Closer Ukrainian/Chinese relations

On 20 June, Ukraine and China signed a declaration of their strategic partnership and signed contracts totalling approximately US$3.5 billion in value. This was a result of a visit by the President of the People’s Republic of China Hu Jintao to Ukraine. Signing the declaration indicates deepening cooperation between the two countries, which is not limited to economic relations, but is also entering the political field.

In the declaration on strategic partnership, which the Ukrainian government had long sought, both parties undertook to coordinate their activities within the UN, and announced the signing of a new basic treaty. Moreover, the interdepartmental agreements and contracts concern trade, infrastructure projects (including the finalisation of a loan to construct a railway line from the airport in Boryspil to Kyiv), energy (including co-operation in preparation for exploiting the Black Sea shelf, nuclear power industry, and the construction of a hydroelectric power plant in Crimea), and cooperation in the mining industry. Details of the contracts were not released. Most likely, they stem from the framework agreements signed in September 2010, when the Chinese announced investments of US$4 billion.

Since Viktor Yanukovych became president of Ukraine, he has sought closer cooperation with China. Also, Beijing itself is increasingly interested in Ukraine; this is demonstrated by the visit itself (the first by a Chinese President for nearly 10 years), as well as their consent to a strategic partnership agreement. It is most important for Ukraine to obtain Chinese loans and investments, while China is interested in access to certain aerospace and defence technologies which Ukraine possesses (including missile technology, naval landing craft, marine and tank engines), as well as investing its surplus foreign currency. The signature of the contracts and the start of some projects means that the cooperation which was launched last year is being continued, and may lead to China’s increased economic presence in Ukraine in the next few years. The conclusion of the strategic partnership is the first step in deepening the political cooperation, which Beijing has so far avoided because of Russia’s disapproval. <smat>