Archive for May, 2018

And finally this evening, a new piece for the Telegraph exploring how the terrorist threat has evolved and how government’s need to be careful in their responses to not make it worse.

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One year since the Manchester bombing, the West risks playing into terrorists’ hands

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Another one for RUSI, this time looking at how the UK should respond to the Belt and Road Initiative. Rather repeats points from previous pieces, but still need to be made. More on this topic in the form of a more substantial piece soon hopefully.

Also, catching up on some other things – this report Understanding the Factors Contributing to Radicalisation Among Central Asian Labour Migrants in Russia which was the product of a longer project we worked on at RUSI finally emerged. It looks at the phenomenon of radicalisation amongst Central Asian labour migrants in Russia. Was the product of a lot of effort, and the final drafting of the paper is heavily owned by my RUSI colleague Mo who took the lead, and Sarah and Nadine who both contributed substantially to both working on the project and drafting bits. Thank you all! Off the back of this, did a Majilis podcast with the excellent Bruce and Muhammad for RFE/RL.

And on the other side of my substantive equation, spoke to the Intercept about the far right terror menace in the UK, and to Voice of America about the Liege terror attack today.

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China’s Belt and Road Initiative: A Call for Pragmatism

Raffaello Pantucci
Commentary22 May 2018
ChinaInternational Security Studies

China’s Belt and Road Initiative requires a logical response, one based on an assessment of realities rather than rhetoric, and reciprocity, rather than outright confrontation.

There has been little clarity of the UK’s approach to the Belt and Road Initiative (BRI) since the prime minister’s visit to Beijing in January. The key message to emerge from the visit seemed contradictory: the UK claimed to be ‘a natural partner’ for the BRI, but at the same time, Prime Minister Theresa May refused to sign a memorandum of understanding for the initiative presented by Chinese leaders. But this is a comprehensible paradox. The UK is facing the same conundrum posed to most countries: Chinese investment is attractive, but the norms and political pressure that may follow in the wake of this grand initiative are not.

The key to properly responding to Beijing’s economic statecraft under the BRI is clarity. The foreign policy concept advanced by Chinese President Xi Jinping is the latest expression of China’s ‘going out’ policy; it provides the overarching logic for Chinese external investment. The BRI narrative is one that has grown over time to overwhelm Chinese foreign policy; almost any external engagement that China engages in can be captured in some way under the BRI.

The first point worth remembering is that just because China talks of the BRI in grandiose uniform terms, this does not mean other countries need to be engaged with it as a single project. For European powers, for example, it is abundantly clear that there is a vast difference between Chinese projects in Europe, and projects in faraway parts of Asia. The BRI concept is an overarching foreign policy idea best understood as a series of distinct projects. And, as with any large set of projects (or foreign policy goals laid out by a foreign power), some elements have a natural logic of cooperation to them, while others do not.

Secondly, it is essential to understand what is actually happening on the ground, since there is much rhetoric and sometimes little action when it comes to the BRI. There are numerous examples of mismatched expectations throughout Central and Eastern Europe. The much vaunted 16+1 format (China plus the former communist countries of Central and Eastern Europe) has delivered little in terms of solid investment; the Czech Republic has found itself facing a sudden massive loss of prospective investment as Chinese energy conglomerate CEFC withdrew abruptly from its push into the Czech market. By contrast, Pakistan is abuzz with activity, as Chinese companies build new infrastructure up and down the country.

The moral of these contrasting episodes is, therefore, to focus on what is happening, not on what is being merely discussed or announced. For, while this is an obvious point, it remains far too easy to get caught up in the noise around Chinese projects and miss what is actually going on. It is also too easy to fall for the other stories that such mega-projects generate. Some stories – such as allegations that Chinese prison labour is being used to implement infrastructure projects – are untrue, while others – such as claims that some countries are taking on onerous debt burdens alongside Chinese projects – are true. But even then, the debt burden story is nuanced. For example, the terms offered by the Export–Import Bank of China or the China Development Bank are sometimes favourable, but there are also genuine questions about the financial liabilities of some projects once they are up and running: see, for instance, the controversy over the sizeable obligations that the government of Pakistan has assumed in guaranteeing revenue for the many Chinese-financed and executed electricity generating projects in the country.

Finally, there is the broader ideological question posed by the BRI. As Western values of prosperity through democracy are being increasingly questioned by Western publics, and governments themselves, Beijing is offering an alternative worldview underpinned by norms and standards that do not necessarily conform with Western outlooks. Yet even on this point, the debate needs to be focused on a case by case basis. The relatively new Asian Infrastructure Investment Bank (AIIB) that elicited such a great controversy in the West was in part a response to a perception among countries of the global south that the dominant international financial institutions did not represent their interests or give them a voice. The AIIB is a product of these considerations as well as an attempt by Beijing to try its own hand at operating international structures that are not Western-invented. In sum, far from being a parallel or disruptive player, the AIIB could be seen as representing a positive Chinese-led contribution to the international order.

In contrast, China’s push to advance its version of the internet to strengthen models of state control, or its attempts to use its economic weight as a coercive tool, remain to be contested. But the key to any such response is strengthening alliances to confront patterns of behaviour from Beijing – either under the auspices of the BRI or otherwise – that are against national interests or those shared throughout the West. Beijing may resist, seeking ways to circumvent such opposition, but this is the natural push-and-pull of international affairs. The key to guiding a response is to offer alternatives and to think about what could address the issues on the ground that Beijing is seeking to resolve through its investments. In other words: if the UK is concerned with a project being undertaken by a developing country under the BRI, they should find ways of engaging with that country to either agree upon alternative sources of investment or to ensure that the Chinese project is delivered to an acceptable standard and that it will deliver maximum local benefit.

This lesson is broadly applicable. The West should focus on engaging with segments of the BRI that are empirically underway, and should engage with local partners to ensure they gain real benefits. The idea that the BRI could be a source of massive profit for UK companies based globally is a view that needs tempering. UK companies in Beijing are already making money accompanying their long-standing Chinese partners as they pursue the BRI. The broader profit is more likely to come from taking advantage of the infrastructure investment that is taking place, and finding ways of ensuring that the countries receiving BRI investment are able to grow in its wake.

The key point to remember within all of this is that the Chinese companies and banks making deals under the BRI are focusing on their own interests; they will expect everyone else to do the same thing.

Been delinquent in updating this site. A few to catch up on, starting with one for my institutional home RUSI which looks specifically at Central Asia and tries to offer some ideas for how Europe in particular might try to focus its efforts there. My hope is to encourage these ideas through various projects that we are working on, but for the moment float them here. There is something important going on in Central Asia, and it would be good to see greater engagement with it as frustrated opportunity will never end well.

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Europe’s Pivot to Central Asia

Raffaello Pantucci
Commentary2 May 2018
International Security StudiesCentral and South Asia

Central Asia has started to assert its interests and identity. European powers should seize the initiative and bolster these trends.

The catalyst for change in Central Asia has been the death of Uzbek President Islam Karimov. The change in Tashkent has brought Shavkat Mirzioyoev to power, a former regime apparatchik who has shown an impressive ability to stimulate change and transformation throughout the Uzbek system.

Regionally, it has led to dramatic changes as well. Longstanding regional blockages have opened a bit, and while there are still some complicated bilateral issues to be resolved, there has been more movement on regional relations in the past year than in the past couple of decades.

Tashkent’s decision to host a conference on Afghanistan, play a greater role in Afghan reconstruction and economic development and more generally be willing to be proactive in multilateral formats there has re-opened a new forum for engagement on the long-beleaguered country.

However, it is equally important to note the growing international role played by Kazakhstan. It was where President Xi Jinping first announced his broader Belt and Road Initiative concept, as well as a founding member of the Eurasian Economic Union, and Astana has for some time placed itself at the heart of Eurasian dynamics.

It has also sought an increasing role on the international stage as a mediator in the conflict in Syria, as well as working to help the international effort to manage the Iranian nuclear confrontation.

Most recently, it reaffirmed its independence by refusing to support a Russian-sponsored UN Security Council resolution condemning US-led airstrikes on the Syrian regime’s forces after the gassing of civilians in Douma.

Both Astana and Tashkent are demonstrating the potential that middle-ranking powers can have when they focus their efforts and attention on specific issues. So, the EU has started to take note and High Representative for Foreign Policy Frederica Mogherini has visited the region twice in the past six months.

To build on the current good relations between Europe and Central Asia, engagement should focus on: connecting ideas; countering violent extremism; and creating an environment conducive for economic development through small and medium-sized enterprises.

Connecting Ideas: A New Silk Road Think Tank

One ‘soft power’ initiative that would be an easy win and would provide a forum for a proper Eurasian discussion about connectivity would be the establishment of a regional connectivity think tank. This institution could draw on expertise from across the region to work together on some of the fundamental problems which still exist at the heart of Eurasia, such as regional economy and security.

It would also help to strengthen civil society across the region, as well as assist education and research needs. It would be able to help develop a data-driven research base that would help to support the work of international financial institutions that seek to give money and develop projects regionally, such as the European Bank for Reconstruction and Development, the European Investment Bank, the Asian Development Bank, or even the Asian Infrastructure Investment Bank.

Leading on Counter-Radicalisation Efforts 

This think tank should not focus solely on understanding the difficult economic and trade questions (including those that are generated by China’s – or other external powers – investment in the region). It should also to focus on some of the difficult security questions of the day, such as violent extremism and the fall-out from the many radicalised Central Asians who fought alongside jihadists in Syria and Iraq.

There are many reasons why people join overseas extremist groups. They are in some cases – as recent RUSI research has shown – a product of people’s experiences as labour migrants in Russia, but they are also in part a result of people’s experiences in Central Asia.

Many training programmes are already underway in the region through various institutions, but the EU should explore whether there are ideas and projects that have been attempted in the region which might be interesting in a European context.

And vice versa: Establishing a platform for greater engagement between countering violent extremism practitioners in Europe and Central Asia – potentially through a platform such as the European Commission’s Radicalisation Awareness Network – would strengthen the connective tissue between our two regions. There is already some connectivity in this regard but improving it and potentially focusing on what joint research projects could be undertaken could help to provide answers to some of the most difficult questions troubling both of our societies.

Boosting Investment and Economic Opportunities

Finally, more needs to be done to encourage private sector development in Central Asia. Regional economies are currently dominated by state-owned enterprises or firms controlled by key tribes or leaders, a pattern which foreign investors – China, Russia, major international energy or mining firms ­– tend to strengthen.

Serious problems still exist in the investment environment. Fears of expropriation, problems with corruption and difficulties in repatriating profits remain key obstacles to foreign investors, and particularly small or medium-sized European firms that cannot afford such risks.

Addressing this problem will require time and will not be easy. Entrenched economic interests will resist change, but a focused European effort that sought to engage with outside powers such as China, Turkey or Russia on questions surrounding transparent governance, an independent judiciary and accountable governance could help deliver change. This would help to improve the business environment in the region and make it more attractive to European investors as well as nurturing a genuine local small and medium-sized enterprises.

The EIB, EBRD or other European investment tools like national development agencies (as well as the Asian Infrastructure Investment Bank or the Asian Development Bank where a number of European powers play an important role) could be used to target investments focused on SME development and which do so through projects designed to incentivise local governments to establish more accountable practices.

This is not, in itself, a new approach, but some of the answers and ideas for these targeted investments could draw on research commissioned from the new Silk Road think tank. The multilateral regional data driven perspective offered might offer some new ideas for how to manage long-standing regional problems.

The key to success lies in Central Asia showing interest in working with Europe, and the latter maintaining a consistent level of attention. Unlike the past when the region was largely seen as a playground for great powers, Central Asia is increasingly attempting to to write its own story.

Progress on this has been halting, but the Kazakh-Uzbek Central Asian ‘motor’ is currently pulling in a positive direction, and Europe should take notice and make a more concerted effort to encourage and nurture this process.

With limited investment which can deliver an outsized result, the EU’s image as the dominant normative power on the Eurasian supercontinent could be strengthened. Or, to paraphrase Halford Mackinder a century ago, Europe can once again reclaim the narrative in the Eurasian heartland.

Slightly late posting a piece for Prospect a week or so ago about China-Russia relations. Covers ground that has been touched on before at greater length in Current History and China Economic Quarterly pieces. Undoubtedly more on this topic to come. Separately, spoke to The Times about the two captures ISIS ‘Beatles’, my recent China-South Asia piece was picked up by a Forbes columnist, and for those who can understand Italian, an event I spoke at in Rome (alongside the chair of the NATO Parliamentary Assembly, the UK Ambassador, the head of Counter-Extremism in Italy, and we were joined at the end by Marco Minniti, the Interior Minister) has now been posted online.

China and Russia: the perennial frenemies

As Russia’s relations with the west go into deep freeze, watch as Putin warms to the east

Back in 2014, relations between Russia and the west took a nosedive as Moscow annexed Crimea, then invaded eastern Ukraine. The west’s opprobrium was largely shrugged off by Russian president Vladimir Putin who instead headed to Shanghai where he was feted by President Xi Jinping. A $400bn gas deal between their two countries was signed. As we watch western relations with Moscow slide even lower in the wake of the attempted murder of Sergei Skripal in Salisbury and the Syrian crisis, do not be surprised if we see President Putin turning, once more, towards the east.

The paving stones for a visit were laid a couple of weeks ago during the Moscow Conference on International Security. Bringing together allies from around the world, the aim of the conference is to showcase Russia’s international relationships. This year, Beijing was represented by its Defence and Foreign Ministers. Both used the event as an opportunity to highlight the importance of bilateral relations. Foreign Minister Wang Yi described relations as at the “best level in history” while Defence Minister Wei Fenghe went further stating “The Chinese side has come (to Moscow) to show Americans the close ties between the armed forces of China and Russia… we’ve come to support you.” Reinforcing this, at around the time of the conference the Russian news agency TASS announced the delivery of an S-400 Triumf missile defence system to China. They also discussed President Putin’s pending visit to China later this year, another opportunity to highlight the strength of their ties.

For those minded to see axes of evil around the world, this pro-Chinese orientation by Moscow seems to fit the bill. As essentially one-man and one-party states, they are natural allies. But this superficial understanding of a relationship misses the contradictions and disgareements at the heart of their relationship: China and Russia are bound together, but they do not necessarily like it.

Back in July 2000, soon after his first inauguration as president, Vladimir Putin gave a speech in Lake Baykal in southern Siberia near the border with Mongolia, in which he worried about Russia’s far east. “If we do not make real efforts to develop the far east in the very near future,” he said, “the Russian population will mainly be speaking Japanese, Chinese and Korean in a few decades.” Yet just 17 years later, Putin’s Prime Minister Dmitri Medvedev was in Beijing praising the rise of the Renminbi and speaking of Russia’s interest in connecting with the currency, further opening Russia to Chinese investment. From fearful neighbour to pusillanimous supplicant, the shift in the Sino-Russian relationship is almost complete.

On the surface of course, relations are better than ever. Chinese officials will highlight how Moscow is a first port of call for new Chinese leaders. Xi Jinping went even further than his predecessors, not only going to Moscow but heading to Sochi a year later for the opening of the Winter Olympics—the first time a Chinese leader had attended such an event. Clearly eager to make sure his Russian hosts were happy, President Xi described the games as “splendid.” President Putin has made more visits to Beijing than any other foreign capital, and consistently turns to Beijing when he is looking for support on the international stage.

“From fearful neighbour to pusillanimous supplicant, the shift in the Sino-Russian relationship is almost complete”

Yet, there is a more complicated story. Last year in Moscow I sat in the audience at a conference panel discussing Eurasian visions. On the rostrum were two prominent Chinese experts who proceeded to give superb presentations on China’s view of the new Eurasian Silk Roads in fluent Russian. Cracking jokes, quoting Russian authors and explaining Beijing’s policies, these men had the mostly Russian audience enrapt. Over lunch later, a Muscovite friend joked how the Chinese experts’ Russian was better than theirs.

In contrast, a year or so earlier I had listened to one of those Chinese experts complain about how difficult a partner Russia was, and how their natural preference laid with relations with the west. Moscow was an unreliable and unpredictable partner whose strategic choices were ones disruptive to the placid world view that Beijing favours. Nor is this wariness one-sided. Talking to friends in Moscow during my last visit, people spoke of unrealised investment promises and a growing concern at the erosion of their nation’s strategic influence thanks to China’s actions in Russia’s backyard.

Such duplicity is in some ways not surprising. Anyone who has looked in detail at relations between any states will find a complicated mass of contradictions, where human dynamics, history and strategic imperatives will often wrestle with each other. But it is particularly striking in the Sino-Russian case. Both are powers driven by a fundamental world view of stable authoritarian state power as the ultimate answer to the difficult management of human societies. Both are fearful of the messianic and democratising west that brings instability, chaos and ultimately state collapse in their wake.

This fundamental imperative keeps the two together, while in secret they fret about each other’s activity. Russia’s behaviour in its perceived sphere of influence is the best example of this. Beijing was deeply unhappy about Russia’s actions in Georgia in 2008, and Ukraine more recently. When Russian Foreign Minister Lavrov reached out to his Chinese counterpart in 2014 to get support for Ukraine, the best he could muster was a statement that China and Russia held “broadly coinciding points of view… over the situation.” The idea that the westphalian order of state borders could be so wantonly disregarded and then breakaway provinces recognised strikes to the heart of China’s worries about its own state survival. Fearful that others might start doing the same to some of its own renegade provinces, Beijing was notably less than outspoken in support on Ukraine and actively blocked Moscow’s moves to get Central Asian powers to recognise what had happened in Georgia.

Yet at the same time, what statements did emerge about Ukraine in particular highlight how while Beijing might not like the end point that was reached, it did understand the imperative behind the initial Russian-led activity. For Beijing, the idea that popular revolutions can overthrow regimes—as appeared to be happening in Ukraine—is a worrying prospect. It points towards a confusing world order in which the primacy of state control comes into question. The Arab Spring, for example, was seen in both Moscow and Beijing as a catastrophic set of events which upended a relatively stable world order. The consequences of which they still see today.

And it is this ultimately which will keep the two powers bound together. Notwithstanding the growing Russian dependence on Chinese investment and the stealthy Chinese encroachment on Russia’s backyard—both in Central Asia where Beijing is increasingly the most consequential actor on the ground, or in Russia’s own empty and resource rich vast eastern regions—Moscow will continue to court Beijing as a close ally and friend. A friend Russia will need even more now that its relations with the west are on such a downward trajectory. And while Beijing may disapprove of Russia’s habit of stirring up the international order as a matter of principle, it will not stymie its behaviour or overtly condemn it. In fact, as we saw in Moscow recently in response to a more aggressive posture from Washington, China will overlook Russia’s disruptive activity to more pointedly confront the west.

These are two powers bound together in an embrace the west will struggle to ever pull apart.