Russian-Chinese Economic Relations and Belt & Road Initiative Investments

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2023 Bilateral trade likely to be about US$235 billion as bilateral investments reach tens of billions

The Russian President Vladimir Putin has been meeting with the Chinese Premier, Xi Jinping in Beijing. We outline some of the essential issues and developments that took part during these extensive bilateral talks and look at some of the major development issues that have taken place between them.

Legal framework

The Treaty on Good Neighborliness, Friendship, and Cooperation between the two countries was signed in July 2001, and serves as the foundation for Russian-Chinese trade and economic cooperation, describing economic relations between the two nations as a comprehensive, equal, trusting partnership, and strategic interaction. The treaty was extended for five years in June 2021. Action plans to implement the provisions of this document are adopted every four years.

Trade turnover

According to China’s General Administration of Customs, trade turnover between the two countries increased by 29.3% in 2022 compared to the previous year, reaching US$190.27 billion, which is a record figure for the two countries over the entire period of cooperation. Imports from Russia to China increased by 43.4% in 2023 to US$114.15 billion, while exports from China to Russia increased by 12.8% to US$76.12 billion. Russia accounted for 3% of total foreign trade turnover in China. According to China, in January-September 2023 bilateral trade turnover increased by 29.5% totalling US$176.4 billion and suggesting a 2023 total of US$235.2 billion is likely to be achieved.

Russia primarily exports energy resources, metals, timber, agricultural products, and seafood to China. China, in turn, imports cars and trucks, consumer electronics, excavators, microprocessor units, clothing, shoes, and consumer goods.


A special intergovernmental commission on investment cooperation serves as the primary mechanism for interaction between the two countries in the field of investment. The Russia-China Investment Fund, established jointly by the Russian Direct Investment Fund and the China Investment Corporation, has been in operation since 2012. The Russia-China Investment Fund for Regional Development was established in 2018 with a target capital of approximately US$750 million, with priority given to projects in the energy, transport infrastructure, logistics and agriculture sectors.

According to the Russian Ministry of Economic Development, as of September 2023, Russia and China implemented 79 large-scale projects together, with total investments of around US$170 billion. According to the Consulate General of China in Vladivostok, Chinese investments in the Russian Far East exceeded US$13 billion in 2022. According to the Russian-Asian Union of Industrialists and Entrepreneurs, the main areas of Chinese investments in Russia in numerous sectors, and replacing the Western companies that have left Russia due to political pressure or sanctions.


At the end of 2022, Russia was second in terms of oil supplies to China, exporting 86.25 million tons of oil.  (Saudi Arabia was first with 87.49 million tons). In 2023, Russia increased exports – 60.6 million tons were supplied to China in H1 2023, a 25.2% increase over the same period last year. Oil imports from Russia to China fell 5.8% in value over the same period to US$32.1 billion.

Russia supplies oil to China through three main routes: a branch of the Eastern Siberia-Pacific Ocean (ESPO) oil pipeline, tankers passing through Kazakhstan, and from the port of Kozmino in the Far East.

Until recently, China also received 7 million tons of Russian oil through Kazakhstan each year. That has increased. Rosneft and China National Petroleum Corporation signed an agreement in February 2022 to increase transit to 10 million tons of oil per year for ten years. The contract is worth US$80 billion.

Natural gas

The Power of Siberia gas pipeline began transporting gas to the Russian domestic market and for export to China in December 2019. A branching pipeline to the eastern regions of China was built on the Russian-Chinese border in the area of the Russian city of Blagoveshchensk and the city of Heihe, located on the opposite side of the Amur River. Gazprom and CNPC signed the contract in May 2014.

Gas will be supplied along the eastern route for 30 years, while the pipeline’s design capacity reaches 38 billion cubic meters of gas per year. The value is US$400 billion. Gazprom supplied 10.39 billion cubic meters of gas to China via this pipeline in 2021, 15.5 billion in 2022, and 22 billion cubic meters in 2023. The construction of a gas processing plant in the city of Svobodny (Russia’s Amur Region) was a critical step in the route’s development. The first line was launched in June 2021, with full design capacity expected by 2025 (42 billion cubic meters per year).

The second project entails shipping up to 50 billion cubic meters to China along the Power of Siberia – 2 pipeline transports of gas per year. The route will be laid through Western Mongolia to the West China’s Xinjiang Province. It passed the feasibility study stage in January 2022, although the contract for gas supplies has yet to be signed.

The third project involves the supply of gas from the Sakhalin island’s shelf along the Power of Siberia – 3 gas pipeline currently under construction to the cities of Dalnerechensk and Hulin (Far Eastern route). Gazprom and CNPC signed an agreement in February 2022 to supply 10 billion cubic meters of natural gas every year for the next 30 years via this route. Moscow and Beijing signed a corresponding intergovernmental agreement on January 31, 2023 (ratified by the State Duma on May 31, 2023). Gazprom and CNPC signed a technical agreement on the project in June 2023.

The volume of Russian pipeline gas supplies to China will reach 48 billion cubic meters every year once the Power of Siberia and Power of Siberia 3 projects reach full capacity.


Chinese investors are involved in Russian projects for the production of liquefied natural gas (LNG). In December 2015, the Silk Road Fund acquired a 9.9% stake in Yamal LNG and gave a US$770 million loan to the company. CNPC owns the remaining 20% of this project. In July 2019, Novatek agreed to sell a 20% stake in the Arctic LNG – 2 natural gas liquefaction plant construction project to two Chinese corporations (10% each) – CNPC and CNOOC (China National Offshore Oil Corporation). Novatek signed long-term contracts with the Chinese companies ENN Natural Gas and Zhejiang Energy in January 2022 for the supply of LNG from the Arctic LNG 2 project. Novatek and Zhejiang Energy agreed to supply 1 million tons of LNG per year for the next 15 years. The agreement with ENN Natural Gas calls for the supply of approximately 0.6 million tons of LNG per year for the next 11 years. LNG will be delivered to the companies’ Chinese receiving terminals.

The Beijing-based China Development Bank and Russia’s VEB agreed on a strategic partnership in September 2019 to finance the construction of a natural gas processing plant in Nakhodka. The first stage of the project’s total design production capacity will be 1.8 million tons of methanol per year. Natural gas for production will be sourced from Sakhalin fields. The plant’s construction began in 2020, with full capacity expected in mid-2023. VEB.RF has already received loans totalling US$11.6 billion from the China Development Bank.

Russia exported 6.5 million tons of LNG to China in 2022 (a 44% increase in comparison with 2021), supplies increased 2.4-fold, in value terms exceeding US$6.74 billion.

Russian LNG supplies to China in January-July 2023 increased by 62.7% year-on-year to 4.46 million  tonnes suggesting an annual volume of about 7.54 million tonnes. To compare, the European Union imported about 88 million tonnes of LNG in 2022.

Nuclear energy

Atomstroyexport, a division of Russia’s state corporation Rosatom, built four power units with VVER-1000 reactor units at the Tianwan NPP between 1998 and 2018. Their total cost is estimated to be around US$3.5 billion. The nuclear fuel for this nuclear power plant is supplied by Rosatom subsidiary TVEL under a US$1 billion contract until 2025. The Russian and Chinese parties signed agreements worth more than US$50 million to service the installed capacities. On March 7, 2019, a general contract for the construction of the 7th and 8th power units with VVER-1200 reactors of the latest generation 3+ was signed – China is building the 5th and 6th blocks of its own design.

A strategic program for the development of interaction in the field of nuclear technologies until 2030 was signed in March 2023.


China is the world’s largest coal importer. Russia and China signed a roadmap for the development of coal cooperation in October 2014.

According to Russian Deputy Energy Minister Sergey Mochalnikov, Russian coal exports to China have increased 2.6-fold in the last six years to 67 million tons per year, with at least 85 million tons of Russian coal expected to be supplied to China by the end of 2023.


China is a major importer of Russian food and agricultural raw materials. According to the Russian Federal Customs Service, Russian exports of this category of goods to China totaled US$3.5 billion in 2021. China traditionally buys a lot of fish and seafood (more than 30% of total exported food volume). Russian vegetable oil, honey, chocolate, beer, and ice cream exports have increased over the last five years. In 2015, China opened the grain market to Russian producers.

Uralkali signed agreements to supply approximately 3.5 million tons of potassium chloride to China between 2023 and 2025 on June 15, 2023.


The Europe-Western China corridor is the largest transportation project. The highway spans approximately 8,500 kilometers, with 2,200 kilometers in Russia, 2,800 kilometers in Kazakhstan, and 3,500 kilometers in China. Construction started in 2008 and is expected to be finished by 2024. The cargo transportation volume is expected to be 33 million tons per year. Some of the facilities are already operational. Chinese companies’ investments are estimated at US$1.53 billion.

A road bridge and a cable car across the Amur River between Blagoveshchensk and Heihe opened in August 2020. The project’s total cost is estimated to be US$204.18 million. The bridge was open to freight traffic in June 2022.

Settlements in national currencies

The Bank of China was the first of China’s commercial banks to begin settlement operations in RMB Yuan and Rubles in March 2003. In March 2017, a yuan settlement and clearing center was opened in Moscow. There are several representative offices of Russian banks in China, as well as a branch of VTB Bank in Shanghai. There are around 60 Russian commercial banks with correspondent accounts in Chinese banks.

Since October 2017, a payment system for RMB Yuan and Russian Ruble settlements has been operational within the framework of the China Foreign Exchange Trade System (CFETS).

On June 5, 2019, an intergovernmental agreement on the transition to mutual settlements in national currencies was reached. In March 2023, Russian President Vladimir Putin stated that Russia and China already conduct two-thirds of their trade in RMB Yuan and Rubles.

Belt & Road Initiative

A joint production between China’s CGTN and Russia’s BRICS TV was broadcast live in China during the 3rd Belt & Road Summit in Beijing and contains plenty of China-Russia discussions. That can be accessed here.

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About Us

During these uncertain times, we must stress that our firm does not approve of the Ukraine conflict. We do not entertain business with sanctioned Russian companies or individuals. However, we are well aware of the new emerging supply chains, can advise on strategic analysis and new logistics corridors, and may assist in non-sanctioned areas. We can help, for example, Russian companies develop operations throughout Asia, including banking advisory services, and trade compliance issues, and have done since 1992.

We also provide financial and sanctions compliance services to foreign companies wishing to access Russia. Additionally, we offer market research and advisory services to foreign exporters interested in accessing Russia as the economy looks to replace Western-sourced products. For assistance, please email or visit