China's Shift to Russia: Trade and FDI

22 Mar

Written By Dr. Ziva Rozen-Bakher

Change in Format of Risks Timeline of Dr. Ziva Rozen-Bakher since 03/2023

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Change in Format of Risks Timeline of Dr. Ziva Rozen-Bakher since 03/2023 〰️

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22 March 2023 at 08:56. When I looked this morning on the West headlines regarding the visit of the President of China to Russia, then most of them deal with ‘China’s peace proposal to end the Ukraine war’, while based on my analysis, the big story is the forthcoming huge shift of FDI and Trade of China from the West to Russia that likely will include also the shift of China’s allies to Russia. Putin may summarize it well: `Russia is willing to support Chinese companies to replace Western business that had left the country over the Ukraine war’, while Xi in the joint statement gave the ‘green light’ for the forthcoming huge shift of China to Russia in Trade and FDI: Expand the scale of trade, Develop an interconnected logistics system, Enhance the level of financial cooperation, consolidate the all-round energy partnership and more.

In the analysis from my Monitoring Risks from 14 March 2022, I already predicted this shift (see Sanctions against Russia: USA Coalition vs. Russian Coalition), while in my analysis from 12 February 2023, I concluded that the global order has changed and that we are going to get dual superpowers-Russia and China that will replace the hegemonic superpower of USA (see USA Coalition versus Russia-China Coalition — Monitoring Risks by Dr. Ziva Rozen-Bakher).

No one in the West should underestimate the market power of China which has 1.4 Milliard people, while Russia has 143 Million people (see below), regardless of the allies of Russia and China that are on the way in making the shift fromWest countries to non-West countries. My prediction is that the countries of the USA coalition will start to feel, sooner than later, the ‘Dry Wave’ of the shift of the Russia-China coalition from West countries to non-West countries. This shift is the BIG backfire of the sanctions of the USA coalition against Russia, yet the big question is not if the USA coalition will pay price for it but how heavy will be the price.

Still, the joint statement of China-Russia did not mention a military alliance, but my assumption is that during the three-day visit, Putin and Xi had the time in a closed room to form the informal military alliance of the Core of Russia-China Coalition or even play with the idea of creating counter-Nato, namely Formal Military Alliance of the Core of Russia-China Coalition.

Translated to English. For Full Statement see: Joint Statement of the Presidents of the People's Republic of China and the Russian Federation on the Development Plan for Key Directions of Sino-Russian Economic Cooperation until 2030 — Ministry of Foreign Affairs of the People's Republic of China (mfa.gov.cn)