Trade between China and Russia is expected to remain on a fast
track in the coming years, but officials and experts also warned of
bottlenecks.
"After eight years of fast growth, Sino-Russian trade has
entered a period of correction," said Chinese Vice-Commerce
Minister Yu Guangzhou, adding that a certain amount of fluctuation
in the growth rate is normal.
Two-way trade between the countries has grown at a pace of over
30 percent every year from 1999 to 2005, jumping 15 percent in the
last year, according to customs.
Yu said the neighboring countries should not only increase trade
volume, but also "improve trade quality".
China is expected to enlarge its imports of machinery and
electronic equipment from Russia, in a bid to restructure bilateral
trade.
The Chinese government has made every effort to boost Russia's
machinery and electronic exports to China, added Liu Guchang, the
Chinese ambassador to Russia.
"China encourages domestic firms to buy products from Russia and
helps Russian exporters showcase their products to Chinese firms,"
he said.
The two governments have also encouraged large companies from
both sides to get involved in bilateral trade exchanges and to get
their brands onto the markets.
Officials and researchers expected bilateral trade between the
two countries would double last year's figure to hit US$60 billion
to US$80 billion in 2010, but they warned there were still
bottlenecks in trade development.
"Disorderly trade has become the key barrier in Sino-Russian
business," said Liu Huaqin, a researcher with the research
institute under the commerce ministry.
Complicated clearance procedures in cross-boarder trade with
Russia have seen many Chinese businesspeople consulting illegal
"one-stop" clearance services.
The so-called grey clearance covers consumer goods such as
textiles and footwear, machinery, and electronic products.
"If these products (that entered the Russian market without
legal clearance) are not qualified, they will become a potential
danger to consumers and will hurt the reputation of Chinese
exporters as well," she said.
Governments from both sides have set up a panel to look into the
issue.
In addition, Yu predicted Russia's accession to the World Trade
Organization would help strengthen its economic ties with China and
Russia, as Russia is expected to complete negotiations for the
accession this year.
He said Russia would further facilitate the economic and trade
exchanges between the two countries after its entry to the WTO.
Increasing investment
Compared to the fast-growing trade figures, growth in bilateral
investment has been slow in recent years.
According to statistics from the commerce ministry, China had
invested a total of US$1 billion in over 700 projects in Russia by
the end of last year. Russia also invested US$70 million in China.
Those projects involved energy and resources exploitation, timber
processing, home appliance making, telecommunications and building
materials.
Liu with the research institute suggested Chinese enterprises
try the processing trade in Russia.
Most Chinese exporters of machinery and electronics currently
sell to Russia through local distributors.
"Our experience shows that bilateral investment ensures steady
growth in the machinery and electronics trade," Liu said. "Products
from joint ventures could either be sold in both countries or
exported."
The Russian government expected Chinese businesses to invest in
Russia to boost local manufacturing.
China also encourages investment in Russia. It expected China's
accumulated investment in Russia to total $12 billion in 2020.
China will set up cooperation areas in Russia to help
enterprises invest in the country.
(China Daily March 16, 2007)