Transformation of China’s Development Model under Xi Jinping and its Implications for Russian Exports

Abstract

The article focuses on the main factors underlying the structural transformation of China’s economic model under Xi Jinping and its implications for Sino‐Russian economic cooperation and Russian merchandise exports. Russian exports to China are analyzed in the context of major changes in the volume and structure of China's aggregate demand. The results show that the rebalancing of the Chinese economy would bring some risks to Russia in the short and medium terms through putting downward pressure on its exports of natural resources (except for natural gas). At the same time, it would open new opportunities for industries producing resource‐intensive consumer goods and, therefore, gives Russia an opportunity for diversification of its economy in the longer term. In order to derive benefits from China’s transformation, Russia should shift the focus of its export policy from negotiating politically driven large projects toward more intensive promotion of consumer goods exports.