November 28, 2022

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World Finance Reviews

Chinese President Xi Jinping warns it could take decades to repair economic damage caused by Ukraine crisis

Chinese President Xi Jinping has urged the EU not to “tie the whole world” to the crisis in Ukraine and warned it could take decades to repair the economic damage.

In a virtual summit with European Union leaders on Friday, Xi told European Commission President Ursula von der Leyen and European Council President Charles Michel that the crisis must be “properly handled”.

“Many people are very worried that the current situation may destroy the achievements of decades of international economic cooperation. If the situation continues to deteriorate, it is estimated that it may take years, or even decades, to recover afterwards,” Xi said, according to a statement from the Chinese foreign ministry.

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The EU said later that it urged Beijing not to “interfere” with sanctions on Russia and while the two sides agreed on working to end the conflict, they had expressed “opposing views” on the situation.

Xi warned against a chaotic response that would “tie the whole world to the crisis [and means] people of all countries will pay a heavy price”.

“The more critical the situation, the more sobriety and calm is needed,” the Chinese leader said.

“The current world economic structure is a framework formed by the long-term efforts of all countries in the world. All parties should cherish this achievement and not easily impact the existing world economic system.

“There should be no politicising, instrumentalising and weaponising the world economy that causes serious crises in the fields of world finance, trade, energy, science and technology, food, industrial chains and supply chains.”

Xi held talks with the heads of the European Commission and Council. Photo: Xinhua alt=Xi held talks with the heads of the European Commission and Council. Photo: Xinhua>

Von der Leyen said after the talks: “We exchanged very clearly opposing views. This is not a conflict. This is a war. This is not a European affair. This is a global affair.”

She added: “We made very clear that China should, if not support, at least not interfere with our sanctions [on Russia] and that equidistance is not enough; that active engagement for peace is important and that each player should play its role”.

Xi said China supports the EU’s efforts to resolve the crisis politically, and that Beijing would work with Europe to prevent a larger-scale humanitarian crisis. Xi also backed a leading role for the EU in talks with other parties, including the United States and Nato.

Russia’s invasion of Ukraine has put a further strain on China’s relations with the EU, which have already been damaged by tit-for-tat sanctions over alleged human rights abuses in Xinjiang that led to a major investment deal being suspended.

China has not condemned Russia’s actions and there have also been reports that Moscow has asked China for military and financial assistance and for help in getting around the sanctions.

China has criticised the sanctions and warned the crisis is already having a spillover effect on other countries.

A commentary published by the social media account of People’s Daily, the Communist Party’s mouthpiece, warned of the impact on natural gas supplies. It said half the EU’s gas imports come from Russia and switching over to supplies from the US will raise costs and increase delivery times.

The EU-China summit was divided into two parts, the first of which was a two-hour discussion between Chinese Premier Li Keqiang, von der Leyen, Michel and EU foreign policy chief Josep Borrell.

Li said China and Europe should jointly safeguard energy and food supplies and the stability of industrial and supply chains.

This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP’s Facebook and Twitter pages. Copyright © 2022 South China Morning Post Publishers Ltd. All rights reserved.

Copyright (c) 2022. South China Morning Post Publishers Ltd. All rights reserved.