New Pipeline Construction to Start in 2009
Russian President Dimitri Medvedev offers his condolences to Chinese leaders over the recent devastating earthquake which killed thousands and left millions of people homeless in China's Sichuan province
In the last seven years, Russia and China have agreed to settle their long simmering border disputes, and bilateral trade has increased from $10 billion to $48 billion a year. To put this number in perspective, in 2007 Russia's total trade with Germany amounted to $52 billion.
To fuel its surging demand for electricity, in recent years China has become the world's largest consumer of coal, and air pollution has become a major problem in Chinese cities. Developing nuclear energy would help China to reduce emissions while continuing to grow its economy.
Most of the Western media coverage of Russian President Dimitry Medvedev's meeting last week with Chinese President Hu Jintao have focused on their joint statement, which criticized U.S. plans to build a missile defense system in Europe. But as usual, the real action last week was not diplomatic, but commercial.
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A Russia Today TV video about Chinese workers in Russia's Far East. Many Russian intellectuals and politicians have publicly expressed their fears that China would seek to annex Russia's resource-rich Far East through mass immigration
Russia and China have finally reached multi-billion dollar agreements to start construction on new oil and gas pipelines across the Russian Far East to China. The pipeline will run 2,500 miles from eastern Siberia to the Russian Pacific port of Nahodka, with a cross-border spur planned from this route to the Chinese oil hub of Daqing. This is a logical follow up to a deal reached in 2006 between OAO Rosneft, Russia's leading state-owned oil company, and Chinese state oil companies to supply hundreds of gas stations across China.
Many Americans view the growing ties between Moscow and Beijing, and their apparent united front on issues such as independence for Kosovo and Iran's nuclear program as a potential threat to U.S. influence. The Shanghai Cooperation Organization, which has periodically refused observer status to the United States, is viewed by many experts in Washington as a Russo-Chinese club to keep America out of former Soviet Central Asia.
In reality, though, both Russia and China are competing for major energy deals with the former Soviet republics, and both Russia and China want to work closely with governments in the region to prevent the spread of Islamic extremism. While in recent years China has been Russia's number one customer for arms, many Russian arms manufacturers are not happy about Chinese theft of their intellectual property, which includes China producing full scale copies of Russia's most advanced fighter jets and tanks. And while Russia in recent years has conducted joint military exercises with China, the Russian combined arms delegations have been far smaller and more poorly equipped than the better-funded Chinese forces.
Meanwhile, many Russian intellectuals and generals have publicly expressed fears that China will eventually annex a depopulated Russian Far East without firing a shot. However, in recent years there is little evidence that China is flooding eastern Siberia with immigrants. Most young Chinese, in fact, would much prefer living and working s in China's booming eastern provinces near the Pacific coast than setting up shop as small entrepreneurs in the villages and cities along the Russian-Chinese border.
So at this point, Russia and China are neither rivals nor allies against the West, but simply partners on a pragmatic, "deal by deal" basis. Nonetheless, there is no doubt that China needs Russia's vast natural resources to fuel its economic growth, and it will be interesting to see how Russia balances its existing resource customers in Western Europe with the demand from China, India and other rapidly growing Asian countries.
