China will hedge its bets on Putin's Ukraine aggression

Understandably, Beijing does not want to confront Moscow directly, due to their quasi-alliance and shared Western pressure. Beijing also doesn't want to see an expansion of NATO, which may one day approach its own front yard.

However, this does not mean Beijing supports Moscow's aggression towards Ukraine.

The current Ukrainian situation is not a unique case. Beijing displayed similar attitudes when it came to the Crimea annexation by Russia in 2014, and the recognition of Abkhazia and South Ossetia dating back to the Russia-Georgia War in 2008. It is crucial to understand that China being active or inactive internationally is a matter of domestic political survival, because of potential domestic weakness.

The situation with Xinjiang and Tibet and Taiwan's increasingly independent self-identity makes it difficult for Beijing to shore up Russia, regardless of how Moscow has beautified its narratives in the Ukrainian tension. From the perspective of the Chinese government, Xinjiang and Tibet are China's legitimate sovereign territory, and Taiwan has been a remaining historical matter left by the Chinese Civil War between the KMT and CPC. They are all domestic issues to Beijing.

Likewise, to Beijing, Crimea remains Ukraine's sovereign territory, and Abkhazia and South Ossetia are officially part of Georgia. If these regions can have a referendum to join Russia or become independent, this means Xinjiang, Tibet and Taiwan can simply do so as well. This is impossible for China to accept, as these are core interests of China and concern the legitimacy of the CPC.

Also, managing China's incoming 20th Party Congress, which will likely lead to President Xi Jinping's third term, is a much more pressing task to Beijing. Maintaining a secure external environment while focusing on mainly internal issues is key to the Chinese leadership. The recent unrest in Kazakhstan is a notable instance of this - Kazakhstan being a neighbouring country where Xi first proposed the Belt and Road Initiative, and a major part of China's strategy to diversify its energy imports. Chinese investment in Kazakhstan, according to official data, exceeded $US20 billion in 2016. Unofficial figures of Chinese investment range from $US55 billion to $US80 billion. But despite Kazakhstan's significance to China, Beijing hasn't been much involved in the Kazakhstan chaos - so it is very unlikely that Beijing intends to have its hand in a conflict in remote and less important Ukraine.

Furthermore, there have been continuous complaints in the Chinese public sphere and academia rebuking Russia as the country that benefited the most from the decline of modern China in the Qing Dynasty. This is an interesting phenomenon, given the censorship in China; in fact, the open expression of these sentiments suggests the tacit approval of the Chinese government. In 2011, a famous Chinese song, Baikal Lake by Li Jian, triggered laments from Chinese citizens over their country's past territorial losses to Russia. If Beijing supports Russia's invasion of Ukraine, it is difficult and illogical for the CPC to justify its own history and defend its legitimacy.

It's also worth noting China's investment in Ukraine. China has been Ukraine's largest trading partner since 2020, and it sees Ukraine as a key entry point for its BRI to Europe. Following the Sino-American trade war, agricultural exports from Ukraine have become increasingly crucial to China. Ukrainian agriculture exports to China climbed by 33 per cent in the first half of 2021, compared to the same time in 2020. By 2019, Ukraine has surpassed the US as China's top corn exporter, accounting for more than 80 per cent of Chinese corn imports.

Thus, a stable and nonviolent Ukraine suits Beijing's interest. By staying diplomatically quiet, too, Beijing may gain support from the EU - or at least maintain a workable relationship - rather than pushing the EU, especially Germany, towards the US, during the increasingly intense Sino-American power struggle. In 2020, Germany is the country with the second-largest imports to Ukraine. Economically, Beijing's interests align with Berlin.

But here's where it gets even more complicated.

If Moscow invades Ukraine, despite Beijing's local affordable economic loss, this scenario may suit China for a different reason - it may move the global geopolitical landscape in China's direction. In Chinese diplomatic circles, there seems to be an unspoken view that an economically weak but militarily aggressive Russia suits China best.

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Firstly, not only is Western pressure pushing both countries together, but Russia's military operations draw attention away from Beijing - much in the same way the September 11 attacks gave China almost a decade of "golden time" to develop itself without much hostility from the US.

Secondly, Russia's already struggling economy, with the situation exacerbated by Western sanctions, will prompt Russia to turn further to the East. This does not necessarily mean Russia will come to depend economicall on China, as Russia is very cautious about that, but the importance of China to Russia is certainly rising.

Thirdly, Russia's stagnating domestic economy perpetuates a situation in which its far east remains sparsely populated, leaving its lengthy border with China relatively secure from a Chinese perspective. This offers China more strategic space and resources to deal with core issues elsewhere, such as its own declining population at home, global competition with the United States, and territorial claims over the South China Sea and Taiwan.

Fourthly, a turbulent Ukraine may offer Beijing a better window of opportunity to purchase its military technology. This relationship had progressed well for decades, but recently was interrupted by the intervention of the US in the noticeable Motor Sich case of 2019.

All being said, Beijing genuinely does not want Russia to fail. A Putin-less Russia might well lead to a pro-Western government, and this is the least desirable scenario for Beijing. It is possible that once this situation settles, Beijing will begin to make some moves. But right now, those sitting in Zhongnanhai are just planning to wait and see.