This Is How China Is Stepping In To Supply Russia

This Is How China Is Stepping In To Supply Russia

Since the Chinese authorities officially opened their borders, Beijing is now seen aiding Russia and stepping up supply of goods and services to the country of Vladimir Putin.

Amidst economic sanctions imposed by the West, Russia’s current account surplus reached an unprecedented $227 billion in 2022, more than double the previous record.

This growth can be attributed to the strong expansion of exports in volumes and prices, particularly in oil and gas and other commodities.

Despite a 16% contraction in imports for the year as a whole, this still marks a recovery from the 35% decline seen in the early weeks following the imposition of sanctions, says the International Institute of Finance.

China Stepping up Supply

Thanks to innovative trade data sources, Russia’s trade has been analyzed and compared to 2021. China’s trade with Russia has significantly expanded and it is now Russia’s most significant trade partner. Trade between the two countries increased by nearly $27 billion during March to September 2022 compared to the same period in 2021, driven mainly by Russia’s higher exports to China, but also due to an increase in imports.

In spite of export controls, Russia has increased its imports of semiconductors and electronic circuits. The total value of chip imports increased from $1.8 billion recorded for January to September 2021 to $2.45 billion over the same period in 2022. Although it is unclear if all chips are prohibited by the US for exports to Russia, China and Hong Kong have successfully replaced other countries as chip suppliers.

Russia’s trade has shown resilience in the face of economic sanctions, demonstrating the country’s ability to access critical goods. By focusing on rebuilding value chains severed by sanctions and rerouting trade via China and other countries, Russia has continued to thrive despite obstacles imposed by the West.

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