5 September 2024
China has
long been Russia’s primary foreign trade partner, and cooperation between the
two countries has only intensified since 2022. Today, trade partners are facing
difficulties concerning payments and logistics as a result of sanctions, but
these challenges are gradually being overcome. In addition, Russian-Chinese
relations should not be defined purely by trade, and it would be prudent to
strengthen cooperation in science, sharing technologies, and developing the
space sector. This will elevate partnership to a new level. Those were the
conclusions reached at the Russia–China session held at the Eastern Economic
Forum (EEF).
KEY
CONCLUSIONS
Cooperation
between Russia and China is reaching a new level
“In
a turbulent and changing world, Chinese-Russian ties have withstood the test of
international shifts, displaying maturity, stability, endurance, and
independence. <...> Our ties have entered the best period in history.
Now, we see relations between two great powers which are characterized by a
high level of trust, cooperation, and strategic value,” Zhang Hanhui,
Ambassador Extraordinary and Plenipotentiary of the People's Republic of China
to the Russian Federation.
“We are now
in a completely new political reality, and we have to look for new approaches
and build a new type of relationship between Russia and China. <...> We
are moving beyond simple cross-border trade to investment cooperation,
establishing joint ventures, bringing Russian enterprises and products to
China, and increasing the number of Chinese enterprises in Russia,” Alexey
Maslov, Director, Institute of Asian and African Studies, Lomonosov Moscow
State University.
PROBLEMS
Sanctions,
payments, and cultural differences
“Alongside
the opportunities the Chinese market offers, we are facing significant
challenges, as sanctions greatly complicate operations. Chinese banks are wary
of secondary sanctions, and Chinese contractors are cautious about working with
our companies,” Olga Basha, Senior Vice President, Head
of International Settlements Development Department, VTB Bank.
“The main
challenge is cultural. We became somewhat spoiled by the Western mentality,
whereby you sit down with a business partner, strike an agreement, and get down
to work. In China, you need to invest time and put your heart into things so as
to build a relationship with a partner,” Artem Zasurskiy, Vice President for
International Development, Sistema.
“After
decades of working in this area, we have developed a set of simple rules and
recommendations. <…> It is crucial to take into account the cultural and
linguistic nuances of the Chinese market, and to adapt products to meet the
demand of Chinese partners. We must listen to our partners in China. If they
suggest changes to packaging or formulas, those adjustments must be
considered,” Veronika Nikishina, General Director, Russian Export Center.
SOLUTIONS
Stimulating
investment
“We
see that investments can and should be increased. What is being done in this
regard? Together with our partners, we lead the entrepreneurs’ committee under
the Russia–China Investment Commission. This is an essential body that
identifies key projects, ensures investments are made, and monitors progress.
We also hold meetings between Russian and Chinese entrepreneurs,” Kirill
Dmitriev, Chief Executive Officer, Russian Direct Investment Fund (RDIF).
Developing
alternative payment methods
“We
are working on alternative payment methods, such as clearing [reducing the
number of transactions – ed.] or netting [discharging mutual obligations
– ed.], whereby transactions are settled through offsets of balanced
volumes of exports and imports. <…> We are launching such a platform,” Veronika Nikishina, General Director, Russian Export
Center.
“We believe that yuan-rouble
transactions do not fall under the jurisdiction of Western countries. That in
turn opens up a great many opportunities to progress,” Kirill
Dmitriev, Chief Executive Officer, Russian Direct Investment Fund (RDIF).
“We are doing everything to improve
the payment system. It’s important to note that beyond Russia and China, the demand
for transactions with neighbouring countries is growing. With VTB’s presence
extending beyond China – we have a joint bank in Vietnam and a branch in India
– cross-conversion between the yuan, dong, and rupee is becoming possible. All
this is expanding the opportunities open to us,” Olga Basha, Senior Vice
President, Head of International Settlements Development Department, VTB Bank.
Harmonizing
standards and documents
“Local
government agencies and bodies must expedite the implementation of bilateral
cooperation agreements signed by our heads of state and prime ministers. It is
essential to enhance transport and logistics infrastructure, accelerate the
creation of an interconnected transport system, and simultaneously improve the
alignment of standards and information exchange rules. We must continue to
improve the business environment and promote investment,” Liao Jiasheng,
General Director, China Logistics Group.
“Neither
China nor Russia has a particularly simple regulatory environment, and
companies in both countries face various barriers. Nonetheless, China remains a
strategic partner for us,” Alexander Ivlev, Co-Chairman of the Executive
Committee, Foreign Investment Advisory Council (FIAC); Advisor, B1 Group.
Opening
up new logistics routes, including via the Arctic
“The
business communities of our countries must further... the development of
transport routes, strengthen cooperation in rail, aviation, road, and maritime
transport... and collaborate on the development of Arctic routes such as the
Ice Silk Road and so on,” Liao Jiasheng, General Director, China Logistics
Group.
“We
believe that participating in the development of Arctic routes is not only a
good business opportunity, but also our mission and contribution. <…> We
have signed an agreement with the Russian state corporation Rosatom, and plan
to put together a fleet capable of navigating Arctic waters year-round.
<…> We expect these routes to expand, reaching Kazan and other cities,”
Ke Jin, General Director, NewNew Shipping.
Expanding
areas of cooperation
“We
need to focus on the long term. We should strengthen cooperation in green and low-carbon
energy; explore the integration of wind, solar, and gas energy; and collaborate
on technologies with zero carbon emissions, such as geothermal and hydrogen
power,” Zhang Daowei, Vice President, China National Petroleum Corporation.
“The
scope of cooperation [between Russia and China] has expanded from traditional
areas such as energy and minerals to emerging sectors like artificial
intelligence, the digital economy, green and low-carbon industries, services,
and transnational e-commerce,” Zhang Hanhui, Ambassador Extraordinary and
Plenipotentiary of the People's Republic of China to the Russian Federation.
“We should
already be thinking about taking cooperation to a fundamentally new level,
focusing on new areas such as the high-tech sector, artificial intelligence,
space, biotech, and other science-intensive industries. Projects in these
fields will not only lead to success for all involved, but also to shared
ground-breaking scientific developments, making for a world-class partnership,”
Alexey Repik, Chairman, Delovaya Rossiya (Business Russia).
“Every CNY
1 million invested in space infrastructure generates up to CNY 100 million in
the growth of other sectors. Therefore, one of the most crucial areas of
technical cooperation and development today is collaboration in the space
sector. This is not just about sharing technology, but also working together on
space exploration,” Pavel Cherenkov, General Director, Sitronics Space.
“We believe
one of the best solutions to the current situation [the inability to rapidly
replace imports in IT and telecommunications – ed.] is technology
transfer from friendly countries, and primarily China. <…> I’m not really
talking about first-tier companies like Huawei, again due to the threat of
sanctions, but about second- and third-tier companies, of which there are a
great many in China,” Andrey Borodin, Partner for IT and Telecommunications,
Ingvarr Zhong Yin.
For more
information, visit the Roscongress Foundation’s Information and Analytical
System at roscongress.org/en
