In the first ten months of 2023, the trade turnover between Russia and China increased by 27.7% compared to the same period in 2022 and amounted to almost $196.5 billion. Such data on Tuesday, November 7, was presented by the General Administration of Customs of the People's Republic of China.
According to the agency, from January to October, shipments of Russian products to the Asian republic increased by 12.4% in annual terms - up to $106.4 billion. Beijing, meanwhile, increased sales of goods to Moscow by 52.2% - up to about $90.1 billion.
"The volume of trade that we are talking about today is really impressive. After all, we set ourselves the goal of reaching $200 billion in 2024. And when we formulated this in 2019, I will tell you frankly, few people believed that it was possible at all, because at that time our trade turnover was $100 billion," Russian President Vladimir Putin said on October 18 during a visit to China.
If the current growth rate is maintained, the target of $200 billion may not only be achieved in 2023, but also significantly exceeded, according to the Federal Customs Service of the Russian Federation. According to the ministry's estimates, by the end of this year, the volume of Russian-Chinese trade should be about $215-220 billion.
China has been Russia's key trading partner for ten years. At the same time, in less than a year, Moscow was able to rise from tenth to sixth place in the list of Beijing's main export-import destinations.
"And if we keep in mind that any country always has a larger trade turnover with neighboring countries (I mean South Korea and Japan), then among non-regional countries, we, in fact, occupy the second place in trade with China, after the United States, overtaking Germany in this indicator," Vladimir Putin said.
- RIA Novosti
- © Sergey Guneev
The growth of mutual trade with the Asian republic noticeably accelerated last year, after the introduction of unprecedented economic sanctions against Moscow by Western countries. Against the backdrop of various restrictions from the United States and the EU, as well as the withdrawal of many American and European companies from the Russian Federation in 2022, the volume of Russian-Chinese trade increased by 29.3% at once and approached a record $190.3 billion at that time.
"Despite the difficult external situation, our trade and economic cooperation is actively developing... We are strengthening our partnership in the energy sector. Supplies of Russian oil, natural gas, coal, and electricity to China are increasing. We are also building up cooperation in industry," Russian Prime Minister Mikhail Mishustin said on October 25 at a meeting with Premier of the State Council of the People's Republic of China Li Qiang.
According to the latest available data from Chinese customs, from January to September 2023, almost 74% of all exports from the Russian Federation to China accounted for hydrocarbons. At the same time, Russia has become the main supplier of crude oil to China, ahead of Saudi Arabia, its main competitor in the energy market of the Asian republic. Moreover, Moscow now sells raw materials to Beijing at an average of $75 per barrel, which is significantly higher than the price ceiling set by the West of $60.
In addition to energy, China is actively buying metals and wood from Russia. Meanwhile, experts note an increase in the supply of higher-value added products.
"The Chinese market has traditionally been very important and promising for Russian companies. At the same time, we see that non-resource and non-energy exports to China are also growing... We supply not only low-value-added products, but also goods with higher added value, for example, in the field of agriculture and food," Veronika Nikishina, head of the Russian Export Center, said in a conversation with RT.
China, in turn, is noticeably increasing its presence in the Russian car market. So, if at the beginning of 2022 only 9% of new cars sold in the Russian Federation belonged to Chinese brands, then by the end of September 2023 this figure reached 54%, according to the materials of the analytical agency Autostat.
- BAIC and Kayi cars in Agat showroom in Volgograd
- RIA Novosti
- © Kirill Braga
Moreover, today up to 92% of cars imported from abroad to Russia come from China. This was told in an interview with RT by the acting head of the Federal Customs Service of the Russian Federation Ruslan Davydov. According to him, Western countries, primarily European ones, "made a strategic mistake by cutting themselves off from the Russian market," while China took advantage of the window of opportunity.
"In general, the Chinese auto industry has made a giant leap forward over the past two years. The country has reached a sustainable level of production, which makes it possible to accumulate profits for subsequent investments in new technologies. And we see how the quality of Chinese cars is improving literally before our eyes. At the same time, our consumers are getting used to it and are no longer afraid to buy Chinese," Davydov added.
"Directly impacts economic recovery"
Along with cars, Chinese companies massively supply industrial equipment, electronics, household appliances and a number of other consumer goods to Russia, Natalia Milchakova, a leading analyst at Freedom Finance Global, said in a conversation with RT. In general, in her opinion, the strengthening of trade cooperation with China has made it possible to minimize the impact of Western sanctions on Russia.
Initially, in the face of unprecedented external pressure, a number of analysts predicted a collapse of the Russian economy by 10-25% in 2022. Nevertheless, the real decline was only 2.1% and was even less deep than in the pandemic 2020 (2.7%) and the crisis 2009 (7.8%). Moreover, in 2023, the country's GDP is expected to fully recoup last year's losses and add about 3%.
"The increase in trade with China has a direct proportional effect on the recovery of the Russian economy after last year's recession. China is our main trading partner, to which a significant part of the export flows of raw materials previously supplied to the West has been redirected. Russian GDP by the end of 2023 is projected to grow by 2.8%, and an increase in exports of Russian raw materials and goods to China will make a great contribution to this growth," Milchakova stressed.
It is noteworthy that as mutual trade increases, Moscow and Beijing are trying to use dollars and euros in trade operations less and less. Thus, according to the Russian government, today more than 90% of cross-border settlements are carried out by Russia and China in rubles and yuan.
"We see a significant increase in the share of national currencies in trade. This allows us not to depend on third countries and build relations only on the basis of our own priorities," Veronika Nikishina emphasized.