Diplomatic diss to Obama: Russia, China step up ties with new investment bank

In just the latest sign of warming bilateral ties, Russian and Chinese officials announced plans Friday to form a jointly-run investment bank designed in part to funnel Chinese investor money into Russian companies.

The proposed bank is one of more than 30 agreements announced as Chinese President Xi Jinping arrived in Moscow for the massive Red Square “Victory Day” parade Saturday to mark the 70th anniversary of the defeat of Nazi Germany in Europe.

With President Obama and other Western leaders declining to attend the parade amid rising tensions with Russian President Vladimir Putin over Ukraine, Mr. Xi is the most prominent of the two dozen or so national leaders who traveled to Moscow for the event.

The Russian news service Interfax said the new bank would be jointly managed by the Russian Direct Investment Fund and CITIC Merchant, a division of China’s CITIC financial group. There were no details on the capitalization of the joint venture, which the Interfax report said would also offer merger and consulting advice to Chinese companies looking to invest in Russian ventures and provide debt financing, including Chinese bank loans and bonds sold on Asian markets.

Another agreement announced Friday sets up a $6 billion loan to finance a Moscow-to-Kazan high-speed rail link, with China reportedly providing about a third of the total financing.

With Mr. Putin increasingly at odds with the West, Russia’s economic, security and political ties with China have accelerated in recent months. The two former Cold War rivals have signed a string of major deals to sell Russian oil and natural gas to China, have announced plans for the first-ever joint naval exercise in the Mediterranean, and have even been in talks on a joint mission to the Moon to establish a manned lunar base.

Mr. Putin announced Friday in Moscow that he had accepted Mr. Xi’s invitation to travel to Beijing later this year for China’s own celebration of the victory over Japan in World War II. The Russian leader also took a swipe at what he said were efforts by some in the West to downplay the losses suffered by the Soviet Union and China from the war, or to minimize their role in the defeat of Hitler and Imperial Japan.

 
“We always oppose any attempt to deny, distort or falsify history, and fight against any move to beautify fascists, militarists and their accomplices or the moves to sling mud to liberators,” Mr. Putin said, according to the ChineseXinhua news agency.