From cautious concern to doomsday predictions, the U.S.-China Security and Review Commission (USCC) heard testimony on February 20 that broadly addressed one question: Is China a partner in an “Axis of Autocracy,” alongside the other major autocratic countries of Iran, North Korea, and Russia?
Interestingly, the scope of the Commission’s hearing was limited to addressing the relationships between only four of the world’s autocracies. Yet, multiple sources state that, in fact, the population of the world is far more governed by autocracies than not. Indeed, a map of autocracies around the world shows that the nations of the African continent are led far more by autocrats than by any other political system – yet none of these governments were included in the USCC’s “axis.”
By not encouraging comment and debate on the rest of the autocratic world, largely found in Africa and the Middle East, an opportunity is missed. In diving deeper into other autocracies’ links with the “big four” and among themselves, we would gain a more profound understanding of the power of autocratic societies and their consequential and complex relationships.
Nonetheless, as several testimonies at the USCC hearing revealed, the activities and dependencies among China, Iran, North Korea, and Russia have increased and deepened to the point that the relationships can be loosely characterized as a single unit – an axis of autocracy – all while each maintains a great deal of individual sovereignty.
It is hard to find positive commonalities among these four countries, but very simple to find negative ones. Among the latter are a lack of or seriously curtailed freedoms in the key areas of speech, religion, press, assembly, petition, unreasonable search and seizure, and freedom of movement.
The China-Russia Relationship
The China-Russia portion of the axis – if indeed it can be said to exist in such a concrete conceptual form – is made up of a number of components, according to Dr. Elizabeth Wishnick of the Center for Naval Analyses (CNA).
“China and Russia claim they are priority partners not allies,” Wishnick told the USCC, according to her written testimony, “but military and technical cooperation has been an important aspect of their relations since the establishment of their strategic partnership in 1996.” She went on to name concrete examples of such cooperation: “bilateral and multilateral military exercises… arms and weapons component sales, and joint production and systems development. Collaboration by Chinese and Russian actors in hybrid maritime actions has been a new area of activity since 2023.”
Wishnick also mentioned that Chinese forces “seek to learn” from Russian combat experience. The Chinese People’s Liberation Army (PLA) has not been in a battlefield for 46 years, since China first initiated and then lost a war with Vietnam in 1979.
However, it is unlikely that the PLA would see itself as an inferior partner in any military exercise. In fact, Chinese officials typically refuse to characterize any interaction with foreign individuals or entities as an opportunity to be “taught”; they have far too much pride to admit that they don’t already know something. If that concept holds true in joint exercises with the Russians, therefore, it suggests a scenario that could lead to genuine resentment between Chinese and Russian forces.
In fact, there are a dozen or more “areas of divergence” between China and Russia, which Wishnick identifies. Distrust stretches back decades to the 1950s and 1960s, when finally, the Soviet Union withdrew thousands of advisers and material support from China over the ideological chasm created by Mao’s accusation of “revisionism” (and years of tension preceding that). That history still rankles with an older generation – ask any 80-year-old in Beijing.
Wishnick pointed out, however, that “[a]t this juncture Chinese and Russian officials have made a political decision to emphasize their areas of agreement – all of their joint statements do this, omitting any areas of discord.” The care both China and Russia take to maintain a united and positive front publicly could be seen as an indication of the political will behind their relationship – but also a tacit admission of the potential for public disgruntlement.
What Really Unites the Axis: Sanctions Evasion
In one of the more compelling testimonies, the former head of intelligence at the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) addressed the economic linkages among all four autocracies, and their techniques for evading Western sanctions. Kimberly Donovan of the Atlantic Council described the “sophisticated money laundering techniques…used by U.S. adversaries, such as China, Iran, Russia, and North Korea,” who “work together to take advantage of the global financial system and evade U.S. sanctions that are intended to deter and disrupt their nefarious activity.”
“Being sanctioned by the West is one of the few things these rogue states have in common,” Donovan pointed out. Sanctions severely restrict these countries’ access to the US-led global financial system, limit their ability to trade in commodities, generate revenue, and import sophisticated technology.”
Much of Donovan’s testimony reads like a Ken Follett spy thriller. From the case studies she presented, Donovan offered three fundamental conclusions:
First, China, Russia, Iran, and North Korea have constructed elaborate systems to circumvent and evade U.S. sanctions;
Second, third country procurement networks enable these sanction evasion systems; and
Third, these sanctions evasion systems have limitations and vulnerabilities that may present opportunities for U.S. action.
China is motivated by the sanctions, by its competition with the United States, and by its need for inexpensive energy, to work with other three autocratic nations to get around the sanctions, Donovan said.
“China, Russia, Iran, and North Korea have developed trade systems that bypass Western financial systems and shipping services. In this system, payments are denominated in Chinese currency and processed through China’s opaque financial system,” she explained. Russia has adopted the Chinese yuan and is trying to connect the Chinese payment system with the Russian alternative to SWIFT. Donovan cautioned that Hong Kong in particular functions as “a hub for sanctions evasion” and money laundering, largely because, as she noted, “Many international banks still treat Hong Kong as a global financial hub.
In addition, Donovan noted that “goods and commodities, such as oil, are carried by the ‘shadow fleet’ tankers that operate outside of maritime regulations and take steps to obscure their operations.” Her testimony goes on to detail these shadow fleet trade routes and cargos, including the transport of luxury goods into North Korea. Among the examples she cited are “Chinese independent refineries called ‘teapots,’ which absorb 90 percent of Iranian oil.”
Donovan also described a barter system among the nations, such as the improbable 2021 arrangement between a Chinese company selling auto parts to Iran in exchange for $2 million worth of pistachios.
Conclusion
That China, Iran, North Korea, and Russia cooperate and collude to evade sanctions both old and new is not in question. The testimonies at the USCC hearing showed that the actors on both sides of the equation have been nimble in finding ways to get around the other.
In terms of China, it has clearly headed back to a greater degree of autocracy and therefore autocratic “friends” because there’s really no other place to go. China longed for admiration and respectability from the Western nations of the world, a prize that has remained elusive primarily due to Beijing’s own actions and the friends it now chooses to keep.
Xi Jinping needs security and energy, and has increasingly turn to fellow autocracies to fill those needs. Yet these same partners in the “axis” are countries that most of the Chinese people would prefer not to be identified with. The Chinese wish to be respected as a nation and as a people. They desire status. Most of what they do around the world is defensive, borne of a centuries-old sense of vulnerability and paranoia.
The USCC made clear that the “axis of autocracy” is at heart a set of transactional relationships. Of the four autocratic nations, it is China that is best suited to break with the other three.
