Posts Tagged ‘China-Central Asia’

A brief post in the wake of Islam Karimov’s death in Beijing for the site I post everything China-Central Asia related. As ever, this is something I have a few bigger things in the pipeline about. Somewhat related, spoke to the Associated Press about the attack on the Chinese Embassy in Bishkek, the Wall Street Journal about Anjem’s jailing, the Telegraph about the numbers of children being referred to Channel and Times about a new ISIS magazine.

Karimov’s Death Seen From Beijing

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Islam Karimov’s death is the realisation of a regional concern that many have long worried about: succession amongst leaders of the Central Asian states. The question of who comes next has been a persistent concern, particularly in Kazakhstan and Uzbekistan. Beijing is not immune to these worrries. On every visit to Beijing in which Central Asia has been a focus of discussions, there have been inevitable conversations with Chinese Central Asia analysts who have been particularly perplexed about what might happen in a post-Karimov Uzbekistan. Yet, now that this scenario has arrived, China seems unperturbed and experts spoken to seem equally unconcerned. Seen from Beijing, Uzbekistan post-Karimov is a case of business as usual.

The biggest indicator of China’s reaction to Islam Karimov’s death is how the leadership responded to the news of his demise. It came at an awkward time for China, with Beijing policymakers and planners consumed with the preparations and meetings around the G20 Summit in Hangzhou. Consequently, the best that Xi Jinping could muster was a formal note through the MFA to acting President Nigmatilla Yuldoshev praising Karimov as ‘true friend’ to China. He later dispatched Vice Premier Zhang Gaoli to the funeral as his special envoy, while Prime Minister Li Keqiang paid his respects at the Uzbek Embassy in Beijing.


This set of moves could be read as dismissive, especially given the importance of respect in the Asian context. Zhang Gaoli is ultimately the seventh ranked member of seven within the Politburo Standing Committee. Therefore, in some ways, he was the most junior senior person Beijing could send. In contrast Tajik leader Rahmon, Afghan leader Ghani and Russian Prime Minister Dmitri Medvedev attended. If Beijing was to punch at this weight, then presumably Prime Minister Li Keqiang should have attended.

But at the same time, there are no other state funerals that China has reacted to in this way. The most recent possible comparison that comes to mind was the passing of Lee Kuan Yew of Singapore, a leader who commanded such respect in life that he was able to muster meetings of the Politburo outside Beijing when he visited China. Yet when he passed away, Beijing sent Li Yuanchao. Like Zhang, Li Yuanchao was a Vice Premier, but only a member of the Politburo – a second tier of senior leadership made up of 25 of the most senior members of the Party. While important, Li is definitely junior to Zhang, a Standing Committee Politburo member – ie, one of Beijing’s most inner circle of seven who rule the country. Li, it is worth mentioning, appears to also have been Beijing’s representative at Nelson Mandela’s funeral, suggesting that he may be the unofficial Chinese representative to international state funerals.

Admittedly, this is a lot of ‘Pekinology’ tea-leaf reading. However, it does seem that Beijing’s leadership made some effort to show their respect to Uzbekistan in the wake of President Karimov’s passing, notwithstanding the fact that they were otherwise preoccupied with the world’s heads of state descending on Hangzhou for the G20 meeting.

Looking beyond this speculative analysis, there is further substance to Zhang Gaoli as the representative of China to Karimov’s funeral. As well as his role on the Standing Committee, Zhang is also head of the Leading Group for Advancing the Development of One Belt One Road, a group established in February 2015 which has been tasked with steering Xi Jinping’s great initiative across the Eurasian continent. Considering the importance of Uzbekistan within this context, it is possible that Zhang is in fact one of the more appropriate members to attend the funeral given the opportunity it also presented to interact with Uzbekistan’s likely new leadership. During his visit he – like the other eminent visitors who came to pay their respects – secured an audience with Prime Minister Shavkat Mirziyoyev in which they spoke about continuing ‘to promote the Belt and Road initiative, and enrich the connotations of their all-round strategic partnership by prioritizing economy, trade, energy, production capacity, traffic and security in bilateral cooperation.’

Interested to hear more about the broader context of Uzbek-China relations, I reached out to contacts in China working in the think tank and corporate sector about what they thought of Karimov’s passing. Professor Zhao Huasheng of Fudan University in Shanghai, one of the eminent dons of Central Asia research in China told me ‘I think it [Karimov’s passing] will have no significant impact on China-Uzbekistan relations, because there are no serious problems in bilateral relations. And there is no reason for the new leader not to maintain good relations with China. A peaceful and smooth transition of power is critical for stability in the country and for security in the region.’ The biggest prerequisite and issue on the table for Professor Zhao was that the country had a ‘peaceful and smooth transition of power.’ This view was confirmed by a couple of other Chinese experts spoken to, all of whom pointed to the fact that China’s pre-eminent concern was that Uzbekistan stayed on a stable trajectory. This in fact may have been the concern that had been expressed previously – with people worried that Karimov was the lid on a cauldron that might boil over without him, rather than the leader himself being the key lynchpin in the relationship.

There are in fact no indicators at the moment to suggest that the transition of power should be anything other than smooth, or that there will be an upending of Beijing and Tashkent’s warming relationship. While there has been some speculation that the likely successor (and now interim leader), PM Shavkat Mirziyoyev, may have an openness to a more productive and close relationship with Moscow than his predecessor, it is not clear this will come to China’s detriment. Mr Miriziyoyev has already established a relationship of sorts with President Xi as the individual who personally escorted President Xi Jinping to the airport when he visited Tashkent in June 2016, a visit during which President Xi was the first ever foreign leader to give a speech in the Oliy Majlis and the two leaders (President’s Xi and Karimov) together opened a railway line that China had helped build in the country.

Suffice to say all the indicators in China-Uzbek relations are positive (notwithstanding underlying concerns that are fairly common across the region towards the potentially overbearing nature of large Chinese investments), and it would be surprising if the new leader broke away from, or reversed, this relationship. Uzbekistan continues to want foreign investment, and China has proven a fairly reliable actor in this regard. While Moscow appears to be quite actively courting Tashkent in the wake of President Karimov’s death, Beijing is the one with the relationship on a steady upward trajectory. For Beijing, the priority remains that Uzbekistan stays stable and finds ways of incorporating and building into the ‘Belt and Road’ vision. Seen from Tashkent, there is no clear reason why this wouldn’t be a possibility.

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More catch-up posting this time for the Telegraph in the wake of the suicide bombing on the Chinese Embassy in Bishkek. Also spoke to Voice of America, Financial Times, Guardian and BBC Chinese on the topic.

Now China, too, is in Isil’s firing line

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A suicide attack on China’s embassy in Bishkek, Kyrgyzstan will have little registered on most British radars. Yet, it marks a significant moment for China, as one of the first times that China has come so directly into the crosshairs of terrorists outside its borders.

Details may be scant at the moment, but it appears to mark the first time a Chinese diplomatic compound has been hit in such a way. It is also the latest marker in a gradual escalation of a terrorist threat that China is finding itself facing and points to an interesting marker in the growing normalization of China’s global role.

At the moment, it is unclear who is responsible for the attack. Early reporting seems to indicate Uighur extremists, and the targeting of the Chinese Embassy is a clear message.

Uighurs are a minority community resident mostly in China’s westernmost region (Xinjiang, that is adjacent to Kyrgyzstan), who have long chafed under Beijing’s rule.

This anger has expressed itself in large-scale riots between communities in China, a growing emigration of unhappy Uighurs from China, terrorist incidents within the country, and increasingly now violence outside the country.

The incident in Bishkek is not the first time that Uighurs have come under blame for attacks against Chinese officials in Kyrgyzstan, and it is not the first time that Uighurs have been linked to attacks against Chinese targets outside the country. A group is currently under trial in Thailand for their responsibility in a bombing of a shrine popular with Chinese tourists in Bangkok in August of last year.

But the targeting of the Embassy like this shows the degree to which China’s terrorist problem is one that has metastasized.

China has growing numbers of Uighurs and other nationals fighting in Afghanistan and Syria – both with Isil (the various leaks of Isil documents show almost 200 records that show links to China), whilst those fighting with other groups under the banner of a group called the Turkestan Islamic Party (TIP) alongside other jihadi groups fighting against the Assad regime number possibly into the high hundreds.

Both groups have threatened attacks against China, though it is not clear that they have actually allocated many resources towards trying to achieve this.

Where China has usually faced the menace of international terrorism, it is more usually in an incidental fashion with nationals in the wrong place at the right time. And whilse groups have sometimes claimed to have been aiming for China – like in July last year when Somali group al Shabaab struck the Jazeera hotel in Mogadishu killing 12, including a guard at the Chinese Embassy which was operating out of the building, and later released a message saying the attack was in solidarity for Uighurs’ treatment in China – there has been little evidence that they were really the intended target.

In fact, in its early days, al Qaeda did not appear to really engage much with the Uighurs’ cause or see China as a natural enemy.

In an interview in 1999 Osama bin Laden denied all knowledge of Uighurs saying: “I often hear about Chinese Muslims, but since we have no direct connection with people in China and no member of our organization comes from China, I don’t have any detailed knowledge about them.” And other al Qaeda ideologues at the time spoke of the alignment of Chinese and al Qaeda’s interests in fighting the United States.

Fast forward to today and current al Qaeda leader Ayman al Zawahiri has loudly praised Uighur extremist leaders in some of his recent speeches. At the same time, Isil leader al Baghdadi has specifically threatened China in speeches and his group has ransomed and been responsible for the deaths of Chinese hostages.

An almost complete turnaround for China, and something that highlights the degree to which China has ascended to being a front line power with all the problems and responsibilities that are associated with that.

The full contours of what has taken place in Bishkek are still unclear. It may yet prove to be something with deeper local links and causes, but it comes against a broader trajectory of China increasingly finding itself in terrorist cross-hairs around the world. This is the darker side of global power and projection, and something China is going to have to get used to.

 

Catching up on another late post, this time for the Financial Times Beyond BRICS blog looking in some detail at the question of how the ‘Belt and Road’ has had an impact on Xinjiang-Central Asia trade. Trying to look at this as a case study for the bigger question lots are asking. Am immensely grateful to the excellent Anna Sophia for doing some excellent digging to get the numbers for this. As ever a topic that will get more coverage as we go forwards, and check out China in Central Asia for more on this larger topic.

Xinjiang trade raises doubts over China’s ‘Belt and Road’ plan

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The vast Chinese northwestern frontier region of Xinjiang may serve as a useful early indicator of how Beijing’s much-touted “Belt and Road Initiative” (BRI) is supposed to work – and how successful it may become.

The region, which is home to several muslim minority peoples, has been wracked by ethnic turmoil for decades, prompting Beijing to seek to nurture social stability by driving economic development through hefty investments.

But for this strategy to gain traction, Beijing realised that it needed to boost development in the region around Xinjiang by building commercial corridors to neighbouring Central Asian countries such as Kazakhstan, Tajikistan, Kyrgyzstan, Uzbekistan and Turkmenistan. Thus, Xinjiang was key motivator behind the BRI concept.

But so far the results have been underwhelming. In the three years since the forerunner of the BRI was launched, Xinjiang’s trade volume has not increased and it still constitutes an unchanging portion of total Chinese trade with Central Asia (see chart). This discrepancy between action and results raises questions about whether the BRI is a turning point in Chinese economic policy or simply old wine in a new bottle.

The Xinjiang Uighur Autonomous Region government is an active player in the BRI. Under its auspices, Xinjiang’s major energy companies are expanding Chinese energy trade with Central Asia.

Following its promotion as one of seven national centers for the development of Chinese wind power in 2014, the Xinjiang-based wind turbine company Goldwind won contracts to build plants throughout Central Asia in 2015. In addition, the Tebian Electric Apparatus Stock Company, one of China’s major power transformer companies located in Xinjiang, announced in 2015 plans to build a power transformation line in Kyrgyzstan and a power station in Tajikistan.

Xi Jinping, the Chinese president, called the power station in Tajikistan a symbol of the growing “friendship” between China and Tajikistan, highlighting Xinjiang’s importance to the political and economic objectives of the BRI.

In addition to this corporate activity, the Xinjiang Communist party leadership has represented Beijing in Central Asia. Zhang Chunxian, Communist Party Secretary in Xnjiang, has formalised trade partnerships initiated by Mr Xi with Tajikistan and Kazakhstan. These include deals on agriculture, infrastructure and trade with Tajikistan after Mr Xi’s 2013 visit and a $2bn trade deal with Kazakhstan. Thus, Xinjiang is serving to implement the leader’s vision.

These BRI deals, however, do not in fact represent a departure from Xinjiang’s trade history. Special trade relationships with Central Asian states existed before the initiative was announced, and energy and commodities were already important in its regional trade.

The Kashgar Special Economic Zone was established in 2010 and is intended to deal primarily in regional commodities exports. Likewise, plans for the Kazakhstan Khorgos Border Cooperation Center, where duty-free trade between Kazakhstan and Xinjiang could occur, were already announced in 2011, though construction did not begin until 2014. The point being that many of the projects now tagged as BRI are in fact pre-existing projects that are being re-branded.

The lack of change in Xinjiang’s trade volume since the BRI was announced calls the connection between the broader vision and the deals into question. In 2015, Xinjiang’s trade volume with Central Asia declined more rapidly than the national volume, while experiencing a reduction in trade with every Central Asian country aside from Turkmenistan, which was involved in building a new pipeline to the region.

Xinjiang’s textile exports have increased in 2016, according to the Global Trade Review. However, textiles were already a significant part of Xinjiang’s trade to Central Asia, so the rebound may merely be the result of a weak 2015 base.

The discrepancy between Xinjiang’s visibility in the BRI and its steady proportion of China’s total trade with Central Asia suggests that – so far – the initiative is simply publicising trade relations that existed before, instead of changing China’s trade patterns.

If this pattern holds, it will be important for countries that deal with China to look beyond the visionary rhetoric of the BRI and engage instead with concrete and bankable projects. This requires a focus on what made sense before the BRI was announced.

Raffaelo Pantucci is director of international security studies and Anna Sophia Young is a research intern at the Royal United Services Institute (RUSI), a think tank based in London.

Catching up on some old posting, going to put out a few things at the same time. All looking at China in Eurasia, a topic that continues to be a major focus. Of course, all of my work on this is stored on the China in Central Asia site, and this particular piece is something that was undertaken with my excellent RUSI colleague Sarah Lain.
Proceedings of a workshop held in New Delhi in March 2016 to explore the challenges that China’s strategic Belt and Road vision to connect Central Asia hopes to address.

In March 2016, RUSI, in collaboration with the Vivekananda International Foundation (VIF) hosted a workshop in New Delhi to discuss the challenges of connectivity facing China’s strategic Belt and Road vision, which aims to connect Central Asia  and develop strategic economic corridors across the region.

The workshop covered the different economic corridor concepts initiated by China and India and their aim of enhanced connectivity in Central and South Asia, how such visions will be realised and how they could enhance the security and economic development of the region.

The report summarises these discussions and provides insights into co-operation between China and its regional partners.

A new post this time on the other topic that occupies a lot of time, looking at China and Russia’s relations with Central Asia. It is in essence the transcript of a presentation Sarah and me did in Washington at the kind invitation of the fantastic Marlene Laruelle of George Washington University and Director of their Central Asia Program. As ever, more on this topic to come, more stuff can always be found on China in Central Asia.

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China and Russia in Central Asia: Cooperation and Conflict

Despite the significant rise of China’s economic influence in the region, Russia continues to maintain its political leverage in Central Asia. In contrast to China, it explicitly states its intention to keep its grip on this influence, as highlighted by Medvedev’s speech in 2008. This declared commitment to preserving Russia’s ‘spheres of privileged influence’ certainly includes Central Asia. The key aim for Russia is to ensure, at least in theory, loyalty to the Russian government, seeking countries it can depend on for support. The various alliances Russia plays a crucial role in alongside the Central Asian states, such as the EEU, SCO, CSTO and CIS, also have a utility of legitimizing Russia’s position in a visibly multipolar world. Indeed, the SCO is a platform shared with China, but they all act as a way of overtly demonstrating structural equivalents of Western-dominated organizations such as the EU and NATO.

The Ukraine crisis has undermined Russia’s legitimacy by raising suspicions for both Central Asia and China about Russian intentions in the region. The prevention of color revolutions, which was enshrined in the recently updated version of Russia’s Military Doctrine, has potential implications across the former Soviet space. Indeed, Russia’s commitment to protect Russian- speakers and ethnic Russians abroad causes concern for Central Asians. Although Russia has almost exclusively acted on this in the more Western-leaning post-Soviet countries, such as Ukraine and Georgia, a speech by Putin that addressed Kazakhstan was provocative in light of events in Ukraine. Not only did Putin praise Nazarbayev, but he also highlighted that Kazakhs realized the value of being part of the “greater Russian world,” which raised alarm bells in Astana. Russia has proven it has no issues in leveraging its position over former Soviet states for certain self-interested strategic purposes.
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It is worth noting that, despite this political leverage Russia has over its former empire, the Central Asian states are by no means passive in their relationship with Russia. Independence of action varies between the five states, but it has expressed itself in subtle ways. For example, in the UN vote on Crimea, Kazakhstan and Uzbekistan abstained from voting. Although potentially more symbolic than reflecting real intention, Nazarbayev has made statements in which he says Kazakhstan will leave the EEU if it ceases to be in Kazakhstan’s economic or political interests to be a member.

An area of general agreement between Russia and Central Asia, however, is the definition of and desire for political stability in the region. Although there are certainly concerns around how Tajikistan is currently handling its fragile political situation, the Central Asian states are as averse to abrupt regime changes or color revolutions threatening the status quo as Russia. This allows for a consensus between Russia and Central Asia towards political and governance norms.

China is certainly engaging in a different way politically with Central Asia compared to Russia. China’s political role in the region could be described as latent but one that has not yet manifested itself so overtly. It is certainly a more subtle political actor than Russia. However, there are indications that Central Asia plays the role of testing ground for Chinese foreign policy efforts, meaning Central Asia forms what could be described as China’s “inadvertent empire.” The belt and road vision is a prime example of this. It was significant that Xi Jinping announced the Silk Road Economic Belt (SREB) at Nazarbayev University in 2013. This represented a vision that built on something that had already been happening for years in Central Asia. China had long been building infrastructure using linked loans, which allowed domestic companies to “go out” and build in Central Asia. The announcement showed Xi Jinping stamping his name and authority onto a coherent foreign policy that was based on existing activities. China’s “testing ground” has also manifested itself in other formats, particularly those that are multilateral. The SCO is the best example of a structure through which China can test its security policy in the region.

Moreover, a contrast between Russian and Chinese foreign policy in Central Asia is that China’s policy is closely linked to addressing domestic concerns. For China, it is much more about ensuring stability and development in Xinjiang. Central Asia is an important trade link to ensure access and opportunities for Xinjiang back home. Thus, it is much less about spheres of influence for China. Rather than ensure explicit political loyalty to China within Central Asian governments, which features more importantly in Russia’s foreign policy, China strives more towards developing good economic ties. Of course, political allegiance and support assists doing business in the region, but the ultimate aim is economic utility for China.

One question, the answer to which is not yet clear, is when does this economic power express itself politically? There are a few examples of how this might express itself. For example, in Kyrgyzstan there have been cases of Chinese businessmen facing serious trouble with local corrupt officials when they have failed to pay off the right people, often ending in violence. The Chinese Embassy in certain cases has expressed anger directly to the government of Kyrgyzstan, demanding for an apology. For the most part, however, China’s political role has continued to be consistent with non-interference. China is happy to be the largest investment partner to the region, but does not wish to own the political and security problems of Central Asia in the same way Russia is prepared to do.

Therefore, in the security sphere, Russia still seems to be the dominant player. The Chinese have been active in terms of border security, military aid and some arms deals. It has conducted training with Tajikistan and Kyrgyzstan in particular, which it views as weak links from a Chinese security perspective. Again, engagement primarily reflects China’s domestic security concerns rather than a willingness to project itself as a security power in the region. China still appears content deferring to Russia on this broader security agenda.

A good example of this reluctance to intervene in domestic issues can be seen in Pakistan. Some of the recent issues around the China-Pakistan economic corridor (CPEC) illustrate this. China’s priority is to build a corridor from Kashgar that ends in either Karachi or Gwadar, gaining sea access. However, it appears China was not quite prepared for Pakistan’s internal disputes over the route and is not clear on how to mediate this discussion. The Chinese Embassy in Islamabad was forced to issue a statement on this, essentially sending the message that CPEC is a project that should benefit the entire country. It is up to Pakistan to handle the local politics. Looking back to Central Asia, tensions in regional politics certainly present challenges to China’s intended implementation of the SREB. These are challenges that China will be reluctant to mediate directly.

Both Russia and China clearly provide economic incentives for the Central Asians to cooperate with them. It seems that Russia is much more willing to leverage these incentives, and indeed pressure Central Asian states economically when useful, particularly to extract political gains. A prime example of this pertains to the Manas base in Kyrgyzstan. When Kyrgyzstan was discussing closing access to the base for the US in 2009, Russia offered a huge aid package to Kyrgyzstan as an incentive to terminate the US contract. When Bakiyev went back on this deal, Russia used its soft power as a tool to pressure Kyrgyzstan to reconsider, particularly pushing stories of Bakiyev’s involvement in corruption as a way of de-legitimizing the leader. This demonstrates Russia’s approach of rewarding, but also punishing, the Central Asian states to act in a way that benefits Russia. Another example of an economic pressure point is migrant workers. In January 2015 new rules came into force that made it more difficult for migrant workers to work legally in Russia, such as mandatory Russian language tests and increased costs for documentation. This in particular affected Tajik workers, which led many to believe this was Russia’s way of pressuring Tajikistan to join the EEU.

It is easy to interpret every policy Russia has towards Central Asia as a form of leverage. This is not only an over-simplification but also may be unfair to Russia. However, some of the pressure points Russia can exploit are vulnerable, indicating that the Central Asian states are by no means inevitably tied to Russian foreign policy. For example, given the economic situation in Russia, remittances are dropping. These constitute an economic life-line to Kyrgyzstan and Tajikistan in particular, and if they drop there is less incentive for these countries to respond to some of Russia’s more political demands. Russia has had to cancel hydropower projects in Kyrgyzstan, which it had pledged to fund, not only showing Russia as unreliable but simultaneously reinforcing the perception that China is the real economic player. Although in the long-term it is unlikely that Central Asia-Russia economic ties can be severed, it still shows that some of Russia’s points of leverage are far from guaranteed.

The EEU is Russia’s big economic draw, and tool, for the region. Although in principle it could be positive in furthering economic integration, it so far has shown many negatives. For example, in the first three months of 2015, inter-member trade actually dropped. The fact that Ukraine is unlikely to join unless there is another domestic political pivot means there are huge limitations to the benefits that the Central Asian members can reap from the union given the over- dominance of the Russian economy. Moreover, given the rhetoric from Nazarbayev on the EEU, there are also clearly fears that it is used by Russia as a political tool.

The failures of this Union have manifested themselves in the protectionist measures initiated by member states. For example, Kazakhstan has implemented oil embargoes against Russia. There are complaints from Kyrgyzstan regarding the lack of benefits the EEU brings the country, whilst highlighting that it had no choice in joining. Obviously this also plays into Kyrgyzstan’s interests of extracting more economic incentives from Russia. But fundamentally there are question marks as how political, rather than economic, the strategy is behind the implementation of this project.

China in contrast is investing in Central Asia at a rate that Russia knows it cannot compete with. China is now the biggest trading partner of the Central Asia region, having displaced Russia. There are also risks for Russia that at least symbolically Central Asia becomes a Chinese foreign policy project. Having been very cautious about endorsing the SREB, Russia supported the project by agreeing to find ways to integrate the SREB with the EEU. The practicalities of such integration are unclear given the difference in structure of each strategy. However, it is likely instead that the EEU will be subsumed rhetorically by the SREB project, i.e. that the EEU becomes a part of the bigger Chinese project. This signifies a loss of prestige for Russia.

One unknown for the Belt and Road project is how the economic slowdown in China might affect the project’s implementation. There have already been some frustrations voiced in Central Asia on this front. For example, Nazarbayev noted that Kazakhstan is being affected negatively not only by the economic slowdown in Russia, but also by that which is occurring in China. Turkmenistan is struggling to find consistent gas demand in China, and subsequent pricing, as planned. The enthusiastic push to making TAPI a reality speaks to the urgency of Turkmenistan’s need to find new gas markets. There have also been challenges in Xinjiang’s own domestic build-up, the powerhouse of the SREB policy. The planned robust economic development there does not seem to have taken off at the speed required. This will have knock- on effects across the border. On the other hand, the Belt and Road presents a potential outlet for the challenges causing the slowdown in China. If the infrastructure construction market is slowing down at home, and there is excess capacity in companies and materials at home, exporting it abroad is a strategy for, at least in the short-term, ameliorating this.

Another challenge in the Belt and Road discourse pertains to the huge loans that China is dispensing to the Central Asian states, with little confidence that they will be paid back. Although economically this may not make sense, it does speak to the longer-term perspective that China takes with such loans. They are much more patient about such debts. Moreover, the way these deals are structured has an added benefit to China. For example, China’s Eximbank will grant a significant loan to the Tajik government to implement a series of projects on the condition that a Chinese company will implement it. Often this means that the money never really leaves Beijing – it is simply shifted from one Chinese state bank account to another.

Thus, in conclusions, there is always potential for conflict between two great powers such as China and Russia in Central Asia, but currently there seems to be a useful division of labor between the two. There are overriding geopolitical dynamics between Russia and China that mean they gain more from avoiding confrontation. China does not seem perturbed by Russia’s desire to maintain its neo-imperial approach to the region, as long as it does not conflict directly with China’s economic interest. Russia is aware it cannot compete with China in terms of economic investment but knows that it can maintain the security mandate in the region. This creates a genuine mutual respect between the two in Central Asia. Moreover, there is an informal consensus on the need for political stability between Russia, China and the Central Asian states. That is not to say that tensions are absent. People we have spoken to in Beijing hint that the Russians are difficult to work with. People we have spoken to in Moscow are innately suspicious of Chinese geopolitical intentions in the region. So far, however, it is difficult to see where full-blown conflict between the two might occur.

And now a short paper co-authored with Sarah, my co-editor on the China in Central Asia site, as part of a larger project we have been working on at our home institution of RUSI looking at China in the region. There has been an earlier report in this series, and more to come.

Security and Stability along the Silk Road

Sarah Lain and Raffaello Pantucci
RUSI Publications, 29 February 2016
Central and South Asia, International Security Studies

Proceedings of a 19 January 2016 workshop on the security context for the Silk Road Economic Belt (SREB) across Central Asia and the stabilising effects of investment and infrastructure development

Download the report here

On 19 January 2016, RUSI in collaboration with the University of World Economy and Diplomacy hosted a day-long workshop in Tashkent on the security context for the Silk Road Economic Belt (SREB) across Central Asia and the stabilising effects investment and infrastructure development could have on the region.

The workshop included a specific discussion about Uzbekistan’s role in regional security in light of the SREB initiative, as well as China’s views and approaches to security questions throughout the broader region. The event brought together participants from Uzbekistan, China and the UK, including representatives from academia and think tanks.

This workshop report summarises the discussions from the conference and offers insights into the current state of the Chinese-led project.

And now another (very short piece) for the South China Morning Post, this time looking at the implications to Russia of the opening up of Iran and what this means for the Silk Road Economic Belt vision.

China’s new silk road is designed to cut Russia out of Eurasian trade

Raffaello Pantucci says the ‘One Belt, One Road’ trade initiative is likely to sideline Moscow and give Beijing the upper hand in their awkward relationship

PUBLISHED : Tuesday, 16 February, 2016, 2:00pm
UPDATED : Tuesday, 16 February, 2016, 2:00pm

China Tehran train

The first Chinese cargo train, following Iran-China efforts to revive the Silk Road, arrives in Tehran on February 15. The 32-container train arrived after a 14-day journey from northwestern China. Photo: EPA

President Xi Jinping’s ( 習近平 ) visit to Tehran – the first by a foreign leader since the lifting of sanctions – highlights the potential centrality of Iran to China’s broader regional foreign policy. The opening up of Iran, a country in which China has long maintained substantial interests, means Xi’s “One Belt, One Road” vision can now go cleanly across Eurasia without ever going through Russia. Moscow can be cut out.

Rouhani XJP

Iranian President Hassan Rouhani (left) shakes hands with President Xi Jinping in Tehran in January. Photo: Reuters

Visiting Tashkent, one can see the ancient routes laid out by the Timurid empire that constituted the ancient silk road. Rather than track through Russia, most would go below the Caspian and Black seas to reach Turkey and Europe. An iron silk road has been established that will track the old silk routes

Soon after Xi visited Tehran, a train laden with goods left Yiwu, Zhejiang province (浙江), headed to Tehran following this route. On February 10, it crossed the border from Turkmenistan and arrived in Iran this week. The Ukrainian minister of infrastructure announced at the same time that, by the end of the month, a direct rail line would open between Ukraine and China, cutting across Georgia, Azerbaijan, the Caspian Sea and Kazakhstan. An iron silk road has been established that will track the old silk routes.

Train carriage Tehran China

The first Chinese cargo train arrives in Tehran after passing through Kazakhstan and Turkmenistan. Photo: EPA

Moscow has long been an awkward partner for Beijing and the question of how Russia fits into the belt and road vision was always unclear. Some incorrectly saw the Eurasian Economic Union as an effort by Moscow to push back on China’s dominance in Central Asia. This misinterprets both powers’ interests: Moscow is aiming to recreate a former space of control, while China is building trade corridors. For China, the existence of a common economic space with a single tariff barrier from its borders to the edges of Europe is a benefit to trade.

Putin and XJP Sochi

Russian President Vladimir Putin (right) and Xi Jinping meet in the Russian Black Sea resort of Sochi. Photo: AFP

The reality is that cutting a path across Russia is a long rail route that is only going to be attractive to high-value small objects which are still fairly limited in production volume in Xinjiang – and can now instead go along the route to Ukraine. Mass-produced, high-volume goods for which China is famous are much better placed going by sea to Europe. Unless, that is, the ultimate market is in the heart of the Eurasian continent. And this is where the route across Iran is interesting – connecting China’s markets directly to the bustling bazaars of the Middle East.

In paving an iron silk road, China is gradually reducing Moscow’s importance. This will further strengthen Beijing’s hand in their bilateral relationship and reduce Russia’s power on the international stage. Isolated by the West and increasingly sidelined by China, Moscow’s decline will only be highlighted by the opening of these new routes across Eurasia.

Raffaello Pantucci is director of international security studies at the Royal United Services Institute