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International relations

Chinese and Russian companies ink $20bn in business deals

Beijing seeks alternatives to tariff-hit American gas and soybeans

Workers next to tanks for liquefied natural gas in China's Shaanxi Province. China views Russia as an alternative source for the fuel as tariffs push up prices of American gas.   © Reuters

BEIJING -- Chinese and Russian enterprises signed roughly $20 billion in business deals on the sidelines of the summit in Moscow on Wednesday as Beijing seeks to bolster trade and economic relationships with countries other than the U.S.

Much of the deals focused on the energy sector and 5G mobile technology, according to government announcements. China and Russia also aim to double bilateral trade in the future.

Sinopec Group, which counts China Petroleum & Chemical as a core unit, will work with a Russian company to increase Chinese imports of natural gas, according to Chinese reports.

China had been planning to buy more cheap liquefied natural gas from the U.S. But higher tariffs on American products, imposed as part of their ongoing trade war, forced Beijing to explore alternative sources. In high-tech, Chinese companies are also deepening ties to Russian counterparts as Washington tries to freeze them out of certain areas.

China's Alibaba Group Holding has agreed to create an e-commerce venture in Russia with partners including a leading Russian communications provider. Huawei Technologies, whose equipment the U.S. deems a security risk, will work to establish 5G networks with a Russian telecom company.

Bilateral trade jumped 24.5% to $108 billion in 2018. The two sides agreed to increase it to $200 billion, with an apparent target date of 2025.

As the trade war squeezes shipments between China and the U.S., Beijing is focusing more on Russia and other countries that are part of its Belt and Road infrastructure initiative. China also plans to import more soybeans from Russia to supplement the U.S. shipments now subject to retaliatory Chinese tariffs.

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