China-Russia Economic & Trade Index 2020 Report Released

The China-Russia Economic and Trade Index Report (2020) was officially released by the China Economic Information Service (CEIS) last week.

The report reflects the trade volume between China and its regions with Russia, monitoring the development trends of bilateral trade. For 2019, China-Russia trade showed a steady upward trend rising 12.66 percent from 2018. This reflected the desire of both countries to double bilateral trade to US$200 billion by 2024.

Although the Covid-19 virus pandemic has put those immediate targets on hold, the Index shows that for 2020, China-Russia bilateral trade has maintained growth, albeit not at the same rates. Growth for 2020 is likely to be about 5-6%, which can be considered good under the circumstances.

Russia’s main exports to China have included non-edible raw materials, fossil fuels and lubricants. China’s exports to Russia include finished products classified by raw materials, machinery and transportation equipment, and miscellaneous finished products, including food, textiles, steel, and machinery.

The intra-industry trade index shows that China and Russia enjoy the highest degree of division of labor in the food industry, followed by processing manufacturing. The consumer goods retail industry is also becoming increasingly optimized between the two countries. Russia is a major supplier of agricultural products to China while Russian companies are increasingly turning to Chinese online retailers to sell their products.

The results reflect the scale and quality of bilateral economic and trade cooperation between the two countries.

Harbin, the capital city of China’s Heilongjiang Province, has inherent geographical advantages in trade with Russia. The release of the accompanying Harbin City Index provides thought- provoking support for the development of Harbin as a regional center in cooperation with Russia. Harbin, in China’s Heilongjiang Province, is the administrative centre for much Sino-Russian trade being the Provincial capital and on the main Trans-Siberian Expressway with train routes running south from Russia through the city en route to Beijing. Heilongjiang also possesses several border crossings between Russia and China, with one of the largest being at Suifenhe, near Mudanjiang. The Harbin City Radiation Index, which measures the external impact of Harbin trade with and from Russia, closed at 149.46 points in 2019, registering an increase of 13.01 percent year on year. The 2020 Index will be released next year and may also show a Covid affected decline. However this is likely to be reversed once the Covid-19 pandemic passes, meaning there are opportunities for Russian investors to look at the China export market during this time and take advantage of increasing trade volumes, and pent-up demand from next year onwards.

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