Russia looking to China for economic cooperation

Russia highly values its economic cooperation with China and sees huge potential for further development, according to a veteran Russian investor.

Cooperation between Russia and China in the fields of trade, energy, scientific and industrial projects, and security could benefit both sides, Russian Direct Investment Fund chief executive Kirill Dmitriev told Xinhua in a recent interview.

He said Russian companies increasingly looked east in search of cooperation opportunities.

Russian Direct Investment Fund and China's Investment Corporation formed a joint investment fund in 2012, with capitalization of 2 billion U.S. dollars. Seventy percent of that capital would be invested in Russia, Dmitriev said.

The Russia-China Investment Fund had already closed its first deal, with the largest forestry group in Russia, he said, adding 30 more projects were in the fund's portfolio.

Dmitriev said Chinese direct investment in Russia grew 40-fold in the 2004-2012 period, reaching 4.9 billion dollars.

He said China now played a leading role in investment and trade in the Asia-Pacific region, with its trade turnover in 2012 exceeding U.S. and EU foreign trade combined by 120 billion dollars.

By lowering trade barriers, China also facilitated the economic development of its neighbors, he said.

"We expect that, in 2014, Russia-China trade will reach 100 billion U.S. dollars, and by 2020 that figure should be twice as big, thanks to closer relations and mutual understanding," he said.

The Fund chief said the most important aspect for deep economic reforms in China was the government's efforts to make the yuan convertible while gradually abandoning dollar accounting during trade and investment operations.

For example, Russia-China trade in their national currencies had exceeded the equivalent of 2 billion dollars since 2011, Dmitriev said.

China also was steadily liberalizing its domestic financial market, and enhancing the status of Shanghai, Hong Kong and Beijing as international financial centers, he said.

In general, the Asia-Pacific region demonstrated a positive economic dynamic, which was especially apparent when compared with western markets, Dmitriev said, citing the 7-percent GDP growth in the region. This led to rising domestic demand and imports, as well as increasing mutual trade among the region's countries.

"Further lowering of barriers for capital, services and goods in Asia would create millions of jobs. This is why development of economic cooperation, along with rising labor productivity and investment into large infrastructural projects, have been a priority for the region," Dmitriev said.

As for the upcoming Boao Forum for Asia (BFA) to be held in China's Hainan province, Dmitriev said it would be an important forum to discuss regional cooperation.

Founded in 2001, the BFA is a non-governmental and non-profit international organization committed to regional economic integration and bringing Asian countries closer to their development goals.