The New Geopolitical Relationship between Russia and China 



China is an ally of Russia and because of Russia’s disintegration from the economic system of the Western world, Russia has only two main channels through which the exchange of goods, technologies and finances will carry-Chinese and Indian. Moreover, this unites the main economic partners and political allies of Russia together the hegemony of the West. However, the creation and formulation of the new union will have the consequences and affect also for the West because switching of Russia to new financial, trade, and technological channels will be painful and fraught with tangible losses for them.

China remained loyal to their alliance with Russians despite current economic interests with the West. Russia develops a programme of switching from dollars to yuan in the trade operation. The Central Bank of Russia made a very curious attempt to switch small and medium-sized businesses to the Chinese currency and at the same time it freezes for six months a part of dollar deposits exceeding $10,000. According to the independent estimation, the population of Russia (mainly the urban middle class in large cities) accumulated during the oil boom of 2006-2014 up to 40 billion dollars in cash and in debit accounts.

However, it is necessary to look at the situation more broadly. Beijing hopes to turn the yuan into one of the most popular units of payment and making it the world’s reserve currency and a real alternative of the dollar.

This process continues actively and most of the Russian Chinese government contracts translated into rubles and yuan, and this trend become the popular decision in the Pacific region. The Association of Southeast Asian Nations developed a plan according to this plan, the governments of these countries conclude bilateral agreements only in national currencies.

Agreements about the cross-border trade in the local currency supported and signed by Japan and Indonesia as well as by Thailand, Malaysia, Indonesia, and the Philippines. It is important to mention that these states are also the most consistent in terms of neutrality to the ongoing war in the East Europe.

Nowadays, the Russian economy has three critical areas – monetary, financial, trade and industrial and Russians need the main tools of these states to support and stabilize own critical areas. For its part, Russia will stabilize its partners’ fuel, energy, and food security.

Furthermore, after the withdrawal of Western brands from Russia, Chinese manufacturers of vehicles, building materials and textiles can gain a foothold in the vacant and empty Russian market. Whoever comes to Russia now will become the beneficiary of the growth of the Russian economy for the next five years.

Finally, these countries and China can also become a technological platform for those industries that fell under the western sanctions or were forced to curtail their lines in Russian market.


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