Nikita Minenkov’s logistics company, located near the Amur River, which straddles the border between Russia and China, has been doing well, with turnover doubling two years in a row since 2022, Reuters reports.
Minenkov’s Eurasia Logistics Group is one of the many Russian companies that have benefited from a surge in trade with China as Western firms fled the Russian market following the outbreak of the military conflict in Ukraine and the imposition of sanctions.
The company’s success underlines Moscow’s increasingly close economic relationship with Beijing, which is buying more Russian oil – a vital component of the Russian economy – and supplying it with goods such as cars and machinery.
Chinese trade figures for 2023 show that automobile exports to Russia were nearly seven times higher than in 2022, with a nearly $10 billion increase in value.
As Beijing buys Russian oil at lower prices than other producers, the total volume of Russia-China trade has increased by 64 per cent over the past two years to $240 billion.
Global trade growth is expected to recover to 3.3 per cent in 2024 after a projected slowdown to 0.8 per cent in 2023. Zach Meyers, assistant director of the Centre for European Reform think tank, said:
The surge in Russia-China trade illustrates simply that sanctions lose their bite over time, as non-participating countries take advantage of the economic opportunities left when Western firms retreat.
Chinese carmakers have particularly benefited from the flight of Western companies from Russia, with many carmakers quickly selling off assets and plants. China’s share of the Russian market rose from less than 10 per cent to more than 50 per cent in the two years since the military conflict began in February 2022.
Dealerships that used to sell Volkswagen, Renault and Stellantis models have switched to Chinese brands, including Geely and Chery. Vladislav Vershinin, head of sales at a Changan dealership in Mytishchi, just outside Moscow, said:
There’s no alternative. It has become profitable … the Chinese are adapting very quickly. The attitude of buyers (towards the Chinese) is definitely changing. People look at these brands differently, people trust them.
Sales of Changan cars in Russia in 2023 rose to almost 47,800 units from 2,550 in 2022, according to data from analytical agency Avtostat. Last year, the brand was fifth in sales, and in February 2024, eight of the 10 best-selling car brands in Russia were Chinese, the data show.
