Ukraine's Korea Solution

April 24, 2023

As Ukraine prepares its counter-offensive, the ground beneath the war shifted last week in a positive way. On April 20, a glimpse into a possible solution to the war was delivered in a speech by US Treasury Secretary Janet Yellen. She offered détente with China in order to address the world’s problems together. The next day, on April 21, the Ukraine Defense Contact Group met in Germany and revealed that 230 tanks and 1,500 armored vehicles were headed to Ukraine and that many had been already delivered. The scale of this armored deployment shocked Wagner Group head Evgeny Prigozhin who posted on Telegram that an armed force that size, with 100,000 Ukrainian troops and air defense systems, was bad news for Russia and a “concern” because it indicated “serious opposition”. He and others have criticized Russia’s military as well as Putin’s “maximalist” goals, and an uncharacteristic public dispute has broken out within Russia’s elite. Stopping or toppling Putin may be distant, but China could play a major role in bringing about peace and Yellen offered major incentives for doing so.

Russian oligarch and warlord Evgeny Prigozhin, Ukraine counter offensive buildup is “bad news” for Russia

On April 20, Yellen’s statesman-like address emphasized that “the world is big enough for both of us” — a phrase that echoed Xi Jinping’s message last year at his summit with Biden. Further, America does not want to “decouple” its economy from China’s. “A full separation of our economies would be disastrous for both countries. It would be destabilizing for the rest of the world,” she said, adding that both should compete fairly and both have a responsibility to work together “on areas of shared challenges for the two nations and the world.”

Her speech contained an unspoken quid pro quo which is that if China helps terminate Russia’s war against Ukraine, protectionist measures against its economy will be lifted and trade will once more grow. Beijing is Moscow’s most important ally, but is “neutral” and has not endorsed Putin’s war nor provided military assistance. It has also offered to play a peacekeeping role. But Russia expert Stephen Kotkin suggested, in a recent speech in Toronto, that “Xi won’t give up Russia unless it gets something and that’s tech transfers. China gives peace to Europe and gets technology transfers again.”

Bluntly put: Russia for semiconductor chips and other technologies, now denied. Such commercial realpolitik, and a joint diplomatic effort by the two economic superpowers, could potentially end the conflict. “The solution to the war is the US and China getting together to impose an armistice on each side,” said Kotkin, who is a Stalin biographer and professor at Stanford University.

Naturally, the West must continue to stand behind Ukraine and its looming counter-offensive which will determine where and when the time is right to attempt to halt the war. Kyiv’s objective is to expel all Russian troops from its pre-2014 borders, and, psychologically and politically, Moscow’s elites are already starting to feel defeated and alienated. Support for Putin’s “special military operation” erodes even among fanatics like Prigozhin who fear Ukraine’s “tank coalition” counter-offensive.

US Treasury Secretary Janet Yellen’s opening gambit speech April 20 at Johns Hopkins University

A two-pronged strategy is underway. The priority is the battlefield and support to Kyiv, but equally important is Yellen’s behind-the-scenes opening gambit offering to bury the hatchet with China and join forces to bring about permanent peace through diplomacy. Germany and others have chimed in with the same request that Beijing become involved. Interestingly, Yellen’s speech was lightly covered by the Western press, but was significant and, more importantly, well-received by the Chinese press.

On April 22, the editorial in Beijing’s Global Times noted that “before US Treasury Secretary Janet Yellen laid out the US economic priorities on China, the Chinese Ministry of Commerce said China and US commerce officials met in Beijing last week during which the two sides exchanged views on bilateral economic ties. The re-engagement of US and Chinese officials in certain areas such as business and climate could serve as an opportunity for the strained bilateral relations to turn into a positive direction, but Washington needs to show more sincerity for improving the ties, experts said.” 

The newspaper also quoted Wu Xinbo, director at the Center for American Studies of Fudan University, who reinforced the need for the US to cooperate with China to solve the Ukraine crisis. 

Detente is needed. China struggles and needs a truce with the United States where anti-China rhetoric has heightened. But China’s announced intention to take over Taiwan should be muted or dropped. It is a non-starter militarily and appears to be mostly a rallying cry for a dictatorship that needs to distract attention away from its problems. China has been damaged by the pandemic, lengthy Covid lockdowns, soaring debts abroad, a real estate bubble, reputational damage due to its relationship to Putin, rampant disinvestment by foreign investors, and increasing trade restraints in Europe as well as America. Demographically, China is aging, and the government crackdown on its business empires and entrepreneurs, combined with its inability to access technology, impedes enterprise and economic growth.

This is why Yellen’s olive branch is a welcome, and inspired, initiative, fully endorsed by President Biden. A G2 partnership between the two giant nations would provide a path to halting Putin’s rampage in Europe. “The best outcome is an armistice involving the US and China sooner rather than later. With an demilitarized zone, accelerated security guarantees, Ukraine could become the next South Korea,” said Kotkin.

But China’s involvement is key. “Will Putin keep his word? Never, unless Putin signs the paper in Beijing. I know Washington won’t like that but this is the only solution. If there’s only a ceasefire, Russia will invade Ukraine again. Something must stop Russia from coming back and that’s China. It’s the South Korea solution, one of the most successful countries in the world, where peace has held for 70 years.”

Stephen Kotkin, Stanford University, Investment Magazine

Yellen’s speech never directly addressed the war or a peace-for-chips quid pro quo, but this was the subtext. She emphasized that “it is important that we make progress on global issues regardless of our other disagreements. That’s what the world needs from its two largest economies.”