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Russia’s exports to China are on a steady increase. As Vedomosti writes, citing the General Customs Administration of China, their volume in the first half of 2024 grew by 4% year on year, reaching $65 billion.
Mineral fuels, oil, and petroleum products account for a large share of the total, with hydrocarbons comprising 75% of Russian exports to the PRC. Meanwhile, China's demand for several other categories of goods, such as vegetable and animal oils — and shellfish — has slumped.
Moreover, as Bloomberg recently reported, several Russian companies trading with China have complained of difficulties in international settlements after the U.S. introduced new sanctions. Direct payments in yuan are frequently blocked or delayed, and some businesses admit that receiving yuan in direct payment for goods has become almost impossible.
In a conversation with The Insider, Temur Umarov, a fellow at the Carnegie Russia Eurasia Center in Berlin explained that China does not have a clear picture of how it wants to develop its economic relations with Russia in the near future:
“I would say China is a highly adaptive state that realizes just how unpredictable Russia may be. The circumstances surrounding Russia and Ukraine are equally unpredictable, so China's strategy is to go with the flow. If the state of affairs allows it, China will process direct payments; otherwise, it will have to invent a workaround. There are plenty of options: third countries, shell firms, and minor regional banks.
“Absolutely any spheres that risk secondary sanctions will be regarded as low-priority, and China will squeeze them out of transparent schemes into a gray area that is hard to control. If trading in dual-use goods is prohibited, China will sell them to Russia through third countries in Central Asia and the Gulf. I don't think we will ever see China abandon economic interaction with Russia entirely because it would be too hard a blow for Chinese entrepreneurs.
“Additionally, China values its connection with Russia in the impending confrontation with the U.S. The Chinese need Russia's backing in UN agencies and the Security Council. Overall, Russia is China’s valuable partner in international relations and the defense industry, where Russia still holds a few Soviet technologies China might be after.”