Consequences of Ukraine Crisis on the Asia-Pacific: Kevin Rudd / President and CEO, Asia Society

Hello and welcome to DEEPER LOOK from New York.

I'm Del Irani, it's great to have your company.

Over the course of the last few months, we've discussed the far-reaching global consequences of the Russian invasion of Ukraine...

But today, we're going to focus on the impact this conflict is having on one region in particular - the Asia-pacific region.

Since the fighting began, the relationship between the so-called QUAD countries - Australia, India, Japan, and the United States - has been tested...

And as China continues to standby it's "no limits" friendship with Russia, there is growing unease in region.

So just how are Asian-pacific countries responding to this ongoing conflict?

And what impact could it have the on the future balance of power in the region?

Joining me now to talk more about this is the Honorable Kevin Rudd.

Mr. Rudd served as the Australian Prime Minister from 2007 to 2010.

And again in 2013.

He was also Australia's Foreign Minister between 2010 and 2012.

A global authority on China, he is now the president and chief executive of the Asia Society in New York.

And he joins me now Kevin Rudd, welcome to the program.

Great to have you with us.

Good to be on the program.

So, you know, as a former Australian Prime Minister, and as I mentioned, a global expert on China, can you put this in perspective for us? Paint us a picture.

How is the Asia Pacific viewing this ongoing conflict between Russia and Ukraine?

I think in the region, they look at it first and foremost in terms of; are their national boundaries secure in the future.

Because what Russia has done is an extraordinary thing.

It's violated Article Two of the UN Charter.

It's violated the territorial integrity and political sovereignty of another member state of the United Nations.

And the view across the Asia Pacific is that if that's simply allowed to pass as if it's normal, that then creates a precedent for other countries for the future.

I think the second way in which people are looking at it across Asia, is the significant effect that this invasion and subsequent war is having on the global economy,

global commodity prices, energy supply, as well as agricultural supply, and therefore is undermining global economic growth.

So, I think there is a geopolitical lens of concern and a deep macro-economic lens of concern as well.

when you look at the Asia Pacific region, various countries have taken different stances on this issue.

You've got some that are very much, you know, backing the US led sanctions, they're siding with the US, whereas others have openly, you know, sided with Russia.

To what extent has this conflict heightened tensions in the region.

Not as much, I think, as, for example, the Russians and the Chinese may emphasize.

And that's because a number of nation states in the region are making their positions known clearly and publicly, like Japan, like the Republic of Korea, like Australia, like Singapore.

Others, less publicly.

But I think underneath it all, there is a great degree of concern.

Often mention is made of India and why has chosen to not criticize Russia?

It has purchased most of its defense equipment from Russia over decades and decades.

And therefore, right now, if it was to suddenly break off its defense supplies from Moscow, its armed forces would be in a mess.

Now, interestingly, India is also part of the QUAD Alliance, which of course, Japan, Australia and the US also make up.

And as we've talked about, India's the only country that really hasn't backed the US led global sanctions, US, Japan and Australia have very much backed with the US.

To what extent has this conflict between Russia and Ukraine exposed, let's say, tensions or divisions within the QUAD Alliance?

Well, I know a number of the political figures who are associated with the QUAD, both at a head of government level, at a foreign ministry level and a senior official's level.

And I think it's fair to say that among the QUAD member states, whether it's the United States, I was in Washington just a few days ago,

whether it's Australia, where I was literally a week or so ago.

And I know the new prime minister very well.

He used to be deputy prime minister under me.

Prime Minister Kishida, I don't know, but I do know, senior Japanese officials.

I think there is just a collective understanding about India's unique circumstances and that this will evolve over time.

I think more broadly, when I look at the QUAD, what there is a unified concern over is the extent to which China continues to provide levels of direct and indirect support for Russia,

during this period of Russian military activity in Ukraine.

If you look at the pattern of Chinese imports from Russia, it's going through the roof.

Particularly in terms of oil, gas, and agricultural commodities.

And furthermore, when you have China, refusing to even describe this as an invasion, and even a war, let alone condemning it, then I think there is a much deeper concern

about the emerging pattern of strategic partnership between Beijing and Moscow.

That, I think, is what unites the QUAD and, frankly, creates a much more general concern across the rest of the Indo Pacific region.

And you talked about the growing closeness between China and Russia.

In China's own words, they've expressed it as a "No-Limits-Friendship."

You're a bit of a China expert.

So put into perspective for us.

How significant is that terminology.

Well, when you look at the joint Strategic Framework Agreement, which both sides announced from memory on the 4th of February,

both sides proclaimed "no limits" for this strategic relationship in the future.

It's both the Russian view and the Chinese view.

It is both Vladimir Putin's view and at Xi Jinping's view.

I've looked at the previous documents released when Chinese and Russian leaders have met over the last 20 years.

If I was to trace the visual graph for you, it's kind of gone like that getting better getting warmer, getting warmer.

And then with this one, it goes like this.

And so, What does it mean?

It means increasingly, we're going to look at a Chinese-Russian strategic condominium, as countries in our region have to respond to it.

If you want evidence of that.

Look at President Biden's most recent visit to Seoul and to Tokyo.

What was the Chinese response?

A joint Russian-Chinese Air Force maneuver, using strategic bombers adjacent to South Korean and Japanese airspace to send a combined message.

What's led to the sudden warming of ties.

Has it been, you know, was a COVID?

Has it been some sort of, I guess, the falling out of the US China relationship?

How suddenly have we had this huge spike?

Well, it's been relatively sharp.

And I think it follows in particular changes in US-China strategies since about 2017.

When the United States began defining China as a strategic competitor in the US national security strategy of that year.

And despite the fact that the Biden administration now replaced the Trump administration, on this question of China being a defined strategic competitor, that is still the case.

So, this element has strongly fueled the, shall I say, the intensification of the strategic partnership between Russia and China, but with one other factor.

Both are deeply concerned about their domestic political challenges.

And they are deeply concerned about democratic movements so called "color revolutions" within their countries,

which might ultimately unseat their ruling parties.

And in their heart-of-hearts in their mind-of-minds, they blame Uncle Sam for all of that.

What are the implications of this partnership for the Asia Pacific region in the years to come?

I believe that from Beijing's perspective, the Russia relationship represents what we would call in the strategic literature a "force multiplier."

That is, you've got China's own capabilities, military and economic, technological.

But if you are also allied effectively with the Russian Federation, it brings other advantages to the table.

Number one, because their common border is then stable and secure.

It releases all of China's strategic efforts and energies and assets to pivot against its principal, adversary and opponent along its maritime periphery.

And that is, of course, the United States and its treaty allies, Japan, the ROK Australia.

I think a second strategic advantage, which the Chinese see in this relationship, is that it provides them with more secure lines of energy and

agricultural supply across the land border.

Rather than being exposed to the Straits of Hormuz, or the Straits of Malacca, in the event of a crisis, where they're exposed energy supply lines would be a cause of strategic concern.

And finally, I think from China's perspective, Russia has another advantage of keeping the United States busy in other parts of the world.

It's, in other words, it's seen through the prism of strategic distraction, Syria, Libya, and now Ukraine.

So, the United States has always got to be in the business of walking and chewing gum at the same time, in multiple theaters at once.

Whereas China is focused on one which is how to push the United States back along its maritime periphery, in order to enable China, at a time of its military choosing, to take Taiwan.

So, given that China is sitting in Asia Pacific, watching Russia invade Ukraine, as you said, distracting the US.

How is this affecting China's long-term strategy for its own ambitions and goals in the Asia Pacific region?

I mean, what lessons is China learning from, I guess, Russia's actions?

Well, China militarily is acquiring greater and greater capabilities.

And these capabilities are ultimately measured against what may happen with a Chinese action to take Taiwan.

And that's the principal lens through which China views these developments over time.

I don't believe China's own internal timetable on Taiwan necessarily changes because of what they've observed in Ukraine.

I don't think China believes that it's militarily in a position to "do Taiwan now", because the balance of power across the Taiwan Straits is not big enough in their advantage,

to give them a comfort factor.

It would need to be much bigger.

And I think in their estimate, that is more likely to be the case in the late 20s and in the early 30s.

Similarly, China does not want to be financially and economically exposed to the same order of magnitude that Russia has been through this crisis.

And so, China's principal exposure there is that it relies still on the US dollar denominated international financial system.

And if financial sanctions were then imposed against China, through a military action against Taiwan, right now, would be problematic.

But if by the end of this decade, China has floated the exchange rate, opened its capital account, and made the renminbi into a much bigger piece of the global financial machinery

as a global reserve currency.

Then China then becomes less vulnerable to US dollar denominated sanctions.

But I think China has been working these two contingencies all along.

And I think what they would have observed in Ukraine on this question, would simply reinforce their caution, their level of preparation,

and their sense of a medium-term timetable for Taiwan, rather than an immediate one.

So, I guess my last question to you, Kevin Rudd is how do you see the future of the Asia Pacific region?

I mean, to what extent is this conflict going to have an impact on regional dynamics in the future?

The quid question will be what shape her Russia emerges from out of this appalling violation of international law and the invasion of Ukraine?

How will it emerge diplomatically?

My judgment will be in very poor shape.

Can you imagine Vladimir Putin easily visiting other countries in the region in the world?

Not many, let me tell you.

He'd be welcomed in Beijing, a few others besides, but I think it's probably the last time you're going to see Putin welcome in any Western capital, or any capital in the democratic world.

So, Russia then emerges as a damaged diplomatic asset.

Secondly, its military will now be seen to be qualified in terms of its professionalism.

Up until now, people have seen the Russian military as a highly capable and professional force - less so.

So, while it, therefore still provides China with strategic leverage, as I said before, as a force multiplier, it will emerge as a degraded asset,

both militarily and diplomatically as a consequence of what's unfolded in Ukraine.

Kevin Rudd, thank you so much for your time.

Good to be with you.

U.S.-China relations sank to their lowest level in decades under former President Donald Trump and haven't improved under current President Joe Biden.

But as China continues to flex it's muscles in the Asia-pacific region...

how should the West respond?

Join us next time as we continue our conversation with Kevin Rudd and put these questions to him...

I'm Del Irani, thanks for your company.

I'll see you next time on DEEPER LOOK from NY.