Russia, China Celebrate ‘Perfect Example Of Bilateral Cooperation’

Posted by

Russian-Chinese relations have reached an unprecedentedly high level, according to the Russian and Chinese Foreign Ministers Sergey Lavrov and Wang Yi in remarks dedicated to the 20th anniversary of the Russian-Chinese Treaty of Good-Neighborliness and Friendly Cooperation. The text of that original document can be found here.

In the original treaty, specific national consideration and collaborations were outlined. These included:

Russia

Wishes to obtain sources of capital, which it needs following severe losses to international speculators during the process of the dissolution of the USSR. This effort can be significantly aided using Chinese capital. Accordingly:

  • Russia wants to find sources of employment for its skilled workforce.
  • Russia wants to sell its military technology and expertise.
  • Russia wants to sell its large reserves of petroleum and natural gas.

China

Wishes to develop and modernize its armed forces, much of which remain outdated. This process can be accelerated with Russian military training and technology.

  • China wants to obtain a stable, consistent, and affordable level of fuel shipments, especially petroleum. This goal can be better met with purchases and delivery of Russian oil, including the construction of an Eastern Siberia-Pacific Ocean Oil Pipeline.

Mutual

The United States, Japan and the European Union are three economic powers who possess a skilled workforce and access to capital. Russia and the PRC can more effectively compete against these powers in the world economy, with Russia given access to Chinese capital and China given access to Russian training and technology.

The Treaty has been updated and amended on numerous occasions since, most notably with Belt and Road interconnectivity and the development of LNG as a fuel source. The treaty also encompasses a mutual, cooperative approach to environmental technology, energy conservation, the regulatory environment, international finance, and trade, and highlights a commitment to ensure the “national unity and territorial integrity” in the two countries – an issue of increasing relevance given the current status of Afghanistan.

“Relations between Russia and China have reached unprecedented heights, becoming a perfect example of cooperation between countries in the 21st century. As with every success story, there are certain benchmarks that direct the movement forward for years to come,” Lavrov pointed out. He stressed that the signing of the Treaty of Good-Neighborliness and Friendly Cooperation by Russian President Vladimir Putin and then Chinese leader Jiang Zemin had become a milestone in relations between the two countries.

“It reflected the long-standing traditions of good-neighborliness and friendship between the Russian and Chinese people and outlined the vision of a new model of ties between the two countries. A model that is in line with the core national interests of both countries and the aspirations of their people, and plays an important role in maintaining a stable multipolar world order, guaranteeing security and stability,” the Russian top diplomat emphasized.

According to Lavrov, key provisions of the treaty formed the basis of hundreds of bilateral documents and influenced the development of a legal framework for the two countries’ relations with third nations. Lavrov noted that Moscow and Beijing had “political will, economic feasibility and matching foreign policy priorities” to boost their strategic partnership.

China’s Foreign Minister Wang Yi, speaking at a reception in Beijing marking the 20th anniversary of the signing of the Sino-Russian Treaty of Good Neighbourliness and Friendly Cooperation, said that China and Russia had “built strong strategic support for mutual security and development” and would “always be each other’s strong backers”.

He said the two countries should “further deepen political mutual trust” and “push the comprehensive strategic partnership in a new era, which is not allies but better than allies, to new heights”, according to a transcript published by the Chinese foreign ministry.

“We must further strengthen strategic collaboration and firmly build a strong pillar for maintaining world peace and security,” Wang said. “We will hold high the banner of multilateralism, oppose hegemony and power politics, counter the new cold war and group conflicts.”

Wang said cooperation would also be strengthened on counterterrorism and climate change.

Moscow and Beijing expect to achieve a new record high in mutual trade by the end of 2021, and to reach a trade turnover of US$200 billion in the long-term perspective, Russian Foreign Minister Sergei Lavrov has said.

“China is our largest foreign trade partner. In 2020, the dynamics in this area was negatively affected, albeit not radically, by the coronavirus pandemic. However, we observe a rapid recovery in volumes. There is every reason to expect achieving a new record high in trade by the end of 2021, and in the long term – reaching the target level of $200 billion, which was set by the heads of state,” he said.

According to Lavrov, trade and economic ties are the most important component of Russian-Chinese relations in accordance with Article 16 of the Treaty of Good Neighborliness and Friendly Cooperation. The minister noted that since 2001, the mutual trade turnover has soared almost 14 times and for the last three years has consistently exceeded US$100 billion.

Russia-China bilateral trade can be expected to receive a further, significant boost when the two parties agree on tariff reductions relating to the China-Eurasian Economic Union Free Trade Agreement that was signed off in 2018. Negotiations are still continuing and when completed will provide a massive impetus in bilateral trade.

We discussed the opportunities for Russian companies selling to China in this article.

Chris Devonshire-Ellis of Dezan Shira & Associates comments “There have been practical difficulties for Russian companies investing in China and wanting to set up trading or manufacturing enterprises to take advantage of the China market. These have included sanctions related issues and difficulties in opening bank accounts in China. However, we have solved these and are able to help Russian investors facilitate bank account opening in Shanghai.”

Related Reading

 

About Us

Russia Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Eurasia, including China, Russia, India, and the ASEAN nations, assisting foreign investors into the Eurasian region. Please contact Maria Kotova at russia@dezshira.com for Russian investment advisory or assistance with market intelligence, legal, tax and compliance issues throughout Asia.

Leave a Reply

Your email address will not be published. Required fields are marked *