The opportunities are many, but so are the risks for keen Chinese investors. Richard Li explores both, along with the cultural chasm that still exists between China and Russia
China and Russia’s relationship has come a long way from comrades of old in the days of the iron and bamboo curtains. While China has bounded ahead in recent years, Russia has plodded by comparison since the breakup of the Soviet Union. Yet its accession to the World Trade Organisation (WTO) and the now rapid development of its Far East has been beckoning Chinese businesses westwards.
Compared to 2011, trade between the two neighbours grew 11.2% in 2012, to US$88.16 billion, China’s General Administration of Customs reported in a press conference on 10 January. And parties involved in the deals have become more diversified. Besides large companies trading raw materials and mineral resources, in the past 12 months “closer business connections started to spread intensively among minor enterprises and individual entrepreneurs, especially engaged in R&D and high-tech sectors of both jurisdictions,” says Nikolay Zorin, the managing partner at Zorin Law Office in Moscow.