Xi Jinping has Vladimir Putin over a barrel

While China accounted for 34% of Russia’s total trade in 2024, Russia made up just 4% of China’s

As President Xi Jinping stood shoulder to shoulder with his Russian counterpart, Vladimir Putin, watching Russian and Chinese soldiers marching across Red Square on May 9th, they could have been mistaken for equals. The commemorations of the 80th anniversary of Nazi Germany’s defeat in the second world war painted a picture of the two Eurasian neighbours locking arms against the West and the international order that followed that victory. Mr Putin boasted that their strategic co-operation was built on the “unshakeable principle of equality”. China’s president praised their “everlasting” friendship.

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Mr Xi first attended such a parade in 2015, just after Russia’s annexation of Crimea and its first incursion in Ukraine. That first visit was a clear sign of Russia’s pivot towards Asia. The two men have long seen each other as comrades-in-arms against American dominance, and the two have co-ordinated policy closely since Donald Trump began his second term. Parading their friendship in Red Square was meant to show that Mr Trump’s idea of splitting Russia from China is futile. But its futility is less because Mr Trump faces a strong alliance against him than because of Russia’s utter dependence on China. Indeed Russia is more dependent on China now than at any time in its history.

Nowhere is that clearer than in the cities along the two countries’ 4,300km-long border. Manzhouli is a Chinese town bursting with symbols of Sino-Russian amity. Statues of a Chinese panda and a Russian white bear hold hands on the high street. Bustling restaurants serve Russian staples like vodka, borscht and black bread. Blonde Russian dancers in traditional dress cajole Chinese patrons to twirl with them.

The town has enjoyed a trade boom in recent years. Chinese-made equipment is piled ready to be shipped over the border. Trucks and trains are stacked with timber and coal that have come the other way. Total trade between the two countries increased by 66% from 2021 to 2024, to $245bn. Russia supplies oil, gas and other energy exports accounting for 80% of everything Russia sends to China. In return it gets Chinese ready-made consumer goods, cars and technology. Many are “dual-use” goods like machine tools and semiconductors, which can have military as well as civilian uses. These have helped prop up the Russian war machine.

But the shipments matter far more to Russia than to China. While China accounted for 34% of Russia’s total trade in 2024, Russia made up just 4% of China’s. Western sanctions have left Russia with few alternative buyers for its raw materials, and no real alternative supplier for all the imported goods it needs. Dependencies in the other direction are diminishing. Russia is still China’s biggest foreign supplier of weapons. But these days China can make most of what it needs itself. Its total weapons imports fell by 64% from 2020 to 2024 compared with the previous five years, according to the Stockholm International Peace Research Institute, a think-tank.

All this gives China a lot of leverage. Since the war began it has snapped up lots of Russian oil at a discount. Since 2019 a pipeline called the “Power of Siberia” has delivered Russian gas at low prices into north-eastern China. But Russian requests to build a second pipeline further west are on hold because Chinese officials think they can force Russia to sell its gas more cheaply. China also wants to diversify its energy imports. There are only “limited” prospects for Russian commodity exports to China to continue to grow, wrote Filip Rudnik of merics, a think-tank in Berlin, in a recent article. In March some Chinese state-owned firms reportedly curbed Russian oil imports for fear of American sanctions being tightened.

Sanctions have also pushed Russia to cut its reliance on the dollar. In 2023 the Chinese yuan overtook the dollar to become the most popular currency traded on the Moscow Exchange, the country’s largest. Last year Russia’s central bank said it had no real alternative to the yuan to use for its reserves. Most of Russian trade with China is now settled in the currency. This makes its reserves vulnerable to losses if relations with China worsen.

Colonial? Moi?

While China is happy to buy up Russian commodities and dump its own consumer goods there, its investment in its neighbour remains low, and it has little interest in helping Russia modernise or diversify its economy. Cumulative direct Chinese investments in Russia in 2024 reached just $18bn—equivalent to 1% of Russia’s gdp and barely twice as much as China has invested in Kazakhstan, a much smaller economy.

Trade with the eu, by contrast, accounted for 37% of all Russian trade before Mr Putin’s pivot towards China. Energy exports made up just 62% of what Russia shipped to the eu. And before the war the eu was Russia’s largest investor. In 2019 its foreign direct-investment stock amounted to €311bn ($346bn), while Russia’s fdi stock in the eu was €136bn. As Re-Russia, a Vienna-based analysis firm, notes “the model of China’s economic interaction with Russia looks much more colonial than the Russian-European partnership before the war.”

At the same time, China maintains some diplomatic distance. Both Mr Putin and Mr Xi enjoy railing against “hegemonism” (read: America). And China wants to keep Mr Putin in power and his war economy afloat. But it would rather not encourage Mr Putin to engage in more militarist adventures, says Alexander Gabuev, of the Carnegie Russia Eurasia Centre, another think-tank in Berlin. For China, Russia’s invasion of Ukraine is like “a barbarian king has launched a war against his little barbarian brother,” he says.

One sign of China’s caution can be seen at the un general assembly, where it has abstained in most votes on the war. China is also trying to cosy up to Europe. In April it dropped sanctions on several eu parliamentarians, in place since 2021 as a result of the eu’s own sanctions on Chinese officials over human-rights abuses.

One way Russia could reduce reliance on China is by improving its relationship with America, where the Trump administration has been more friendly than its predecessor, says Sergey Radchenko of Johns Hopkins School of Advanced International Studies. Rather than having no partners at all, “Putin could say, ‘We have options’,” he says. But China is keen to keep Russia where it is. As Mr Xi wrote in an article in the Russian media on May 7th, “Together we must foil all schemes to disrupt or undermine our bonds of amity and trust.” Mr Putin’s war and the extent of China’s influence make any Russian turn to the West unlikely.

The economic imbalance between Russia and China contrasts sharply with Russia’s sense of its own importance. Many Russians still see China like a younger brother. According to a recent poll, twice as many (56%) believe their country has greater influence in the world than those who think that China has (27%). China is still seen as Russia’s friend, but the number of people who feel the relationship is improving has fallen from 63% to 50% over the past two years.

In Manzhouli, the ironies of the increasingly unequal relationship are glaring. The town was founded by Russia in 1901, after it forced a decaying imperial China to allow access to the region’s resources. For much of the 20th century, the Soviet Union was the “elder brother” of its socialist neighbour. Now local Chinese increasingly regard Russians with pity. The brotherly relationship “has been reversed”, says one shopkeeper. The younger brother has pulled ahead.