China-Central Asia | Raffaello Pantucci

Posts Tagged ‘China-Central Asia’

Xinjiang’s April 23 Clash the Worst in Province since July 2009

Posted: May 28, 2013 in China Brief
Tags: bachu, China, China-Central Asia, radicalization, terrorism, xinjiang

And more late posting, this time a piece I wrote for Jamestown’s China Brief looking at the recent grim events in Xinjiang. A topic that is only going to become more relevant as time goes on given the depth of tensions. Of course, this all also feeds into the larger project I am working on looking at China in Central Asia.

Xinjiang’s April 23 Clash the Worst in Province since July 2009

Publication: China Brief Volume: 13 Issue: 11

May 23, 2013 04:16 PM Age: 4 days

By: Raffaello Pantucci

A People’s Armed Police Patrol in Xinjiang, from here

On April 24, reports emerged from Xinjiang that 21 people had been killed in what was reported as a “terrorist clash” in Bachu County, Kashgar Prefecture (Xinhua, April 24). The incident came as U.S. Ambassador to Beijing Gary Locke was undertaking the first visit to the province by a senior U.S. delegation in 20 years as part of Beijing’s push to attract foreign investment to the province (Xinjiang Daily, April 25). The juxtaposition of the two events highlighted Beijing’s persistent difficulties in taming the province’s tensions. They call into question Beijing’s economics-based strategy while illustrating the ongoing questions about the drivers of radicalization in the province.

Initial descriptions about the events in Selibuya village in Bachu County (also known as Maralbexi) just outside Kashgar, suggested the incident was the product of a “violent clash between suspected terrorists and authorities” (Xinhua, April 24). Three community workers were described as entering a property and finding suspicious individuals with knives. They managed to alert others, but were killed before help could arrive. This lead to a larger clash in which a total of 15 police and community workers were killed while six so-called “mobsters” were shot to death (Xinjiang Daily, April 24; Shanghai Daily, April 24). The 15 dead were heralded later as “martyrs” and identified by their ethnicities as 10 Uighur, three Han and two Mongolians (Xinhua, April 29). Grim pictures released in the days after the funerals seemed to show females identified as cadres with their throats slit (CCTV13, April 30).

Xinjiang government spokeswoman Hou Hanmin quickly blamed the incident as being the work of terrorists (Reuters, April 24). Two days later after U.S. State Department spokesman Patrick Ventrell refused to call it terrorism, an editorial lashed out at U.S. “double standards,” something felt all the more keenly in the wake of the Boston bombings in which a Chinese student was killed (Xinhua, April 26). A few days later, security forces announced they had arrested a further 11 suspects for involvement in the incident, bringing the total number of captured individuals to 19 (Xinhua, April 29). In making this announcement, the government laid out its claim that they had disrupted a terrorist cell headed by Qasim Muhammat (also spelt Kasmu Memet) that had been founded in September 2012 and was in the process of planning “something big” this summer in Kashgar (Xinhua, April 29). The group allegedly would gather at cell member Muhanmetemin Barat’s house where they would do physical training, watch extremist videos, read the Koran and practice making explosives (Xinhua, April 29). The group was in the process of making explosives at the house when the three community workers came visiting leading to the incident (Xinhua, April 29).

According to an official timeline released by the government, one of the members of the cell, Musar Aisanjon, had first come to security officials’ attention in July 2007 when he was questioned by authorities linked to unspecified charges. Three years later, he is alleged to have met Qasim Muhammat, who subsequently went on to recruit the other members of the cell (China Daily, April 30). By September 2012, the group was formed and under Qasim’s lead were gathering regularly to train, listen and watch radical material and make knives. By the time of the incident, they allegedly had tested explosives five times. When authorities subsequently raided the properties, they uncovered knives, combat training equipment, illegal religious material and three jihadist flags along with at least one identified as being an “East Turkestan” banner (Xinhua, April 29; China Daily, April 30). Nevertheless, a few days later spokeswoman Huo Hanmin went on record saying that the incident and individuals involved “had no connection with foreign forces” in contrast to many previous incidents where external influences were blamed (China Daily, May 2).

This official version of events was disputed remotely by dissident groups through Radio Free Asia, where they called for independent coverage of the story (RFA, May 3). A BBC crew was able to get to Selibuya and spoke to locals who said a family that was at the center of the clash had “a long-standing dispute with officials.” Apparently very religious, the family was under pressure to shave their beards and for their women to unveil themselves—something that was apparently in accordance with local laws. The family refused and something snapped on April 23 leading to the brutal incident (BBC, April 26). Little of this account beyond the end result was corroborated by official Chinese reports, leaving observers in the usual frustrating state of confusion when observing such incidents in Xinjiang.

Waters were further muddied when RFA—citing Uighur websites, local sources and dissident groups—reported that there had been a further incident in Hotan, Xinjiang during which two more community workers were killed and three cars burned in an incident sparked off by clampdowns in the wake of the Selibuya deaths (RFA, April 26). No further information has emerged about this incident. Other incidents reported by RFA in subsequent days (and not corroborated elsewhere) showed tensions between Uighur and Han across the country. One report indicated there had been a clash between Uighur and Han students at Beijing’s Minorities University leading to the authorities separating the two communities on campus (RFA, April 29). Meanwhile in Shanghai, a group of Uighur women protesting their being banned from selling products outside the Changde Lu Mosque, reportedly were moved along violently by local authorities (RFA, May 3). It is unclear if there is any connection between all of these events and whether these are anything more than usual intra-ethnic tensions. They do, however, highlight a persistent issue.

A contact in Kashgar at around the time of the incident reported no particular local coverage of events, with locals suggesting they return to Urumqi rather than press on toward the borders near Kashgar. Another report indicated that the government had re-issued laws regulating possession of SIM cards in the region (RFA, April 30). Such laws had been issued previously in conjunction with other rioting when it was believed that dissemination of pictures of Han or Uighur brutality against each other had exacerbated tensions. By having people registering SIM cards against ID cards, the belief was that individuals could be tracked.

While possibly sensible from a security surveillance perspective, such measures are impediments to rapid transfer of information. Something that when taken in conjunction with the confusion that permeates the official accounts of the events in Selibuya suggests that the government is going to continue to have a difficult time in attracting the external investment that it is looking for to develop the province. External investors will be both alarmed by the security situation, but also the heavily watched environment and the impediments to obtain SIM cards.

According to 2012 trade figures, during the first 11 months of 2012, Xinjiang attracted some $396 million in foreign direct investment (FDI)—a figure up 30.8 percent year-on-year—but still paltry when put in the context of the $100.02 billion that China overall attracted during the same period (Xinhua, December 21, 2012). Eager to attract foreign firms, the Xinjiang government has been proactive in bringing foreign companies out to the province. It has signed a cooperation agreement with the Confederation of British Industry (CBI); Volkswagen has established a joint venture car factory outside Urumqi; French waste management firm Veolia is taking on the modernization of Urumqi’s wastewater infrastructure; Coca-Cola is opening a plant in the province with its bottling partner Cofco; IBM is working with authorities in Karamay to develop a “smart city”; Danish wind power manufacturer LM Glasfiber setting up a factory in the Urumqi Economic and Technological Development Zone; and Turkey signed an agreement in 2011 to develop a Sino-Turkish Development Park outside Urumqi (www.cbi.org.uk, January 28; China Daily, November 14, 2012; South China Morning Post, April 3, 2012; China Daily, August 16, 2011; http://www.finance.veolia.com, September 1, 2005). More recently, the U.S. delegation visiting with Ambassador Locke had representatives from GE, the Aluminium Company of America (Alcoa), DuPont, Cummins and Peabody Energy Corporation (Xinjiang Daily, April 25).

All of this activity, however, does not seem to be translating into a huge pay-off on the ground as external investment remains relatively low. Foreign firms wonder about the prospects in the wake of incidents like that in Selibuya as well as practical concerns like the province’s still underdeveloped infrastructure and its distance from any bodies of water or markets. The annual China-Eurasia Expo held in Urumqi in September, for example, is intended as a further FDI booster, but most of the deals done are between Chinese firms. During the 2011 Expo, $29.14 billion in deals were signed with Chinese firms versus $5.5 billion in foreign trade contracts (Xinhua, September 3, 2012).

What does seem to have changed, however, is the government’s willingness to blame incidents like that in Selibuya on outside actors (something attested to by Huo Hanmin’s earlier clarifications). In a number of discussions over the past year, the author has heard Chinese scholars suggest that incidents in Xinjiang are at root domestic problems rather than external ones [2]. Xinjiang Party Secretary Zhang Chunxian published an article in Seeking Truth following the wake of the Bachu incident in which he laid out the current context and strategy for developing Xinjiang. Hinting at a slight adjustment in the degree to which authorities are eager to blame outside forces, Zhang described the security problems in terms of social stability and development rather than blaming foreign elements (Qiushi, May 16). In keeping with the reported paranoia of the security services, an anonymous Xinjiang security official, however, said “The ‘three evil forces’ of separatism, extremism and terrorism have long been using mobile phones and the Internet to incite terrorist attacks in China” (Xinhua, May 17). The party secretary’s article stands in contrast to statements in response to previous incidents where outside groups were accused of directing plotters and infiltrating operatives.

Further confusing matters, at around the time of the incident, the Turkestan Islamic Party (TIP) released its latest batch of videos through Islam Awazi, including one in which a now believed dead senior al Qaeda ideologue, Abu Zaid al-Kuwaiti provides “advice for the Muslims of East Turkestan” (jihadology.net, May 4). At no point in these videos is there any mention of recent incidents in Xinjiang or of any specific direct threats against targets in China. Something suggestive of a disconnect between what Uighur groups operate in Waziristan and their ethnic brethren in Xinjiang. The narrative of this incident further emphases this discontent, pointing in the direction of being a domestic clash with no external instigation.

The fact that government has chosen to release such detailed information about this incident would suggest an effort to get their side out with as much detail and openness as possible. This reflects the growing desire of propagandists to have official government bureaus be the most authoritative source on breaking events (Study Times, May 6). This public relations approach seems to be part of a broader effort to shift the messaging about who is to blame for such incidents. Who this is directed at, however, is unclear: the international community, Chinese residents elsewhere in the country or residents of Xinjiang? Whichever the case, given their previous history of opacity and conflicting views from the ground, much more still needs to be done for Beijing’s views on events in Xinjiang to be taken at face value.

Notes:

Author’s Communication with Foreign Visitor in Kashgar, April 24, 2013.
This is a perspective the author has heard at conferences at official think tanks in Beijing and Shanghai and has been corroborated by other foreign scholars in discussions with Chinese experts looking at terrorism questions and South Asia.

Afghanistan’s Economic Hope

Posted: May 28, 2013 in The National Interest
Tags: Afghanistan, China, China and the world, China-Afghanistan, China-Central Asia, Chinese foreign policy, India, India-China relations, SCO

Still catching up on old posts, this is a piece that I think is actually quite important but unfortunately appears to have broadly gotten buried. It is an article for The National Interest in which we get prominent Chinese and Indian academics to agree on paper on working together on Afghanistan’s economic future. As ever more on this subject to come, and please be sure to check out the site that I co-edit looking at China in Central Asia.

Afghanistan’s Economic Hope

Vinod Anand, Hu Shisheng, Raffaello Pantucci

May 23, 2013

The key to Afghanistan’s long-term stability is economic prosperity and development anchored in a secure and sound society. Sitting at the heart of the Eurasian continent, its prospects are important to the UK, China and India. Harnessing a common interest in Afghanistan’s economic future into an agenda could provide the foundations for a long-term solution to that nation’s intractable problems.

Fellow BRICS members China and India do not see eye to eye on a number of issues. Longstanding border disputes plague the relationship and both have different views of Islamabad as a partner. Nevertheless, both share concerns about Afghanistan’s future and recognize the importance of stability in the country for broader regional peace. As a NATO power exiting militarily alongside the United States, the United Kingdom is eager to continue its aid program and other work with regional partners to develop a stable structure that guarantees Afghanistan does not return to its former state as a haven for terrorism and extremism.

According to the United States Geological Survey (USGS), Afghanistan may be sitting on mineral wealth worth around $1 trillion. Its potential lithium deposits have been described as having the potential to turn the country into the ‘Saudi Arabia of lithium’ while it is estimated to have some $421 billion’s worth of iron ore, and a further $273 billion in copper. In the north, Afghanistan sits atop the lower end of the hydrocarbon rich Amu Darya basin. But the ongoing security and governance problems mean that this untapped prosperity remains stuck underground.

The threat of attack and uncertainty about post-2014 have meant that companies have been hesitant to proceed with investments. Security issues aside, problems with a lack of local-government capacity and a difficult business environment mean that while it is easy to get into Afghanistan, setting up shop is only the first hurdle. The result is an Afghanistan that cries out for investment and is unable to profit from its natural wealth. It is here that China and India could play a greater role.

As regional powers with booming economies hungry for raw materials, they are exactly the consumer that would benefit from this mineral wealth. Currently, foreign direct investment into Afghanistan is dominated by Chinese and Indian state-owned enterprises (SOEs). There is MCC, Jiangxi Copper (owners of the Mes Aynak copper mine) and CNPC (responsible for an oil project in Amu Darya), all Chinese SOEs, and SAIL-AFISCO (majority owner of the Hajigak iron ore mine), an Indian firm.

As SOEs, the firms are better able to take on large projects: governments have greater ability to influence company direction and harness it for Afghanistan’s long-term benefit. The key is to get firms to invest in both the project and the country.

This can happen in a number of ways. First, there is the tool of providing jobs for locals around the sites. But projects should also aim to develop infrastructure around the site to connect the mines with the rest of the country and region, efforts that should be prioritized and coordinated in future bids. An additional benefit could be created if firms investing in the country were to assume responsibility for training local engineers and mining professionals. This training could take place at the sites or abroad. One possibility is for Chinese and Indian firms to offer scholarships to Afghan students to attend top universities in China or India to learn skills that could then be deployed on the mining sites. It is here also that the United Kingdom could play a role. British foreign policy has a long history of facilitating training programs, and some of the lessons learned may be helpful to China and India.

The capacity problem is one that exists not only at an operational level, but also at a governmental level. British, Chinese and Indian governments could offer training courses for technocrats in the Ministry of Mines and other civil servants to help them develop the skills needed to effectively manage their country’s national wealth. Investing in local capacity should not stop at training people. Given that the companies in question are state-owned entities, their home governments have greater influence to ensure standards in compliance and corporate practice.

Beijing and New Delhi should push their own SOEs to ensure that certain minimum standards of behavior are undertaken, focused on ensuring that their firms will not indulge in corrupt behavior in pursuit of contracts. A common standard of practice should be established to ensure that deals cut in Afghanistan are clean, and all sides should agree to not undercut each other. Naturally, a pragmatic approach needs to be taken but establishing good practices early will save trouble in the long run. The United Kingdom already works with the Afghan government to support the Extractive Industries Transparency Initiative (EITI), and the lessons being applied here could provide the foundation for a strong anticorruption program in Afghanistan.

Finally, work should be done to develop a special mineral-protection corps. Men currently employed in the security forces will find themselves unemployed as the ANSF budget is reduced, and numbers are cut to create a more professional force. With few other opportunities on offer, they could simply hire themselves out to the highest bidder—whether they are mercenary, Taliban or warlord. Offering them jobs as a civilian security corps tasked with defending mining concessions could offer one useful alternative. A special constabulary has already been established tasked with defending the Mes Aynak project. Creating similar entities in other areas might have the dual effect of creating security on the sites, while providing a good employment opportunity for otherwise unemployed armed men.

This is an admittedly optimistic agenda. But as neighboring countries (and brother BRICS countries) with a vested interest in ensuring Afghanistan’s future, Beijing and New Delhi must find ways to cooperate more effectively. As a key NATO member about to withdraw after a decade of conflict, Britain is eager to create a regional consensus that guarantees a positive legacy in the heart of Eurasia. All three need to find ways of working cooperatively with other regional actors like Pakistan, the Central Asian states and Russia on issues of access and evacuation of mineral resources. Focusing on Afghanistan’s economic future and encouraging local development is key to ensuring a peaceful transition post-2014. Afghanistan’s past has been dominated by imperial exploitation—the future need not be the same.

Brigadier (retd) Vinod Anand is based at the Vivekananda International Foundation (VIF). Professor Hu Shisheng is affiliated with the China Institutes of Contemporary International Relations (CICIR). Raffaello Pantucci is a scholar at the Royal United Services Institute (RUSI).

China’s Leadership Opportunity in Afghanistan

Posted: April 7, 2013 in Carnegie Endowment for International Peace
Tags: Afghanistan, Central Asia, China, China and the world, China-Afghanistan, China-Central Asia, Chinese foreign policy, xinjiang

A new article for the Carnegie Endowment for International Peace, a think tank with offices around the globe. It focuses on China in Afghanistan and is part of a series being directed out of their Beijing office looking at giving China advice for the coming year in foreign policy. The piece has already been re-printed in the Diplomat and I believe may be being re-published on East Asia Forum. I also want to use this opportunity to highlight this piece in the Russian Penza news which I did an interview for, here it is in English and Russian. For more of my work on this part of the world, check out China in Central Asia that I co-edit with Alex.

China’s Leadership Opportunity in Afghanistan

The 2014 deadline for the withdrawal of troops from Afghanistan is fast approaching. China has just over a year before Afghanistan fades from the West’s radar and Western attention toward the country shrinks substantially. However, it is not clear that Beijing has properly considered what it is going to do once NATO forces leave and pass the responsibility for Afghan stability and security to local forces.

And more crucially, it is not clear that China has thought about what it can do with the significant economic leverage it wields in the region. Afghanistan offers China the opportunity to show the world it is a responsible global leader that is not wholly reliant on others to assure its regional interests.

Traditionally, Chinese thinkers have considered Afghanistan the “graveyard of empires.” They chuckle at the ill-advised American-led NATO effort and point to British and Soviet experiences fighting wars in Afghanistan.

But in reality, the presence of NATO forces provided China with a sense of stability. Beijing correctly assumed that NATO’s presence in Afghanistan would mean regional terrorist networks would remain focused on attacking Alliance forces rather than stirring up trouble in neighboring countries like China. NATO’s targeting of Islamist groups also had the effect of striking anti-Chinese Uighur groups that had sought refuge in Afghanistan under the protection of the Taliban or al-Qaeda. These Uighur groups would otherwise have focused their attention on targeting China.

Yet as the date of American withdrawal from Afghanistan approaches, this security dynamic is changing. While China does worry about the threat of Islamist Uighur groups striking from their Afghan bases, this concern is relatively marginal. The bigger problem is the potentially negative repercussions for the rising number of investments from China’s private sector in Afghanistan and its surrounding region. These investments are part of a broader push into Central Asia that flows from an effort to develop China’s historically underdeveloped province of Xinjiang, which borders Afghanistan.

The prospect of an Afghanistan returning to chaos is, therefore, not appealing to policymakers and businesspeople in Beijing. This scenario would bring instability directly to China’s doorstep, and this instability could potentially expand northward into Central Asia or southward into Pakistan. China would suffer from further chaos in either direction.

The solution to this problem is complex. China is not necessarily expected to invest heavily in security efforts and rebuilding Afghanistan’s security apparatus, though some more substantial contribution in this direction than the offer to train a nominal 300 policemen that China made last year in Kabul would be helpful. Rather, China could focus on what it is able to do best: invest in Afghanistan and develop its abundant natural resources.

Chinese state-owned firms have already invested in oil fields in Amu Darya in northern Afghanistan and a copper mine in Mes Aynak, southeast of Kabul. These investments have had mixed success.

Amu Darya has produced for the China National Petroleum Company (CNPC), though its current status is unknown. Problems and uncertainty with China’s investments in Central Asia are reflected in the difficulties of two other Chinese companies—the Metallurgical Corporation of China (MCC) and Jiangxi Copper—in the south.

In part this is because companies operating in the south face understandable security concerns that range from locals angry because they feel they were not justly compensated for their land that was affected by the mine to Taliban-affiliated groups eager to punish the central government by undermining efforts to develop the country.

But these companies also often find they lack a full understanding of the environment in which they are trying to invest. Orchestrators of projects that begin with the best of intentions and large investments, like the Mes Aynak mine, find themselves burdened with a local government response that is confused. Confusion turns to anger when these projects fail to deliver elements that were supposedly included in the original contract. For example, the local Afghan government initially believed that MCC and Jiangxi Copper would build a train line in the south. But the companies claim the contract only stipulated it would conduct a feasibility study. They also claim that the security situation has driven Chinese workers to refuse to work on the site, though reports about whether these stoppages are actually occurring are unclear.

The difficulty of this deal contrasts with the rapidity with which Chinese energy giant CNPC was able to bring online the oil field in Amu Darya. Political complications with the local Afghan strongman Rashid Dostum have held up work, and it is not clear that they have been completely resolved. The field has produced some oil that was transported across the border by truck into Turkmenistan, where it is refined at a separate CNPC site. The company has also said that it is going to develop a refinery in Afghanistan to help facilitate Afghan energy independence.

These two projects show the potential benefits and downsides to investing in Afghanistan. Large mining projects like these have the potential to be help rebuild parts of Afghanistan and transform the economy from one that is reliant on the drug trade and foreign aid to self-reliance.

Even if they were all successful, Chinese investments alone would not transform Afghanistan into a stable and prosperous state. China also needs to leverage its power within the region and persuade other countries to engage in Afghanistan in order to complete this transformation. The Shanghai Cooperation Organization (SCO), a regional entity led by China, has done very little in Afghanistan due to a lack of agreement among members about what exactly actions to take. China believes the SCO should do more, but other member countries believe a bilateral approach is better that a multilateral one and that focusing on building individual relationships in Afghanistan will help strengthen their particular interests. This is unfortunate as the SCO could be a useful vehicle through which China and other regional actors could undertake efforts to counter the narcotics trade in the region and strengthen border controls.

China has growing influence in the Asian Development Bank, which has already invested heavily in Afghanistan. China could continue its support for these projects to help connect Afghanistan to the broader region and reintegrate the nation into the global community, thus fostering stability. This approach complements China’s broader regional strategy to develop Xinjiang into the “gateway for Eurasia” as Premier Wen Jiabao put it during the China-Eurasia Expo in September last year.

And at the social level, China needs to foster person-to-person contact with Afghanistan. Last year during a visit to Kabul, the most striking characteristic of Kabul University’s Confucius Institute—one of the Beijing-backed centers that promote Chinese language and culture across the world—was the absence of Chinese teachers and Afghan students. This stood in contrast to other Confucius Institutes in Central Asia with dozens of students crowding around excited teachers. The security situation undoubtedly complicates things in Kabul, but there are safer parts of the country in which to operate. To further encourage societal ties, Beijing could try to entice more Afghans to study and work in China through scholarships and study grants.

China has an opportunity in the next year to assert some leadership in helping steer Afghanistan in a more positive direction. A stable Afghanistan is in China’s national interest, and taking the lead on this regional issue of international importance could help bolster Beijing’s global position. The West may have made mistakes in Afghanistan’s past, and making up for them will undoubtedly take time. But the Afghanistan problem is one that remains on China’s borders and has the potential to result in even more regional instability. Investing in Afghanistan now will save years of trouble later.

Raffaello Pantucci is a senior research fellow at the Royal United Services Institute and the co-editor of
http://www.chinaincentralasia.com
.

Mr Xi Goes to Moscow

Posted: April 1, 2013 in Oriental Morning Post
Tags: China, China and the world, China-Central Asia, China-Russia, Chinese foreign policy, Russia, Xi Jinping

Somewhat belatedly, I am reposting here an article that I had published in the Chinese 东方早报 (The Oriental Morning Post) during Xi Jinping’s visit to Moscow a week or so ago. The article does not seem to have been put online, so I have posted the English text that I submitted below. I currently cannot figure out how to attach a PDF here, so cannot add the tear page, but if you are interested, please drop me a line and I can send it over. Related, I did an interview for Danish radio on the visit, focusing in particular on Central Asia. I am also going to use this opportunity to highlight interviews I did for the Italian AGI and The Atlantic on China in Central Asia. As ever for more on my work in this direction, please have a look at the site I manage with Alex focusing on our project on China in Central Asia.

China and Russia will maintain a pragmatic partnership

There has been a great deal of speculation in the press about the significance of Xi Jinping’s decision to make Russia his first foreign trip as leader of China. The implication of much of the discussion is that China is about to reorient itself to turn Moscow into a priority ally, creating some sort of a new axis in international affairs. The reality is that little is practically changing in this relationship beyond reaffirmation of the fact that both sides see the other as a power with which it suits them to be perceived as being aligned.

The relationship in the past few years has evolved substantially. Discussions about enhancing military cooperation and the prospect of joint technological development projects were highlighted during Defence Minister Shoigu’s visit to Beijing late last year, national energy giants CNPC and Rosneft have signed deals to build refineries near Tianjin and explore similar opportunities in Russia as well as looking at doing a large $25-$30 billion loan for oil deal – the Russian firm is believed to be seeking the loan from the Chinese firm in a repeat of a deal from a few years ago. At a political level, President Putin visited Beijing very soon after his election victory, so in some ways this is reciprocating. And on the international stage, China and Russia broadly find themselves in agreement with regards their postures on issues like Syria or Iran and generally prove willing to support each other’s positions in the United Nations Security Council. They both found the ‘colour revolutions’ of a few years ago alarming, and view the ‘Arab Spring’ in an even darker light. Trouble from rebellious provinces is an issue they both share, and they see western plots inside domestic problems.

But beneath this cordiality there is a tension. In the run-up to President Xi’s visit, much has been made in the Chinese press that some final agreement may be about to come about on the topic of gas pricing, a discussion that has been ongoing between China and Russia for over a decade. Unable to reach an agreement, we have seen a number of high level visits come and go with no conclusion in sight of the deal. This time, we are told, it may actually happen. And the logic may finally be there: China’s growing gas relationship with Turkmenistan means that it is going to be less reliant on finding Russian sources, something that will in turn pressure Russia to come to some agreement to not lose its hand in the discussion with China.

This aside, there is the question of Central Asia more broadly. A region that Russia has traditionally seen as its strategic backyard, but where China is increasingly becoming the more relevant actor. Economically, this is displacing Russian interests, though it remains clear that the Central Asian powers continue to see Russia as the more important security guarantor regionally. The story of the past decade, however, is the money and investment flowing in mostly from Xinjiang rewiring Central Asia so its roads all lead to China. Russia is seen to be pushing back against this through the institution and implementation of the Customs Union that at the moment only encompasses Belarus, Kazakhstan and Russia. But this is a still developing project and it is unclear how it will ultimately impact Chinese economic growth in Central Asia.

Looking beyond Central Asia, there is the dilemma of Afghanistan and the tensions between India and Pakistan. This triumvirate of countries is a complicated one with both Moscow and Beijing having very different views. Russia has always supported ally India, while Beijing retains strong ties with Islamabad. A delicate balance that has the result of keeping both India and Pakistan out of the Shanghai Cooperation Organization (SCO). And on Afghanistan, while there is evidence that China is slowly coming to the realization that more must be done and soon, Russia remains trapped in the shadow of its history in that country and refuses to commit much.

The point is that China and Russia are not an easy pairing. They may concur on a few things, but disagree on others too. But what they do share is a concern about western dominance in international affairs and a feeling that the American approach is not always necessarily the right one. And it is maybe here that we should look for deeper meaning in the Russia-China relationship. It is not so much that they are partners of principle, but they are partners of utility. Each sees the value in having a strong counterpart whom is willing to stand up to the United States and the West. Left alone, they would end up being isolated in international affairs and have to deal with the brunt of international wrath when they stood up for unpopular issues. But united they are able to provide some cover for each other and extend the travel schedule of any western foreign minister seeking to lobby their support for issues at the UNSC or elsewhere.

China and Russia remain partners of convenience. Their tentative gestures towards a real strategic partnership are likely to continue to edge gradually forwards, and mutual support will continue on the international stage, but the reality is that this is never going to be a holistic and firm axis in international affairs. Instead it will remain a utilitarian partnership that will provide each other with a useful ally when facing down against perceived western interventionism.

Raffaello Pantucci is a Senior Research Fellow at the Royal United Services Institute (RUSI) in London

Horse To Water

Posted: March 17, 2013 in Caravan
Tags: Central Asia, China, China and the world, China-Central Asia, China-Uzbekistan, Chinese foreign policy, Uzbekistan, xinjiang

A new piece for the latest issue of Caravan magazine, an excellent Indian publication that I would highly recommend. The piece is an evolution of a blogpost that we did for the China in Central Asia site a while ago, and of course part of the bigger project on the subject that Alex and myself are working on with Sue Anne helping us document it visually.

Horse to Water

China’s first faltering steps towards building trade links with Uzbekistan

By RAFFAELLO PANTUCCI | 1 March 2013

SUE ANNE TAY

At the 2012 Uzbekistan Tashkent China Xinjiang Business and Trade Fair, an Uzbek visitor photographs a scale model of a Chinese cotton-picking machine.

On a flight from Beijing to Tashkent, the capital of Uzbekistan, Sue Anne Tay, the photographer with whom I visited Tashkent in May last year, ran into a group of businessmen from China’s Xinjiang region. They were on a government-sponsored trip to the “Uzbekistan Tashkent China Xinjiang Business and Trade Fair” in Tashkent, to help build relations between Xinjiang and the neighbouring countries as part of an economic strategy laid out by Chinese Premier Wen Jiabao. As he put it, China wants to “make Xinjiang a gateway for mutually beneficial cooperation between China and other Eurasian countries”.

Unfortunately for this group of businessmen, they had to take a circuitous route to get through this gate. Because of a lack of direct flights from Urumqi to Tashkent at the time, they had been forced to re-route rather inconveniently through Beijing—a five-hour flight south-east followed by a six-hour flight west. In retrospect, the businessmen’s long trip was emblematic of difficulties they later faced in Tashkent.

We ran into them the next evening at a market in a small park behind a statue of Amir Timur, the 14th-century Asian emperor, in the centre of Tashkent. In the cool evening, traders, painters and other craftsmen had gathered to ply their wares to tourists. Some of the Chinese businessmen were getting their portraits drawn, frustrating the Soviet-trained draftsmen by constantly shifting to smoke cigarettes.

One businessman was intrigued by stalls set up near the artists. A forthright man with a flattop haircut typical of many middle-aged Chinese traders who have little time for the niceties of fashion, he had come to Tashkent to sell his food products to local traders. He was a natural leader, with the robust confidence of someone from a tough frontier province, which made his fascination at the outdoor market with faux vintage Soviet cameras all the more odd. Turning them over in his hands, he remarked on how authentic they were; I couldn’t help but think they had been made, like so many things in this world, in China. Using broken English, gestures, and my assistance as a Chinese–English translator, he proudly bargained down the cost of two cameras to $15.

Two days later, at the expo, this gentleman and the other Chinese businessmen were the sellers, trying to win over Uzbek customers for their products. Sponsored by the Xinjiang government, the expo was part of the Chinese autonomous region’s strategy to develop its economic ties with Central Asia. The companies represented all had operations in Xinjiang, though quite a few were from other provinces in China, such as Guangdong. This was also part of the central government’s strategy: richer eastern provinces were to give financial and other aid to their poorer counterparts and participate in the strategy of turning Xinjiang into a Eurasian gateway.

The expo, held in an exhibition hall in the northwestern corner of Tashkent, was underwhelming—a smattering of stalls were arranged in the centre of a much larger, imposing space, giving visitors the impression of being in a hangar. Sellers displayed everything from high-end power generation machinery and cotton-picking machines to uniforms (with a focus on the oil industry and military outfits), Uighur clothing, spices, sauces, car engine parts and electronics. Some exhibitors had carefully considered where they were travelling to—at one of the clothing stalls a sign proudly boasted that they sold ‘Turky Style clothing’, the unfortunate typo belying an attempt to tap into the Turkish-Uzbek ethnic connection. Another stall had a Chinese woman dressed up in what was supposed to be traditional ethnic Uighur attire, wearing a hat with what looked like a feather duster attached to it, as she tried to sell pillows, rugs, slippers and other homemade wool products. Compounding the hall’s feeling of emptiness was the thin crowd.

At one of the few stalls that were attracting a crowd, a Guangdong merchant selling electronics told me that his company “had been asked to invest in Xinjiang by the Guangdong government”. Having attended the expo before, he had an obvious edge over others and had had the foresight to bring along a Uighur salesman from his Urumqi office. Given Uighur and Uzbek are mutually intelligible languages, both spoken by Turkic peoples, the Uighur salesman was able to talk to curious locals and pitch them products. He proudly announced that the products on offer were all made in Xinjiang by Uighur workers, and told visitors to disregard the Guangdong branding. As proof, he pointed to the picture on a computer tablet box: a Google Android figure donning a hat of a style common to both Uighurs and Uzbeks.

Most others vendors had failed to bring someone who could communicate with locals; instead, the men sat around waiting for proceedings to end. At a stand trying to woo Uzbek companies to buy plots inside a new mall outside Xinjiang’s Kashgar city, one of the men who had had his picture drawn the night before was sitting with two of his colleagues. Bored and with no business prospects, they fiddled with mobile phones and remarked on how they, too, had been encouraged to come to Tashkent by the Guangdong government. (Although the trip had government sponsorship, they resentfully noted, they had to pay a fee to join.) It was only upon arrival that they realised Uzbekistan was an underdeveloped and poor market that was unlikely to have many companies eager to set up operations in China. “The Uzbek market is too small and low-income compared to the vast opportunities we have in Xinjiang,” said Tan Chao, a manufacturer of uniforms.

Dealing in goods of a vastly different scale, those manning the machinery companies’ stalls were less surprised by the slow foot traffic. At one stand, Liu Zhao, a cheery representative from a Siemens subsidiary that builds power stations, showed off a large model of a power substation. It had cost them somewhere in the region of 10,000 RMB (Rs 84,000) to ship the ping-pong table-sized model to Tashkent, a fraction of the money the company would make if it sold one, but he did not seem very optimistic about securing a sale. While my Chinese failed me as he went through the technical specifics of the project, he smiled pleasantly as he told me that people in Uzbekistan didn’t need products like the ones his company was offering, because “these people are at a very different stage of development”.

Soon after lunch, a local school was dismissed and there was a sudden influx of Uzbek children into the hall. The stall that particularly appealed to them was the one run by a company that made cotton-picking machines, a subsidiary of Chinese state-owned military aviation firm AVIC, which was hoping to tap the Uzbek cotton market, one of the top five in the world. But even the recent news that Xinjiang had set a cotton producing record was not helping their sales with locals, who apparently preferred American equipment. This left the Chinese businessmen to fight off eager children drawn not out of some financial stake in cotton, but rather by a large toy automobile that the company had sent along. The harassed vendors shooed away the children as they eagerly tried to play with the car, which was roughly the size of a microwave oven. Neither vendor spoke any Russian or Uzbek, but they had learned enough to say something approximating “no sale” to the young and old Uzbeks who pestered them to buy the model.

In the mid-afternoon, Duan Weiming, one of the clothiers, made a modest sale of some Western suits and received a down payment of a few hundred thousand in Uzbek som. Striding around gleefully with huge bundles of cash, he proclaimed that, given its lack of value, he would have no choice but to blow it all while he was in Uzbekistan—the Uzbek som is officially worth 1,800 per US dollar, but unofficially trades at around 2,800. When asked what he planned to spend it on, he responded, “Dinner, drinks and karaoke.” By 4 pm that day, the group at the expo concluded that the day was basically a write-off and that it was time to go home. Rounding everyone up, they hopped on a tour bus and went back to their hotel, enervated by the prospect of sitting through another day in the empty auditorium.

A few days later, over lunch with an Uzbek businessman whose company had helped sponsor the expo, we got a sense of how successful the whole enterprise had been. “Not very, to be honest, but better than last time,” he said. “More Chinese are coming.” A former government employee, he had seen the economic possibilities of China’s booming, dynamic manufacturing capabilities and had chosen to end a flourishing civil service career at a young age to go into business, with a focus on China. Though at the forefront of Sino-Uzbek relations, he was not optimistic about Xinjiang as the gateway for Central Asia. The province made low quality products and traders were, in fact, simply agents from elsewhere in China, he told us. But he admitted that the greater problem was the difficult business environment in Uzbekistan in general. Awkward red tape, worthless currency conversions and a political environment that took very careful manoeuvering meant that it did not matter how many trade fairs were held. “You can take a horse to water,” he told us, “but you cannot make it drink.” And with that his phone rang, dragging him off to do more business with China.

Turkey: Abandoning the EU for the SCO?

Posted: February 15, 2013 in Diplomat
Tags: China-Central Asia, China-Turkey, SCO, shanghai cooperation organization, Turkey, Turkey-Central Asia, xinjiang

A new piece with Alex for The Diplomat, an excellent online magazine focused on mostly Asian affairs and strategy. This one looks particularly at Turkey’s recent public dalliance with the Shanghai Cooperation Organization (SCO) and highlights some of the problems inherent in that organization. Turkey’s role in Central Asia writ large is a fascinating one and the topic of much more research – more hopefully to come! In the meantime, I was quoted in this piece for another online magazine The International on China’s role in ‘New Iron Silk Road’ and Afghanistan. As ever, for more of mine and Alex’s work on the broader themes in these pieces, please see our co-authored blog:
http://www.chinaincentralasia.com

Turkey: Abandoning the EU for the SCO?

February 15, 2013

By Raffaello Pantucci and Alexandros Petersen

Recent moves suggest Turkey could make a bid for entry into the Shanghai Cooperation Organization. It would be a mistake.

Photo Credit: Office of the President: Russian Federation, taken from here

The European Union is in a rut. Its once-vaunted economy and “ever closer” integration is facing the tough challenges of a dogged recession and anti-EU sentiment in some of its most powerful member states. It is therefore perhaps not surprising that some EU aspirants appear lukewarm about their prospects and continued desire to join the club. For Turkey, probably the most unfairly spurned EU aspirant, it makes a lot of sense to at least explore alternatives.

After all, Turkey’s economy is booming – leaping from $614.6 billion in 2009 to $775 billion in 2011 (in current U.S. dollars) according to World Bank figures. Reflecting the country’s position at the global cross-roads, Istanbul’s Ataturk Airport international traffic more than doubled between the years 2006 and 2011. Last year alone its passenger volume increased by 20%, making it Europe’s 6th busiest airport. The country’s regional and global profile has grown since it first evinced a desire to join the EU. European leaders should only be surprised that Turkey has maintained its interest in the EU for so long.

However, even as it makes sense to decision-makers in Ankara to reconsider their relationship with the EU, it is not a strategically sound choice for Turkey to consider membership of the Shanghai Cooperation Organization (SCO) as an alternative. Already a ”dialogue partner” with the SCO, late last month, Turkish Prime Minister Recep Tayyip Erdogan announced that he had made an overture to Russian President Vladimir Putin about joining the SCO, stating “If we get into the SCO, we will say good-bye to the European Union. The Shanghai Five [former name of the SCO] is better — much more powerful.” Erdogan also noted that Turkey has more “common values” with the SCO member states.

The issue, however, is that the SCO remains a nascent organization that is still in the process of defining itself. Absorbing new members, or figuring out the protocols for new members to be formally acceded, is merely one of the many problems the SCO faces. The Organization’s security structures, including the unfortunate-acronym RATS Center [Regional Anti-Terrorism Structure], have yet to fully flesh out their purpose in advancing regional security in a very militarily tense region. Meanwhile, China continues to dominate the SCO’s economic agenda, including negotiations to establish an SCO Free Trade Area (FTA), an SCO Development Bank, and Beijing offering $10 billion in loans for member states. All of this alarms Russian strategists who see China encroaching on Moscow’s Central Asian interests. Nonetheless, all of this results in a minimal concrete presence, something we found first-hand as we travelled around Central Asia over the past year, finding little tangible evidence of the Organization’s footprint on the ground.

Further complicating matters, Turkey is not the only country that has expressed an interest in becoming a full member. In fact, Pakistani and Indian officials both said their countries were interested in becoming full-fledge members at the Prime Minister’s Summit in Bishkek last December. Iran too has expressed an interest in joining the organization, although Moscow recently said this would not be possible so long as Tehran remains under UN sanctions. All three countries currently languish as “observers,“ a status that Pakistan and India have held since 2005 and one that is considered superior to the ‘dialogue partnership’ that Turkey was only accorded last June. Still, both Pakistan and India – strategically important allies for China and Russia respectively – would undoubtedly feel put out were Turkey allowed to jump the queue.

None of this is to say that Turkey does not have a key role to play in Central Asia, the SCO’s primary area of operations. Waiting for visas in Bishkek, we found ourselves jostling with Turkish truckers getting visas to Kazakhstan, whilst in the city’s downtown, eager students at the Kyrgyz-Turkish Manas University told us how exciting it would be to visit Turkey. In neighboring Uzbekistan, our driver told us how he preferred to fly Turkish airlines and how convenient the country was linguistically. This ethnic proximity is something that China in particular has sought to cultivate – in April last year, Erdogan broke protocol when he started his Chinese trip with a stopover in Urumqi, capital of historically Turkic Uighur Xinjiang.

Eager to attract outside investment to encourage prosperity as a salve for ethnic tensions between Uighur and Han Chinese and historical underdevelopment, the Urumqi government has established a Turkish-Chinese trade park outside the city, offering Turkish investors favorable rates and support to develop businesses in the province. Turkey is clearly a significant regional player and its SCO “dialogue partner” status reflects this. But full membership is a step too far and one that seems out of whack with the Organization’s current trajectory.

Far more likely, Erdogan is hinting at a shift in orientation in frustration at the West’s relationship with his country. Europe has repeatedly proven an awkward partner and the United States has demonstrated little appetite to get overly involved in the problems that sit right on Turkey’s border. Aware of his nation’s geopolitical location at a global crossroads, Erdogan is highlighting that he has options.

Still, the reality is that joining the SCO would not heighten Turkey’s global stature or teach the West a lesson. U.S. and NATO policymakers keep an eye on the SCO, but none seriously view it as a strategic counterweight. In some respects, Western strategists have been far more eager than their Chinese counterparts about the possibility of an SCO role in stabilizing Afghanistan after Western combat forces depart in 2014. In the past year, the Organization has expressed some interest in doing more in Afghanistan, but it remains light years away from replacing NATO as a security guarantor.

As an ascendant power in Eurasia, Turkey may find it useful to keep in a toe in the SCO. However, full membership is not in the offing. And even if it were, Turkey’s decision-makers would quickly find that China’s multilateral cover for its bilateral engagement in Central Asia is still an empty shell.

Raffaello Pantucci is a Senior Fellow at the Royal United Services Institute (RUSI). Dr. Alexandros Petersen is the author of The World Island: Eurasian Geopolitics and the Fate of the West and an Associate Professor at the American University of Central Asia. Their joint research is available at www.chinaincentralasia.com.

Russia and China May Compete Economically in Central Asia, But Not Militarily

Posted: February 1, 2013 in Bug Pit
Tags: Afghanistan, Central Asia, China, China and the world, China-Central Asia, Chinese foreign policy, CSTO, Russia-China, SCO

A slightly odd post in that it is not an article, but rather an interview I did with the author of the Bug Pit blog on Eurasianet that focuses on all things ‘military and security in Eurasia’. In any case, it was inspired as a result of the piece I recently did with Lifan for Open Democracy Russia, a piece that has been translated in Russian already and is apparently going to go up in Chinese as well. As ever, more on this topic more broadly to come.

Russia and China May Compete Economically in Central Asia, But Not Militarily

February 1, 2013 – 1:32pm, by Joshua Kucera

Last week, Open Democracy Russia ran a very good series of articles on relations between Russia and China. One was especially interesting for EurasiaNet readers, about choices that the Central Asian states are having to make between integration with Russia or China. The piece concentrates on the economic sphere, in which, as the authors convincingly argue, integration with the two big superpowers is becoming mutually exclusive.

Of course, Russia and China also have their respective Central Asia integration schemes in the security sphere: China has the Shanghai Cooperation Organization, and Russia the Collective Security Treaty Organization. So I asked one of the piece’s authors, Raffaello Pantucci, an expert on Chinese-Central Asian relations, about whether there was going to be a similar reckoning in that sphere. Short answer: no. His more detailed thoughts:

The Bug Pit: Is there a similar looming choice to make for the Central Asian states, whether they prioritize ties with the SCO (dominated by China) or CSTO (dominated by Russia)?

Raffaello Pantucci: There is little similar looming choice with regards the SCO and the CSTO. In part this is since the SCO remains a relatively infant security entity, while the CSTO has the advantage of having lots of interoperable forces and equipment. Also, China has no interest in stirring up a security competition having a foreign and security policy that does its utmost to not seem threatening. Having said all of this, it is interesting to see how the SCO has developed as a security actor – it is maybe not as active as some initially thought it would be, but the Chinese are certainly taking advantage of the opportunities it offers to test out equipment and strategy. The ‘Peace Mission’ exercises they regularly undertake are ones that the Chinese are increasingly playing an active role in directing.

TBP: Why has the SCO not turned out to be as active a military organization as China seems to have originally expected?

RP: I’m not entirely sure that was always the focus from a Chinese perspective. The SCO was born out of the ‘Shanghai Five’ – a grouping that was established in the wake of the collapse of the Soviet Union to help delineate and demilitarize China’s borders with the newly former Soviet states Kazakhstan, Kyrgyzstan, Tajikistan and Russia. This grouping proved successful and it evolved into the SCO in 2001 with Uzbekistan’s accession. In its founding declaration, the members emphasize their ‘non-alignment, not targeting to the third country or region, and opening to the outside world.’ Instead, they focus on countering the domestic threat of three evils ‘terrorism, separatism and religious extremism’ – a very Chinese phrasing. Terrorism is quite a useful unifying rallying subject that all of these nations agree on, all of whom had (and for the most part have) active networks of some sort operating in their territory.

In fact, the Chinese have always seemed more interested in the economic aspects of the SCO, and analysts will say as much in conversation. Their emphasis has repeatedly been on developing the SCO as an economic actor, something they hope will help them strengthen their economic hand and links in the region. Looking at many of the recent economic moves and discussions within the organization – talk of an SCO FTA, an SCO Development Bank, the large loan vehicles through the organization – the impetus is all coming from Beijing.

TBP: Do you think that Central Asian governments would like the SCO to be more active? Is there any desire for China to balance Russia in the security sphere?

RP: When Alex and me were travelling in Kyrgyzstan, one of the more amusing stories we heard was that the roads the Chinese were building were being designed to carry the weight of a Chinese tank. This apocryphal story may be founded on little more than speculation, but it captures quite effectively a concern that bubbles barely beneath the surface in Central Asia. People in the small and under-populated Central Asian states are worried about being neighbours to the Chinese behemoth. Tracked out, it translates into little desire for China to step in as the main security guarantor. And in practice, the Chinese have not done much in direct security terms. Look back to the troubles in Kyrgyzstan in 2010 and there was no evidence of China stepping in – it was rather Russia that ended up standing up as the regional supporter.

A final point to make is that China has little desire to become the main security guarantor in the region. It cuts right against the national ethos of non-interference. Elsewhere around the world it has slowly found itself being dragged into such nettlesome security problems and it is still working out how to address them. Where possible, they would like to avoid this in Central Asia too.

TBP: What do Central Asian leaders expect from China and the SCO long-term? Will they eventually take a larger role in security?

RP: I don’t think the Central Asian leaders see the SCO as being on a trajectory towards a greater security role. The impression is that they see it as a useful way to engage more generally with China and manage Chinese regional goals. The fact that the other main regional security player Uzbekistan has been so hesitant to engage with the SCO as a security actor highlights the distance the Chinese still have to go to turn it into a regional security player that everyone will buy into.

The interesting long-term question is what exactly will the Chinese do if their economic interests are directly threatened by security problems. Will they simply write them off? Or rely on local actors to protect them? Or send their own forces in, either under a Chinese flag or the SCO? The answer at this point is unclear, and this is a question that Chinese policymakers are still struggling with.

Decision time for Central Asia: Russia or China?

Posted: January 28, 2013 in Open Democracy
Tags: Central Asia, China, China and the world, China-Central Asia, China-Kyrgyzstan, China-Russia, kyrgyzstan, Tajikistan

Slightly delayed posting of my latest piece, this time with my sometime co-author and friend Li Lifan looking again at China-Russia and Central Asia. This was part of a series that Ben edited at Open Democracy Russia which seems to have attracted some attention. As usual, a lot more on this topic coming soon as part of mine and Alex’s project on China in Central Asia.

Decision time for Central Asia: Russia or China?

LI LIFAN and RAFFAELLO PANTUCCI 24 January 2013

Vladimir Putin’s attempts to draw the countries of central Asia into his fledgling Eurasian Union creates a dilemma for some of them: if they take up his offer, they might lose their valuable trading links with China. Li Lifan and Raffaello Pantucci discuss their options.

If one turns enough of a blind eye, it is easy to be optimistic about Central Asia. Wily diplomats from Kyrgyzstan and Tajikistan are masterfully playing off the great powers. Kazakhstan and Turkmenistan are turning into hubs in their own right – and nobody can tell plucky Uzbekistan what to do. This is nobody’s backyard, and attempts by neo-imperialists in Moscow, Washington and Beijing to play games in the region are only strengthening the hands of the Central Asian states themselves. This is a comforting picture – which is why Western policymakers love it – but it looks increasingly false as President Putin tightens the screws.

Why a Eurasian Union matters

Russia’s desire to strengthen its sphere of influence in Central Asia seems to be intensifying. The first sign came in October 2011 when Russia’s ‘national leader’ published his vision for a Eurasian Union in the Gazprom-Media owned daily Izvestia. Here Putin stated that the Customs Union with Belarus and Kazakhstan that would come into force on 1st January 2012 was just the beginning – and that it would expand ‘by involving Kyrgyzstan and Tajikistan. Then, we plan to go beyond that, and set ourselves the ambitious goal of a higher level of integration – a Eurasian Union.’

The Russian president is said to dream of his third term being his ‘geopolitical presidency,’ where he will make up for the lost ground and lack of achievement in foreign affairs that he views as his main failing. The transformation of the fledgling Customs Union into the Eurasian Union of his dreams is the centrepiece of this strategy. Whilst Kazakhstan seems to have already decided that it wants to be a part of the Union (and its president, Nursultan Nazarbayev is credited for first raising the idea of a Customs Union back in 1995), for the Central Asian states of Kyrgyzstan and Tajikistan this is a potential turning point, forcing a decision on which partner they want to prioritize: China or Russia?

The way Central Asian states will turn — to Russia’s Eurasian Union or to China — is the test for influence in the region. Photo: (cc) Wikimedia/IvaNdimitry

Deciding whether to follow Putin into the Eurasian Union will be a decisive choice for both states in the year ahead, as it will force them to choose which they want to risk: the GDP they get from trade with China or the GDP generated from remittances from their nationals working in Russia. Putin has thrown down the gauntlet – they will now have to make up their minds whether their economic future is going to be closer to Moscow or Beijing. Their dichotomy is not quite as black and white as this, but this is nevertheless a power test. The choices they make will decide whether Russia or China has a stronger say in Central Asia.

Kyrgyzstan’s dilemma

There is a simple reason why Putin’s union matters so much to Kyrgyzstan and Tajikistan: trade with China. Unlike energy rich Kazakhstan, already in the Customs Union, Bishkek and Dushanbe’s economies are dependent on business with Beijing. Kyrgyzstan’s ‘shuttle trade’ business with China, where small traders cross borders as ‘tourists’ with their goods in suitcases in order to avoid Customs duties, accounts for roughly a third of its GDP.

On the other hand there is fear in Bishkek that if they do not deepen integration with Moscow then the millions of migrant workers it exports to Russia – whose remittances are also equivalent to a third of GDP – will be forced to carry international passports, or suffer far reduced quotas. The nightmare is that they will eventually end up barred from Moscow’s labour market by a full visa regime – something nationalist elements in Russia, including charismatic opposition leader Alexey Navalny, have been calling for.

These fears are well grounded: in December 2012 Putin warned that within three years he wanted to end the post-Soviet practice of migrants from the CIS being able to come to Russia on their internal passports, effectively ID cards – but Customs Union members will be exempted from the new requirement for international passports. Polls conducted by the independent Levada Centre show over 60% of Russians supporting tighter immigration controls.

Visa-free admission to Russia and access to the Russian labour market may be soon be a thing of the past for Kyrgyz migrants. Photo: (cc) Shutterstock/FotograFFF

That free access to Russia can no longer be taken for granted is not lost on Kyrgyzstan. But at the same time the Kyrgyz elite fears that joining a Eurasian Union would mean effectively losing control over its border tariffs and regulations, and would destroy the rich network of new trade routes that are tying them into China, bringing them cheap goods and enabling a substantial re-export economy. These trade routes are economic lifelines for this fragile state – and for this network the Customs Union has all the potential to be a total disaster. As a former Kyrgyz cabinet minister put it to one of us in Bishkek last year, it would ‘decimate’ the country’s key markets in the south at Kara Suu and Osh. In his words, ‘almost every’ small business in Kyrgyzstan is reliant on trade with China and any new tariffs or rules would entirely change the local economy.

China: vulnerability and official indifference

Chinese officials insist that the expansion of the Customs Union matters little to them. Ambassador to Bishkek Wang Kaiwen put it succinctly to reporters in late November when he said: ‘Kyrgyzstan’s entry into this Customs Union will not affect trade relations with China.’ Kyrgyz-Chinese trade, he pointed out, oscillated somewhere between $5-$10 billion per annum, a figure that was ‘a small problem’ dwarfed by China’s overall foreign trade of $3 trillion. The question of whether ‘to join or not…should be your decision.’

This blunt response hides a complex reality. It is true that in the grand scheme of things, China’s trade with Kyrgyzstan is a drop in the ocean. The problem for China is that it is a drop that comes from one of the most troubled parts of one of its most restive provinces. China is not investing massively in its trade infrastructure with Central Asian countries for reasons of charity – but to stabilize its own restive Xinjiang Uygur province by turning it into a trade hub for this region.

The Eurasian Union would have a potentially damaging effect on the substantial investment China has made on both sides of its border. The erection of a Russia controlled tariff barrier between China and Kyrgyzstan is likely to have a chilling effect on trade coming out of Kashgar, at a time when the Chinese government has invested a great deal into trying to develop the southern city. Capital of a part of Xinjiang that has faced heightened ethnic tensions for decades, the government has spent a lot of money re-developing the old city and establishing a Special Economic Zone with the aim of turning it into a hub for Central Asian trade.

According to recent figures China invested some $91.91 billion into infrastructure in its ‘western provinces’ – an area that covers Tibet, Guizhou and Xinjiang. This is a focused strategy and Xinjiang sits in the middle of it. All of this will be threatened if suddenly traders no longer find it profitable to send their goods along the roads winding into the CIS from Kashgar. At the same time these traders’ choice of markets is surprisingly limited: without a route through Kyrgyzstan or Tajikistan they would have to travel through the Khunjerab Pass to Pakistan. The problem there is the roads on the Pakistani side remain woefully under-built. Their only other possible border crossing would be with Afghanistan, which remains firmly closed at time of writing.

Seen from China, these are unanswered questions. When one of us asked a group of academics in Urumqi, the capital of Xinjiang, what they thought of the Customs Union’s impact to China, they shrugged and in vague terms said they were ‘waiting to see’ if the Customs Union would actually come to pass across the whole region. In Shanghai and Beijing, everyone has stories of friends who have conducted surveys in the region that highlight its unpopularity. But this is largely behind closed doors. The official line is that espoused by Ambassador Wang, that ‘Kyrgyzstan’s entry into Customs Union will not affect trade relations with China.’ Nothing to see here, keep moving on…

A losing game for small states?

This used to be the sort of situation where Central Asians were in their element, masters of the game of playing one partner off against another. Kyrgyzstan in particular has cannily used access to its Manas airbase to extract large chunks of money from both America and Russia. This time it seems as though Moscow is playing a much harder game, forcing Bishkek into a decision that could ruin one aspect of its economy or another. How this plays out may end up determining the shape of the Kyrgyz economy. For all the talk about China in Central Asia, Putin is still able to compete with Beijing – and the choices made in Bishkek and Dushanbe will make it clearer whether Moscow is still the world power it dreams of being.

China and Central Asia in 2013

Posted: January 20, 2013 in China Brief
Tags: Afghanistan, Central Asia, China, China and the world, China-Central Asia, Chinese foreign policy, Kazakhstan, kyrgyzstan, Tajikistan, Turkmenistan, Uzbekistan

A kick-off to the new year with Alex on China-Central Asia with an overview for Jamestown Foundations’ China Brief. This is part of our ongoing project looking at China in Central Asia about which we have a number of large publications coming this year.

China and Central Asia in 2013

Publication: China Brief Volume: 13 Issue: 2

January 18, 2013 05:10 PM Age: 1 days

By: Raffaello Pantucci, Alexandros Petersen

China’s Gateway to Central Asia, Khorgos, picture from here

In the last two years, China has emerged as the most consequential outside actor in Central Asia. As we have described in other writings, China’s ascension to this role has been largely inadvertent [1]. It has more to do with the region’s contemporary circumstances and China’s overall economic momentum than a concerted effort emanating from the Zhongnanhai. The implications for United States and NATO policy are nevertheless profound. Not only have the geopolitics of Eurasia shifted in ways little understood in Washington and Brussels, but the socio-political and physical undergirding of the post-Soviet space from Aktobe to Kandahar is being transformed.

Official Chinese policy in Central Asia is quiet and cautious, focused on developing the region as an economic partner with its western province Xinjiang whilst also looking beyond at what China characterizes as the “Eurasian Land Bridge…connecting east Asia and west Europe” (Xinhua, September 4, 2012). Chinese state-owned enterprises (SOEs) are active throughout the region on major infrastructure projects, but it is not clear how much they are being directed as part of some grand strategy as opposed to focusing on obvious profitable opportunities. The Shanghai Cooperation Organization (SCO), the main multilateral vehicle for Chinese regional efforts and reassuring engagement is a powerfully symbolic, but institutionally empty actor. Many smaller Chinese actors—ranging from shuttle traders to small-time entrepreneurs to schoolteachers and students posted to Confucius Institutes throughout the region—are the gradual vanguard of possible long-term Chinese investment and influence.

China’s engagement in Afghanistan is growing as U.S. and Western involvement wanes. Whether Chinese companies and diplomats remain in the event of a surge in violence and country-wide destabilization is a question that will be answered post-2014. For the moment, however, Chinese SOEs Metallurgic Corporation of China (MCC) and Jiangxi Copper are invested heavily in one of the world’s biggest copper mines at Mes Aynak (just southeast of Kabul) while China’s energy giant China National Petroleum Corporation (CNPC) is pumping oil in Afghanistan’s northern Amu Darya Basin. Currently, the firm is trucking the oil across the border to refineries in Turkmenistan, although plans are in place to develop a refinery on the Afghan side of the border. Plans also are moving forward for the construction of another string of the Central Asia-China pipeline from Turkmenistan to Xinjiang to pass through northern Afghanistan (Xinhua, June 6, 2012). CNPC and its subsidiaries already have cut deals with local authorities to ensure security in their operating areas. Should Afghanistan once again be split between a Pashtun south and a Tajik and Uzbek north, Chinese companies may have the relationships to continue operations under the protection of a new Northern Alliance. It seems that plans for the natural gas pipeline include distribution to local communities in northern Afghanistan [2].

Next door, at the source of the gas in Turkmenistan, CNPC and the Chinese government have carved out for themselves an envious position as one of the most influential outside players in Ashgabat, at least when talking in energy terms. The Central Asia-China pipeline, one of the most impressive feats in energy infrastructure construction, was completed in 18 months and now is slated to bring 60 billion cubic meters (bcm) of natural gas per year to China in the coming decades (Platts, August 31, 2011). These immense volumes—four times that planned for the Trans-Anatolian pipeline from the Caspian to Southeastern Europe—may require up to three different routes for the project’s separate strings. This route planned to traverse northern Afghanistan will offer an alternative to the more costly route through Uzbekistan and Kazakhstan [3].

Turkmenistan’s main energy and foreign policy priority at the moment is the realization of the Turkmenistan–Afghanistan–Pakistan–India (TAPI) pipeline southeast across Afghanistan to markets in Pakistan and India. During the project’s recent international road show, CNPC and Sinopec reportedly expressed interest in the project, even if it was unclear in what capacity [4]. For the sake of diversity, Turkmenistan’s leadership would almost certainly prefer non-Chinese companies investing in TAPI. During the Petrotech conference in New Delhi in October 2012, the acting Minister of Oil and Gas Industry and Mineral Resources Kakageldy Abdullaev made overtures to Indian firms to come and invest in Turkmenistan (Business Standard, November 27, 2012).

Further downstream in Uzbekistan, the government started to pump its own gas down the pipeline traversing its territory in September. The move was part of a 2010 agreement signed between the two countries for Uzbekneftegas to send some 10 bcm per year to China (Platts, September 24, 2012). In historically energy-poor Tajikistan, CNPC partnered with Total to purchase a share each of Tethys find in Bokhtar, at the eastern end of the Amu Darya Basin (Bloomberg, December 21, 2012). In Kyrgyzstan, a Chinese firm also has agreed to build a refinery in the Chui Oblast whilst acting Kyrgyz Economy Minister Temir Sariyev reported “China is interested in the construction of Kazakhstan-Kyrgyzstan-China oil pipeline and a gas pipeline from Turkmenistan via the south of Kyrgyzstan” (Azer News, December 4, 2012; Central Asia Online, April 27, 2012).

Beijing and Chinese companies have long cultivated a close partnership with Kazakhstan as a regional power and source of valuable resources (“Sino-Kazakh Ties on a Roll,” China Brief, January 18). While Western companies suffer in their attempts to bring offshore projects online in Kazakhstan’s Caspian waters, China steadily has become the largest outside energy investor onshore. China’s sovereign wealth fund China Investment Corporation (CIC) is set to buy into Kazakhoil Aktobe, Kazakhturkmunai and Mangistau Investments—a deal which according to some estimates will give Chinese companies control over 40 percent of Kazakhstan’s oil production (TengriNews, January 8). The Kazakhstan-China oil pipeline—completed in a number of stages throughout the last decade—is slated to operate at its full capacity of 20 million tons per year (tpy) by 2014 (EnergyGlobal, November 9, 2012).

Nevertheless, this rosy picture has another side. According to analysts spoken to in Astana, the fields to which China has access are older ones that have been exploited for years. Furthermore, local Kazakhs with whom the authors spoke do not have particularly positive perspectives on their Chinese employers. At a grander scale, the slow progress with the Kazakh side of the free trade zone at Khorgos on the border between the two countries just northeast of Almaty is further evidence of these tensions. Analysts and officials asked either side of the border have vague responses about delays with the site. Currently, the Chinese side teams with new markets, corporate offices, hotels and customs buildings, but the Kazakhstani side still has some way to go in bringing its infrastructure on par with its neighbor [5]. Khorgos is the crossing point from China into Central Asia for three developments: a Central Asia-China pipeline from Turkmenistan; a new highway that is under construction linking Almaty, Astana, the Caspian shore and Russia; and a second train connection between China and Kazakhstan that opened last month (Xinhua, December 22, 2012). A key component of China’s so-called “New Eurasian Land Bridge,” the Khorgos passage is one of the main arteries in the chain connecting China’s eastern coast with Western Europe through Russia and the Black Sea-Caspian region.

These difficulties are even more evident in Kyrgyzstan where there have been a spate of clashes between locals and Chinese workers. In October, reports emerged from a gold mine managed by the Zijin Mining group in Taldy-Bulak that locals had threatened to burn down a company office after the company allegedly was killed a local horse (RIA Novosti, October 22, 2012). Then, in January, a fracas broke out between Chinese and local workers after Chinese workers allegedly caught a local stealing. In the ensuing clash some 100 people were involved and 18 Chinese workers were injured, two seriously (Xinhua, January 11). Whilst Kyrgyzstan is a notoriously difficult environment for foreign investors with many other nation’s countries also experiencing problems, China seemed to respond with particular attention this time around. In response to the first incident, the head of the Chinese Chamber of Commerce in Kyrgzystan, Li Deming, wrote an op-ed stating “Kyrgyzstan still a mine field for investors” (Global Times, October 28, 2012). In December, during an SCO Prime Ministers’ Meeting in Bishkek, Premier Wen Jiabao met with his counterpart and reinforced this message encouraging “Chinese enterprises to expand investment in Kyrgyzstan” (Xinhua, December 4, 2012).

A much larger, potentially strategic, threat to Chinese investments in Central Asia, however, lies in Russian President Vladimir Putin’s proposed Eurasian Union. Most recently announced in October 2011, when President Putin laid out his plan in an article in the Izvestia newspaper, the notion has its roots in the Customs Union that was first proposed in the 1990s by President Nazarbayev of Kazakhstan. While slow to accept the idea, President Putin now has embraced the idea wholeheartedly to create a regional organization that would coordinate “economic and currency policy” between the countries of the former Soviet Union (Reuters, October 3, 2011). Currently, the Union is made up of Kazakhstan, Belarus and Russia, but, in Central Asia, both Tajikistan and Kyrgyzstan have expressed an interest in joining. What is not entirely clear is whether this is something that is taking place as a result of Russian pressure or whether this is a choice. In his annual statement to the Duma in December 2012, President Putin spoke of tightening requirements for the citizens of the Commonwealth of Independent States (CIS) to enter Russia with passports rather than simply ID cards as is the case at the moment. He left open the caveat, however, that free access would continue to be allowed for citizens of countries members of the Union (RIA Novosti, December 12, 2012). The potential implication to remittance-reliant Kyrgyzstan or Tajikistan is clear, creating an instant obstacle for the masses of young men from those countries who work in Moscow to send money back home to their families.

The issue for China is what impact this will have on China’s trade relationship with these countries. In particular, Kyrgyzstan is one of the key routes for Chinese goods into the region and for onward re-export—Ambassador Wang Kaiwen, China’s man in Bishkek, places the figure at $5 billion per annum. In commenting, Ambassador Wang also placed Kyrgyzstan’s trade with China in a broader context. As he put it, “trade between China and Kyrgyzstan is $5 billion, and China’s foreign trade is $3 trillion…so this [joining the union] is not a big problem” (Knews.kg, November 30, 2012). The point is that this is a relatively limited problem for China, but the repercussions in Bishkek are uncertain and potentially more substantial.

In many ways, this uncertainty places China’s 2013 in Central Asia in its appropriate context. It is increasingly clear that China is the most consequential regional actor that is making all the right moves to consolidate its interests. The regional impact and the reactions of both the Central Asian states and Russia to this growing preponderance remain to be seen. For Beijing, the relationship is an important one if they are to effectively develop Xinjiang, but their growing perceived dominance is something that is met with ambivalence regionally where nations like China’s money, but worry about its dominance. The dragon has clearly risen in Central Asia, but how the region will decide to respond still remains unclear.

Notes:

Raffaello Pantucci and Alexandros Petersen, “China’s Inadvertent Empire”, The National Interest, October 24, 2012,chinaincentralasia.com/2012/10/24/chinas-inadvertent-empire/
Author interviews, November 2012
Author interviews, October 2012
Author interviews in Ashgabat, September 2012
Author observations at Khorgos, April 2012; and interview January 2013

Europe and China Cooperation in Central Asia

Posted: December 19, 2012 in Oriental Morning Post
Tags: China, China and the world, China-Central Asia, China-Europe, China-Europe cooperation on Central Asia, Chinese foreign policy, New Silk Road

Another op-ed in the Chinese press, this time in 中文 for the Oriental Morning Post (东方早报). Looks at the question of Chinese-European cooperation on Central Asia. More detail on this topic coming soon. As usual, Chinese on top, English submission below.

中欧在中亚的合作前景

吉尔吉斯斯坦首都比什凯克最近有点忙。就在短短几周里，欧盟与中亚部长级会议和上海合作组织总理会议先后在此召开。虽然两者并无联系，但两大高层会议在吉尔吉斯斯坦召开不但显示了中亚的重要性，也体现了这一区域作为中欧之间桥梁的潜在作用。

目前中国在中亚是一支崛起力量。与日俱增的投资、对于天然资源的兴趣和区域制度的发展都在让这一区域重新转向中国。最近上合组织总理会议上，温家宝总理鼓励中亚各国充分利用中国提供的100亿美元贷款来建设这一地区的基础设施，即充分体现了这点。中国希望这一区域的经济能够腾飞，而更为重要的是能同时带动新疆的发展。

欧盟的部长级会议并没有这样远大的目标，而是再次强调了发展中亚对于欧盟的重要性。除土库曼斯坦首都阿什哈巴德之外，欧盟外长凯瑟琳·阿什顿访问了其他各国首都，并且利用这次部长会议机会强调“可能进一步发展我们之间的能源、贸易和经济关系”。欧洲在中亚的投资目前非常有限，这主要是因为缺乏机会，投资环境也非常不佳。但是毫无疑问，欧盟具有发展双方联系的意图和希望。

2007年，欧盟公布了中亚战略，内容范围非常雄心勃勃，意图为整个欧洲在中亚打造一份新计划。这一战略以欧盟的“欧洲伙伴政策”为表述，旨在增强欧盟对中亚的重心。在德国担任欧盟轮值主席国期间，作为历史上长期对中亚充满兴趣的国家，一手推动了这一战略。欧洲非常希望这能发展出一条更为实在的路径，通向这些长期来被他们忽略的中亚国家。

然而事与愿违，距这份战略公布至今已有五年时间，但并未见到任何实质性的发展。欧盟在中亚投入了大量资源，这非常显而易见，如果你驾车在中亚地区，会看到学校和开发项目工地上挂着欧盟的旗帜。除此之外，欧盟也通过一项叫做“中亚边界管理”的合作来帮助中亚各国进行边界控制，为落后的边境管理提供现代化训练和管理办法。但是，欧洲在此留下的足迹依然停留在非常表面的层次，绝大多数中亚国家并不会把欧盟当作这一区域的主要角色。如纳布科天然气输气管工程这样的大规模能源项目依然在无穷无尽的讨论谈判之中。

相比之下，中国在中亚的力量迅速崛起。过去一年里每个中亚国家我至少都去了一次以上，而在每个国家的官员、民众和分析家都告诉我中国是那里的新力量。有趣的是，虽然他们看到的是中国为这一区域带来的变化，但他们都宣称更想成为欧洲国家。欧盟模式许诺的稳定繁荣和国家发展是他们都希望能逐步达成的前景，而且他们强调自己愿意同欧洲做生意。照此看来，欧盟在中亚赢得了软权力。

但是，欧盟和中国在中亚取得的成就也突出了中欧间通过中亚进行结盟的潜在可能。中国对这一区域产生兴趣的本质是发展新疆战略。今年早些时候在乌鲁木齐举办的中国亚欧博览会上，温家宝总理说计划要把新疆发展成“亚欧的门户”。其想法是建立通过中亚、最终到达欧洲的联系。这将为新疆带来经济繁荣和发展，产生如当年“丝绸之路”那样将欧洲和亚洲相连的效应。

这对于各种有关方都是个非常具有吸引力的计划。这不仅仅将帮助达成中国区域发展的目标，还能为中亚带去繁荣，以及增强中国和欧洲之间直接贸易联系，这一切都将对经济发展产生重要作用。

当然，需要克服的障碍也不少。尽管中亚人民经常强调中国是这一区域的崛起大国，但他们也经常告诉我中国控制带来所谓的危险。吉尔吉斯斯坦和哈萨克斯坦的人们说中国公司给工人待遇过低，不够公平，塔吉克斯坦人则一直对中国男人娶走了他们的女人表示不满。显然，中国在中亚的软实力建设还有待提高。但是，中国公司可以向欧洲同仁学习一件事情：雇佣当地工人，为他们提供好的工作条件，改善他们的社会，这些都是中国在中非投资时能够用来改善自己形象的方法。同欧洲公司进行接触也许可以帮助中国投资者学习一下他们使用的战略。

这一切都将是个长期游戏。欧洲对中亚重燃兴趣，但这需要有更具体的行动跟进。但是如果中国愿意表达同欧洲作为伙伴在中亚共同发展的兴趣，那么这一定会引来欧洲更大的关注。虽然讨论“新丝绸之路”未免有些过时，但通过中亚铺开中欧之间的道路将会最终带来两方战略合作的果实。

(李鸣燕译)

Europe in Central Asia

Bishkek, Kyrgyzstan has had a busy few weeks. In the space of a few weeks it has hosted a EU-Central Asia Ministerial meeting and then the Shanghai Cooperation Organization (SCO) Prime Minister’s Summit. Whilst unconnected, the two high level meetings in Kyrgyzstan show Central Asia’s importance, but also the potential for the region to act as a link between China and Europe.

Currently, China is the rising power in Central Asia. Its growing investment, appetite for natural resources and development of regional institutions are reorienting the region towards China. The recent SCO Prime Ministerial Summit in Bishkek highlighted all of this as Premier Wen Jiabao encouraged Central Asian powers to take advantage of the $10 billion loan that China was extending through the SCO to encourage regional infrastructure investment. The hope for China is that the region would develop economically, and more importantly, that it would develop in a way that would help encourage development in Xinjiang.

Europe’s Ministerial meeting was far less ambitious, but highlighted once again the importance that the EU attaches to developing Central Asia. Visiting all of the regional capitals except Ashgabat, Turkmenistan, European foreign minister Catherine Ashton used the opportunity of the Ministerial meeting in Bishkek to emphasize the ‘potential to further develop our energy, trade and economic relations.’ European investment in Central Asia is currently quite limited, trapped between a lack of opportunities and a very challenging investment climate. But clearly the hope and intention is there to try to develop this connection.

Back in 2007, the EU launched a strategy for Central Asia. The paper was ambitious in its scope, and aimed to lay out a new plan for Europe to engage with Central Asia. Phrased as being an expansion of the EU’s ‘European Neighbourhood Policy’ the strategy aimed to increase and target’s the EU’s focus towards Central Asia. Nurtured and launched under a German Presidency of the EU – a member state that has always had a keen historical interest in the region – there was a great hope that it might finally help develop a more practical approach towards a set of states the EU had long overlooked.

Unfortunately, in the five years since the strategy was launched, very little has tangibly been achieved. The EU has spent considerable resources in Central Asia – something that is visible on the ground as you drive around with European Union flags on schools and development projects around the region. It has also helped try to develop border controls across the region through a special Border’s Management Program that has tried to bring modern training and methods to Central Asia’s underdeveloped border guards. But its regional footprint is still very light, with most Central Asian countries not considering the EU one of the region’s major players. Large-scale energy projects like the Nabucco pipeline have yet to get going and are trapped in endless discussion rounds.

In contrast, they increasingly see China as a major player. Over the past year, I have been to all of the Central Asian countries at least once. And in each one, officials, citizens and analysts all told me that China was the rising power in the region. What is interesting is that while they all see the growing consequence of China in the region, they all aspire to be like European states. The model offered by the EU of stable prosperity and a developed state is something that they would all like to achieve eventually and they were eager to emphasize that they would like to do business with Europe. The EU, it seems, is winning the soft power conversation on the ground in Central Asia.

But these parallel achievements by the EU and China in the region highlight the potential for a great alliance between the EU and China through Central Asia. China’s interest in the region is in essence an extension of its strategy to develop Xinjiang. The underlying plan laid out during the China Eurasia Expo is to develop Xinjiang into becoming a ‘gateway for Eurasia’ as Premier Wen Jiabao put it in Urumqi earlier this year. The idea is to develop links through Central Asia and ultimately through to Europe. This would bring prosperity and economic development to a part of the country that has thus far suffered from underinvestment and under-development. It would also finally have the effect of rebuilding the Silk Road that used to bring Europe and Asia together.

This is a plan that has great appeal to all involved. It would not only help China’s goals for regional development, but also help bring prosperity to Central Asia, and finally, help improve direct trade links between China and Europe. All of which would have the net effect of improving prosperity.

Of course, there are a number of obstacles to overcome. While people in Central Asia were often eager to highlight that China was the rising power regionally, they were equally eager to tell me stories of the dangers of Chinese domination. People in Kyrgyzstan and Kazakhstan told stories of Chinese companies paying badly and treating workers unfairly, while Tajiks would repeatedly talk of Chinese men marrying their women. China has a great deal of soft power work to do in the region. But here is something that Chinese firms regionally could learn from their European counterparts. Hiring local staff, offering them good working conditions and establishing ways to help improve the societies in which they are working are methods that the Chinese investors in Central Asia might be able to help improve their image. Making contact with European companies regionally might be a way to try to learn some strategies they have deployed.

All of this is a very long-term game. Europe’s renewed interest in Central Asia needs to be followed up with more concerted action. But an expression of interest from China that Europe is a partner with which China would like to work with in helping regional development in Central Asia is something that could help spur greater European attention on the region. While it is cliché to talk about the New Silk Road, repaving the link between China and Europe through Central Asia could help finally bring the EU-China strategic partnership to fruition.

Raffaello Pantucci

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