messy end to Xi’s second term that came in the following months. There were numerous, harsh zero-COVID lockdowns, including in Hainan; unprecedented protests in November; and finally, the sudden, almost overnight, withdrawal of the policy the following month.

A picture of Haikou in China’s southern Hainan province.

A picture of Haikou in China’s southern Hainan province.
| Photo Credit:
AFP

Now that the zero-COVID walls have come down and Xi has secured his third term, Beijing’s focus is turning to kick-starting its beleaguered economy that is grappling with not only the after-effects of COVID policies, but other long-persisting problems, such as rising local government debt and an ailing property sector. Complicating its efforts are worsening relations with the West and the U.S. in particular, and trade and technology tensions that threaten to derail Beijing’s quest to become the world’s largest economy and a leading global innovation power.

Xi’s plans for Hainan offer a clue into China’s broader strategy to deal with these headwinds and to deepen its position as an economic lynchpin for the region. The FTP blueprint is certainly ambitious. Last year, Xi called for accelerating the first phase of the plan, which aims to establish the 35,000 sq km island as China’s most open economic region by 2025. The ultimate goal is to build a tropical Dubai in the middle of the South China Sea by 2035. The stakes for Beijing and the region are enormous. “After Shenzhen and Shanghai,” says Wang Daxue, an official with the Hainan government, “this will be the third most important event in China’s reform and opening up history.” The jury, however, is out on whether Hainan will be a transformative success story like Shenzhen or underwhelm, like Shanghai’s much-celebrated free trade zone launched a decade ago.

Residental buildings in Sanya, in China’s southern Hainan province.

Residental buildings in Sanya, in China’s southern Hainan province.
| Photo Credit:
AFP

Experiments under way

Hainan, a lush tropical island that is closer to Hanoi than Beijing, is an unlikely location for a potential global trading hub. It is located just off the Chinese mainland in the crystal-clear waters of the South China Sea. Tourism drives its economy, with millions of mainland tourists descending on the island every year to enjoy its tropical weather and beaches. Home to 10 million people, the island was carved out of Guangdong province and given its own administrative status in 1988. Since then, it has been used as a testing ground for economic reform policies. Property reforms in the early 1990s were rolled out in Hainan and later across China, heralding a real estate boom. This ended up driving Chinese economic growth for three decades.

The FTP plan, by 2035, will essentially establish Hainan as a separate administrative trading entity within China. At its heart is what’s being called the “free flow through the first line, control at the second line” model. Goods can enter the “first line” from overseas to Hainan freely, with the usual customs scrutiny kicking in only at the “second line” if they subsequently enter the Chinese mainland. This is a first-of-its-kind trading arrangement for China. The plan proposes “five frees” — another first for China — referring to free trade, investment, cross-border capital flows, transportation, and exit and entry. How “free,” particularly on the fifth point, remains uncertain, given China’s generally tight immigration controls.

The broader idea is to attract foreign enterprises — particularly from Southeast Asia, given its proximity — to use Hainan as a base for trade, offering incentives such as zero tariffs and the lowest tax rate in China.

Haikou, the sprawling and modern capital in the northern edge of the island, and Sanya, a tourist paradise and a naval base in the far south, are the twin economic engines for the plan. The infrastructure is already in place. A bullet train link constructed in 2010 runs all along the island’s eastern coast, covering the 300 km distance between the two cities in a little over 90 minutes.

Since the announcement of the FTP in 2018, the plan’s progress has been measured steady, if unspectacular. Three years of zero-COVID have hardly been the best advertisement for openness. The province’s $64 billion GDP ranks it fourth from bottom of China’s 31 provinces, only higher than the western provinces of Ningxia, Qinghai and Tibet. In 2021, foreign investment stood at $3.5 billion. The number of foreign-funded companies had, however, close to doubled, to a little under 2,000.

On Sanya’s northeastern suburbs is a cluster of high-rise buildings. The “tax-free city” is still a work in progress — massive construction cranes dot the landscape — but there were long lines on a recent afternoon outside luxury goods stores. For years, Chinese consumers have travelled abroad to lap up luxury goods, from Louis Vuitton handbags to Tiffany jewellery. The idea now, explains Zhao Jing, a director at the Tax-Free City, is to redirect them within China. The rules of the city allow Chinese citizens to purchase goods duty-free, as long as they have a flight ticket out of Sanya to anywhere in the mainland. Once purchased, the goods will be kept for pick up at Sanya airport. The elaborate arrangements are to prevent black market sales.

People wait in line to enter an Alexander McQueen store at a shopping complex in Sanya, Hainan province, China.

People wait in line to enter an Alexander McQueen store at a shopping complex in Sanya, Hainan province, China.
| Photo Credit:
REUTERS

Duty-free goods and free trade aren’t the only experiments under way in Hainan; the island is also serving as a testing ground for China’s new energy transport policies. By 2030, Hainan will completely ban the sale of fuel cars. The surge in electric vehicles (EV) on the streets of Haikou — easily noticed by their green licence plates — is among the fastest in China, because of a tax exemption policy. The number of electric cars in the province has risen from 20,577 units in 2018 to a massive 1,91,937 in 2022, up from 1.62% to now 10.46% of all vehicles. This is the highest proportion anywhere in China. Also noticeable is that a majority of the cars are domestic brands. The only overseas EV manufacturer in the top five, as of sales in 2021, was Tesla. It ranked fifth, accounting for 5% of the market, trailing behind Chinese car-maker BYD, which has a 14.4% share.

The Sanya shopping complex.

The Sanya shopping complex.
| Photo Credit:
REUTERS

Experimentation has been critical to the success of economic reforms in China, going back to the 1980s. Policies have been first tested in select cities or regions. Those that worked were rolled out elsewhere, while those that failed were quietly discarded. This is why, Hainan’s officials explain, the FTP is being rolled out in stages to see what works before 2035. Beijing hopes that by then, Hainan will be giving Hong Kong some competition.

Hurdles to cross

There are, however, several hurdles that remain. One major reason why the reforms process, described by Deng as crossing the river while feeling the stones, worked previously was the political decentralisation pushed by Deng. Provinces were given space to work out their own policies. Perhaps the single biggest political legacy of the Xi era has been rolling back the autonomy of provinces. In recent interviews, officials in two local provinces said recent years had seen some policy paralysis in the bureaucracy because the fear of getting decisions wrong was overwhelming, so much so that doing nothing was a safer option. To what degree Hainan’s opening will be micromanaged by Beijing or left to local officials remains an open question.

Another major hurdle, as far as foreign investors will be concerned, is about the legal protections on offer. Hainan’s FTP plan promises international standards. Over the Jiang Zemin and Hu Jintao years, China enacted a range of judicial reforms to professionalise the courts and create conditions that would enable an inflow of foreign investment and enterprises, which worked remarkably well in attracting business despite China’s party-controlled legal system. However, the current perception among most foreign companies is that the past decade has seen a rolling back of already modest judicial autonomy and a reassertion of party control.

The other broader tension of the past decade has been between the desire to integrate China more closely with the world economically while exercising Chinese power more assertively. Some of the same countries that Beijing is looking to attract to Hainan are those that are contesting Beijing’s tightening military grip in the South China Sea.

Relations with India are another case in point. A burgeoning trade relationship continues, but the flood of Chinese investment into India, which both countries had, prior to 2020, seen as a positive force for economic integration, has reduced to a trickle following the People’s Liberation Army’s transgressions across the Line of Actual Control (LAC). While the LAC, and the stalemate in India-China relations, remain unresolved, Xi has begun his third term by appearing to course-correct, at least tactically, elsewhere, and woo the region amid Beijing’s primary strategic challenge — worsening relations with the U.S. China is positioning itself as the defender of globalisation and of developing countries, a message that a Belt and Road summit later this year is expected to reinforce.

Indeed, this is also the broader message of the Hainan project. “Hainan is a vivid example of China’s commitment to the future,” says Zhou Li, a Counsellor at the Foreign Ministry in Beijing. “It highlights China’s resolution of further opening. A free trade port represents the world’s highest level of opening up, and demonstrates that China’s door will not close, but open wider and wider.”

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Xi Jinping Aide Who Oversaw 2-Month Lockdown To Be China’s Next Premier

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Li Qiang is poised to be confirmed as premier on Saturday. (File)

Beijing:

Four years before Li Qiang gained notoriety as the force behind the two-month Covid lockdown of Shanghai, the man set to become China’s next premier worked quietly behind the scenes to drive a bold revamp of the megacity’s sclerotic stock market.

Li’s back-channelling – sources said he bypassed the China Securities Regulatory Commission, which lost some of its power under the new set-up – demonstrated what became a reputation for pragmatism as well as close ties with President Xi Jinping.

In late 2018, Xi himself announced Shanghai’s new tech-focused STAR Market as well as the pilot of a registration-based IPO system, reforms meant to entice China’s hottest young firms to list locally rather than overseas.

“The CSRC was very unhappy,” said a veteran banker close to regulators and Shanghai officials, declining to be named given the sensitivity of the matter.

“Li’s relationship with Xi played a role here,” enabling him to present the scheme directly to the central government, without going through the CSRC, the person added.

The CSRC did not respond to a request for comment.

Previously the Communist Party chief in Shanghai, Li is poised to be confirmed as premier on Saturday during the ongoing National People’s Congress, charged with managing the world’s second largest economy. He would replace the retiring Li Keqiang, who is widely perceived to have been increasingly sidelined as Xi tightened his grip on management of the economy.

Leadership watchers say Li Qiang’s closeness to Xi is both a strength and a vulnerability: while he has Xi’s trust, he is beholden to his long-time patron.

Trey McArver, co-founder of consultancy Trivium China, said Li is likely to be much more powerful than his predecessor.

Xi expended significant political capital to get him into the role, given Li’s lack of central government experience and the Shanghai lockdown, McArver said.

“Officials know that Li Qiang is Xi Jinping’s guy,” he said.

“He clearly thinks that Li Qiang is a very competent person and he has put him in this position because he trusts him and he expects a lot of him.”

Li, 63, did not respond to questions sent to China’s State Council Information Office.

Practical Pragmatist

A career bureaucrat, Li was revealed as the pick for China’s No. 2 role in October when Xi unveiled a leadership line-up stacked with loyalists.

At that time, Li had been known for overseeing the harrowing Covid lockdown earlier last year of Shanghai’s 25 million people, which shut the city’s economy and left psychological scars among its residents. That made him a target of anger but did nothing to derail his promotion.

Li was also instrumental in pushing for China’s unexpectedly sudden end to its zero-Covid policy late last year, Reuters reported on Friday.

People who have interacted with Li say they found him practical-minded, an effective bureaucratic operator, and supportive of the private sector – a stance that would be expected in someone whose career put him in charge of some of China’s most economically dynamic regions.

As Communist Party chief between 2002 to 2004 in his home city of Wenzhou, a hotbed of entrepreneurialism, Li came across as open-minded and willing to listen, said Zhou Dewen, who represented small and mid-sized enterprises in the city.

“He took a liberal approach of granting private companies default access to enter the market, except when explicitly banned by law, rather then the traditional approach of keeping private companies out by default,” said Zhou.

Craig Allen, president of the US-China Business Council and a former US official, said Li sought to level the playing field for foreign businesses, pointing to the speed with which US carmaker Tesla was able to get its Shanghai factory there operational in 2019.

“Clearly nothing got in the way once a decision was made. There was a clarity of a kind in his decision making, an authority, and that really helps,” said Allen, describing Li as comfortable in his own skin.

Still, several observers caution against putting too much weight on Li’s experience in a business hub such as Shanghai, since Xi has steadily tightened Communist Party control and taken the economy in a more statist direction.

“Now Li is a national leader, working under a market-sceptic boss, and he has to balance growth with a range of social, technological, and geopolitical goals,” said Neil Thomas, senior analyst at Eurasia.

No Wall-Flower

Even by the opaque standards of Chinese politics, there is little public information about Li’s background or personal life.

Born in Ruian county in what is now Wenzhou, the 17-year-old Li went to work in 1976 at an irrigation station in his hometown, a desirable job in what turned out to be the final year of Mao Zedong’s Cultural Revolution.

Li entered Zhejiang Agricultural University in 1978, the year that campuses were reopened in China and competition for places was fierce. He later was awarded master’s degrees from the central party school in Beijing and Hong Kong Polytechnic University.

It was in Zhejiang, home to some of China’s biggest private companies, where Xi was provincial party secretary and Li was his chief of staff between 2004 and 2007, that the two men would have built their personal bond.

American author Robert Lawrence Kuhn, who met Li and Xi together in 2005 and 2006, said the two shared an easy rapport.

“Unlike most other staffers of top leaders, Li was no wall-flower,” Kuhn told Reuters.

“In the presence of Xi, he felt comfortable and confident enough to put himself forward to engage me, which tells me he is not worried his boss might think he is trying to steal his limelight,” Kuhn said.

However, leadership watchers said there are limits to what Li will be able to do.

“Li can make some repairs here and there, but he won’t tear down the wall and build something new,” said Chen Daoyin, former associate professor at Shanghai University of Political Science and Law, and now a commentator based in Chile.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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After Snubbing US, Middle East’s Red Carpet for China’s Xi Jingping

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Xi Jinping will visit Saudi Arabia for several days starting Wednesday.

Two months after snubbing US President Joe Biden’s pleas for oil, Saudi Arabia is rolling out the red carpet for his Chinese counterpart, Xi Jinping.

Xi will visit Saudi Arabia for several days starting Wednesday, during which he will take part in a regional summit with Saudi Crown Prince Mohammed bin Salman and other Arab leaders, the kingdom’s SPA state news agency said, promising agreements worth some $30 billion.  Energy and infrastructure deals will top the agenda, according to two people briefed on the plans.

China confirmed the trip on Wednesday morning, a day after Xi led the nation in mourning the death of former leader Jiang Zemin on the heels of recent protests against his Covid Zero policy. The summit will give both Xi and Prince Mohammed a chance to showcase the Gulf’s deepening ties with Beijing, underlining just how far US-Saudi relations have sunk.

“This visit is the culmination or crowning of a deep strengthening in relations over the last few years,” said Ali Shihabi, a Saudi commentator and advisory board member for the kingdom’s Neom megaproject. “The US is concerned about this but cannot slow this already strong relationship down.” 

A low point in US-Saudi ties came in October when Biden accused Riyadh of allying with Russia on oil production cuts, and vowed “consequences.” However, relations have been fraying for some time as the US shifts its global focus to the competition with China.

It’s a decade since the US was Riyadh’s biggest trading partner, and in that time not only has China leapfrogged America, but so too have India and Japan. Total US-Saudi trade shrank from some $76 billion in 2012 to $29 billion last year.

That’s in part because the US shale industry means it no longer imports much Middle East oil; China is Saudi Arabia’s top crude customer now –  and regional oil exporters will be keen for information on China’s plans for lifting Covid restrictions.

Yet Washington has also riled Saudis with its attempts – now all but dead – to return to the nuclear deal with Iran, a regional Saudi rival, while Riyadh’s powerful alliance with Russia and other oil exporters in OPEC+ is another point of friction.  

“For the Arab states, it’s about alternatives, in all possible ways”

“It’s high time we stopped seeing this as being purely about economic and commercial relations,” said Cinzia Bianco, a visiting fellow at the European Council on Foreign Relations, who focuses on the Gulf. “For the Arab states, it’s about alternatives, in all possible ways.”

Beijing has been picking up some of that economic and political slack.

In the past six months, Janes IntelTrak Belt & Road Monitor reported a surge of activity across the Middle East by US-blacklisted telecoms firm Huawei Technologies Co.; that State Grid Corporation of China was looking at investment opportunities in regional electricity transmission and distribution; and Saudi Arabia and China agreed to coordinate their investments in Belt and Road Initiative participating nations. 

The countries will sign pacts for the further “harmonization” of the Belt and Road Initiative with Saudi Arabia’s own Vision 2030 development plan, the SPA agency said. 

Talks on a free trade agreement between China and the six-nation Gulf Cooperation Council are entering a “final stage,” China’s ambassador to the United Arab Emirates Zhang Yiming said last month. He even mentioned a memorandum on moon exploration signed with the UAE.

Gulf states view the US as an increasingly unreliable partner and “want to capitalize on a new global multipolar landscape that presents fresh opportunities,” said Elham Fakhro, a research fellow at Exeter University’s Centre for Gulf Studies. In doing so, they might “strengthen their own bargaining power with the United States,” she said.

Still, the US maintains a significant troop presence in Saudi Arabia and across the region, and there are limits to how far Gulf states will look elsewhere.

It’s seen as unlikely, for example, that Saudi Arabia will move forward with the idea of accepting yuan payments instead of the dollar for oil, the two people briefed on the preparations said, referring to reports earlier this year. Diplomats and analysts said at the time the reports should be seen as a political message to the US, rather than the kingdom’s plans.

Whereas Donald Trump chose Riyadh for his first overseas trip as president, Biden came to office pledging that he’d treat the crown price as a pariah for his part in the murder of columnist Jamal Khashoggi.

But faced with high inflation going into the midterm elections, he swallowed his pride and visited the kingdom in July seeking help to lower global oil prices. 

He appeared to make some headway, expressing optimism Riyadh would take steps to comply – only for Saudi Arabia and OPEC+ to then announce production cuts. A furious Biden said it was time for the US to rethink the relationship.

Buoyed by higher oil revenues spurred by Russia’s war, the Saudi crown prince has cast the kingdom as a growing power capable of standing up to US pressure.

China has cheered on from the sidelines: Foreign Minister Wang Yi praised the kingdom’s “independent energy policy” and efforts to stabilize the international energy market after meeting with his Saudi counterpart in October. Wang also thanked Riyadh for “long-term and firm support” on matters including Taiwan, Xinjiang, Hong Kong and human rights – all touchstone issues for the US.

China Praises Saudi Arabia’s ‘Independent’ Energy Policy

“There’s a real synergy to the relationship,” said Jonathan Fulton, a nonresident senior fellow at the Atlantic Council focused on China’s relations with the Gulf. 

Whereas “the US keeps talking about a great power game” and focusing on counterterrorism, China has been helping address domestic concerns. The upshot is it’s less about China trying to replace the US than the two countries playing completely different games when it comes to the Middle East, he said.  

Since China held its last biennial dialog with Arab states in July 2020, Saudi Aramco revived discussions to build a multi-billion dollar refining and petrochemicals complex in China.

Saudi Arabia started working with Huawei to develop artificial intelligence systems and the kingdom’s using Chinese expertise to make its own drones. It’s even been reported to be manufacturing ballistic missiles with China’s help, according to a U.S. intelligence assessment.

China is now Saudi Arabia’s top crude customer. Photographer: Simon Dawson/Bloomberg

It’s not all one way, though. High oil prices hurt China as well as the US, and Beijing nurtures close relations with Iran, a key Saudi rival. China cannot just replicate US military support for the region. 

The US isn’t asking countries to choose between Washington and Beijing but asking them to be “mindful” of the relationships they’re developing, Derek Chollet, a counselor at the US State Department, told a briefing in Kuwait ahead of Xi’s visit. 

“Our assessment is that China, in its efforts to build relations in this region, does not have an interest in building mutually beneficial partnerships,” he said. 

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

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China vows crackdown on ‘hostile forces’ as public tests Xi

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China’s ruling Communist Party has vowed to “resolutely crack down on infiltration and sabotage activities by hostile forces,” following the largest street demonstrations in decades staged by citizens fed up with strict anti-virus restrictions.

The statement from the Central Political and Legal Affairs Commission released late Tuesday comes amid a massive show of force by security services to deter a recurrence of the protests that broke out over the weekend in Beijing, Shanghai, Guangzhou and several other cities.

While it did not directly address the protests, the statement serves as a reminder of the party’s determination to enforce its rule.

Hundreds of SUVs, vans and armored vehicles with flashing lights were parked along city streets Wednesday while police and paramilitary forces conducted random ID checks and searched people’s mobile phones for photos, banned apps or other potential evidence that they had taken part in the demonstrations.

The number of people who have been detained at the demonstrations and in follow-up police actions is not known.

Also read | The signals from China’s anti-COVID lockdown protests | In Focus podcast

The commission’s statement, issued after an expanded session Monday presided over by its head Chen Wenqing, a member of the party’s 24-member Politburo, said the meeting aimed to review the outcomes of October’s 20th party congress.

At that event, President Xi Jinping granted himself a third five-year term as secretary general, potentially making him China’s leader for life, while stacking key bodies with loyalists and eliminating opposing voices.

“The meeting emphasized that political and legal organs must take effective measures to … resolutely safeguard national security and social stability,” the statement said.

“We must resolutely crack down on infiltration and sabotage activities by hostile forces in accordance with the law, resolutely crack down on illegal and criminal acts that disrupt social order and effectively maintain overall social stability,” it said.

Yet, less than a month after seemingly ensuring his political future and unrivaled dominance, Mr. Xi, who has signaled he favors regime stability above all, is facing his biggest public challenge yet.

He and the party have yet to directly address the unrest, which spread to college campuses and the semi-autonomous southern city of Hong Kong, as well as sparking sympathy protests abroad.

Most protesters focused their ire on the “zero-COVID” policy that has placed millions under lockdown and quarantine, limiting their access to food and medicine while ravaging the economy and severely restricting travel. Many mocked the government’s ever-changing line of reasoning, as well as claims that “hostile outside foreign forces” were stirring the wave of anger.

Yet bolder voices called for greater freedom and democracy and for Mr. Xi, China’s most powerful leader in decades, as well as the party he leads, to step down — speech considered subversive and punishable with lengthy prison terms. Some held up blank pieces of white paper to demonstrate their lack of free speech rights.

The weekend protests were sparked by anger over the deaths of at least 10 people in a fire on Nov. 24 in China’s far west that prompted angry questions online about whether firefighters or victims trying to escape were blocked by anti-virus controls.

Authorities eased some controls and announced a new push to vaccinate vulnerable groups after the demonstrations, but maintained they would stick to the “zero-COVID” strategy.

The party had already promised last month to reduce disruptions, but a spike in infections swiftly prompted party cadres under intense pressure to tighten controls in an effort to prevent outbreaks. The National Health Commission on Wednesday reported 37,612 cases detected over the previous 24 hours, while the death toll remained unchanged at 5,233.

Beijing’s Tsinghua University, where students protested over the weekend, and other schools in the capital and the southern province of Guangdong sent students home in an apparent attempt to defuse tensions. Chinese leaders are wary of universities, which have been hotbeds of activism including the Tiananmen protests.

Police appeared to be trying to keep their crackdown out of sight, possibly to avoid encouraging others by drawing attention to the scale of the protests. Videos and posts on Chinese social media about protests were deleted by the party’s vast online censorship apparatus.

“Zero COVID” has helped keep case numbers lower than those of the United States and other major countries, but global health experts including the head of the World Health Organization increasingly say it is unsustainable. China dismissed the remarks as irresponsible.

Beijing needs to make its approach “very targeted” to reduce economic disruption, the head of the International Monetary Fund told The Associated Press in an interview Tuesday.

Economists and health experts, however, warn that Beijing can’t relax controls that keep most travelers out of China until tens of millions of older people are vaccinated. They say that means “zero COVID” might not end for as much as another year.

On Wednesday, U.S. Ambassador to China Nicholas Burns said restrictions were, among other things, making it impossible for U.S. diplomats to meet with American prisoners being held in China, as is mandated by international treaty. Because of a lack of commercial airline routes into the country, the embassy has to use monthly charter flights to move its personnel in and out.

“COVID is really dominating every aspect of life” in China, he said in an online discussion with the Chicago Council on Global Affairs.

On the protests, Mr. Burns said the embassy was observing their progress and the government’s response, but said, “We believe the Chinese people have a right to protest peacefully.”

“They have a right to make their views known. They have a right to be heard. That’s a fundamental right around the world. It should be. And that right should not be hindered with, and it shouldn’t be interfered with,” he said.

Mr. Burns also referenced instances of Chinese police harassing and detaining foreign reporters covering the protests.

Also read | Time for change: On ending the zero-COVID policy

“We support freedom of the press as well as freedom of speech,” he said.

Asked about foreign expressions of support for the protesters, Chinese Foreign Ministry spokesperson Zhao Lijian defended China’s approach to handling COVID-19 and said other nations should mind their own business.

“We hope they will first heed their own peoples’ voices and interests instead of pointing fingers at others,” Zhao told reporters at a daily briefing.

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