More trade, less commitment: a new turn in Russia-China economic relations

You are invited to a seminar titled More trade, less commitment: a new turn in Russia-China economic relations, hosted by the Belt and Road Initiative Research Cluster at the NUS Faculty of Arts and Social Sciences.

Speaker: Dr Janis Kluge (German Institute for International and Security Affairs)
Date: Monday, 28 Aug 2023
Time: 4pm – 5:30pm (SGT)
Venue: NUS AS7 01-17 (Seminar Room B)
The Shaw Foundation Building, Block AS7, #01-17
5 Arts Link, Singapore 117570
Registration: Microsoft Forms (or scan the QR code to register)

More trade, less commitment: a new turn in Russia-China economic relations

Since February 2022, when Russia launched its invasion of Ukraine and Western countries imposed harsh sanctions on Moscow, trade between China and Russia has increased significantly. Chinese suppliers replaced Western competitors in many sectors, accounting for half of Russian total imports in 2023. Russian trade data also suggests that China plays a key role in sanctions circumvention. Russia, in turn, increased its energy exports to China, although logistical bottlenecks limited the diversion of hydrocarbon trade from west to east. For sanctions-hit Russia, the Chinese renminbi has become much more important, both for trade settlement and for as a reserve currency. However, the long arm of sanctions has also hurt Sino-Russian cooperation in key areas, especially in the high-tech and the digital economy. Some Chinese companies, such as Huawei, have reduced their business with Russia or relocated Russian staff to neighboring countries such as Kazakhstan, and a project to jointly develop a long-range aircraft has been cancelled. Chinese investors are also wary of investing in the Russian economy, given the political and sanctions risks involved, as well as the bleak long-term prospects. While Russia-China trade is booming and crucial for Moscow‘s ability to withstand sanctions, economic cooperation between the two countries does not have the same depth of Russia’s previous ties with Western partners and is unlikely to be an equivalent substitute.

Dr Janis Kluge is a Senior Associate at the German Institute for International and Security Affairs (SWP) in Berlin, where he consults the German government and Bundestag on foreign policy issues. His research focuses on Russia’s economic development, Russia-China relations and sanctions. He holds a PhD in economics from Witten/Herdecke University.