Rus­sia and China to show united front at show­case eco­nomic fo­rum

Daily Mirror (Sri Lanka) - - MIRROR BUSINESS -

MOSCOW (AFP) - Chi­nese Pres­i­dent Xi Jin­ping ap­peared yes­ter­day as guest of honour at Rus­sia’s show­case eco­nomic fo­rum, as the two neigh­bours present a united front in the face of shared trou­bles with the US.

Xi ar­rived in Moscow on Wed­nes­day for a three-day visit with Vladimir Putin and de­scribed the Rus­sian leader as his “best friend” dur­ing a cosy meet­ing at the Krem­lin.

To end the trip, Xi and his host will ap­pear at a ple­nary session of the an­nual Saint Petersburg Eco­nomic Fo­rum, which Moscow hopes will woo for­eign in­vestors de­spite an un­cer­tain busi­ness cli­mate.

Xi is set to present China’s ideas on sus­tain­able devel­op­ment and mul­ti­lat­eral co­op­er­a­tion, Bei­jing said ahead of his ap­pear­ance.

The 2019 fo­rum “will il­lus­trate very clearly just how bi-po­lar the world has be­come,” said Chris Weafer, a se­nior part­ner at the Macro Ad­vi­sory con­sult­ing firm.

“In the same week that Pres­i­dent Trump will be hav­ing tea with the Queen in Lon­don, Pres­i­dent Putin will be host­ing Pres­i­dent Xi in Saint Petersburg.”

The trip comes five years af­ter Moscow’s an­nex­a­tion of Ukraine’s Crimea penin­sula led to a serious rift with the West and a move to­wards Rus­sia’s neigh­bour to the east.

Bei­jing is mean­while locked in a trade war with the United States.

Moscow and Bei­jing’s eco­nomic ties have grown in re­cent years, though they re­main heav­ily weighted in favour of China, which dwarfs Rus­sia in eco­nomic and de­mo­graphic terms.

Xi’s visit has al­ready seen the sign­ing of dozens of com­mer­cial con­tracts in e-com­merce, tele­coms, gas and other ar­eas.

While this is the Chi­nese leader’s first ap­pear­ance at the eco­nomic fo­rum, where he heads a 1,000-strong del­e­ga­tion, he and Putin have met reg­u­larly in re­cent years.

Ahead of Xi’s visit, Krem­lin ad­vi­sor Yury Ushakov de­scribed China as “Rus­sia’s most im­por­tant eco­nomic part­ner”.

The part­ner­ship is yield­ing in­creas­ing trade, which grew by 25 per­cent in 2018 to hit a record US$108 bil­lion, he said.

But de­spite po­lit­i­cal ten­sions and re­peated rounds of sanc­tions over Moscow’s ac­tions in Ukraine, the Euro­pean Union re­mains by far the big­gest for­eign in­vestor in Rus­sia - well ahead of China and the US.

“China is taking time to ramp up in­vest­ments in Rus­sia,” said Charles Robert­son, chief econ­o­mist at Re­nais­sance Cap­i­tal. “It wants to feel se­cure about the long term, it doesn’t want to rush into it.”

He pre­dicted China would make big in­vest­ments over the next three to five years, pos­si­bly even sooner, as Rus­sia plays an im­por­tant role in Chi­nese projects along Bei­jing’s New Silk Road.

Among ma­jor Rus­sian-chi­nese col­lab­o­ra­tions is the Power of Siberia gas pipe­line, a joint project be­tween Gazprom and China’s CNPC which is set to de­liver Rus­sian gas to China from later this year.

CNPC and the Silk Road Fund also have a 29.9 per­cent stake in the Ya­mal LNG liq­ue­fied nat­u­ral gas megapro­ject run by Rus­sia’s No­vatek in Arc­tic Siberia.

But an­a­lysts stress the lim­its of this al­liance. “Asym­me­tries are present across the board but are es­pe­cially vis­i­ble in the eco­nomic field,” ac­cord­ing to a re­port pub­lished last month by the In­sti­tute for In­ter­na­tional Po­lit­i­cal Stud­ies (ISPI) in Mi­lan.

Rus­sia’s GDP is today no big­ger than that of China’s Guang­dong prov­ince, and its de­fence spend­ing is a third of that of its neigh­bour.

“It is hard not to see who has the up­per hand in this re­la­tion­ship,” the ISPI re­port said.

Rus­sian Pres­i­dent Vladimir Putin, Chi­nese Pres­i­dent Xi Jin­ping, United Na­tions Sec­re­tary-gen­eral An­to­nio Guter­res and Slo­vak Prime Min­is­ter Peter Pel­le­grini ar­rive for a ple­nary session of the St. Petersburg In­ter­na­tional Eco­nomic Fo­rum (SPIEF) in Saint Petersburg

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