Russia’s dependence on China may not be enough to save economy

Abstract

Russia’s increasing reliance on China for trade underscores potential vulnerabilities due to China’s economic woes and the yuan’s currency controls. This is prompting Russia to aggressively pursue the digital ruble. Despite Western sanctions, Russia-China trade has increased, enhancing bilateral commerce and financial cooperation. Trade is also increasingly denominated in yuan and rubles, furthering the two countries’ goals of de-dollarization. Russia’s economic growth relies heavily on state spending for military purposes, potentially leading to inflation and social unrest. The push for a digital ruble aims to manage these challenges, but highlights long-term economic vulnerabilities