War in Ukraine Has China Cashing In
The country’s trade with Russia this year has exceeded $200 billion, and makers of cars and trucks are the big winners.
On China’s snowy border with Russia, a dealership that sells trucks has seen its sales double in the past year thanks to Russian customers. China’s exports to its neighbor are so strong that Chinese construction workers built warehouses and 20-story office towers at the border this summer.
The border town Heihe is a microcosm of China’s ever closer economic relationship with Russia. China is profiting from Russia’s invasion of Ukraine, which has led Russia to switch from the West to China for purchases of everything from cars to computer chips.
Russia, in turn, has sold oil and natural gas to China at deep discounts. Russian chocolates, sausages and other consumer goods have become plentiful in Chinese supermarkets. Trade between Russia and China surpassed $200 billion in the first 11 months of this year, a level the countries had not expected to reach until 2024.
Russia’s war in Ukraine has also gotten an image boost from China. State media disseminates a steady diet of Russian propaganda in China and around the world. Russia is so popular in China that social media influencers flock to Harbin, the capital of China’s northernmost province in the east, Heilongjiang, to pose in Russian garb in front of a former Russian cathedral there.
This is not going to last. Russian economy is about to flip the fuck out though China got their cut already.
Will be interesting how China's opinions change once dirty money dries up but my guess is that they'll forever pretend to be fence sitters as long as Han China is doing well.
One interesting note on how down China was with new Russian market is that they started to print Russian text on national brand products like Huawei last year and I just a new pair of huawei ear phones that no longer have it. It's probably just a coincidence but it's kinda funny nevertheless.
"Russian economy is about to flip the fuck out"
Just curious, what's your sourcing on that? I ask because this has been said since the sanctions were put in place but they've managed to limb along.
It is strange, also according to the IMF forecasts GDP growth this and next year.
It's looking like no one really knows - seeing mixed signals in the recent reporting. They are reporting higher GDP but the concern seems to be projected inflation increases and a possible housing bubble.
When diving into the reporting, I found some interesting nuggets referring to Putin directing his interior ministers toward manual economic controls since 2014. The thought is in mitigating crises (Crimea and now Ukraine). From looking at China, manual controls seem to work in the short term before mistakes set in long term. Curious to see how much longer Russia can hold out.
It's running way to fucking hot to be sustainable. You usually see it like this before hyperinflation sets in and people start eating grass.
The thing about modern economies is that it's been pretty extensively proven by now that you can run on a war deficit for basically forever as long as you have a couple strong trade partners.
Yeah I did a bit of looking around recent headlines and see similar sentiments:
I guess we'll see if they can dodge another bullet