Russian Rubles Flow into Chinese Border Towns as Ties Deepen Since Ukraine War

Wang Runguo, dressed in a navy tracksuit and colorful high-top trainers, moved quickly across the gleaming floor of his car showroom. The 45-year-old from one of China’s poorest provinces was closing another deal, a routine for a man whose salary has more than doubled in the past year due to a timely shift from corn to cars and from China to Russia.

A year ago, Wang worked for an agricultural company growing corn and soybeans for the domestic market. He now manages Xingyun International Automobile Export, founded in August 2025 to serve Suifenhe’s booming car export industry. “Recently, China and Russia have been moving closer together,” Wang says. “As we move closer, more and more cars are going there.”

A manager at Suifenhe Hengchi International Trade, one of the city’s largest car dealerships, put it more bluntly: “The Russia-Ukraine war … has been a good opportunity for our business.”

As Russian President Vladimir Putin visits China on Tuesday, Moscow may hope Beijing continues to see the benefits of the cozy relationship.

On China’s border with Russia, where the United States is a distant concept but Russians spend their money, local businesspeople say they are unconcerned by Western sanctions.

China rejects Western sanctions and says they do not comply with international law. Earlier this month the Chinese embassy in London lodged “stern representations” over sanctions applied to Chinese companies accused of supplying drones and military goods to Russia. A Chinese government spokesperson said: “Normal exchanges and cooperation between Chinese and Russian enterprises should not be interfered with” by sanctions.

Ever since Russia launched its full-scale invasion of Ukraine in February 2022, weeks after Xi Jinping and Putin declared a “no limits” partnership, ties between the two countries have deepened. Bilateral trade has soared to record highs, to the chagrin of Western leaders who accuse Beijing of providing an economic lifeline to Moscow while it wages a war of aggression.

Beijing has bought more than 316.5 billion euros of Russian fossil fuels since the invasion began, data from the Centre for Research on Energy and Clean Air shows, far outstripping purchases by any other country. Chinese companies have jumped to fill gaps in the Russian market left by retreating Western businesses. Exports to Russia from Heilongjiang, the province including Suifenhe, rose 22% last year.

“The dependency is mutual, but asymmetric,” says Alexander Gabuev, director of the Carnegie Russia Eurasia Center. China now buys nearly 30% of Russia’s exports, while about 3% of China’s exports flow in the opposite direction.

But in certain industries, Russia plays a much bigger role in China’s economic fortunes. One such trade is cars, a sector struggling with oversupply and weak domestic demand. Vehicles are a major export from Suifenhe.

Between 2021 and 2024, Chinese brands’ share of the Russian car market increased from 7% to nearly 60%, according to data from the China Passenger Car Association. In 2024, China sold more than 1 million vehicles to Russia, making it the top destination for Chinese vehicles, though it has since dropped to second place behind Mexico.

Further volumes come from exporting Chinese-made, foreign-branded vehicles. Despite sanctions on Russia, tens of thousands of cars from brands such as BMW, Honda and Volkswagen continue to be sold in Russia each year via third-party Chinese dealerships.

Wang’s BMW, a used model, sold for 120,000 yuan ($17,600). That is cheap compared with prices in Russia, says the buyer, a Russia-based businessman. And it is too expensive for Chinese consumers, Wang says. It’s a win-win.

As much as China has kept the Russian economy afloat, Russian rubles also sustain many parts of China, where the economy relies heavily on exports and domestic consumers are unwilling or unable to spend.

Gao Bin, boss of Suifenhe Hengchi International Trade, says the company pivoted to exporting cars to Russia three years ago. The first car they shipped was a black Toyota Camry. “After the war started, there was demand in Russia,” he says. Last year, he sold more than 7,000 cars to Russia, compared with only a few dozen domestically. “Domestic sales have basically come to a halt.”

Suifenhe, a city of just 60,000 people in China’s economically depressed rust belt, is a microcosm of this relationship. Cyrillic signs are everywhere and prices are advertised in rubles as commonly as yuan. But most shops are boarded up. From certain hilltops, you can peer into barren Russian villages, although a multistory observation tower built to attract tourists has been abandoned and unfinished for years.

As the first place in China to allow the use of rubles as legal tender, Suifenhe has long hosted a large community of Russian businesspeople and visitors, boosted by a visa-free regime for Russian tourists introduced in September. It is just two hours from Vladivostok by train. According to local businesspeople, Russians are the only ones spending.

Ning Qiang, who runs a beauty salon catering exclusively to Russians, says the number of customers has increased by about 50% since the visa-free policy started. By 5 p.m. on a Tuesday, he had received three clients. “When China-Russia relations are good, life is better for ordinary people,” he says. “Locals in Suifenhe don’t buy much.”

Heilongjiang saw a more than 60% boost in visitors from Russia in the first six months of the visa-free policy, Chinese state media reported. Gabuev says difficulty getting European visas is pushing more Russians to travel east. “And they come back mostly really fascinated and willing to come back again. It’s a net positive for the Chinese,” he says.

One Russian spending her money in China rather than Russia is Mariia Publichuk, a 36-year-old from Vladivostok living in Suifenhe with her eight-year-old daughter. Publichuk moved there last year so her daughter could study Chinese. Mornings are spent at a local primary school surrounded by Chinese children; evenings are spent singing and dancing in the central square. “English is the first most useful language in the world,” Publichuk says. “And the second is Chinese.”

But for anyone whose livelihood depends on yuan rather than rubles, times are tough. The manager of a local logistics hub handling cross-border and domestic freight says it has been his worst year since starting the job six years ago. The war in the Middle East has pushed up fuel prices for his trucks, and orders are down. “Even during the pandemic … it wasn’t like this,” says Wang, who declines to give his first name. “This year, in every industry … demand in China is decreasing. It’s simply that people don’t have money in their pockets.”

National statistics tell a similar story. Despite the U.S.-China trade war pushing U.S. tariffs on Chinese goods as high as 145% last year, Chinese goods continue to be shipped overseas at astonishing rates. China’s trade surplus reached a record $1.2 trillion last year. In the first three months of 2026, exports were up nearly 15% compared with the same period last year, while domestic retail sales in March grew only 1.7% from a year earlier.

U.S. President Donald Trump left Beijing last week after a two-day summit full of pageantry with promises of “fantastic trade deals.” But there has been little public announcements on tariffs. On Saturday, China’s Ministry of Commerce said the two sides would establish a board of trade to discuss “tariff reductions” but did not provide further details.

China’s long-term goal is to make the economy less reliant on exports. In March, Premier Li Qiang said China “must adhere to the strategic basis of expanding domestic demand.”

Structural problems such as an aging population, a depressed real estate sector and lack of consumer confidence after the pandemic make this transition hard to execute. Exporting goods, whose prices are kept low in part because of discounted energy supplies from Russia, is a lot easier.

Despite the economic slowdown, Beijing still holds the cards in the China-Russia relationship. China has options for international trade that Russia does not. Bloomberg recently reported that 90% of Russia’s sanctioned technology is imported from China. And with Trump in the White House, Xi is under less pressure than ever over his relationship with Putin. The war in Ukraine barely featured in last week’s U.S.-China summit. Trump’s “ask to Xi Jinping to contribute to the peace effort in Ukraine is not a very serious push,” Gabuev says. “Not that Xi Jinping feels that he’s on the hook for that.”

In Suifenhe, even the most ardent Russophiles see Russia as a country in decline, notwithstanding their own city’s beleaguered economy.

On the outskirts of town, in a crumbling, barely populated village, a house built in the style of a Russian wooden cottage, painted bright blue and yellow, stands out from the gray. Its inhabitant is Song Lu, a 67-year-old retired artist whose family has lived in Suifenhe for generations. An enthusiast for Russian arts and crafts, he builds models of traditional Russian wooden carriages in his spare time and has built a blue tubular sauna in his front garden. “Russians might find it hard to admit, but in reality, China has already become the big brother,” he says.

Additional research was contributed by Lillian Yang.