What has been portrayed as an economic clash between East and West is taking on an increasingly ideological nature. Chinese President Xi Jinping laid out new rules of the game for Sino-US relations in blunt terms to US President Joe Biden, outlining what could be dubbed the Global South Consensus at a meeting in Lima at the weekend. 

The ideas espoused by Xi at the APEC summit in Lima are very similar to Russian President Vladimir Putin’s world views that he put forward at his Valdai speech this month that call for a new multipolar world order. Xi also specifically echoed Russian Foreign Minister Sergei Lavrov’s “new rules of the game” speech delivered in February 2021 at a joint press conference with EU foreign policy chief Josep Borrell that said Russia would no longer tolerate the dual Western policy of sanctioning with one hand and trading with the other. 

In this context, Xi’s comments to Biden could be taken as a warning. Lavrov’s speech has been interpreted as the first concrete step Russia took towards the invasion of Ukraine and Lavrov went out of his way to humiliate Borrell by having three European diplomats expelled from the country as the two men sat down at the negotiating table. Borrell was in Moscow to try to mend strained relations and Lavrov diplomatically slapped him in the face. 

Xi’s tone with Biden was less confrontational, but the language was equally sharp and forceful. China has been making many of the same preparations that Russia made in the years before the Ukraine invasion: it has sold off vast quantities of its US assets; it has been investing massively in modernising its army and navy; it has built up a massive $700bn reserve of cash; and Beijing has been actively reaching out to countries around the world to build up a non-aligned alliance in the form of the BRICS+, G20, ASEAN and its own Belt and Road Initiative (BRI) programme – the brainchild of Xi himself, when he first took office. The Kremlin took all the same steps before crossing the Ukrainian border in 2022, triggering the most extreme sanctions ever. 

Four red lines  

The Sino-Russia relationship has been described as both a marriage of convenience or a lop-sided partnership of slave and master, as Xi introduced the concept of “four red lines” in his discussion with Biden. 

Like Lavrov’s demand that the Western sanctions end or else Russia would break off diplomatic relations with the West, Xi highlighted four issues where China will not make any concessions whatsoever and is demanding the US withdraw its pressure: 

• Taiwan issue, 
• democracy and human rights, 
• development path, and 
• development rights.

These are, “China's four red lines, which cannot be challenged,” the Chinese Foreign Ministry said in its readout of the meeting, bolding the issues in the press release. 

Like Ukraine’s neutrality for the Russian president, the One China policy of returning Taiwan to Beijing’s political control remains sacrosanct and Xi was saying flatly there is no room for compromise. 

On democracy and human rights, Xi signalled a hardening of China’s stance, stating that the US should cease its interference in China’s internal affairs, such as the Western allegations of persecution of the Uighur.

The point on the development path covers a wide range of issues, including freedom to trade and the Western mooted tariffs on Chinese goods to protect its own markets from things like booming Chinses EV production and sales. Xi asserted that “the Chinese people’s right to development cannot be deprived or ignored” and warned against using national security as a pretext for what he called “malicious restrictions and suppression.”

“Mutually beneficial cooperation is the path to common development,” he said, warning that “small yards with high fences” – a reference to US export controls and restrictions on Chinese technology – are unbefitting of a global power.

And development rights is a direct criticism of the US policies like the CHIPS regulation that is designed to withhold advanced US technology to stymie China’s development and maintain the US lead in the global markets. 

China watcher Arnaud Bertrand called the list the most aggressive and direct dressing down Xi had ever given to the US president in his career. 

The US readout of the meeting was noticeably more subdued, holding itself to merely stating: “The two leaders reviewed the bilateral relationship over the past four years and took stock of efforts to responsibly manage competitive aspects of the relationship,” and stressing the need to “responsibly managing competitive aspects of the relationship.”

Moscow consensus 

Despite their long-standing mutual distrust of each other, China and Russia have become increasingly aligned in their global world views. The bedrock of this cooperation is based on their shared objection to the unipolar international system of the US hegemony on geopolitics. Both leaders have stressed the need to shift to a multipolar system on many occasions. 

But more subtly than this is the Moscow consensus ideology, described by bne IntelliNews in 2020, when tensions began to rise noticeably, and that is shared by many countries of the Global South to differing degrees.  

This stands in stark contrast to the well-established Washington Consensus that binds together the countries of the West and is the foundation of things like the International Monetary Fund (IMF) economic reform packages for developing countries. At its root it emphasises individual happiness, personal political freedoms and entrepreneurial activity as the bedrock on which responsible liberal economic policies are built. 

In contrast, the Moscow consensus downplays individual freedoms where citizens are expected to sacrifice these for the good of development and stability of the state. It underlines the principles of state sovereignty, economic pragmatism and a strong role for the state in economic development, where “national champions” can play a leading role and leave control of strategic industries in the state’s hands. 

As bne IntelliNews reported, Putin’s version of this is ZAO Kremlin, where the government has typically set up two state-controlled national champions in important sectors like banking and set them in competition to get the double benefits of control and efficiency. The system has been surprisingly successful and the Moscow consensus has led to Russia’s robust economy, although it comes at the cost of a less dynamic economy and lower overall growth, as the founder of the Eurasia Group Ian Bremmer argued in his book “The J Curve.” 

China runs a very similar system where there are probably even fewer individual freedoms and the state has an even tighter grip on the economy, but has benefited from the greater stability the Moscow consensus brings. 

Amongst the Global South, the Moscow consensus has wide appeal as these developing countries grapple with difficult economic development problems where the state is expected to be an effective leader in lieu of well-developed sectors and shallow capital markets. In addition, in most of these countries the population is politically immature and democratic institutions very underdeveloped, again favouring the centralised control of strong governments. 

For Russia, China and even EU-leaning Georgia, one of the flashpoints is the Western insistence on adopting LGBT rights at an early stage of transition – something that makes little sense to largely conservative and politically illiterate populations in the emerging world. 

However, the Moscow consensus is unlikely to become the dominant alternative to the Washington consensus, as the Global South has not bought into the aggressive anti-Western stance Xi and Putin appear to prefer. India in particular would like to see better cooperation between the West and the Global South for mutual development. 

The Global South has still not worked out what it would like to achieve, nor what a multipolar world would look like. This was highlighted last year by the rival BRICS+ summit and the Indian-hosted G20 summit  that was dominated by Prime Minister Narendra Modi and was not attended by either Xi or Putin. It’s still a work in progress, but a Global South consensus should be a lot less confrontational than Putin’s version, as most members of the Global South still sit on the fence. And the despite his tough talk, Xi has been harping on about the theme of cooperation in all his recent international meetings. 

Seven lessons

According to a detailed Chinese readout, Xi articulated seven key principles for managing relations between the world’s two largest economies. Chief among them was the need for a “correct strategic understanding,” with Xi emphasising that the Thucydides Trap – a concept in international relations that suggests that when a rising power threatens to displace an established dominant power, the likelihood of conflict between the two increases significantly, which Bertrand interprets as a veiled threat. 

“A ‘new Cold War’ cannot and should not be fought,” Xi stated, adding that “containment of China is unwise, undesirable and will not succeed.”

Xi went on to outlined seven key "lessons" from the past four years during his meeting with Biden, stressing the need for constructive and equal bilateral relations:

1. Strategic Understanding: Xi stated that a new Cold War is unnecessary, and attempting to contain China will not succeed.
2. Credibility: He emphasised that credibility is crucial, pointing out that inconsistent US actions damage trust.
3. Equality: Both countries should treat each other as equals and avoid trying to reshape or suppress the other.
4. Respect Red Lines: China has "four red lines" that should not be challenged: Taiwan, democracy and human rights, development path, and development rights.
5. Dialogue and Cooperation: Common interests have grown, and both nations should expand areas of cooperation for mutual benefit.
6. Focus on Wellbeing: Relations should focus on benefiting both peoples, removing obstacles, and preventing negative impacts on cultural exchanges.
7. Great Power Responsibility: Both countries should work towards world peace, avoid unnecessary conflict, and refrain from coercing other countries to take sides.

Xi's call for mutual respect, genuine cooperation and avoiding actions that might harm bilateral ties or stability tallies almost directly with the list of principles that constitute the multipolar world in Putin’s Valdai speech. Putin said the “new world order doctrine” can be broken into six points:

• Openness between states;
• The absence of “universal dogmas”;
• The necessity of considering each country’s voice in making “global decisions”;
• The rejection of certain international blocs (this apparently doesn’t apply to the BRICS+ organisation, but is a jab at Western-led bodies like the G7 and IMF);
• Closing the developmental gap between countries; and
• Pursuing equality for all peoples.

Like the Kremlin in 2021, Xi demonstrated growing impatience with the high-handed manned he feels the US is taking with China. He warned that “if the US side always says one thing and does another, it is very detrimental to America’s image and damages mutual trust,” and rejected efforts to “reshape the other based on a so-called ‘position of strength’” or to “deprive the other of legitimate development rights to maintain their own leading position.”

Talking to Trump 

Though ostensibly aimed at Biden, Xi’s message was clearly aimed at Trump. Lavrov’s new rules of the game speech was clearly written by Putin and aimed at the European Commission. Borrell’s visit to Moscow became the stage on which Lavrov stood to delivery this message and Borrell’s deliberate humiliation was designed to make it clear this was not some off-the-cuff rant but a clear message. 

In the same way, Xi delivered his dressing down to a lame duck president at a major international forum to emphasise this was a new policy and not just a chat between two old men. 

By framing his points as “lessons learned,” Xi signalled an end to the Biden-era’s ineffective policies regarding Sino-US relations and was inviting Trump to make a fresh start with new more cooperative policies: Xi comments can be seen as both a threat and a call to make a fresh start, but only on terms that Beijing finds acceptable, framed by the new four red lines. 

Analysts believe this reflects China’s growing confidence in its global standing and its belief that Washington no longer holds a “position of strength” in the bilateral relationship. While Putin’s war in Ukraine was nominally engineered to guarantee Ukraine never joins Nato, his broader goal has always been to break the unipolar stranglehold Washington has had on geopolitics and create a multipolar world – and with the growing cooperation and importance of the BRICS+, G20, Shanghai Cooperation Organization (SCO) and all the other non-aligned alliances he has been largely successful. 

As Xi stated, “great power competition should not be the theme of the era; unity and cooperation are needed to overcome difficulties together.” Whether these words will resonate in Washington or Trump remains to be seen, but given Trump’s track record the chances seem low.