The Duran Podcast - China & Russia, better than alliance

Episode Date: May 19, 2024

China & Russia, better than alliance

All right, Alexander, let's talk about Putin's trip to China and a hug. Xi Jinping actually hugged Putin, which shows how close this relationship has become. Alliance, I believe. I think either the economist or foreign policy came out with a post, or maybe political, I don't know, all the same. They came out with a post and they said that. this is an alliance. China and Russia is an alliance, even though they don't call it that. But they also issued a joint statement, which talks about the multipolar world, condemns the United States, and its hegemonic tendencies, its hegemonic actions. It talks about building a deeper cooperation,

military, education, information space, finance, trading in local currencies, a quite, an incredible trip by Putin to China, and of course, Putin brought most of his government with him, at least many of the important top officials, including the defense minister, and Shui Gu was also by his side. Yeah, I think you summarized it, but, you know, let's just go into a few more of the details. This has been an extraordinary summit meeting, even by the standards of the Chinese-Russian relationship. Now, I think it was the Financial Times, but it's likely that it's been said in more than one place.

They're talking about this as an alliance. The Chinese and the Russians, of course, say it's more than an alliance. It's better than an alliance. It's not a formal military alliance. And they've issued this extraordinary 8,000-word joint statement. I should say I've been reading it, but so far it's, I've only found a Chinese,

Chinese text, and I've only been able to read it in machine translation, but it's still pretty clear. It's a huge joint statement makes the point that they're not actually military political allies, but they're more than military political allies. It also says that they're not directing their, you know, what they're doing, their relationship is not specifically directed at other countries, which of course every country says. But whatever you call it, call it an alliance, call it a strategic partnership, call it a friendship.

This is the greatest, the biggest convergence between two great powers that has taken place in modern history. I've never known a convergence quite like this to take place before. I suppose the closest analogy you can come up with is what happened between the United States and Britain during the Second World War and immediately after. But this goes beyond that. And of course, it's a much more equal relationship

than the British-American one was, where Britain became essentially a subordinate power to the United States and quickly ceased to be a great power. So this is a forging together of two great powers. and of course the atmospherics say it all. Now, I said that this is an 8,000 word statement. Now, Putin and C didn't just agree this statement over the course of a relatively short two-day visit. I mean, that is impossible. So they've been working on this for months.

So in all that time, we've had Janet Yellen coming to Beijing. We remember that visit. We had Tony Blinken coming to Beijing. We've had all our shawls coming to Beijing. We had this absolute debacle of a summit between Macron and Xi Jinping in France. All of these countries have been basically saying to China, you must cut off economic links with Russia. You mustn't supply Russia with dual-use technologies.

You mustn't do any of these things. We'll sanction you if you do. And throughout that time, even as the Chinese had been listening to what all of these Western leaders have been saying, they've been working on this joint statement with Russia, this 8,000 word joint statement. And it is comprehensive. I mean, it covers every conceivable field of activity that you would expect from two So there's a military aspect, which comes right at the beginning. There's a very strong joint statement of foreign policy. There is a clear attack on the current foreign policies of the

United States, though they carefully avoid identifying it too obviously as the United States. But on the economic side, I mean, you can always talk about now the setting up of a economic, a unified economic space between China and Russia. So China and Russia, coordinating their economies at every conceivable level, they're engaging in all kinds of joint projects. So, you know, there was some talk, there was a lot of talk a couple of years ago that the Chinese and the Russians were working together, for example, on a wide-body aircraft. Then there was suggestions that because the Russians are moving forward with bringing back the Elyushion 96, which is a Soviet era joint wide body, that they are modernising, that the Russians had pulled

out of that program, it turns out that they haven't, that, you know, they're fully involved, they're fully involved in a joint heavy lift helicopter project. So, enormous amount of work on aerospace, on big aircraft engines, to rival those produced in Canada, Pratt and Whitney, and in the United States, General Electric. A huge amount of work on space programs, on consumer goods, on financing, a huge amount about that as well,

moving all their trade to current, to their own currencies, no longer using the dollar or the euro in their mutual trade. Apparently, already 90% of settlements are in their own currencies. But obviously there's going to be a development, a major development of that structure. And, you know, development of Arctic, the northern sea route. And, of course, massive energy cooperation. I was reading today, you know, an article in the Daily Telegraph saying, you know,

that the Russians will have one day to trade territory to Ukraine, give back territory to Ukraine, because they'll need to do that in order to reopen Western markets to their gas exports. This is so completely detached a reality when you read this, because, you know, the article says that, you know, by inherent, you know, trade with China on gas and energy is inherently inferior to, trade with Europe. You just read this out.

You read this joint statement and you understand immediately how completely surreal that kind of thinking is. And what this meeting was all about this visit by Putin

to China was not to agree all of these things. They've already been agreed. They've already been negotiated. over many months. But for the two sides, not just Putin and C, who know each other very well now,

but for everybody else, all of the people on the Russian side, all of the people on the Chinese side, to get to know each other, to establish personal connections. So not just meet virtually, but actually to have proper established physical contacts, to meet together as a group.

So, as you correctly, said virtually the entire Russian government, all the top people that matter. The exceptions are at Michoudin, the Prime Minister and Medvedev, who remained in Moscow to keep things running there. But, you know, Bel-Usuv, the new defence minister, Sergei, the former defence minister, who's now obviously secretary of the Security Council. And Putin had a lot to say a couple of days ago, a day or so ago about what his responsibilities would be. Lavrov, obviously, Manturov, the economics, sorry, the overall man in charge of the economics, now former industry minister, Ali Khanov, the new industry minister, Rishetnikov, the economics

minister, Novak, the energy minister, Nebulina, the central bank chair. You know, you don't just bring your central bank chair if you're just discussing trade issues. she's clearly there to discuss currencies and other things. Siluana, the finance minister. And then there's this army of business people as well. I mean, Deripaska, you know, Deripaska was there. Koston was there, you know, from a VTB, that, you know, that the bank, VTB. Greff, German Gref, head of Spare Bank.

He's also there. Spare bank, biggest bank, by far in Russia, the one that most Russians, keep their accounts in, the one that is, of course, providing most Russians with MIR cards. Greff often assumed in the West to be pro-Western. Anyway, he's not, clearly. He's there. He's this meet. He's come on this visit.

And, you know, all of these people are forming working parties, talking to each other. And basically, they're meeting their Chinese opposite numbers. This is first and foremost what this is all about. So personal contacts and relationships are being established between the top people of the Russian government and the top people of the Chinese government. And then, of course, Putin goes to Harbin. Harbin is a town in the north of China, the major city in the north of China, used to have, that still has a Russian community. these were white Russians mainly who left Russia after the end of the revolution and the Civil War and they established themselves in this Chinese city, had been big Chinese Russian community there.

It, by the way, survived and continued even after the communists took over China itself, even though these were white Russians. But to the extent that this community, still, which it does, to a certain extent. The Russians reconnecting with it. But of course, it's an important industrial centre close to the Russian border. The Russians are now developing the Far East. And Putin also goes to the university there, meets the students, has discussions with the students. So there's that kind of contact at a person-to-person level. So as I said, what we're looking at, and I think this is the key thing, it's a unified economic space.

It is, in effect, the unification of Eurasia. And, you know, there's been an awful lot of work to get us to this point. This hasn't happened, as I said, immediately, but it's the further big step in the economic unification of Eurasia that Mackinder, the British geopolitician, of the early 20th century was so worried would one day happen and which he said if that does ever happen

it will mean that the Atlantic powers will lose their control of the world so it's not happening it's not just happening to a very great extent it's largely already happened I mean if anyone ever had any

doubts about China and Russia I think this trip should put all those doubts. Yes. Yes. Over. Finished. Yes. China and Russia, they're in this together.

And the way I saw it is not only are they in this together, but they're going to bring bricks and the multipolar world to fruition. They're going to bring. They're going to usher in the multipolar world, whether the collective West, the United States likes it. or not. I think that was the message that they were putting out. It's a done deal. We're heading into a multipolar world and the U.S. can either play ball or they can resist. The choices is theirs. That's how I read the statement. But before you comment on that, what was the thinking for China and for Russia in, for China, mostly, in hosting? yelling, blinking, and going to meet with Macaron and Ursula, if all of this had already

been planned months in advance, were they just saying, let's give it one more try, let's feel, let's feel these countries out, let's see what the U.S. is thinking, let's see what the EU is thinking in France. I mean, was that the reason to take all these meetings? Were they misdirecting a bit? I don't know. What was the reasoning? I don't think they were misdirecting. If we're talking about Yellen and Blinken, what basically happened was that Biden out of the blue telephone Xi Jinping and asked him to agree to receive these two people. And Xi Jinping agreed and they came. And well, the Yellen visit didn't go especially well, but the Blinken visit was a disaster. And I think, you know, we need to say that. The Chinese were not having.

with all the threats and, you know, demands that he was coming with and the threats to impose sanctions on Chinese banks. And they made that absolutely clear. I think that the reason why the Chinese agreed to meet Lincoln and agreed to meet Yellen was because they want to maintain a dialogue with the United States. They don't want to close the doors. Just as the Russians didn't want to close the doors, Remember, the closing of the doors was not made by the Russians.

It was carried out by the Western powers in February and March 2022. Firstly, they imposed all this enormous wave of sanctions. Then there was still some contacts between Macron-Schultz and Putin over the course of March. The French and the Germans found Putin immovable. and at some point a decision was made that they wouldn't communicate with the Russians any further. And that was their decision. It wasn't a Russian decision. And the same applies, I think, to the Chinese. They don't want to close the doors. They want to maintain an economic relationship with the United States. They understand that's important. They also want to keep some kind of dialogue with the United States going because otherwise the situation.

of the South China Sea and Taiwan, you know, could escalate out of control. And it's important for the Chinese to keep explaining to the Americans how dangerous this game the Americans are playing in this region actually is. They want to maintain that kind of line of communication. But it's absolutely clear that any attempt, any diplomatic attempt now, by the Americans to change China's course with respect to Russia is a failure, is going to be a failure, because the Chinese, having interacted with the Americans for some time now,

but especially during this period of the Biden administration, and seeing what people in Congress and in the media landscape in the United States and increasingly in Europe also, are saying about them, well, the Chinese have come to their conclusion, the conclusion, that the confrontation with the United States is now inevitable, and they must prepare for it. And that means strengthening their position with their major friend, which is, of course, Russia. So the Blinken-Yellen trips and what followed, because of course, Yellen and Brinkley, went back to the United States, and we've seen more aggressive action from the United States,

at least action which the Chinese will interpret as aggressive, the decision, for example, to impose 100% tariffs of Chinese electric vehicles. I mean, the Chinese will have seen all of that, and they'll have concluded that, as the Russians have long been saying, the Americans are not agreement-capable. So, you know, they listen, they hear, they maintain the dialogue, they set out their own views to these leaders, but they've come to realize that what the Americans say is not always necessarily the same as what they do. The Americans are becoming increasingly hostile and as the Chinese would see it aggressive. And what China needs to do is to shore up its defences in advance of the crisis that is going to come. Now, the Europeans are slightly different because there is a, there is still a division in Europe. I mean, the Germans still keen to maintain some kind of economic connection with China.

It's become one of their, I believe it's their biggest market. And I think their economy is already in a bad shape now that they've cut themselves off from Russian energy. But, you know, they want to maintain some kind of connection to China. other European countries becoming increasingly aggressive, notably the British. You have Macron, dithering. Sometimes he wants to keep on good terms of the Chinese, as he showed when he went to Beijing last year. Other times, especially when he's got Osceola von der Leyen hovering around him,

making sure that he sticks to the proper line. He takes the hardest possible line with China. we discussed this the other day. You know, we'll let you export some EV cars to Europe, but in return, you've got to agree to let us have, let us confiscate Russian assets and to stop exports to Russia. By the way, the joint statement makes it absolutely clear that confiscation of assets is absolutely out of the question

as far as the Chinese and the Russians are concerned. But China absolutely completely rejects that. actually in the statement. So anyway, the Europeans trying with the Chinese to have their cake and eat it as well, but they're also drifting into confrontation. And as we discussed in the program that we did the other day about Xi Jinping's trip to Europe, his real purpose, the really meaningful part of that journey was not the visit to France. which went nowhere. And apparently, if anything, worsened the relations. It was the meetings with Vuchich and Orban in Serbia and Hungary.

As I said, the Chinese are shoring up their defenses, and they're shoring up their potential allies when that confrontation where the West comes. Yeah. I wonder what the U.S. is going to now do. after seeing everything that happened in China I mean well there's what they do

well there's what they should do and what they will do the first is I mean if if they really want to just take a step back and think about what's happened they would understand that they've to great extent

been responsible for bringing this whole situation about I mean the Russians and the Chinese were always going to establish good relations after the Soviet Union fell. In fact, they were moving towards establishing better relations in the last years of the Soviet Union already. So they were going to establish good relations, but it wasn't necessarily going to result in the creation of an economic bloc, like the one we're seeing. US policy trying to contain China and Russia simultaneously.

again as the Russian Chinese Joint State statement is saying has brought this all about all the work of Kisinger has been undone so I mean you know it's it's it's brought us back to the situation the worst nightmare that both Kisinger and Jijinsky by the way both warned against it's it happened but what is the United States going to do. They're not going to learn the lesson from that. They're not going to say to themselves, my goal, we're creating this colossal block against us, far more powerful with immeasurably greater resources than the old Warsaw Pact ever had. They're not going to do that. They're not going to revise their views. They're going to continue more of the same. They're going to continue to harass the Chinese with more export bans and technology bans. selective sanctions, probably outright decoupling from China, they realize it's not an option because that would be too disruptive to the American economy, the US economy. But, you know,

they'll continue to try to contain China in some kind of ways. They'll try to build up alliances with countries like the Philippines and others in the Pacific, very unreliable alliances. and they'll start getting locked up in an arms race with the Chinese in the Pacific. And of course they've already got an arms race with the Russians in Europe, which they're losing. But, you know, I don't really see any sign that they're going to really try to reverse policy. And my own guess is that at some point, once the Ukrainian crisis, has been, resolved. In other words, once the Russians have won in Ukraine. After an interval of further hysteria, we will start to see some voices in Washington saying, again, what they have been saying before,

the true enemy is China. What we need to do is to peel Russia off from China. Confronting Russia hasn't worked. So let's see whether we can find some way to win the Russians back. I think that's, you know, we're looking at five, ten years forward now. And of course, by that time, what they'll discover, if they do go to Moscow, is that the train has left the station because it's not just that all these linkages have been created, these economic and technological and other linkages. But also, coming back to what I was saying earlier in the program, all of these person-to-person linkages are now being established as well. You know, business people like Deripaska and Gref

who once had what they thought were firm ties with Western business people are now going to establish similar ties with Chinese business people, which are going to be more durable, and which they're not going to want to. to risk with adventures with the West. So it's a complete, not just economic shift, but in terms of Russia, you could almost call it a cultural shift, an ongoing cultural shift as well. Okay, so let's wrap up the video and talk about the fact that Putin brought with him, Belusov and Serge Shouyaku.

Sergues Shouegu actually was sitting next to Putin most of the time during meetings and negotiations. What does that tell you? Well, first of all, it confirms a point that we made the other day in our program when we analyzed what had happened, that Shogu has not been disgraced or dismissed or parked in some sign of your position. He is a key player now in the Russian power structure. If anything, he's been promoted. He's now closer to Putin as Putin's national security advisor.

He is supervising the military industrial complex. Putin explained that to the army officers, and he had a meeting which both Belosuf and Shoygu attended with the heads of the military industrial complex, well. So I'm sure he goes in charge of that. He's also in charge of foreign arms exports, technological developments, all kinds of things like that. So he is, if anything, an even more powerful man than he was previously. He now wears a civilian suit, which in which he looks like, but I would add a lot more comfortable than the military uniform he used to wear. And he's now

close to Putin where I think he always wanted to be. So that's one thing. Now, Putin had these two back-to-back meetings. I discussed them in detail on my channel, these two back-to-back meetings. One was with the top people in the military, the actual military officers, Gerasimov and the heads of the military districts, in which he made it absolutely clear, by the way, that the Russians in Ukraine are working according to a plan, and that the team, the military team, is not going to be changed.

In other words, Gerasimov and all the other top military leaders are going to remain in place. And Putin said that he's now happy with the way everybody's doing their job, and he sees no reason to change that. But he also explained at both of these meetings a lot about Bel-Uzv's role. And he said that military spending is now very high. The footprint of the military industrial complex has. increased massively over the last two and a half years. That means that a strong economic manager needs to be put in charge in order to ensure that

the development of the military industrial complex is beneficial to the development of the civilian economy. And he's put in charge of the Ministry of Defence. the country's most senior and most capable economic planner. And I think that is how we should think about Bel-Ousuf to ensure that that is done. So that's his role. So, you know, and making sure that, you know,

the military industrial complex is not just cut off from the rest of the economy, becomes a black hole in which resources and money are poured in at the expense of the wider economy, that it becomes instead, as he put it, a centre of innovation and new developments and that kind of thing. Which, by the way, is not new. I mean, it's not unique.

If you know anything about the economic history of the United States, you will know that a lot of, you know, a lot of the military spending that used to happen in the United States in the old days when the United States was still an industrial power did actually strengthen and advance the civilian industrial economy as well. You see that in aerospace, the aerospace industries, for example, where the United States achieved its huge lead. in civilian aircraft, in civil aircraft, after the Second World War, because of the enormous development, developments in military aircraft technology, particularly the big bombers and the transport aircraft, that took place both during and immediately after the Second World War. There is a direct line, if you like,

between the development of the B-29, Super Fortress, and the development of the 747, you know, the original jumbo jet, the first big wide body that appeared in the 1960s. And, you know, it's there in many, many other sectors as well. Even the Internet started initially as a military program. So that's what Putin wants to do. He wants to make sure that these two parts of the economy feed off and support each other, rather than the one acting as a drain on the other.

And Bella Ousef, who's, he went out of his way to say, has always enjoyed those, has always had an interest in this and in, you know, the military side of things as well, that he's the right person in the defence ministry to pilot that. Now, coming back to this trip to China, Bella Ousuf and Shoygoo are going to be the people, who will be increasingly driving technological and industrial development to acknowledge technological development in things like AI, for example, in which Belosov has known to have a particularly keen interest. So you bring these two people along with you.

Obviously, they're going to be involved in discussions with the Chinese military. But based on what Putin has just been saying, they're going to be key players in developing, you know, developing contacts with the Chinese over civilian developments and applications as well. And what I said about a military industrial complex that you can use it, if you use it properly, to support your civilian industries, that's also been happening in China too. So, you know, the Tivdavtam. All right.

Makes sense. Let's see what happens going forward. Interesting times. All right, the durand.orgal.com. We are on Rumble Odyssey, Bitshute, Telegram, Rockfin, and Twitter X, and go to the Duran shop. Get 15% off. Most merchandise use the code. Get ready, 15.

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