Settlement in national currencies helps boost trade between the two countries and also has an impact on global finance and
the energy market
Russia and China have reinforced their increasingly deeper ties with a second huge energy deal. The latest move adds to the massive $400 billion gas contract signed earlier in the year.
Russian President Vladimir Putin is in Beijing for the Asia-Pacific Economic Cooperation summit.
In an attempt to circumnavigate the dollar both countries look set to settle accounts using national currencies, Euronews reported Tuesday.
The Russian president appears excited by the prospect: “I think that national currency settlement in such partner economies, like Russia and China, is a promising direction of cooperation. Settlement in national currencies helps boost trade between the two countries and also has an impact on global finance and the energy market,” he said.
The forging of closer Sino-Russian ties have already reaped rewards for both counties, in 2010 China overtook Germany as Russia’s largest trading partner. However, the same is not true for China.
Beijing’s biggest trading partner is the United States and US President Barack Obama is also in town in an attempt to make sure it stays that way: “Over the next five years, nearly half of all economic growth outside the United States is projected to come from right here in Asia. That makes this region an incredible opportunity for creating jobs and economic growth in the United States,” Obama said.
Economic observers say the current frosty relations between Moscow, the US and Europe over Ukraine is forcing Russia to look to China as investment from the West shrinks.
China’s FTA Vision
President Xi Jinping on Tuesday pushed China’s free trade vision for the Asia Pacific region and asked APEC to “break open closed doors” as leaders of the grouping held talks on forging consensus over opening up commerce in the resource-rich and economically dynamic region.
President Xi is hosting the 22nd Asia-Pacific Economic Cooperation (APEC) Economic Leaders’ meeting at the Yanqi Lake International Convention Center in northern suburb of Beijing.
The meeting is being attended by 21 heads of state.
Xi said, “We should... push vigorously for the progress of the FTAAP, setting out clearly its targets, direction and roadmap and turn the desire into reality at an early date.”
He said the meeting is expected to achieve four objectives, including the launch of the Free Trade Area of the Asia-Pacific (FTAAP) process, issue a statement on the 25th anniversary of the APEC, promotion of innovation, reforms and growth to seek new momentum for long-term development of the Asia-Pacific and a blueprint to lay a solid foundation for all-round connectivity in the Asia-Pacific.
Xi called for concrete actions to facilitate free trade, improve connectivity and pursue innovation.
He stressed that the APEC members have made important consensus on the launch of the FTAAP process, promotion of connectivity as well as pursuit of innovation and development.
“We need to translate the consensus into actions and make development blueprints for the next five, ten and even 25 years,” said Xi.
Historic Agreement
Asia-Pacific leaders have agreed to move towards a new free trade zone strongly backed by Beijing.
The Free Trade Area of the Asia-Pacific (FTAAP) is seen by some as a rival to a US trade pact, which excludes China.
The APEC summit near Beijing agreed to launch a study into the FTAAP.
Chinese leader Xi Jinping, who earlier urged Asia-Pacific nations to accelerate economic ties, described the endorsement of the pact as a “historic” decision.
The US is currently negotiating a separate Trans-Pacific Partnership (TPP), which is considered part of Washington’s “pivot” towards Asia - ensuring continued US influence in the region in response to growing Chinese power.
The TPP involves 12 countries, but not China or Russia.
US President Barack Obama has rejected suggestions by Chinese commentators that the TPP is a way of countering Chinese influence.
In an interview with China’s Xinhua state news agency, he said the US was in no way trying to contain China.
In its final communique, APEC said the study into the establishment of the FTAAP would last two years.
“Currently, the global economic recovery still faces many unstable and uncertain factors,” the Chinese leader said earlier.
“Facing the new situation, we should further promote regional economic integration and create a pattern of opening up that is conducive to long-term development.”
