Sino-Russian economic relations amidst global uncertainties

Jovičić, Elena and Jolović, Nevena (2024) Sino-Russian economic relations amidst global uncertainties. In: International Academic Conference: Harvesting the winds of change: China and the global actors. Institute of International Politics and Economics, Belgrade, pp. 172-190. ISBN 978-86-7067-338-0

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Abstract

The study aims to examine the current development of economic cooperation between China and Russia in the context of the impact of the Russia-Ukraine conflict. The particular focus is on the analysis of investment and the dynamics of bilateral trade, including the identification of the main challenges and prospects for the coming period. Based on secondary data analysis, it can be concluded that Chinese investment in Russia has sharply declined over the past three years, while total Sino-Russian trade has significantly increased. Although bilateral trade has exhibited a positive trend, it is characterised by a significant structural imbalance stemming from the fact that Russia mainly supplies raw materials and China exports high-tech products to Russia. Regarding investment, despite the declared “no limits partnership” between China and Russia and the opening up of the space for deeper cooperation after Western companies withdrew investment from the Russian market, China has been acting rather cautiously, taking into account sanctions and geopolitical risks. In the coming period, trade cooperation is expected to expand further while China will most likely pursue a cautious investment policy, engaging exclusively in particularly profitable projects. In the long term, however, if the relationship deterioration between Russia and Western countries persists, a new economic system may emerge, with China taking the lead in investment activities.

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