Putin-Xi Bromance Blossoms Under Trump Tests

(Bloomberg) --

There have been outings to the zoo (to loan some pandas) and the Bolshoi Theatre for Chinese President Xi Jinping during his three-day trip to Russia. Last night, he and President Vladimir Putin strolled the streets of the former imperial capital of St. Petersburg and toured the cruiser Aurora, now a museum extolling its role in the Russian revolution.

Xi and Putin have for years spoken with mutual admiration. In recent months, they’ve taken the relationship up a notch, driven by mutual economic interest. Xi is embroiled in a nasty trade war with the U.S. under President Donald Trump, while Putin’s economy is still squeezed by sanctions.

The enemy of their enemy, it seems, is their friend.

China and Russia also share positions on handling Iran and North Korea. Xi and Putin have both shown concern about a world where trade actions are used as foreign-policy weapons, where pacts controlling nuclear arsenals are ripped up and where populism drives domestic politics.

But as they take the stage today at Putin’s annual economic forum in St. Petersburg, there are also underlying differences. China sees itself very much as the big brother, something Russia can chafe against as a reversal of the position it enjoyed during the Soviet era. Economic cooperation doesn’t mean unity on all strategic interests.

And if tensions with the U.S. fade, their need to be quite so chummy might taper with it.

Global Headlines

Time’s running out | No matter how much business groups and Republican senators oppose Trump’s Mexico tariffs, there may be no stopping them before Monday — and then rolling them back would be an even more daunting prospect. Congress has constitutional authority over trade and could pass a law to block the president’s action. But partisan gridlock and decades of delegating responsibility to the president will complicate any legislative challenge.

About face | Democratic presidential candidate front-runner Joe Biden came out against a 1976 provision that bars federal funds for abortion, just a day after he affirmed support for it in a move that drew fierce criticism from rivals and progressive activists. It's the latest sign of potential trouble for Biden with woman voters. Before he entered the race, several women said he made them uncomfortable by touching them.

Nationalist patrons | Conservative groups in the U.S. have supported an alliance of populist parties that has sought to undermine the European Union. As Marine Strauss and Boris Groendahl report, prosecutors in Vienna are looking into whether an Austrian partner of the groups broke any rules.

Massacre aftermath | Sudan’s Saudi-backed military council faces an international outcry over the June 3 shootings of pro-democracy activists that killed dozens — the worst violence since a popular uprising forced veteran President Omar al-Bashir out in April. The African Union suspended Sudan, and countries including the U.S. and Norway have denounced the killings. Russia, which says it’s trying to defuse the crisis, joined China in blocking a statement at the UN Security Council condemning the massacre.

Inside player | Lindsey Graham has two sources of power in Washington: his gavel and his golf clubs. Graham chairs the influential Senate Judiciary Committee, but his frequent phone conversations and golf games with Trump set him apart from other senior Republicans. Democrats may be dismayed by his reflexive backing of the president, but they also see him as the man to break the logjam in the Senate, Steven T. Dennis reports.

What to Watch

• Six European Union leaders meet in Brussels for dinner to discuss candidates to lead the next EU Commission.
• Kazakhstan holds elections on Sunday in which acting President Kassym-Jomart Tokayev is seeking to put an electoral seal on his position as the hand-picked successor of the central Asian nation’s leader-for-life, Nursultan Nazarbayev.

And finally...Theresa May formally steps down today as Conservative Party leader, but the British pound’s rocky road could be poised to outlast her turbulent term as prime minister. The currency could be the biggest loser if a hard-line Brexiteer such as Boris Johnson replaces May, a Bloomberg survey of analysts shows. While sterling could drop more than 2%, it would probably avoid a bigger decline on the conviction that Parliament will block efforts to leave the European Union without a deal.

--With assistance from Kathleen Hunter, Karl Maier and Ben Sills.

©2019 Bloomberg L.P.