Posts Tagged ‘China-Russia’

For much the same reasons as last time, been a bit delinquent in posting. Going to try to catch up a bit now, starting with a piece for my host institution RUSI looking at the China-Russia relationship. There is a possibility that some may see a whiff of contradiction in here, given the volume of writing I have done about how the China-Russia relationship is changing, but at the same time the point here is to say that it increasingly feels like in some places we are letting this get a bit too far. All of which reflects a weakened understanding of the topic. More on this as you can imagine to come, and as ever, comments, corrections and contradictions welcome.

The Over-Hyphenation of ‘China-Russia’

Raffaello Pantucci
Commentary, 3 October 2019
China, International Security Studies, Russia, Global Security Issues, Land Forces, Military Personnel, Technology

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A growing Western habit of linking China and Russia as joint adversaries in various contexts is missing the actual strengths of the relationship, and their varied interests in third locations.

Geopolitics have returned with a vengeance. Public discourse is increasingly conducted in adversarial terms, with ‘our side’ versus ‘their side’ dominating the strategic narrative. And while the ‘enemy of the day’ from a UK perspective is Iran, there is a growing discussion about China and Russia as though they are one and the same, a new ‘axis of evil’ working to stymie ‘our’ ability to operate in the world.

Reading between the lines of the narratives of most international confrontations, ‘they’ – for the most part the Russians and Chinese – inevitably appear to be supporting almost all of those who the UK (or ‘West’ more broadly) is against in the world: blocking votes at the UN; working together on military exercises; building up bases in the Arctic; and supporting Venezuela, Iran or the Syrian regime. This new entente appears to be behind many adversaries.

Yet there is a real danger of creating a Frankenstein’s monster in this interpretation of the Sino–Russian vector. There is no denying that the two have moved closer together in recent years – just watch the optics from Chinese Premier Li Keqiang’s visit to Moscow where he was feted as a great potential saviour of the Russian economy, or the latest security exercises involving Russian and Chinese forces, Tsentr 2019 – but the truth is that there are tensions between the two countries bubbling below the surface.

Start with Central Asia where there is a perennial tussle between the two over who is the dominant force. Russia has watched as China has become a major holder of regional debt, as its companies have moved in en masse to dominate local economies, and it is increasingly clear how China is moving into Russia’s traditional role of security provision. Chinese border guards are showing up along Tajikistan’s border with Afghanistan, doing training exercises and furnishing equipment. Security ministries across the region have growing numbers of officials who speak Mandarin or have experience in China. Russia’s power no longer looks as strong as it once was. It takes little effort to find voices in Moscow who worry about this erosion of Russia’s sphere of influence.

Or look at the growing Chinese technological penetration into Russia. Like much of the world, Russia is in the midst of a debate to determine who is going to build its 5G networks. But unlike the US, the UK or the rest of Europe, there is little evidence that Russians are going to resist China’s entry into this sector. Moscow’s spooks may worry about what this means for their dependencies on China but, as they will candidly say, what alternatives do they have? They point to who is sanctioning them at the moment. China may be scary, but the West is actually punishing Russia.

And, to look at a loftier normative level: China is fundamentally a status quo power, while Russia is the ultimate disruptor. Beijing quite liked the world structure as it was before US President Donald Trump took his sledgehammer to everything; the old world order fostered China’s stratospheric economic growth. It was a good path to which Beijing would like to return. By contrast, Russia has made itself increasingly relevant around the world through disruption, by creating chaos or by helping spur it along, as a prelude to Moscow inserting itself as an important player to help bring resolution.

These are fundamentally contradictory positions: Beijing likes the status quo, while Moscow derives relevance in chaos. And there are moments where these two perspectives have clashed. Beijing disapproved of Moscow’s redrawing of Ukraine’s borders (and Georgia’s beforehand). China has its own provinces with ethnic minorities seeking independence and recognition. It certainly does not like the precedents that Moscow set in recognising the South Ossetians and Abkhazians in Georgia or the breakaway parts of Ukraine. What if people were to start doing this to Tibet or Xinjiang?

Yet notwithstanding these tensions, the West is increasingly looking for a China–Russia axis around the world. The US has articulated this axis most clearly in the Pentagon’s National Defence Strategy, and similar concerns are echoed in Brussels and London. More glib commentary tries to separate them out – Russia is described as being a storm, while China is climate change. The argument here is that both are problematic, only that the former is an irritant, while the other is seismic. Yet increasingly such perspectives consider the two countries as parts of a linked problem.

Russia and China are not blind to this narrative and the broader global confrontations. For them it can be useful to show a strong alliance in the face of the growing Western bloc. At most major international conferences, senior figures stand up and champion their close relationship. They are undertaking ever more ambitious and important military exercises together. Beijing’s strategic bombers have participated in Russia alongside 1,600 troops as part of the massive Tsentr 2019 military exercise, the third or fourth such drill this year they have done together. They are talking about an ‘Ice Silk Road’ over the Arctic and have obviously developed a modus vivendi of sorts over what is going on in Central Asia. Li Keqiang’s latest visit has highlighted more investments into Russia (and Russian sales to China), at a time when Beijing’s economy continues to suffer under US trade tariff impositions.

Beijing and Moscow also share a worry about the ongoing pattern of popular uprising endangering regimes around the world. For Beijing this is most visible in Hong Kong, while Moscow has watched protestors rumbling on its streets for some time. For both of them, the fear is that this is part of the bigger wave of ‘colour revolutions’ that swept through Georgia, Ukraine and Kyrgyzstan in the 2000s, and more recently through the Middle East in the Arab uprising. Seeing these as Western-orchestrated plots to bring down governments the West found inconvenient, Moscow and Beijing worry that they might be next on the list.

There is no doubt that China and Russia increasingly see their futures as linked and are binding themselves closer together. But the West’s current habit of only seeing them this way is exacerbating this tendency and creating a unified adversary.

Adopting such an approach also means the UK is blind to the potential opportunities that exist on the ground in some contested areas of the world. Simply seeing a China–Russia axis means that observers miss their different equities in different places, and the fact that the local dynamics in each context and region vary. The UK must be careful not to will itself into a confrontation against an adversary that does not always exist.

BANNER IMAGE: Ceremony for exchanging the documents signed during the President of the People’s Republic of China Xi Jinping’s working visit to the Russian Federation, 2018. Courtesy of President of Russia/Creative Commons Attribution 4.0 International

The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.

And finally in this catch-up blast, a longer op-ed for the South China Morning Post looking at some of the recent machinations between China and Iran. Had a few comments back that this was an obvious point to make, but it feels like it needs to be all considered against the broader backdrop of China’s growing influence and power in its own backyard. More on this topic to come.

All of these posts aside, spoke to the Sunday Times about Chinese investment and influence in Ireland, spoke to CNBC about China-Russia (which was translated into Hungarian), The National about the far right in Germany, to Samaa TV about ISIS in Khorasan, to The National again about bounties being put on ISIS leaders heads, an old interview was used again in this fantastic Portuguese piece in Sabato by Nuno Tiago Pinto about important Portuguese foreign fighter Nero Saraiva who lived for a while in the UK, an earlier comment to the Telegraph about Hamza bin Laden’s death was picked up again, and another earlier piece in the Sunday Times was picked up by VoA.

Why Iran has got China wrong: Beijing will follow its own playbook in countering the US-led West

  • While regional players like Iran seek to bring China into the conversation as an ally, Beijing continues to rely on the rhetoric of non-interference
  • China is focused single-mindedly on its own interests and set to get stronger as a result

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The first-ever Chinese goods train to Iran arrives in Tehran on February 15, 2016, after a 14-day journey hailed as a revival of the Silk Raod under China’s Belt and Road Initiative. China is emerging as the central power in its immediate and expanding neighbourhood, while the West tears at itself and old alliances. Photo: EPA

Buried among last week’s news of confrontation with Iran was a story that China was on the cusp of investing US$400 billion into the country’s hydrocarbon industry. This was followed late in the week by the news that Iran was going to be joining China and Russia in new naval exercises, an announcement that came a week after the Iranian Armed Forces Chief of Staff, Major General Mohammad Baqeri, visited a naval base in Shanghai.

The clear suggestion was that Iran was showing it had a strong ally in Beijing. The axis of convenience against the West was bringing Tehran firmly into its bosom.

Yet, in the face of all of this noise from Iran, Beijing was largely silent. A foreign ministry spokesman denied any knowledge when confronted with a question about the investment during a regular press briefing. The Chinese commentariat seemed mostly focused on downplaying Iran’s role in the strike on the Abqaiq and Khurais facilities in Saudi Arabia, and President Xi Jinping had a phone call with King Salman.

Reported in similar terms by both the Saudi and Chinese state media (the Belt and Road was only mentioned in Xinhua’s read-out and the Saudi statement was far more aggressive), the phone call was a decorative effort highlighting the importance of the bilateral relationship and China’s desire for events not to escalate.

And, while Beijing seemed eager to not engage, Iranian sources appeared to deny the existence of the supersized investment. On Friday, an interview emerged with the head of money and capital markets at the Tehran Chamber of Commerce stating that he had not heard anything about it.

Furthermore, Iran’s oil minister Bijan Namdar Zanganeh denied the rumours, bluntly saying, “I have not heard such a thing.” In fact, the discussion in Tehran at the moment around China is about how long the Bank of Kunlun will be able to continue to be a lifeline of sorts for the country.

Owned mostly by the China National Petroleum Corporation, the bank is a Xinjiang institution that has long served as a conduit for financial relations between China and Iran. As the rest of the world severed its links to Tehran, Kunlun has kept a connection going. The bank has faced some pressure, falling into the US Treasury Department’s sights, leading the bank to try to downplay its relations for fear of damaging repercussions for parent institution CNPC.

The result has been a paring back of financial relations between the bank and Iran, with the maintenance of only a few lines of credit focused specifically on non-sanctioned goods.

Rather, the Iranian announcements have the ring of similarity to previous announcements to have emerged from Moscow, as its relations with the West went downhill.

Back in 2014, as the West’s condemnation of Russia’s redrawing of Ukraine’s borders reached fever pitch, President Vladimir Putin headed to Shanghai where he oversaw the signing alongside President Xi of a US$400 billion energy deal between China and Russia. The deal was one which had been announced and signed a few times before, but it landed in Shanghai at a convenient moment for the Russian leader.

Again, this was not a moment without some irritation for Beijing. While China never condemned Russia’s actions in Ukraine, it was not best pleased, keeping its comments sparse. China is not keen on major disruptions to international affairs, like the attack in Saudi Arabia, especially ones which might have repercussions for Beijing.

The precedent that Russia set in redrawing borders in Ukraine was not one that China wanted widely adopted –
fearing the loss of its own restive regions. And disruptions to international energy supplies result in higher prices, something China could do without.

The question, then, is whether China is hostage to disruptive powers like Iran and Russia, or whether Beijing is, in fact, gaining the upper hand.

To better understand this, it is important to note another event over the weekend that ties the three countries together – the Taliban negotiating team’s visit to Beijing after stops in Moscow and Tehran.

Organised after the dramatic failure of the American-led talks, the whistle-stop regional tour appears to be an effort by the Taliban to understand better where things now stand. With Afghan elections around the corner and the conflict showing little evidence of concluding, all three surrounding powers have begun to worry about how they will manage the long-term instability with which Afghanistan seems cursed.

From China’s perspective, however, this is all reflective of the fact that everyone appears to want to show that Beijing is on their side. In each of these situations, the regional players have all sought to bring China into the conversation and show that Beijing is backing them.

China is judicious in avoiding apportioning blame, and at best uses the opportunity to make digs at the United States. The net result is that China emerges as the central power in its immediate and expanding neighbourhood, while the West tears at itself and old alliances.

For Beijing, there is some danger in assuming this position. First, it reinforces the image of China as the central power in a new axis of convenience against the US-led West. And second, it places China in a position of potential responsibility between some of the world’s most intractable conflicts.

Yet, it is equally possible that Beijing has factored both of these realities in and is actually happy to bolster alliances against the US.

In terms of China’s unavoidable responsibilities, this is something that has been on the cards for some time, and yet Beijing has yet to really demonstrate a requirement to have to step in.

Instead, China continues to call on the rhetoric of non-interference to simply let things play themselves out, focused single-mindedly on its own interests. Rather than taking on the activist West at its own game, China appears to be crafting its own playbook.

And while Tehran may think that it is hustling Beijing into showing its hand in its favour, the reality is that it is China that is most likely to emerge strengthened from this geopolitical dance.

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

Belatedly posting a piece for the Financial Times excellent Beyond BRICS blog which focuses on the reality of the Chinese relationship with Iran and Russia. More complicated than is often assumed. A topic that I would like to focus on more in the future, both in terms of the reality and complexity of China’s relations with Iran and Russia, as well as broader Eurasian geopolitics. On that particular note, please check back into the China in Central Asia website which  I am hoping to awaken soon.

Separately, spoke to the Guardian about the UK’s disengagement and desistance programme, to the BBC about the extreme right wing, to the LA Times about a Uighur fighting extradition from Turkey, to De Trouw about the role of mainstream political discourse in dragging the extreme right forwards, to AFP about ISIS (which was translated into Spanish), to the Independent about a plot that was uncovered to target Europe by some Sunday Times reporters, and finally a Press Association interview was used in the MetroDaily Star, and Al Banaba. Beyond this, my recent Observer piece was picked up and translated in digest into Spanish by El Mundo.

Russia and Iran cannot always count on China

In response to US sanctions, Beijing’s own interests come first

Presidents Vladimir Putin and Xi Jinping at a friendly ice hockey match between Russian and Chinese youth teams in Taijin last year © Getty

Beijing is seen by some as the financial backstop that countries can call on to bail them out when they fall foul of US displeasure and face sanctions. Yet a close examination of the cases of Russia and Iran instead shows that China is reactive to US sanctions policy, to the detriment of its supposed strategic allies.

This reflects the attractiveness of the US market, the reach of extraterritorial sanctions and the independence of some Chinese institutions from Beijing’s geopolitical interests.

It also highlights the existence of fissures between powers that are often painted as members of an anti-western alliance. They may talk with the rhetoric of allies, but their relationships are more complicated. Understanding how this will play out will be key for policymakers seeking to navigate today’s dangerous waters.

At a geostrategic level, China, Russia and Iran appear to be in lockstep. Yet notwithstanding their proximity, expressed in public shows of affection between their leaders (in particular between presidents Xi Jinping and Vladimir Putin), the reality is that there are deep tensions in Beijing’s bilateral relationships with Moscow and Tehran. Nowhere are these expressed more substantially than in the economic sphere, where Russia and Iran have consistently been disappointed by the willingness of Chinese entities and institutions to invest in their countries.

Most recently, China has been hesitant in its support of Russia’s de-dollarisation policy, through a cross-border system of bilateral settlements, for fear of angering the US. The two powers failed to conclude an agreement as planned by the end of last year, with one Russian source close to the talks telling Kommersant: “From Washington’s standpoint, China’s agreement with Russia would look like it was helping Moscow evade sanctions.”

This came after reports that Moscow was ready to bet heavily on China, diversifying its foreign reserves so that 15 per cent ($67bn) were held in renminbi, leaving the Russian central bank with a quarter of the world’s renminbi holdings. This was after it had sold about $100bn of its US dollar reserves while purchasing $44bn worth of renminbi in the second quarter of 2018.

The two countries already settle 14 per cent of bilateral payments in renminbi and 7 to 8 per cent in roubles, but were seeking to increase this, and to enshrine cross-border use of the Chinese Union Pay and Russian Mir credit card systems in each other’s countries.

A similar story can be seen in Tehran, where eagerness by authorities to use Beijing to circumvent a newly hardening US sanctions policy has been met with hesitation by Chinese institutions.

This was most publicly expressed in December, when it emerged that Kunlun Bank, which is majority owned by China National Petroleum Corp, was only going to clear Iranian payments, in full compliance with US sanctions policy, until the end of April, when China’s “significant reduction exemption” for the import of Iranian oil expires. Cutting this major lifeline for the Iranian economy was believed to be the product of CNPC’s concerns about the impact of its Iranian activities on its interests in the US.

Tehran has also seen a drop in imports from China, with an analysis by Bourse & Bazaar suggesting a 70 per cent drop from October to December last year after two months of tightened US sanctions. Like Moscow, Tehran has sought to increase the volume of transactions in local currencies but its central bank does not publish the composition of its foreign reserves, so it is not clear whether this has changed.

Frustration can also be seen in the supposed benefits that Russia and Iran have sought through investments under the Belt and Road Initiative, Beijing’s global infrastructure programme.

When Total, the French oil company, withdrew from Iran’s South Pars gasfield in response to President Donald Trump’s overturning of the agreement to lift sanctions on Iran, CNPC initially stepped forward. But it has not developed the field it at the pace Tehran had hoped, and reports this year suggested CNPC may have suspended its activities. The Financial Times has reported that Iran’s Revolutionary Guards are ready to take its place.

Similarly, Ali Akbar Salehi, head of Iran’s Atomic Energy Organization, expressed concern that Chinese developers were taking their time in redesigning the Arak heavy water reactor according to the terms laid out in the 2015 nuclear deal. He attributed this to fears of US sanctions.

While it is hard to draw a straight line between US sanctions and Chinese reticence, it is also clear that Moscow does not always find Beijing a useful infrastructure partner. In reported comments in December about the Moscow-Kazan High Speed Rail (HSR) train line, Anton Siluanov, deputy prime minister and finance minister, said he did not see the line’s economic benefits and questioned its viability. The project was proposed and signed in 2015 when China was on a global HSR push, and questions always hung over its practicability (and indeed of other HSR projects around the world). Its seeming jettisoning reflects the reality that not all Chinese infrastructure projects work out, even in countries that are supposedly strategic allies of Beijing.

There are a number of explanations for these trends. First; Chinese banks, companies and other institutions may sometimes act in ways that contradict Beijing’s view, driven by specific concerns of their own. The assumption that all of China works in lockstep to advance Beijing’s geopolitical world view does not always match up with facts on the ground. It may be hard to divine whether a Chinese institution is responding to sanctions pressure, fear of losing access to the US market or some central Beijing command, but their behaviour does not always match policy declarations.

Second, Chinese institutions drive hard bargains. In the context of Iran and Russia, China is the funder and their local counterparts the supplicants. This puts Chinese institutions in the driving seat — something they are aware of and will exploit. Commenting on Beijing’s reticence to sign a bilateral memorandum with Moscow, one source told Kommersant that in addition to concerns about the US, “China needs time to tweak the final document more to its benefit”.

Third, countries like Iran and Russia are fearful of becoming overly dependent on Beijing. They realise that opening too much to China risks flooding local markets and potentially curtailing their own development.

In Tehran, the government has gone further, with reports of authorities advising against buying Chinese goods because it amounted to “exporting jobs”.

It is clear that China’s alliance with Russia and Iran is more complicated than sometimes realised. It is also clear that US sanctions continue to have a deterrent effect on Chinese institutions.

Yet it is hard to project such complications into the future. While Beijing may have tensions with Moscow and Tehran, the three continue to be willing to support each other at a geopolitical level. If the aggression with which US economic sanctions are employed continues, alternative global economic structures will develop.

Their beginnings are already visible. Moscow is taking the firmest steps in this direction through its de-dollarisation policy. Tehran may find itself obliged to follow if it is unable to find a way out of its current impasse.

While it is clear that US sanctions may have an effect on their economies, it is not clear that they are generating the change in behaviour that Washington desires. In this context, Beijing will sense an opportunity.

This article has been modified since publication to correct the statement on Iran’s imports from China, previously stated as exports to China.

Raffaello Pantucci is director of International Security Studies at the Royal United Services Institute (Rusi)

More belated catch up posting from my occasional column in the South China Morning Post, this one published at the same time as the SCO Summit and G7 in Charlevoix.

From China to Central Asia, a regional security bloc’s long, slow march towards an alternative world order

The world’s attention was on Singapore and Charlevoix but the future may have been in the Chinese city of Qingdao

PUBLISHED : Monday, 18 June, 2018, 8:45am
UPDATED : Wednesday, 20 June, 2018, 2:18pm

While the world was captivated this week by the globetrotting show of US President Donald Trump, another summit just days earlier suggested what an alternative world order might look like.

Various heads of state from member nations of the Shanghai Cooperation Organisation (SCO) met in the Chinese city of Qingdao for the bloc’s annual heads of state meeting.

The SCO’s activities have been limited in the decade and a half since it was formed but this year’s summit had some significant moments.

First and foremost was the presence of – and handshake between – Indian Prime Minister Narendra Modi and Pakistani President Mamnoon Hussain. While the membership of the two regional rivals is likely to be a major block to future activity, the presence of their leaders showed some of the organisation’s potential. Modi’s attendance alone signalled that the world’s biggest democracy wanted to maintain strong links to this archetypal non-Western institution to make sure it had all of its international bases covered.

The event was also an opportunity for two of the West’s biggest pariahs, Iran and Russia, to grandstand.

In the past Beijing has sought to tamp down efforts by Iranian leaders to transform the summit into a chance to bash the West. Back in 2010, President Mahmoud Ahmedinejad was so disappointed by the SCO’s refusal to admit Iran over fears of antagonising the West that he skipped the summit in Tashkent and instead attended the Shanghai Expo. But in Qingdao, the group chose to unite to highlight their displeasure at renewed Western sanctions against Iran and the collapse of the Iran nuclear deal.

Russian President Vladimir Putin has also regularly used high-profile summits in China to show disregard for Western sanctions and the optics around Putin’s attendance were similar to many other previous events, though this time are topped with a medal for his “friendship” with China.

On the sidelines of the summit, Chinese President Xi Jinping announced that “no matter what fluctuations there are in the international situation, China and Russia have always firmly taken the development of relations as a priority”. On live television he then proceeded to give the Russian leader a gold medal lauding him as “my best, most intimate friend”.

Awkward phrasing aside, this is a clear signal that China is siding with Moscow in tensions between Russia and the West. While Beijing might not always approve of Moscow’s disruptive behaviour on the international stage, the reality is that the two powers will, under their existing leaderships, always stand together against the West.

And this signal by Beijing was the most notable point about this entire summit.

China has long treated the SCO with the reverence required of an institution that brings together the heads of state of a number of its allies and which it helped name, while at the same time disregarding it as a functional organisation. Beijing has been unable, for example, to realise some of its key ambitions with the group. China has sought to push the SCO towards greater economic integration and activity, something resisted by other members fearful of China’s further encroachment into their territories.

Moscow sees the SCO as a way to try to control Chinese efforts in Central Asia while the Central Asians broadly view it as a possible way to maintain a balanced conversation with their giant neighbours. Meanwhile, powers like Iran, India or Pakistan see it as an alternative international forum that they want to be involved in.

With the accession of India and Pakistan most observers in China fear that the organisation’s already limited ability to operate is going to be even further reduced.

Yet none of this detracts from the fact that for Beijing it is a forum which they are hosting which now brings together the leaders of over a third of the planet’s population. They are clearly the dominant player within it, and it is a forum in which Western powers cannot meddle.

This gives Beijing the perfect opportunity to show its stature on the world stage and its efforts to offer a more stable alternative world order to the chaotic one that is most vividly expressed by the Trump administration.

The SCO may have done remarkably little beyond hold big meetings and China’s activity in all of the SCO member states at a bilateral level is infinitely more significant than its efforts through the bloc.

But at the same time, this is a forum that has consistently met and only grown. Under its auspices, China has managed to slowly encroach on Russia’s military and political dominance in its own backyard, and has now persuaded the world’s biggest democracy that it is an important group to be involved in.

This slow march forwards stands in stark contrast to the imagery and disputes to emerge from the G7 summit in Charlevoix. And while the Western media may have largely ignored events in Qingdao for events in Canada and Singapore, the rest of the world is paying attention. An alternative order might be starting to crystallise, or at least one that has potential to deeply undermine the West’s capacity to determine the future of world affairs.

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

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.

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 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