Posts tagged ‘Russia’

11/05/2015

Private banker KV Kamath named first BRICS bank head | Reuters

Indian private banker K.V. Kamath has been named as the first head of a new development bank being set up by the BRICS group of emerging market economies, Finance Secretary Rajiv Mehrishi told reporters on Monday.

K.V.Kamath gestures during the Reuters India Summit at his office in Mumbai in this November 25, 2008 file photo. REUTERS/Stringer/Files

The BRICS – Brazil, Russia, India, China and South Africa – agreed to set up the $100 billion development bank last July, in a step toward reshaping the Western-dominated international financial system.

“Kamath has been appointed as the head of the BRICS bank, the appointment will become effective when he becomes free from his current assignments,” Mehrishi told reporters in New Delhi.

It was agreed then that the New Development Bank, which will fund infrastructure projects in developing nations, would be based in Shanghai. It would be headed by an Indian for a first five-year term, followed by a Brazilian and then a Russian.

via Private banker KV Kamath named first BRICS bank head | Reuters.

08/05/2015

China Parades Closer Ties in Moscow – China Real Time Report – WSJ

When a Chinese honor guard joins a military parade in Russia’s capital this weekend, watched by China’s President Xi Jinping, it will mark more than just a symbolic recognition of the two countries’ contributions to the Allied victory in 1945. As the WSJ’s Jeremy Page reports:

China’s participation also reflects an upgrade of its military ties with Russia, including joint naval exercises and a revival of arms purchases, that could complicate U.S.-led efforts to counter both nations’ expanding military activities, analysts and diplomats say.

The 102 Chinese troops who will join the Victory Day parade in Moscow on Saturday were seen during a rehearsal this week marching through streets near Red Square singing the Russian wartime ballad “Katyusha”, according to video footage posted online.

The only other foreign countries with troops in the parade are India, Mongolia, Serbia and six former Soviet states.

Three Chinese navy ships also made a rare foray into the Black Sea on their way to join commemorations in Russia’s southern port of Novorossiysk on Saturday.

The Chinese ships—two missile destroyers and a supply vessel — will then take part in joint exercises with the Russian navy in the Mediterranean Sea for the first time, according to Chinese and Russian authorities.

Both sides say the drills aren’t directed at other countries, but the timing, after Russia’s 2014 annexation of Crimea, and the location, on NATO’s southern flank, have compounded Western concerns about an emerging Moscow-Beijing axis.

via China Parades Closer Ties in Moscow – China Real Time Report – WSJ.

08/04/2015

Learning Mandarin in the tundra – Russia invites China into oil business | Reuters

Russia‘s freezing north has never been the most welcoming place for foreign travelers, and its onshore oil riches have always been state secrets. But when the order comes from the Kremlin to open up, people obey.

Pipelines to be laid to transport oil to Vankor are seen at the Rosneft company owned Suzunskoye oil field, north from the Russian Siberian city of Krasnoyarsk, March 26, 2015.  REUTERS/Sergei Karpukhin

Last September, President Vladimir Putin, who has been seeking new markets in Asia for Russian energy exports to replace traditional customers in Europe, announced that he would welcome Chinese investment in Vankor, a vast new oil field in remote eastern Siberia owned by state firm Rosneft.

Since then, delegations from both China and India have been flown out to visit the field in the remote tundra.

Some of the workers, who spend four weeks at a time at the isolated station – where temperatures can fall as low as minus 60 Celcius (minus 76 Fahrenheit) – have duly taken up Mandarin.

“No problem. We will work with the Chinese workers if need be,” said Alexei Zyryanov, deputy head of an oil and gas production unit.

All of Vankor’s output of 440,000 barrels per day of crude is already shipped east, via the East Siberia-Pacific Ocean pipeline, which includes a spur feeding China’s northeast.

But a proposed Chinese investment in a stake in the project would go far further than Moscow has ever gone before to luring Beijing into its hydrocarbon industry.

Rarely has Moscow considered offering an ownership stake in such a big strategic onshore deposit to outsiders, despite decades of interest from Western majors. The offer is the more remarkable for being made to China, a rival for decades with which Russia nearly went to war in the 1960s over a border dispute.

Rosneft confirmed that it has reached a draft agreement to sell a 10 percent stake in Vankor to China.

via Learning Mandarin in the tundra – Russia invites China into oil business | Reuters.

31/03/2015

What could happen in China in 2015? | McKinsey & Company

What could happen in China in 2015?

What do you get when you add slower economic growth, greater volatility, and rising competition to more international flights and genuine Chinese innovation? McKinsey director Gordon Orr’s annual predictions.

December 2014 | byGordon Orr

It seemed harder to prepare my “look ahead” this year. On reflection, I believe this is because political and economic leaders in China have clear plans and supporting policies that they are sticking to. You can debate the pace at which actions are being taken, but not really the direction in which the country is traveling. This means a number of the themes I highlighted for this year will remain relevant in 2015:

What could happen in China in 2015?

Author Gordon Orr discusses his China predictions with McKinsey director Nick Leung and principal Yougang Chen.

Improving productivity and efficiency will remain the key to maintaining profitability for many companies, given lower economic growth (overall and at a sector level) and the impact of producer price deflation on multiple sectors.

The impact of technology as it eliminates jobs in services and manufacturing will become even greater (but still not in government).

As a result, the government will keep a sharper focus on net job creation and the quality of those new positions. Companies will hire even more information technologists to keep up in the race to exploit technology better than their competitors.

The push to lower pollution, and now carbon emissions, will lead to even greater investment in domestic solar and wind farms, boosting the global position of Chinese producers.

High-speed-rail construction will continue domestically and increasingly abroad, as Chinese companies become the builder of choice for high-speed rail globally.

Beyond these, there are several additional themes that will be important in 2015. I describe them below.

What else may happen in 2015? – see article:

via What could happen in China in 2015? | McKinsey & Company.

27/02/2015

China bans ivory imports ahead of royal visit: Xinhua | Reuters

China has announced a one-year ban on the import of African ivory carvings ahead of next week’s visit by Britain’s Prince William, a strong critic of the ivory trade.

China will halt approval for imports until late February next year, newsagency Xinhua reported on Thursday, citing the State Forestry Administration, which regulates the trade. The ban will affect carvings acquired after 1975, it added.

Prince William has previously been critical of China over its consumption of ivory, while animal rights groups say the country’s growing appetite for the contraband material has fueled a surge in poaching in Africa.

“The move is to protect African elephants, and the one-year timeframe is designed to assess the effects,” Xinhua said.

China crushed 6.2 metric tonnes (6.83 tons) of confiscated ivory early last year in its first such public destruction of any part of its stockpile. However, the country still ranks as the world’s biggest end-market for poached ivory according to conservation body the World Wildlife Fund.

China signed a pact banning global trade in ivory in 1981, but it got an exemption in 2008 to buy 62 tonnes of ivory from several African nations. It releases a portion of that stockpile each year to government-licensed ivory carving factories.

via China bans ivory imports ahead of royal visit: Xinhua | Reuters.

20/01/2015

5 Takeaways From China’s GDP – WSJ

1 THE SLOWEST PACE IN MORE THAN 20 YEARS

For much of the last two decades, China has been working overtime to drive the growth of the world economy. Now, it’s slowing to suborbital speeds. Last year’s growth of 7.4% was the slowest since 1990, a year when China was reeling from out-of-control inflation and the sanctions that followed the Tiananmen Square massacre.

2 IT’S ONLY GOING TO GET WORSE

The slowdown of 2014 is unlikely to be a blip, and probably presages an extended deceleration of growth. The often bullish International Monetary Fund has penciled in 6.8% growth for 2015, as has investment bank UBS. Others are even more downbeat. Oxford Economics predicts 6.5%–and says this will be the last time China’s growth exceeds 6%.

3 COMMODITY EXPORTERS WILL BE THE BIGGEST LOSERS

China is a huge importer of raw materials, from oil to soybeans. Much of last decade’s commodity boom was premised on the idea of insatiable Chinese demand. As the extent of the slowdown crystallizes, prices for key goods are tumbling, and commodity-dependent economies like Russia, Brazil, Venezuela and Angola are already in trouble. Expect more of the same.

4 HOUSING IS THE WILDCARD

The only thing that could lift the fortunes of commodity producers would be a revival of China’s housing market. House prices were down 4.5% on year as of December, according to the National Bureau of Statistics. Construction has ground to a halt on many sites as developers wait to see if the market will turn around. Prices could stabilize this year, said Haibin Zhu, an economist at J.P. Morgan, but that is far from certain. If moves to introduce a property tax end up killing confidence in the market, prices could keep falling.

5 THESE FIGURES NEED TO BE TAKEN WITH A PINCH OF SALT

Economists say it is daft to get hung up on changes of a few tenths of a percentage point in the official growth rate. The statistics bureau’s methodology is “not so scientific,” as Harry Wu, a skeptic at Hitotsubashi University in Japan, puts it. And even if statisticians at the central government level are immune to political pressure, few doubt that the local bureaus underneath them are capable of fudging the numbers to produce a more flattering picture.

Still, the general trend seems to be clear. If the government says the economy is slowing down, you can bet the slowdown is real.

via 5 Takeaways From China’s GDP – WSJ.

20/12/2014

Chinese warm to Russia in the winter – China – Chinadaily.com.cn

Chinese travelers have been flocking to Russia in recent days to cash in on the weak rouble.

Chinese warm to Russia in the winter

Bitter weather means that winter is usually the offseason for Russian tourism, and some Chinese travel agencies even stop selling tours to the country from October to June.

But this winter, the ailing rouble has stoked Chinese traveler’s enthusiasm for heading north.

Online travel agency Tongcheng Network Technology Share Co, in Suzhou, Jiangsu province, recently launched winter tour services to Russia for the first time. The agency said it has received 113 percent more bookings in December than in November.

“The number of bookings and inquiries increased sharply as the rouble depreciated significantly,” said Liu Qing, chief executive officer of Tongcheng’s Outbound Tourism Department.

Ctrip.com International, the largest online travel agency in China, said inquiries about Russian tours rose by 100 percent month-on-month in December.

Dai Yu, marketing director of Ctrip’s Tourism Department, said winter tours to Russia are about 60 percent cheaper than summer ones and the cost has fallen further due to the weak rouble.

Group tours to Russia usually last for six to eight days, with recent prices quoted at between 5,000 and 8,000 yuan ($815 to $1,300), much lower than tours to Western Europe.

Zhang Jing, 32, from Beijing, said she plans to book a low-priced tour to Russia for her parents. “It is a good deal to go now,” Zhang said, adding that her parents will choose between leaving at New Year‘s or Spring Festival in February.

Travel industry insiders said Russia will be a popular choice for Chinese visitors during the seven-day Spring Festival holiday.

Some agencies have already sold Spring Festival tours, although most travelers will only make their plans in the next month.

Liu said, “We can’t estimate how many travelers will book tours for Spring Festival, but we have already seen a dramatic rise in bookings.”

China is the main source of tourists to Russia, with their numbers increasing by 10 percent year-on-year in the first nine months of 2014, according to the Russian tourism authority. The number of tourists from Russia, the third-largest source of inbound tourists to China, continues to fall and will worsen due to the weakening rouble.

via Chinese warm to Russia in the winter – China – Chinadaily.com.cn.

19/11/2014

Putin Loses His Grip on Central Asia as China Moves In – Businessweek

As President Vladimir Putin strains to keep Ukraine within Russia’s grasp, he may be losing his grip on another part of his would-be empire: the former Soviet republics of Central Asia, which are increasingly turning toward China for investment and trade.

Russia's President Vladimir Putin and Tajik President Emomali Rakhmon meet on the sidelines of an informal summit of the regional security group in 2013

In the latest sign of its growing economic ties with the region, China is planning a $16.3 billion fund to finance railways, roads, and pipelines across Central Asia, reviving the centuries-old Silk Road trade route between China and Europe. President Xi Jinping first proposed the idea last year during a visit to Kazakhstan, the region’s wealthiest country.

Beijing has plenty of reasons to spend big in Central Asia. Improved infrastructure would help link China to European markets and give China increased access to the region’s rich natural resources. Kazakhstan is a major oil producer, while neighboring Kyrgyzstan has large mineral deposits and Turkmenistan produces natural gas.

At the same time, the planned construction would give an economic boost to adjoining areas of western China where Beijing is trying to quell a separatist insurgency, says Sarah Lain, a researcher at the Royal United Services Institute in London. As it has in Africa, China is likely to bring Chinese workers into Central Asia to do much of the construction.

During much of the 19th century, the Russian and British empires vied for control of Central Asia, a rivalry dubbed the “Great Game.” But the predominantly Muslim region, which also includes the countries of Tajikistan, Turkmenistan, and Uzbekistan, was annexed by the Soviet Union after the Bolshevik revolution and has remained close to Moscow in the post-Soviet era.

Putin has sought to maintain those ties—for example, by inviting Kazakhstan and Kyrgyzstan to join a customs union with Moscow. But with the Russian economy in a deep slump, he can’t match the big money that China is offering. Indeed, Russia’s economic malaise is clobbering some Central Asian economies, spurring them to seek help from China.

via Putin Loses His Grip on Central Asia as China Moves In – Businessweek.

07/11/2014

Foreign policy: Showing off to the world | The Economist

THE factories have closed down for a few days, and millions of cars have been ordered off the roads. Clear blue skies appearing over a usually smog-choked Beijing always mean one thing: a big event is about to get under way.

From November 10th President Xi Jinping will welcome world leaders to this year’s Asia-Pacific Economic Co-operation (APEC) summit. Not since the Olympics in 2008 have so many leaders gathered in the capital, and they will include the heads of the United States, Russia and Japan. It is a defining moment for Mr Xi’s foreign policy. Having established himself at home as China’s most powerful leader since Deng Xiaoping, he now seems to want to demand a bigger, more dominant and more respected role for China than his predecessors, Deng included, ever dared ask for.

Respect begins by putting on a good face to guests. Chinese bullying over disputed maritime claims has done much to raise tensions in the region. But now Mr Xi appears to be lowering them. In particular, China’s relations with Japan have been abysmal. The government has treated Japan’s prime minister, Shinzo Abe, with both venom and pettiness, implying he is a closet militarist. The relationship had sunk to such a low that it will count as notable progress if Mr Xi shakes Mr Abe’s hand—even if he does little more—at the summit.

On November 11th and 12th, Mr Xi will host a state visit in Beijing for Barack Obama. It is the second summit with the American president, following one at Sunnylands in California in 2013. It will be a good show, with a scenic walk and all that. But the substance appears less clear. At the time of Sunnylands, there was much Chinese talk of a “new type of great-power relationship” with America. Yet since it implies a diminished role for America, at least in Asia, Mr Obama does not seem inclined to go along. The two men appear likely to co-operate in a few areas, including climate change, trade and investment. They will agree to a bit more communication over respective military movements in and over the seas near China. But hopes that cordiality at Sunnylands might lead the relationship to blossom may come to little.

In truth, Mr Xi does not have much respect left for Mr Obama; the Chinese dismiss him as weak-willed in foreign policy. And so much of Mr Xi’s ambition lies elsewhere. Above all, the dream is to return China to its rightful place in a world in which, according to Bonnie Glaser of the Centre for Strategic and International Studies, a Washington think-tank, “China will be at the centre, and every other nation will have to consider China’s interests.”

This attitude is most familiar to China’s neighbours in the South China Sea and East China Sea. China has upset the Philippines by grabbing a disputed reef; Vietnam, by moving an oil rig into contested waters; Japan, by challenging its control over uninhabited islets; and even South Korea which, though on good terms, was concerned along with others when China declared an “Air Defence Identification Zone” over the East China Sea, demanding that planes inform it when entering it.

Yet Mr Xi has also courted friends under the catchphrase of “peaceful development”. He has pushed multilateral initiatives, including a new Asian Infrastructure Investment Bank, which many of China’s neighbours, including India, have signed up to. A New Development Bank has also been set up with fellow “BRICs”—Brazil, Russia, India and South Africa.

One of Mr Xi’s playmates is President Vladimir Putin. China and Russia have a history of mutual distrust, but Mr Xi’s first trip abroad as president, in March 2013, was to Moscow. Since then the two countries have struck a long-stalled gas deal and, according to Kommersant, a Russian newspaper, a pact on cyber-security. China backs Russia’s pro-Syrian stand in the UN Security Council and has refused to condemn Russia’s territorial incursions in Crimea and eastern Ukraine—though it loves to preach non-interference.

A strong thread that binds the two countries is American dominance in international affairs. “No country”, said Mr Xi at a security summit earlier this year to which Mr Putin was invited, “should attempt to dominate regional security affairs or infringe upon the legitimate rights…of other countries.” Mr Xi did not name America, but a month earlier Mr Obama had in Tokyo emphasised that America’s security pact with Japan extended to the Japan-controlled Senkaku islands, which China claims and calls the Diaoyu.

Is Mr Xi’s foreign policy succeeding? Only in parts. China’s maritime assertiveness has pushed some neighbours closer to Japan and America. But for long China will remain Asian nations’ biggest trading partner. It is busy pursuing regional and bilateral trade agreements while an American-led trade initiative, the Trans-Pacific Partnership, is bogged down. At APEC Mr Xi will seek to build on those economic relationships. And, given China’s heft, by and large he will succeed.

via Foreign policy: Showing off to the world | The Economist.

28/10/2014

Putin Turns to China as Russia’s Economy Is Weakened by Sanctions – Businessweek

Defying the U.S. and Europe is forcing Russian President Vladimir Putin to aid his biggest rival to the east. To avert a recession, Russia is turning to China for investment, granting it once restricted access to raw materials and advanced weapons, say two people involved in planning Kremlin policy who asked not to be identified discussing internal matters. Russia’s growing dependence on China, with which it spent decades battling for control over global communism, may end up strengthening its neighbor’s position in the Pacific. With the ruble near a record low and foreign investment disappearing, luring Chinese cash also may deepen Russia’s reliance on natural resources and derail efforts to diversify the economy.

“Now that Putin has turned away from the West and toward the East, China is drawing maximum profit from Russian necessity,” says Masha Lipman, an independent political analyst in Moscow who co-authored a study on Putin with former U.S. Ambassador Michael McFaul. China is wasting no time filling the void created by the closing of U.S. and European debt markets to Russia’s largest borrowers. A delegation led by Premier Li Keqiang signed a package of deals on Oct. 13 in Moscow. Among them were an agreement to swap $25 billion in Chinese yuan for Russian rubles over three years, a treaty to protect companies operating in Russia and China from having their profits taxed twice, and cooperation on satellite-navigation systems and high-speed rail. To promote trade, Export-Import Bank of China agreed to provide credit lines to state-owned VTB Group and Vnesheconombank, Russia’s development bank, as well as a trade finance deal with Russian Agricultural Bank.

Russia’s economy is more vulnerable than it’s been since the collapse of the Soviet Union in 1991. Unlike then, Russians are united in support of their leader, and with $455 billion in foreign currency and gold reserves, the country isn’t broke, according to Lipman. “The economy was much worse then, but Russia was in a much better position geopolitically because it had the support of the U.S. and Europe,” she says. Putin spokesman Dmitry Peskov didn’t respond to requests for comment.

via Putin Turns to China as Russia’s Economy Is Weakened by Sanctions – Businessweek.

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