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Inside China: Why Putin’s intervention in Ukraine is bad news for China

- - Thursday, March 13, 2014

On March 1, two tugboats hurriedly towed a nearly completed behemoth out of Ukraine's Feodosiya shipyard on the Crimean Peninsula. It was loaded quickly onto a huge cargo ship that set sail to China.

The behemoth was the second of four Zubr-class air-cushioned landing craft, or LCAC, ordered by the Chinese navy from former Ukrainian President Victor Yanukovych's government. The vessel is the world's largest hovercraft, and is essential for amphibious assault landings along beaches and coastlines.

The Ukrainian interim government's rapid delivery of the unfinished LCAC, without conducting sea trials, was aimed at avoiding a potential freeze on arms transfers to China if Russian or pro-Russian forces took over Crimea.

Ukraine is ranked as the world's sixth-largest arms exporter. The former Soviet republic inherited a substantial portion of Moscow's weapons expertise and military industry: About 30 percent of all Soviet defense industries are located inside Ukraine.

The Ukrainian PA Yuzhmash weapons plant alone produced two-thirds of the Soviet Union's surface-to-air missiles, nearly half of all Soviet ballistic missiles, and almost all of the Soviets' space launch vehicles. Three of the Soviet Union's six surface warship shipyards were located in Ukraine and made all classes of vessels from frigates and destroyers to nuclear-powered cruisers and aircraft carriers.

After Ukraine gained independence in 1991, many of the Soviet-era military design and manufacturing capabilities remained in Ukraine, creating a dilemma for Kiev: Its big-ticket weapons systems, defense technologies, military production capabilities and weapons experts left over from the Soviet era far exceeded the needs of independent Ukraine's defenses.

As a result, over the past two decades, Ukraine has binged on arms sales, exporting advanced Soviet weapons surpluses. And Kiev's biggest customer has been China, under an international arms embargo since 1989 following the People's Liberation Army's slaughter of pro-democracy protesters in Tiananmen Square.

Over the past two decades, Ukraine has been instrumental in helping the Chinese navy become a blue-water force with global reach. The crown jewel of China's nationalism is the Kuznetsov-class aircraft carrier Liaoning. The half-finished Soviet vessel, then-known as the Varyag, was purchased for $20 million by the Chinese military from the Ukrainian government in 1998.

The merchant vessel Xue Long, or Snow Dragon, was bought by China from Ukraine in the mid-1990s. In a deal with Ukraine, China obtained its navy's largest ocean-going ship — the Qinghai Lake, a comprehensive depot/supply ship crucial for blue-water naval expeditions.

There are two reasons why China wants so many weapons from Ukraine. First, the arms are cheap, often costing Beijing a fraction of what it would have to pay for similar systems from Russia, China's other main source of arms imports.

Second, and more important, China can get Soviet- or Russian-designed advanced weapons without Moscow complaining that Beijing is violating Russian intellectual property rights.

Through Ukraine, China has obtained some key Russian technologies, including the AI-222-25 turbofan jet engine to equip China's knockoff Russian Su-27 jets; a prototype of Russia's Su-33 fighter jet known as T-10K-3; and potentially the D-18T bomber engine that is key to developing China's strategic outreach.

In recent years, Russia has become increasingly perturbed by Beijing's possession of its military technologies obtained through Ukraine. In 2011, Ukrainian journalist Anna Babinets wrote that "Russia's prime goal is to get rid of Ukraine as an arms dealer so that she can increase the price of her own military equipment and keep supplying it to Asia and Africa, without fear of competition from Ukraine."

That is why Vladimir Putin's intervention in Ukraine, especially the defense industry-heavy Crimea, is bad news for China.

For Beijing, a loophole in the low-cost, easy-access arms market may soon be sealed by the Russians.

Miles Yu's column appears Fridays. He can be reached at mmilesyu@gmail.com and @Yu_Miles.