MOSCOW (BLOOMBERG) - Chinese President Xi Jinping touted a new level of relations with Mr Vladimir Putin as he embarked on a three-day visit to Russia that highlights a deepening partnership between the two countries as both face growing tensions with the US.

"Step by step, we've been able to bring our relations to the highest level in history," Mr Xi said at the opening of the talks, according to a Kremlin transcript.

Ties now are "at an unprecedented level," Mr Putin said at the start of the meeting on Wednesday (June 5).

"We confirmed that the positions of Russia and China on key world problems are close, or as the diplomats say, coincide," the Russian leader said after the first round of discussions with Mr Xi, whom he referred to as "dear friend".

Mr Xi, who will address a flagship investment forum on Friday in the Russian leader's hometown of St. Petersburg, will sign about 30 documents with Mr Putin after the talks focused on trade, investment and energy.

Bilateral trade increased last year by about a quarter to a record US$108 billion (S$147.34 billion).

The countries' first natural gas pipeline is due to open later this year and China is investing in Russia's Yamal Arctic LNG project.



Russian President Vladimir Putin and his Chinese counterpart Xi Jinping after a signing ceremony at the Kremlin in Moscow on June 5, 2019. PHOTO: REUTERS



US TENSIONS

Mr Xi's warm embrace of Mr Putin comes as he's locked in an escalating trade war with Washington.

Russia and China have stepped up their economic and defence ties and are coordinating more closely on major international issues such as Syria, Iran and North Korea, amid a shared opposition to US global dominance.



Russia and China have stepped up their economic and defence ties and are coordinating more closely on major international issues. PHOTO: REUTERS



China sees Russia as a "large, friendly nuclear-armed neighbour" and as a key source of arms and energy, said Mr Alexander Gabuev, head of the Carnegie Moscow Centre's Russia in the Asia-Pacific Programme.

Its focus on Russia has grown since US President Donald Trump came to power with a far more confrontational policy, he said.

Still, Russia needs China much more than the other way round, according to the analyst.

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"For Russia, China is a big lifeline, but for China, Russia is not as important as the strategic relationship with the US or Japan."

While constrained by the huge imbalance in the size of the countries' economies, Russia has sought to attract more Chinese investment and trade to compensate for the chill in ties with the West since the 2014 standoff over Ukraine sparked a chill in ties with the West.

The share of trade with Russia held by China has almost doubled to 20 per cent since then at Europe's expense.

About 1,000 Chinese officials and business executives will attend the St. Petersburg International Economic Forum, the biggest foreign delegation.

Mr Trump and other Western leaders gathered on the south coast of England on Wednesday to commemorate the 75th anniversary of the D-Day landings in World War II. Mr Putin participated in the celebration five years ago, but wasn't invited this time.

Mr Xi brought with him two Chinese pandas which he will donate to the Moscow Zoo.

The two leaders will also see a performance at Moscow's famed Bolshoi Theatre.

The Chinese President, who will attend the opening of a Chinese car plant on Wednesday, will leave for St. Petersburg on Thursday, where he'll receive an honorary doctorate from Mr Putin's alma mater.