China and Russia committed to broaden economic ties

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China and Russia are mutually interested in discussing the world economy, trade cooperation and globalization at the coming BRICS summit in south China’s coastal city of Xiamen, according to Russian ambassador Ivanovich Denisov.

That’s partly because the economic cooperation between the two countries is seeing such strong prospects.

Energy lies at the center of the China-Russia economic relationship.

Russia became China’s biggest source of imported oil last year. China imported a record high of 52.48 million tons of crude oil from Russia in 2016, up 23.7 percent year-on-year, according to the administration of customs.

The oil supply will keep increasing in the coming years. China’s petroleum giant Sinopec signed an agreement with Russia in 2013 to import an additional 10 million tons of crude oil over the next 10 years. And the second construction phase of the China-Russia crude oil pipeline will be finished by the end of 2017.

Meanwhile, the China-Russia natural gas pipeline is more than a quarter complete, allowing China to use natural gas directly from its northern neighbor in about two years.

VCG Photo

China has also invested in Russia’s energy sector. The Yamal LNG project, a liquefied natural gas plant at the north east of the Yamal Peninsula, is by far the biggest one and China’first energy project inside the Arctic Circle. The facility will be in production as soon as next month.

Aviation cooperation is another highlight of the relationship.

China and Russia agreed in May to invest together to develop a new generation of commercial aircraft. The new airliner will be a wide-body long-range plane to compete with rivals like Boeing and Airbus.

Russia will also invest in the port city of Fangchenggang in south China's Guangxi Zhuang Autonomous Region, to manufacture small helicopters and drones.

The two countries also partnered in high-speed rail. The construction of the Moscow-Kazan high-speed railway has already started.

The Transbaikal Railway, the main railroad to transport oil and timber to China. /VCG Photo

Financial cooperation could be the new area that China and Russia will explore together. China Development Bank and Export-Import Bank of China signed agreements with their Russian counterparts, to invest in projects that involve the two countries.

China also started a rouble clearing service last year, with the transaction volume reaching 11.7 billion yuan (1.77 billion US dollars).

As their trading ties are getting closer, more financial cooperation is expected. Data from Chinese General Administration of Customs shows, trade between China and Russia reached 223 billion yuan for the first five months of this year.

(Cyrus Ip contributed to the story)