Russian-Chinese Projects in 2014

MOSCOW – Russian President Vladimir Putin’s visit to China in May 2014 marked the beginning of several major investment projects and the launch of a number of cooperation agreements between the two countries.

 ENERGY DEALS

 The two countries signed their biggest gas contract ever, with Gazprom agreeing to supply 38 billion cubic meters of gas per year for the next 30 years. The contract is worth a total of roughly $400 billion.

The total amount to be delivered over the agreed period would exceed more than 1 trillion cubic meters. Investments in gas extraction and transportation infrastructure in Russia alone will be worth $55 billion.

Russian state Corporation Rosatom is currently in talks with the Chinese side over the construction of nuclear power units on the mainland. A memorandum of understanding was signed between Russia and China on the possible construction of floating nuclear power plants.

Russia’s largest independent gas producer Novatek has signed a contract with China’s CNPC to supply 3 million tons of LNG (liquefied natural gas) per year for 20 years as part of the Yamal LNG project.

The Rus-Hydro energy holding company signed a strategic cooperation agreement with the Chinese company Power China. Under the agreement, the company will consider the possibility of Power China participation in a program to develop Rus-Hydro small hydropower.

OAO Rossiiskiye Seti (Russian Grids) and State Grid Corporation of China signed an agreement on strategic cooperation. The parties plan to focus on exploring the possibility of the construction of Euro-Asian energy bridge and set up the delivery of electricity from Russia to China.

LOGISTICS

Russian Railways and the Chinese state railway operator China Railway Corporation have agreed on strategic cooperation in the development of infrastructure and operations.

President of the United Aircraft Corporation (UAC), and Chairman of the Chinese corporation COMAC signed a memorandum on cooperation on a long-term program of long-range wide-body passenger aircraft.

Chinese automaker Chery Automobile announced the start of production of its cars in Russia in July with up to 30,000 units per year at the Derveis plant in Karachay-Cherkessia.

China’s largest SUV maker Great Wall Motors (GWM) started construction of a $500 million car plant in the Tula Region with output of up to 150,000 vehicles per year.

FINANCIAL SECTOR

VTB, VEB and the Russian Agricultural Bank, which were targeted by Western sanctions, reported a number of agreements with the Export-Import Bank of China (Eximbank) amounting to at least $ 4billion.

The Central Banks of Russia and China signed a three-year agreement on exchange operations (currency swap) of $24.5 billion. According to the Russian regulator, the agreement will promote the development of bilateral economic relations and the greater use of rubles and yuan in trade and investment.

DEFENSE

Russian defense companies are negotiating to supply China with S-400 anti-aircraft missile systems and manufacturing the heavy Mi-26 helicopter, with a carrying capacity of up to 15 tons, in China.

RIA Novosti

Maher Taki