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Sino-Russian trade heads for new highs
By Yan Yang (China Daily)
Updated: 2004-10-14 08:59

Increasing economic power and expanded trade co-operations will push bilateral trade between China and Russia to US$20 billion this year, rising by nearly 30 per cent, analysts said.

Li Gang, an expert from the Chinese Academy of International Trade and Economic Co-operation, said the steady economic development in the two countries is the driving force for improved bilateral trade.

Statistics from Chinese Customs show the trade volume between China and Russia jumped to US$15.76 billion in 2003 from US$5.72 billion in 1999 with an annual growth rate of 20 per cent.

The number reached US$12.87 billion in the first eight months of this year, up 35.4 per cent year-on-year, making China Russia's fourth biggest trade partner.

"By this trend, China and Russia will reach the short-term goal of US$20 billion this year," Li said.

He also predicted Russia's possible accession into the World Trade Organization will dramatically change the current trade order and mode between the two nations.

Li said co-operation between China and Russia in high-tech fields such as aviation, aerospace, bio-engineering, chemical engineering, mechanical technology, agriculture and forestry will diversify the current trade pattern.

Besides trade on regular commodities, bigger projects, such as building a cross-boarder oil pipeline, should be introduced to give a fresh force to bilateral trade, he added.

Russian President Vladimir Putin's upcoming visit will bring more vitality to Sino-Russian relations.

Putin will pay a state visit to China today through Saturday his first visit to China in his second presidential term. During his visit, Chinese President Hu Jintao and Putin will exchange views on issues of common concern and sign a joint communique and a series of important documents.

Putin said before his visit, the goal of bringing Russo-Chinese trade turnover to US$60 billion is quite realistic.

"Our trade is growing at a fast pace. I think we shall attain the US$20 billion level in the near future and, in the medium-term perspective, will be able to bring our trade to US$60 billion. These are absolutely feasible and attainable targets," Putin said.

Many major investment projects are being discussed between the two sides.

Besides the oil pipeline, China is studying the possibility of building a large pulp mill in Russia's Far East and intends to invest about 300 million yuan (US$36 million) in the project.

Plans to build Chinese business centres and Chinatowns in Moscow and St Petersburg are also in the works.

During his visit to Russia in September, Premier Wen Jiabao said China planned to invest US$12 billion in Russia by 2020, focusing on infrastructure construction, energy development, manufacturing and high-tech fields.

But greater efforts should be made to tap the potentials of Sino-Russia trade, Li said.

"Bilateral trade increased by 32.1 per cent last year. But the rate is still slower than China's general trade increase of 37.1 per cent," Li said.

Trade order and standardization are big problems for the two countries. The irregular trade has been a historic concern in Sino-Russian trade which led to many disputes, he said.

The Russian side claimed there are huge illegal imports from China. The irregular trading was born because Russia allowed so-called "customs clearance" companies to carry out importing transactions and provide "one-stop" service which combined transportation and customs clearance.

These companies, which usually have close relations with the Russian Customs, offer favorable tariff policies and will not supply customs clearance manifests.

Russian customs houses have confiscated Chinese goods and increased its tariff unilaterally on Chinese goods.

China has asked the Russian Government to launch a joint working group as soon as possible and pull this kind of trade back on the normal track.

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