Trade war brings old rivals closer together

China’s escalating trade war with the U.S. is drawing Beijing and Moscow closer to each other. China’s decision to curb soya bean imports from the U.S. as part of a tit-for-tat tariff spiral between the two countries is bringing Russia, especially its less developed but resource-rich ‘Far East’, into the equation. New links are being forged between the two neighbours, who are facing the heat from Washington. The plan fits well into Russian President Vladimir Putin’s pivot to the ‘Far East’. The Russians have identified Vladivostok and Khabarovsk, which are close to the Chinese border, as the double hubs for the growth of this long-neglected region. The Hong Kong-based South China Morning Post recently reported that Russia is offering foreign investors from China and other countries one million hectares of land suitable for cultivating soya beans and other agri-products. Valery Dubrovskiy, director of investment for Russia’s Far East Investment and Export Agency, was quoted as saying that several Chinese companies have expressed interest in the deal, under which land in Russia’s Taiga region is being opened up for foreign investment. “We expect most of the investment to come from China,” he said. “We expect 50% from China, 25% from Russia and 25% from other countries like Japan and Korea.”

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