Trade relations boom between China, Russia

By Chen Qingqing Source:Global Times Published: 2017/10/30 23:23:39

Premier Li, Medvedev to discuss high-tech, infrastructure projects


Trade between China and Russia has been rising this year, boosted by growing high-level political trust, with experts predicting a further expansion in ties.

The two countries are expected to expand their cooperation in various sectors, including infrastructure, investments, agriculture and energy during the visit of Russian Prime Minister Dmitry Medvedev to China from Tuesday to Thursday, said Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation.

"Chinese and Russian industries are mutually beneficial and highly complementary," he said.

During his visit, Medvedev will meet with Chinese Premier Li Keqiang on key areas of China-Russia cooperation, such as high-tech and infrastructure, according to the Russian government's website.

From January to September, trade between China and Russia rose 27.7 percent from the previous year to 419.6 billion yuan ($63.2 billion), according to data released by the General Administration of Customs of China in October.

"Since the beginning of the year, bilateral trade has improved, which is the result of policy adjustments made by the Russian and Chinese governments," Ma Youjun, director of the Russia Institute at Heilongjiang Provincial Academy of Social Sciences, told the Global Times on Monday.

While Russia has shifted its focus from its western regions to its Far East, the Chinese government has launched the Belt and Road initiative. As a result, projects like the China-Russia oil pipelines have generated more-than-expected benefits for the two sides, Ma noted.

Russia remained China's biggest crude oil supplier ahead of Angola and Saudi Arabia for the seventh straight month in September, Reuters reported, citing Chinese customs figures. Russia's crude oil exports to China hit a record-high of 1.55 million barrels per day, or 6.35 million tons, an increase of 60.5 percent from the previous year.        

"Russia's increasing oil exports have helped stabilize China's energy supply, while China, which has an edge in light industries, exports highly in-demand products to Russia like textiles," Bai said.

Bilateral trade has declined in recent years mainly because of fluctuations in the value of the Russian ruble, "which was affected by US dollar-denominated commodity prices," Bai said.

To mitigate the exchange rate risk, China recently established a payment-versus-payment system for yuan-ruble transactions. China's central bank has approved the service.

More deals

Still, a large part of the trade between China and Russia remains "buying and selling," Ma said. "Aside from the rise in energy cooperation, more deals are expected to be signed in industrial cooperation, but Chinese and Russian companies need to further integrate into each other's supply chain," he said.

Since the dissolution of the Soviet Union decades ago, Russia has maintained a competitive advantage in heavy industries, which is also an area to be further explored, the expert added.

The two countries have jointly launched developed projects in aviation, agriculture equipment and machinery.

"Healthy China-Russian relations will also counterbalance US influence, which will help stabilize the global geopolitical and economic outlook," Ma said.



Posted in: DIPLOMACY

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