Other BriefingsSaudi-Russia Bilateral Trade Targeted At US$5 Billion
The Russian Ambassador to Saudi Arabia, Sergey Kozlov has said that there is plenty of room for growth in bilateral trade between Russia and Saudi Arabia, and that the two countries intend to reach an initial target of US$5 billion.
Kozlov stated that the bilateral trade and economic relations between the two countries are characterized by positive dynamics, and that Moscow sees Riyadh as a promising trade and economic partner whose role in global and regional affairs is steadily growing. Bilateral trade in 2022 reached about US$1.75 billion.
There are trade drivers. Russia’s relationships with the Gulf Cooperation Council (GCC) states typically revolves on a widespread regional desire to hedge against the United States. The US is seen as a waning power in some circles as the Middle East is becoming less of a core U.S. national security interest as a result of the U.S. pivot to Asia, the drawdown of the U.S. military presence in Iraq and Afghanistan, and the United States own booming domestic oil and gas production. All these point to less US influence in the region leaving countries like Russia and China to fill in the gaps.
The GCC states and Russia also share a preference for strong, borderline authoritarian governance. Most of the GCC states abstained from a UN vote criticising Russia for the Ukraine conflict, while it appears apparent that Russian President Putin and Saudi Arabia’s Mohammed bin Salman get along.
Much of the Saudi portion of the bilateral trade volumes with Russia are driven by the petroleum chemicals sector, with Saudi Arabia exporting Amino-resins, Acyclic Alcohols, and Polyacetals. Russia in return exports Refined Petroleum, Barley and other foodstuffs.
There will be other opportunities for trade and development. Saudi Arabia has officially applied to join the BRICS grouping of countries, while like Russia it is a participant in the Shanghai Cooperation Organisation, which also includes a growing multilateral trade section.
With Russian nationals exploring regional potential in the neighbouring United Arab Emirates, it will only be a matter of time before opportunity spill over from this transfers to Saudi Arabia, with the non-energy and services sector ripe for bilateral development.
Dezan Shira & Associates has a partner firm in Saudi Arabia. For assistance please contact dubai@dezshira.com
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