Xi and Putin Tighten Bonds in China; Germany Faces Ongoing Economic and Political Trouble

Russia’s Vladimir Putin and China’s Xi Jinping put the world on notice that their’s is a relationship to last. Meanwhile, Germany is in economic and political trouble.

Two of the world’s most significant leaders have recently met face-to-face. Xi Jinping, president and life chair of the Chinese Communist Party, visited a trade fair and a defence research establishment with Vladimir Putin, the Russian president, in Harbin, in China’s north-east. The visit followed a day of talks in Beijing between the leaders that seemed orchestrated to convey both the strategic alignment of the two powerful autocrats as well as a personal connection.

This was far from the first time the leaders had met, in fact it was the 43rd time, but there seemed to be a new level of intimacy now. The meeting seemed contrived, but for what purpose? It was soon clear that the two men wanted the world to know what students of geopolitics know already – that the leaders of China and Russia are united against the United States, in particular, and the West in general.

Of most concern to the West is the flow of Chinese technology and other useful items to Russian manufacturers of weapons. U.S. Secretary of State Antony Blinken has referred to China as the “top supplier” of machine tools, microelectronics, and other items deemed by America to be “dual use,” meaning they have both civilian and military applications. China’s share of Russian machine tool imports grew from less than 30 percent before the Ukraine war to about 60 percent in 2022, and 88 percent in 2023. “Russia would struggle to sustain its assault on Ukraine without China’s support,” Blinken has said. In fact, Russia now seems to have the upper hand in the war and has recently made territorial gains in Ukraine’s eastern region.

The talks in Beijing last week culminated in a joint statement that took aim at the United States, pledging that Russia and China would work more closely in critical sectors, including the military, energy, and space. A New York Times report of the meeting quoted Richard McGregor, a senior fellow for East Asia at the Lowy Institute in Sydney, as saying, “Xi’s very deliberate embrace of Putin for the cameras wasn’t just to emphasise the closeness of the political relationship … [but] a touch of disdain directed at Washington, which has been pressuring Beijing to withdraw support from Moscow. That clearly isn’t going to happen in any substantive fashion.”

Trouble in Germany

From my current place in Germany, the economic situation has worsened. As The Economist writes, “… there is no misreading the mood in Germany today. A deep malaise has settled on the country. Four-fifths of Germans tell pollsters they are unhappy with their rulers.” The newspaper argues that three failures stand out: the assumptions underpinning foreign policy were disrupted following Russia’s invasion of Ukraine in February 2022; the coalition government’s retreat from a proposed law banning fossil-fuel boilers in favour of heat pumps tarnished its climate transformation credentials; and – most damaging – a constitutional court ruled last November that unused Covid-19 money could not be used to fund the government’s climate plans and industrial subsidies, forcing swinging budget cuts in a country already close to recession.

Maybe, but Germany’s towns and villages still seemed more prosperous than those in broken, post-Brexit Britain or in fractured France. The International Monetary Fund, by contrast, reckons Germany will be the only G7 economy that shrank in 2023. At 0.9 percent, its growth in 2024 is forecast to remain below the average of 1.4 percent for advanced economies. According to Deutsche Bank, the Mittelstand, small and medium-sized companies that are the backbone of the economy, see bureaucracy as a key impediment to doing business, ranking close behind the shortage of skilled workers and high energy costs.

Perhaps the most damning comment comes from a paper published by the Carnegie Endowment for International Peace, which concluded that Germany’s economic industrial-based models and the political parties established following the Second World War are “… fumbling. They lived on the insurance of American security, of cheap Russian gas, of a Mittelstand that had world market share, and an EU that gave it economic clout. This scaffolding is being dismantled. Germany faces a new reality.”

What the increasingly shaky coalition government under the leadership of the unpopular Olaf Scholz will do to address the problems is the question that now demands answers.

Colin Chapman FAIIA is a writer, broadcaster, public speaker, who specialises in geopolitics, international economics, and global media issues. He is a former president of AIIA NSW and was appointed a fellow of the AIIA in 2017. Colin is editor at large with Australian Outlook.

This article is published under a Creative Commons License and may be republished with attribution.