Russia’s decision to close its more than 4,000km-long land border with China to prevent the coronavirus outbreak risks damaging a relationship that has bloomed over the past six years as the Kremlin’s ties with the west have soured.
The closure of the 16 border crossings – coming into effect at midnight on Friday — will hurt the flow of more than $110bn worth of trade between the two countries last year. Russia’s foreign ministry also announced that it had stopped issuing electronic visas to Chinese nationals, suspending a special permit that gives tourists short-term access to St Petersburg, the Baltic Sea exclave of Kaliningrad and parts of the country’s Far East. Russia’s vast oil exports to China via pipelines will be unaffected, however.
“Up until now, no cases of the deadly disease have been recorded in Russia,” said Mikhail Mishustin, Russia’s prime minister. “Nevertheless, we must do everything we can to protect our people.”
China is Russia’s largest trade partner, and bilateral volumes rose 25 per cent in 2018 to top $100bn. Both countries have pledged to double their bilateral trade volumes by 2024, helped by new infrastructure such as the Blagoveshchensk-Heihe bridge completed in November and a railway bridge 450km downstream, which was completed last March and was designed to carry 20m tonnes of goods a year.
“The disease itself will definitely affect [trade] volumes,” said Alexander Gabuev, senior fellow at the Carnegie Moscow Center, noting that China’s quarantine restrictions had limited mobility and might lead to reduced fuel imports from Russia.
“The border closure will have a limited hit for China-Russia trade for now, but the coronavirus might have a much bigger impact on the trade relationship between Moscow and Beijing due to a possible collapse in demand for Russian exports,” he added.
Electronics and industrial equipment account for almost half of China’s exports to Russia, as well as textiles, clothing and furniture. Food, paper products and minerals are also shipped across the border on trucks or trains.
In an effort to smooth the fallout from the border closure, Mr Mishustin’s decree ordered the Russian foreign ministry to contact its Chinese counterpart and “emphasise that [the border closures] are justified by special circumstances and are only temporary”.
A decision to ban mass Chinese tour groups — the biggest driver of growth for Russia’s tourist industry since 2015 — was taken earlier this week.
While flights between major Russian and Chinese cities are still operating, the head of the Association of Tour Operators of Russia, a tourism lobbying group, said on Thursday that Russia stood to lose $100m from the restrictions, and an additional $10m from Russian tourists cancelling or postponing trips to China.
The rouble has fallen about 2 per cent so far this week, mainly because of fears over how the virus may impact global trade growth.
The Russia-China border — one of the world’s longest — has for much of the past 60 years been a line of tension, first between former communist allies whose friendship fractured and led to border skirmishes and then between rapidly diverging economies after the end of the cold war.
However, a good personal rapport between presidents Vladimir Putin and Xi Jinping coupled with deteriorating relations with the west have given rise to a rapprochement.
Only two months ago, Russia and China completed construction of the first-ever road bridge across the Amur river that demarcates the border, in a fanfare-filled event celebrating the deepening trade relationship between the two neighbours.
Source: Economy - ft.com
