China’s Growth Brings Opportunities To World Economies
China’s economic growth will bring new development opportunities for the world, especially for cooperation in Euro-Asia regions.
Boris Titov, chairman of the Russian part of the China-Russia Friendship Committee for Peace and Development, said in an interview last Thursday that “China’s economic momentum is unstoppable and its growth will bring fresh development opportunities for world economies including Russia.”
China has become the world’s 2nd largest economy by nominal total GDP (gross domestic product), Mr. Titov noted, adding that the most prominent characteristic of China’s economic “new normal” is the transformation of its economic development mode.
Under the “new normal” status, the export-driven economy will now need to refocus on boosting domestic consumption, which will unleash the full potential of China’s economy.
He said, a substantial amount of Chinese investment will find its way to markets around the world as the country’s economy keeps growing.
China’s Silk Road Economic Belt initiative is conducive to the infrastructure development of the countries concerned in the Euro-Asia region, he said, adding that benefit-sharing is the most prominent characteristic of this strategy.
“The strategy will do nothing to harm the interests of the countries concerned. Instead, it will help these countries develop their own economies, and that is why the strategy gets very strong support from them.”
As for bi-lateral cooperation, energy is a Key area of Russia-China economic cooperation, and the 2 countries’ cooperation in the area of small- and medium-sized businesses is also quite promising.
China’s economic growth will give impetus to the development of Russia’s small- and medium-sized businesses and will also help the country exit the recession at an earlier date.
According to official statistics, China’s investment in Russia has been growing steadily over the past few years. Chinese direct investment in Russia, including those via 3rd countries, totaled US$33-B into Y 2014.
At the 19th Saint Petersburg International Economic Forum (SPIEF) a group of Chinese and Russian companies officially signed a contract on jointly conducting the pre-construction survey and design of the Moscow-Kazan high-speed railway.
The 770-kilometer railway is a Key infrastructure development project for Russia. It is estimated to cost more than US$20-B. Upon completion in Y 2018, the rail link will dramatically reduce the travel time between Moscow and Kazan from 14 hrs to 3.5 hrs, becoming part of the planned Beijing-Moscow high-speed transport corridor.
Besides the high-speed railway, China and Russia are working on such large-scale cooperation projects as cross-border Nat Gas pipelines, the development of large, wide-body airplanes and a development strategy for the Far East region.
Both China and Russia have injected major financial resources into these cooperation projects.
The central banks of the 2 countries signed a currency swap agreement worth RMB Yuan 150-B or 815-B Rubles (US$24-B) last October. The amount of RMB Yuan currency used in bi-lateral trade settlement at the Russian branch of Bank of China grew more than 6X last year, according to the data.
The National Development Bank of China, a state-owned bank for financing overseas investment by Chinese companies, has signed cooperation agreements with 3 major Russian banks in May to finance large-scale cooperation projects and the development of the Far East region.
China and Russia have also stepped up financial cooperation on such multilateral platforms as the Silk Road Fund and the Asia Infrastructure Development Bank.
Under the direct guidance of top leaders of both countries, investment and financial cooperation have become a new growth point for the China-Russia all-round strategic cooperation partnership, and 2-way trade is expected to top US$100-B this year after reaching an all-time high of US$95.3-B in Y 2014.
Stay tuned…
HeffX-LTN
Paul Ebeling
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