Putin Heads to Beijing for Talks With Xi as Russia's Economic Reliance on China Grows
Following closely on Donald Trump's visit, Russian President Vladimir Putin is traveling to Beijing for discussions with Xi Jinping. DW examines how China's trade and financial assistance is helping to sustain Russia's economy.
Russia may celebrate its "no-limits" partnership with China β a term introduced when President Vladimir Putin and Xi Jinping met shortly before the Ukraine war β yet these ties are becoming increasingly unbalanced.
While bilateral trade moderated last year due to declining oil prices, Russia's goods exports to China have nearly doubled since February 2022, when Moscow initiated its full-scale invasion.
In 2024, Russia shipped approximately $129 billion (β¬111 billion) worth of goods to China β the vast majority consisting of crude oil, coal and natural gas sold at significant discounts.
The Center for Research on Energy and Clean Air calculated that China has purchased more than β¬319 billion ($372 billion) of Russian fossil fuels since the conflict began, providing Moscow with essential hard currency to finance its military amid Western sanctions.
In exchange, China exported nearly $116 billion worth of goods to Russia in 2024, delivering machinery, electronics and vehicles that replaced Western suppliers that left the Russian market.
Although Beijing has refrained from directly exporting finished military hardware to Russia, China has provided billions of dollars' worth of dual-use goods β civilian products and technologies that also have military purposes. These have also helped maintain Russia's defense sector.
As Putin and Xi prepare to meet in Beijing this week for high-level discussions β scheduled to commemorate the 25th anniversary of the two nations' cooperation treaty β this growing disparity leaves Moscow increasingly susceptible to Beijing's priorities.
China and Russia: A partnership of equals?
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Why is Russia becoming more dependent on Chinese technology?
Western sanctions, imposed since 2022 and repeatedly strengthened, have cut off Russia's access to advanced Western technology.
The United States, European Union, United Kingdom and allies prohibited exports of semiconductors, microelectronics, precision machine tools and other dual-use goods essential for weapons manufacturing. These actions created severe shortages in Russia.
In response, Moscow turned to China, which, according to Bloomberg, provided roughly 90% of Russia's sanctioned technology imports in 2025 β up from 80% the previous year.
Acquiring items such as machine tools for missile and drone assembly is far more challenging and costly than before the war. Russia must employ complex evasion networks through third countries and often pays premiums of nearly 90% above pre-war prices.
Beijing has also supplied Russia with earth observation intelligence, satellite imagery for military purposes and drones, Bloomberg reported last year.
Chinese technology has allowed Russia to maintain and even increase its production of missiles, drones and other weapons, keeping the war economy functioning.
Why are Russia and China conducting more trade in yuan?
As the Ukraine war developed, the US, EU and allies removed major Russian banks from the SWIFT payment system and froze approximately $300 billion of Russia's central bank reserves held abroad.
This effectively turned the dollar-dominated financial system into a weapon against the Kremlin, making dollar or euro transactions risky or impossible. The move also exposed foreign banks, individuals and entities worldwide to secondary sanctions if they continued dealing with sanctioned Russian entities.
In response, Moscow and Beijing accelerated so-called de-dollarization, the shift away from using the US dollar toward their own national currencies. According to Russian Finance Minister Anton Siluanov, by late last year, the two countries were settling over 99% of their bilateral trade in rubles and yuan.
This trend has been reinforced by the BRICS group of emerging economies, which encourages local-currency settlements among its nearly dozen members and has even proposed plans for a single BRICS currency.
Yuanization, as it's called, has created new dependencies, however. Russia now faces occasional yuan shortages, higher borrowing costs and must accept Beijing's advantage in all bilateral negotiations.
China isn't trying to replace the dollar overnight, but a more widely used yuan increases Beijing's global economic influence. Countries that hold or borrow in yuan become more connected to China's economy and policies.
Is China likely to increase its economic dominance over Russia?
Many top Russia-China analysts believe that Beijing's leverage over Moscow is likely to grow further in the coming years.
During his visit this week, Putin is expected to push for progress on new and expanded pipelines that will further strengthen Russia's export revenues and China's energy security.
Boosting Russian pipeline capacity to China "would significantly enhance Beijing's oil security in a Taiwan contingency," Joseph Webster, a senior fellow at the Atlantic Council, wrote in a post on Substack on Sunday.
Webster was referring to China's repeated threats to invade Taiwan, a move that could draw Western sanctions on Beijing or even a US naval blockade that disrupts China's sea-borne oil imports.
The Kremlin is particularly eager to finalize construction of the long-delayed Power of Siberia 2 gas pipeline, which could deliver up to 50 billion cubic meters of gas annually to China via Mongolia. The project remains stalled over pricing disputes and technical details.
Beijing's desire for reliable overland energy supplies has grown since the disruptions in the Strait of Hormuz during the Iran war. But any breakthrough in those plans would further tie Russia's energy future to China, reinforcing Beijing's leverage over Moscow.
The Putin-Xi summit also comes just days after US President Donald Trump's high-profile visit to Beijing, which saw Washington and Beijing attempt to stabilize their ties on trade, technology and global issues after a challenging few years.
A thaw in US-China relations, however, would not help Putin. It reduces China's incentive to fully align with Russia against the West, as Beijing prioritizes protecting its massive economic interests with the US and Europe.
Conflicts remain after Trump-Xi summit ends
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Edited by: Srinivas Mazumdaru