Chinese Manufacturers Push Russian Producers Out of Key Sectors
Chinese manufacturers are rapidly taking over key sectors of the Russian economy as local producers struggle with weakening investment, high borrowing costs, and declining export revenues.
The Gaze informs about it, referring to a new assessment by Ukraine’s Foreign Intelligence Service.
The report notes that Russia’s internal economic pressures, including a high key interest rate, inefficient monetary regulation, and shrinking budget stimulus, have left domestic companies unable to maintain competitiveness.
While official statistics present investment levels as stable, analysts say much of the data reflects pre-existing assets rather than new capital formation, pointing to a real decline of around 1.5%.
Meanwhile, export income has fallen by 20%, and increased tax burdens are further limiting business growth. Industrial representatives inside Russia reportedly identify elevated lending costs and the slow pace of rate reductions as the main barriers to recovery.
As Russian firms lose capacity and market share, segments of the economy are opening wide to foreign suppliers – first and foremost to China. Without heavy financial commitments, Chinese companies are moving in and securing control over markets once dominated by Russian producers.
The heavy truck sector illustrates the shift most clearly. Between January and October, sales of vehicles over 14 tons plunged 54%, while long-haul tractor sales fell 71%. Overall registrations fell to 37,900 units – 57% below the previous year.
Despite Russia’s KAMAZ retaining nominal leadership with a 29.5% share, Chinese brands including Sitrak (16.3%), Shacman (10.8%) and FAW (9%) are steadily overtaking the Russian giant. Belarus’s MAZ, holding 7.2%, adds additional competitive pressure.
Ukrainian intelligence concludes that Russian producers are “doomed to further displacement” from strategic sectors of their own market, and that reversing the trend amid aggressive foreign expansion is “virtually impossible.”
Their assessment aligns with broader indicators suggesting the Russian economy is entering a phase of structural slowdown. Growth remains too weak to offset inflation, and analysts warn that internal stagnation may accelerate external influence, particularly from China, whose technological and industrial presence in Russia has expanded significantly since the invasion of Ukraine.
As The Gaze reported earlier, a new study has shown that China is significantly raising prices on controlled goods for Russia, effectively exploiting its dependence on Chinese exports amid sanctions.
Read more on The Gaze: Currency Operations for Sanctions Evasion: How the Yuan and Dirham Save the Kremlin and Why This Weakness Can Be Blocked