Russia and China sign deals worth US$20 billion as Xi Jinping and Vladimir Putin’s growing friendship bears fruit
- Agreements to boost cooperation in spheres such as energy and technology highlight closer partnership in face of tensions with US
China and Russia have signed more than US$20 billion of deals to boost economic ties in areas such as technology and energy following Xi Jinping’s summit with his “best friend” Vladimir Putin.
Wednesday’s meeting between the two presidents, who have spoken of their desire to boost practical cooperation in the face of increasing rivalry with the United States, marked the start of Xi’s three-day visit to Russia to commemorate the 70th anniversary of the establishment of diplomatic relations between Moscow and Beijing.
On Thursday the Chinese commerce ministry said that the two sides aimed to increase the volume of trade between the two countries to US$200 billion a year following last year’s 24.5 per cent rise to a record level of US$108 billion.
Gao Feng, a spokesman for the ministry, said the deals covered areas such as nuclear power, natural gas, automobiles, hi-tech development, e-commerce and 5G communications.
The deals were the first concrete results of the warm words exchanged between the leaders, who agreed to deepen their “unprecedented” strategic partnership for “mutual advantage”.
“We discussed the current state of, and prospects for, bilateral cooperation in a businesslike and constructive manner, and reviewed, in substance, important international issues while paying close attention to Russia-China cooperation in areas that are truly important for both countries,” Putin said in a joint press statement with Xi on Wednesday.
Xi – who had previously told Russian media that he “treasured” the relationship with Putin, whom he described as “my best friend” – said the two countries would work to “build mutual support and assistance in issues that concern our key interests in the spirit of innovation, cooperation for the sake of mutual advantage, and promote our relations in the new era for the benefit of our two nations and the peoples of the world”.
Putin also highlighted the energy cooperation between the two countries, adding that Russia was China’s leading oil exporter and the eastern route of a gas pipeline between Russia and China will enter service in December.
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Novatek and Sinopec, Russian and China’s leading natural gas companies, signed a preliminary deal with Russian state-owned bank Gazprombank on Wednesday to set up a joint venture to market gas in China.
The Russian natural gas company is also forming a partnership with China Natural Petroleum Corporation and China National Offshore Oil Corporation to develop an Arctic natural gas facility, with both Chinese companies holding a 10 per cent stake in the project, according to S&P Global Platts, an energy information provider.
A general contract was also signed to build extra units of the Xudabao Nuclear Power Plant, located on the coast of the northeastern Chinese province of Liaoning.
The Chinese commerce ministry also said that Moscow had agreed to increase its soybean exports after imports from America declined sharply due to the ongoing trade war.
Andrey Denisov, Russia’s ambassador to China, was quoted by Chinese media as saying that the country should “double” its soybean exports to China, which currently make up a tiny proportion of the overall quantities bought by China.
The two sides are also discussing a US$153.3 million investment to create a joint agricultural holding company in Primorsky in Russia’s far east.
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Meanwhile, Chinese telecoms giant Huawei, which has been targeted by US sanctions after it was accused of spying and undermining national security, signed a deal with Russian telecoms company MTS to develop a 5G network.
China Investment Corporation and RDIF, a Russian sovereign wealth fund, were also reported to have agreed to set up a US$1 billion joint technology research fund, according the US-based analysts Sovereign Wealth Fund Institute.
Shi Yinhong, an international relations professor at Renmin University of China, said the two sides were boosting their strategic and diplomatic collaboration at a time of “extraordinary” tensions between Washington and Beijing.
“Though concrete cooperation in hi-tech areas [between Beijing and Moscow] is necessarily limited, in the purely military field it is assured,” Shi, an adviser to China’s State Council, said.
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While Xi is highlighting his rapport with his “best friend” Putin, the professor added, “the romance has gone out of the personal relationship between Xi and [Donald] Trump”.
