Eastern Economic Forum: Xi and Putin offer united front against “protectionism”

Eastern Economic Forum: Xi and Putin offer united front against “protectionism”

12/09/18

Anuttama Banerji, Business & Policy Team Intern

Chinese President Xi Jinping and Russian President Vladimir Putin hit out at the rise of “protectionism” during the Eastern Economic Forum today, in remarks clearly aimed at Washington.

Speaking at the forum in the east-Russian city of Vladivostok, President Xi said: “There are deep and complex changes underway in the international situation; the politics of force, unilateral approaches and protectionism are rearing their head.”

He added that the states of north-east Asia should work together to counter that trend, Straits Times reports.

President Putin took a similar position, citing barriers to trade as a key challenge for Asian economies in particular.

“The global economy is more and more often encountering harsh forms of protectionism,” he said. “Fundamental principles of trade, competition and economic benefits are being debased … becoming hostage to ideological approaches.

“Clearly, this is a serious challenge for the whole global economy, especially for the dynamic growth of the Asia-Pacific region.”

In a demonstration of closer ties, Putin said that Moscow and Beijing planned to use their own national currencies more often in trade deals as reciprocal payments, CNBC reports.

He added that the Chinese yuan was “acquiring the qualities” of a reserve currency, while questioning the continued viability of the dollar.

The Eastern Economic Forum comes amid an increase in US-China trade tensions, with the Trump administration said to be considering a 25 per cent tariff on almost all Chinese products, and China has seeking World Trade Organization backing to impose tariffs worth US$7 billion a year on US goods, as reported by Reuters.

There are also suggestions of a growing anxiety in Beijing over how the key players in the global economy are lining up in the trade war. The Financial Times reports that China fears a coordinated response against its trade policies from the G7. This dynamic may well be a factor driving stronger ties between Moscow and Beijing, which go beyond the economic sphere.

The forum takes place as Russian and Chinese troops participate in joint military exercises on a scale not seen since the fall of the Soviet Union, and which highlight a major geopolitical shift. At least 300,000 Russian troops, 36,000 vehicles and 1,000 aircraft are taking part in the Vostok 2018 exercises, CNN reports.