Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Chinese PM Woos Businessmen

APZhu gesturing while he addresses businessmen at the Metropol Hotel on Monday.
Visiting Chinese Prime Minister Zhu Rongji met with Russian business executives Monday to push for an expansion of bilateral trade, which has lagged behind the two former adversaries' growing political ties.

"Trade and economic cooperation must soon be brought to the level that would correspond to our relations in the political field," Zhu said in a speech.

Zhu arrived Friday in St. Petersburg, where he and his Russian counterpart Mikhail Kasyanov signed several trade agreements. The deals included one on a feasibility study for a 2,400-kilometer, $1.7 billion oil pipeline from Siberia to northeastern China.

They also signed a contract for delivery of five Tu-204 cargo planes to Chinese airlines, as part of what observers call Russia's push to win China over from Boeings.

"Our meeting has brought greater results than any previous such meetings," Zhu said.

Political tensions between the two giant neighbors eased shortly before the 1991 Soviet collapse, and Russia and China have developed what they describe as a "strategic partnership." Moscow and Beijing jointly oppose alleged U.S. global domination and Washington's plans to build limited defenses against ballistic missiles.

Beijing has also become the top customer for Russia's ailing military industries, buying billions of dollars worth of jets, missiles, submarines and destroyers throughout the 1990s.

But other trade has fallen behind, and Russian energy companies and airline makers have steadily lost ground in China to Western competitors. The two countries' trade volume was a record high at $8 billion last year, but it was dwarfed by China's $115 billion in annual trade with the United States. Russia now accounts for just 2 percent of China's trade.

In his speech Monday, Zhu said the pipeline deal alone, when completed, would earn Russia up to $10 billion a year in oil exports to China.

Russian officials have said the pipeline would supply 20 million tons of crude oil annually upon completion in 2005, and after 2010 it would carry 30 million tons of crude per year. Russia also plans to take part in a tender for a gas pipeline to China.

Zhu voiced hope that mutual trade would grow on the basis of the new friendship treaty signed by President Vladimir Putin and Chinese President Jiang Zemin in July.

He urged Russian officials and businesses to help increase Chinese exports to Russia, which remained low at $2.2 billion last year. Zhu said that Russian shuttle traders also import around $10 billion of Chinese goods a year in semi-legal schemes, robbing both countries' governments of revenues and undermining consumers' confidence by choosing cheap, low-quality goods.

"We must encourage trade between big companies to help supplies of high-quality Chinese goods at affordable prices and phase out products supplied through illegal channels," Zhu said. "We hope the Russian government will create beneficial conditions for such companies to allow them to compete with illegal trade."

Zhu is expected to meet with Putin and other Russian officials Tuesday and visit the Star City cosmonaut training center near Moscow before ending his visit Wednesday.