The differences between China and Russia trade are becoming increasingly obvious, with an investment portfolio involving US$160 billion. Russia wants to focus on cooperation with China to develop high-value-added industries, while China needs Russia's raw materials and energy more. Before the Russian-Ukrainian conflict, China has always been willing to cooperate with Russia in the field of high-tech, but after Russia was sanctioned, how much benefits can cooperation in this field bring to China?
m Shushin
Recently, Russian Prime Minister Mishushin met with Chinese officials. He once again talked about the recent comprehensive and in-depth cooperation and development between the two countries. The investment portfolio involves US$160 billion, spanning 79 important projects. For Russia, establishing a joint venture with China to produce high-value-added products such as IT products and chips is the top priority of the Russian government. However, in these two areas where Russia wants to vigorously advance, the pattern has been subverted. Nikita Maslenikov, chief economist at the Russian Center for Political Technology, believes that the two sides urgently need to resolve the major differences: China's investment in Russia is concentrated in the natural resources industry and agriculture, while Russia is more interested in attracting Chinese investment in in the fields of automobiles, engineering and processing industries.
Russian energy facilities
In the fields of IT and chip , Russia has limited strength, but it does have certain export performance to China. As a traditional power, Russia still has considerable strength in the military industry, nuclear energy, electricity, machinery manufacturing and other fields. For example, between 2015 and 2019, Russia's share of high-tech products imported from China and exported to China was relatively stable. Especially in the aviation field, Russia inherited the Soviet legacy and also inherited the strong position of the Soviet aviation industry. But later, the Russian aviation industry gradually declined. One of the key reasons was that modern aviation needed high-standard semiconductor technology, which was Russia's shortcomings. Russia has completely lagged behind in the field of civil aviation passenger aircraft. Its materials, overall mechanical design, assembly, advanced turbofan engine , avionics and other technologies cannot meet the current expectations of civil aviation for cost-benefit comparison. If it relies entirely on Russia for design, CR929 will definitely become a backward model that cannot be profitable, especially in terms of fuel economy, it will lag far behind the latest Western products.
Russian chip
This decline has directly affected China-Russia cooperation. Some time ago, Russian Vice Premier Borisov said that Russia believes that China and Russia have differences on the CR929 passenger aircraft project, and Russia's participation is becoming less and less. Many people believe that this indicates that Russia will withdraw from the CR929 cooperation project. At the beginning of design, the CR929 aimed at breaking the market monopoly of Boeing and Airbus , just like the domestic large aircraft C919, and is expected to be delivered within 10 years. However, since the Russian side really wants to take the lead in the project, the research and development progress of CR929 is much behind that of C919. After the outbreak of the Russian-Ukrainian conflict this year, the West imposed a thorough blockade of the Russian aviation industry and cut off the supply of to parts, resulting in the possibility of CR929 redesigning. This is enough to prove that under Russia's current state, China and Russia may face greater variables in cooperation in the field of high-tech.
Chinese and Russian large passenger aircraft CR929
Overall, Russia's dependence on China's high-value-added services and products is increasing, which means it is more difficult for Russia to enhance cooperation with China in this field.
Simply put, Russia's high-tech products exported to foreign and to China are too low, and the commodity field is narrow, so its dependence on imports on China is increasing. Of course, this also means that China has considerable room for play on Russia's path to deepening its development of high-value-added industries. As long as Russia is sincerely deepening cooperation, China can help Russia build an joint venture that is beneficial to both sides on the basis of the concept of mutual benefit and win-win.
wants to increase cooperation with China in the field of high value-added areas, and Russia also faces a problem. Russia's economic structure is single, and it is overly dependent on natural resource exports, especially energy export business, and lacks motivation to innovate and expand its own economy, which negatively affects the effectiveness of cooperation with China.China has the largest demand for Russia, and it has increased imports in the near future, but the technical bottleneck of expanding imports in the short term is objective. At the same time, Russia lacks other powerful products to provide customers such as China, let alone high-value-added areas.
