05/19/2014, 00.00
Send to a friend

Putin's visit to Shanghai marks an eastward shift for Russian economy

by Nina Achmatova
The Kremlin's chief is coming accompanied by a large delegation representing 46 companies, including Russia's oil and gas giants. Moscow hopes to sign a long-awaited contract for gas supplies from Siberia to China with deals in 40 other priority areas in the pipeline. Ukraine will also be discussed.

Moscow (AsiaNews) - Russian President Vladimir Putin will travel to China on an official visit tomorrow and Wednesday. He will be accompanied by a large delegation that includes officials from state-owned companies. For Russian media, the visit represents the most ambitious bilateral talks in recent decades with the People's Republic of China.

Putin's official visit to China coincides with a session of the Conference on Interaction and Confidence Building Measures in Asia (CICA) in Shanghai, and will provide the Russian leader with an opportunity to ink a large package of documents, including some 40 deals, contracts, and understandings that Moscow hopes will include a 30-year contract to supply Russian gas to China.

Although the economy will take centre stage, the Ukrainian crisis and possible Sino-Russian coordination in the touchy matter will probably be discusses as well, especially since the former Soviet republic goes to the polls next Sunday and tensions between Russia and the West are not letting up.

For Russia's Kommersant newspaper, Putin's visit is part of Moscow's new 'eastern strategy'. In addition to markets for Russia's military industry and energy sector, China is in fact an attractive source for foreign investments, especially at a time when its traditional markets - Europe for example - have been damaged by the crisis in Ukraine.

For China, in addition to a real interest in Russian energy supplies, Moscow's international isolation is a bonus, the paper noted.

The Russian delegation in Shanghai, where Putin will meet with President Xi Jinping, will included officials from 46 companies, including oil and gas giants Gazprom, Rosneft and Novatek.

"Today, Russia firmly places China at the top of its foreign trade partners," Putin said. "In 2013, the volume of bilateral trade was close to billion, which is far from being the limit. We will try to increase trade turnover to 0 billion by 2015 and up to 0 billion by 2020."

For Moscow, the real goal is getting a gas deal since its markets in Europe now look shaky because of Western Europe's desire to reduce its dependency on Russia and American plans to export shale gas. Indeed, rising tensions with the West over the Ukraine have spurred negotiations with Beijing after a hiatus of ten years due to prices.

In view of the international situation, state giant Gazprom has even hinted that it might be flexible in order to get a deal.

An optimistic Putin seems certain that the two sides will reach an understanding, if not sign a contract right away. This will enable Russia to supply China with 38 billion cubic metres (bcm) of gas a year from its own Asia-Pacific region.

So far, a lot of work has been done, Putin said in an interview in which he outlined the areas of Sino-Russian cooperation: atomic energy, space, pharmaceuticals, information technology, joint wide-body long-range aircraft and helicopter production.

Investments into the joint Russia-China Investment Fund (RCIF) will soon surpass US billion, the head of the Russian Direct Investment Fund said. The Fund is designed to promote economic development in the Russian Far East.

Moscow hopes the visit will be the beginning of a new Sino-Russian partnership and strategic cooperation, including discussion about the Ukraine, even though it is not officially on the agenda.

Putin has hinted that he is looking for a partner and will work with Beijing on the matter. Both Russia and China agree that changing the outcome of World War II is "unacceptable" and that their opposed to "attempts to falsify history" and "turn fascists into heroes", a charge the Kremlin has levelled against the Ukrainian government.

As evidence of Russia's new found interest in the East, in Shanghai Putin will also meet with Mongolian President Elbegdorj Tsakhiagiin, Iraqi Prime Minister Nuri al-Maliki and Iranian President Hassan Rouhani.

Send to a friend
Printable version
See also
Pope talks about the Middle East, the Holy Land and the food crisis with Bush
Official gets death penalty for graft and embezzlement in pension fund scandal
Ahmadinejad in Shanghai open to dialogue but still rails at US
Ahmadinejad in Shanghai to talk nuclear with Hu Jintao and Putin
Vladimir Putin in Beijing with Eurasian trade in mind