Country Report: Russia (May 2019)

Editorial Staff (with the assistance of Olga Puzanova)

In Rossiya v Global’noi Politike Sergei Karaganov continued his charges against the mindset of the majority of international affairs writers in the West and even Russia for their dangerous idea that the world is unpredictable, and influencing it is impossible. In his view the big players can shape it, and the elements of unpredictability are less than in many other epochs because the information revolution gives people more of a chance to influence policy in opposition to the establishment. Having lost faith in the inevitability of world-wide victory for the European model and the power of its money, many are refusing to see what is unfolding. Having refused to integrate with Russia in the 1990s, the West made a bad mistake, worsening its decline. That left only the question of when and under what circumstances a confrontation would occur. Yet, Russia’s economic elite miscalculated, not preparing for the conflict ahead and the sanctions to come. Losing military superiority, on which five centuries of Western domination were built, the West lost control of much of the world and began to turn against the liberal economic order. This offers Russia a promising opportunity, which few have been thoughtful enough to anticipate.

The EU may be in a fatal crisis. A man like Trump could be expected after repeated US failures as well as the rise of China in a manner at odds with Western assumptions. Panic is due to the collapse of the intellectual foundation of the elite in the West, argues Karaganov. Theories, concepts, and schools of thought have been thrown into disarray in Western academic circles. They can be dismissed as reflecting the interests of their countries or rulers, while others must follow their own rules, as in Russia after erroneous intellectual copying of the West in the 1990s with its totalitarian ideology of liberalism, even if the clash of civilizations was a corrective.

In an effort now to explain the failure of the US, fantastic myths are woven about interference by Russia in elections, a Russian military threat, and demonization of China. Karaganov points to theories of globalization, democratic peace, and soft power as no more than defenses of the interests of one’s country. Meanwhile the evil campaign against Russia now tries to undermine its soft power in defense of sovereignty, national pride, cultural independence, and traditional values. Karaganov says that the danger of war is higher than at any time since the mid-60s: China’s overall power soon will reach that of the US and Eurasia has begun to pull ahead, while the US is returning to the Western hemisphere even as it conducts a de facto cold war against China, potentially reducing its quest for an enemy in Russia and just considers new ways to neutralize it. Conditions for normalization of Russo-European relations are taking shape with some states in the lead; geopolitical and geo-economic polarization is occurring between America (with parts of Europe) and Greater Eurasia. Much depends on China’s recognition that it must restrain itself to be only the first among equals (relying first on the SCO) or else regional powers with likely US involvement will consolidate against China. Appealing for regionalization—not globalization—and a new world system, in the formation of which Russia will be the third of 4 or 5 countries playing a key role, Karaganov dismisses old theories and practices in international relations—replacing them with new ones—preserving the UN while discarding other institutions.

In RSMD on March 28, an article by Aleksei Kupriianov related terrorism in Kashmir to BRICS and the SCO, pointing to a February 14 suicide-bomber attack that killed more than 40 Indian security personnel. This incident led to an Indian “diplomatic attack” to isolate Islamabad as a sponsor of terrorism, including in BRICS, which regularly positions itself in the battle against terrorism of late, after India kept pressing to put this on the agenda even as it faced pushback from China toward any initiatives that could be construed as anti-Pakistan. However, in 2017 China’s position suddenly shifted, agreeing to an Indian position condemning terrorism. A list of organizations was included, leading India to claim a big diplomatic success. China sent a message of deeper BRICS partnership to make the summit in Xiamen a success and reassured India just months after it was victimized by terrorism again. Pakistan reacted with alarm, promising to put its house in order to improve its international image. Yet, soon Wang Yi made it clear that China had not changed at all toward Pakistan, still seen as a victim and not a sponsor of terrorism. In the earlier list, only organizations already banned in Pakistan were mentioned, and at the UN, China blocked India’s listing of a Pakistani terrorist. When in June 1017 India and Pakistan were accepted in the SCO, that venue appeared to be the main platform for discussing questions of regional security—including all of the main regional players and a more suitable structure for this struggle—the Regional Anti-terrorist Structure (RATS). However, expanding from four to six members has proven over the past 1 ½ years that RATS cannot coordinate India and Pakistan. Both sides are blamed for not catching the “Shanghai spirit,” and little can be expected from these “permanent enemies,” no matter which platform is used, warns the article.

India needs China’s help to exert pressure on Pakistan, the article asserts, but this will happen only if cooperation with India becomes more important than with Pakistan for China. This will not be easy, given the distrust of the political elites in Delhi and Beijing and India’s insistence on strategic autonomy while Pakistan has turned into a client of the PRC. The one possibility is for India to become such an important trading partner of China that it neutralizes Pakistan’s close political ties. Yet, Pakistan could turn from China to Arab countries. Another option for Delhi is to win Russia’s support in international arenas, but the article quickly moves away from that to discuss the India-Pakistan-China triangle, insisting that India would have a much easier time dealing with Islamabad if China helped it to convince Pakistan. The article ends with a call for reforming the SCO’s anti-terrorism approach, but it conveys no optimism about doing that.

North Korea

On May 7 RSMD turned to Konstantin Asmolov’s take on Putin’s meeting with Kim Jong-un in Vladivostok. The invitation was issued in May 2018 when Lavrov visited Pyongyang, Kim had indicated that he wanted to visit that year for the 70th anniversary of the establishment of diplomatic relations, but only in March 2019 when a DPRK delegation went to Moscow was it clear that preparations were in their final stage. There was much speculation about what the two leaders would discuss, especially in the ROK and Japan, including that Kim would seek support for further talks with Trump and raise opposition to the repatriation of North Korean workers, as planned at the end of the year despite it not being beneficial to either the DPRK or Russian businessmen. It was reported that Putin would ask Kim to return to the Six-Party Talks format.

On April 25 the leaders met, including for about two hours behind closed doors, twice as long as planned. Putin spoke of supporting positive processes now under way. Kim praised Putin for forging a strong Russia and called for restoring traditional bilateral relations. The article stresses how little was revealed about the talks, while discerning that officials in energy and transport infrastructure were present. Putin attributed to Kim the stabilization of the situation around the peninsula in recent months and said that no alternative exists to peaceful resolution of the nuclear and other problems of the region. Russia puts the peninsula in the context of security in Northeast Asia as a whole, implying that the problem is much more than North Korea and that assurances to the North would help to address these wider concerns with a lasting, multilateral framework. The article repeats Kim’s position that the ball is in the US court after it took an unfriendly position in Hanoi, leading to a dead-end. The article faults journalists who assert that the summit was fruitless, pointing to misdeeds of South Korean journalists. Despite insisting that Russia does not take the side of the North or the South, it gives Russia’s position as essentially that of the North without acknowledging the fact.

Fontanka.ru on April 24 focused on the response to Kim Jong-un’s summit with Putin. Nikolai Neliubin wrote that talks with Kim Jong-un were necessary for Putin, as for any other leader of Russia, to demonstrate to the world Russia’s status as a superpower. For Kim the summit was needed to feed his people, having something to ask of a leader where North Korean workers are building things. Yet, there was little in the way of news. Andrei Lan’kov responded to questions, saying that Putin had invited Kim more than three years earlier, but only after the Hanoi summit did Kim agree as he was left in a bind with unprecedented sanctions in place. Lan’kov added that Russia could do things without violating the international sanctions regime, such as providing humanitarian assistance, medicines, and fertilizer, which the North is seeking. While no more than 10,000 of the earlier 30,000 North Korean workers remain and must depart by the end of the year in accord with the sanctions, variants were discussed to allow them to remain, such as to register them as students, catering also to appeals in the Russian Far East, where they comprise one-third of construction workers. Each worker paid a bribe to leave the DPRK, equal to about one year’s wages in the North, expecting an enormous income by home standards even after more than half is taken by their government. In recent years Russia has been practically excluded from the negotiating process in the region, left in the third or even the fourth ranks. With this summit Putin shows that Russia has influence. Russia’s tasks are to control the situation on its border to prevent any direct threat and to preserve the status quo to avoid war, conflict, and the fall of the house of Kim, which could lead to a puppet pro-China regime or a pro-US South Korean regime. Unification, Lan’kov adds, is not needed by Russia. Third for Russia is nuclear disarmament. As the poorest officially recognized nuclear power, it is the most in need of sustaining its privileged position. Yet, Lan’kov does not see denuclearization ahead. He equates Russia’s normal policy to North Korea with the US 1972 policy to the extremist Mao regime, having nothing to do with ideology. Yet, this perspective ignores the impact of such ties on regional peace and stability, given the assumption that the North will keep its nuclear arsenal. On April 26 Lan’kov repeated some of these remarks for the Carnegie Center in Moscow, while taking some satisfaction at the realism in Vladivostok without high-sounding declarations.

Sino-US relations

In Kommersant on May 10 Aleksandr Gabuev asked what China expects from the trade war with the US. He first notes that China has fully stopped purchases of US oil as proof that this war is proceeding on many fronts and becoming painful for Beijing, causing double the GDP loss of the US. China could complicate life for workers for US companies in China, but that would have side effects. Why then did China not make concessions? Aware that trade would be raised by Trump, China had counted on the customary big contracts for American goods as the answer. Instead, the US demanded systemic change, open markets, and an end to stealing technology. The deal reached in May quickly collapsed, leading Trump to raise tariffs, and China had to respond. A second cause was the US making everything not only public and scandalous, giving the impression that Xi Jinping is succumbing to foreign pressure. His authority was now threatened, while Trump’s chaotic approach led to a loss of belief that a deal could be reached before the 2018 US elections, after which Trump’s position would be weakened. Now China has no answer. It may devalue the yuan. Meanwhile, Washington is blaming China, second to Russia, for interfering in US democracy. This is serious war, concludes Gabuev.

On May 8 in Profil’ Vasilii Kashin discussed the Sino-US trade war after Trump—as late as May 3—was predicting a quick, successful outcome. From the outset China was ready to increase its imports from the US mainly by replacing imports from other countries, and it would have made reforms in protecting intellectual property rights and opening its economy in accord with the logic of its own economic transformation. Unacceptable were demands for an end to state support of high-tech sectors, even if it might put some in the shadows. Within days Trump was tweeting that China had reversed course on the expected deal. Soon Chinese sources asserted that Xi Jinping had forbidden further concessions. This sudden turnabout is explained by Kashin as due to internal American factors and changes in Sino-US relations. Trump’s internal situation is stronger, and he does not need a short-term success, which could be viewed as a strategic failure, and he may not have known the details of the talks until a late date. As for bilateral ties, they were degrading on all fronts while trade talks were proceeding, as seen in US Taiwan policy, Huawei policy, and criticism of Chinese violations of human rights in Xinjiang. Even as China strove to avoid open clashes, its rhetoric grew more severe. Ending the tariff war would not do much to ease tensions, Kashin concludes.

In Vzgliad on April 30 Timofei Borachev wrote that China is not dangerous. Several years ago there was reason to fear its excessively self-assured behavior, and neighbors prepared to contain it with the US. What was feared has not come to pass, and the chance of that for Russia has been reduced, but it has not totally disappeared. China is learning rules of the game and overcoming bad habits; it is time to consider how Russia should react to the new behavior. It cannot be China’s junior partner nor pretend that a full-fledged power triangle with China and the US could be possible or even necessary. It would be dangerous to become entangled in their struggle. A lot was new in the just-concluded BRI forum: more participants than in 2017; Europe was more in support with politicians and experts as companies signed memoranda; and even as the old “nucleus” of participants from the SCO was there, a wider international coalition interested in joint development took shape. Only Indians completely ignored the forum, unable to “find themselves” in the new world order being constructed, while US representatives were there only to “observe” Chinese foreign policy. Often BRI is compared to the Marshall Plan, which allowed the US to control Western Europe after WWII, and Russia fears that China will establish control over Central Asia, as if it is Russian property. Yet, the most important change in China’s behavior is a desire for multilateral forms of cooperation, breaking from bilateral formats to embrace multilateral ones in world politics. Russia and others had to explain the value of these.

Of course, business projects are still bilateral, not political ones. The shift in behavior was on display in September 2018 when Xi Jinping at the Eastern Economic Forum in Vladivostok behaved as an equal at the plenum with Putin, the president of Mongolia, and the prime ministers of South Korea and Japan. If China in the SCO and BRICS had worked in such formats, this had now become a priority. The explanation given is that Beijing at last understood that today’s competitive struggle requires a collective with conditions deemed more favorable than unavoidable losses to the advantage of the leader.  Increasingly extreme egoistic US policies turn away its allies, and Beijing follows recipes that had enabled the US to become the leader. It is no wonder, readers are told, that the BRI forum aroused an almost hysterical reaction in Western media. Now an alternative model exists unlike after the Cold War. A danger still exists that China will revert to an imperial model, in which case it is guaranteed to lose in the inevitable cold war with the US. China could be hurt by maintaining a relatively closed economy—as it still has many barriers—and by a dearth of communications resources for international exchanges. Today Xi Jinping needs a new quality of openness to the outside.

In Mezhdunaodnaya Zhizn’ Aleksandr Mokretskii focused on Chinese diplomacy in the era of Xi Jinping, pointing to active diplomacy befitting the status of the PRC. Already in 2013, he finds a more active and purposeful diplomacy in the South China Sea, toward Japan, in initiating BRI, and in global hot spots. In 2015 energy was concentrated on BRI, free trade zones, and marking the 70th anniversary of liberation from Japanese militarism. In late 2017 note is taken of the goal of constructing international relations of a new type and a community of common destiny as well as new efforts to hold aloft the Chinese model in contrast to a Western one. China was seeking new types of cooperation, where it played the leading role, utilizing diverse forums with new energy, including the SCO. The Chinese expert community is convinced that the West is containing the rise of their country. Diplomacy became more active in boosting soft power and spreading the “Beijing Consensus.” With rising self-confidence in China, the question arises how ready the world is for Pax Sinica, forging its own world order. Missing in this article is any mention of Russia having a special place in an order being built by an ambitious rising power, while the US decline is taken as a given with China responding in an increasingly effective manner.

Sino-Russian relations

In Nezavisimaya Gazeta on April 22, Anatolii Komrakov wrote of Russia’s concern about the BRI project, known also as the New Silk Road, coming to fruition. On the eve of the second forum in late April in Beijing, Chinese are proposing significant strengthening of efforts, testifying to the successes of the project. Ambassador Li Hui just told Rossiiskaya Gazeta what an important partner Russia is in carrying BRI forward. Yet, experts told the newspaper that Russia is formally not a participant in the project, and its turn to the East has not moved beyond a state of declarations. Russia is, however, a member of the EEU, which in May 2018 agreed to cooperate with China economically, and docking this with BRI was agreed by Putin and Xi as far back as May 2015. This was seen as raising the partnership to a new level and almost as creating a common economic space on the continent. This happened at the peak of Western sanctions, and trade jumped ahead to $107 billion in 2018, a rise of 27.1 percent from 2017. Chinese were delighted that Russia would supply gas through the eastern pipeline, a new agreement was reached on nuclear energy, joint work on a wide-bodied passenger airplane went forward, and Chinese investment funded LNG from Yamal as talks proceeded on further cooperation in the Arctic. Yet, the wider the scope of BRI, the less clear it is, allowing anything to be presented as included. More clarity is needed on its aims, its details, at the forum. In the plan’s logic, into Russia should be built railroad and automobile bridges heading for Europe. Yet, Russian authorities have completely rejected a high-speed artery from Moscow to China, as Putin, in any case, chose St. Petersburg as the new direction. Russia is not ready to turn itself into part of a Chinese megaregion or simply a place of transit for Chinese goods heading for Europe. It sought to forge its own megaregion in the form of the EEU, although Kazakhstan has gone far ahead with the Silk Road. Assessing China’s project as very successful, Russia still declines to join it, counting on its own EEU project and the agreement to dock the two projects despite what the article asserts is the failure of docking to take place. It quotes an expert as saying that declarations of a turn to the East have disoriented business, which is ill-informed about what is needed. Rather than clarify the real challenges, this reference to ignorance or inexperience is a way to avoid the sources of trouble. Russia seeks centrality, not becoming a transit territory but making its own products. Businessmen are upset because in the turn to the East they expected the Chinese to buy their production. Some see a way for Russia to raise its status, worried about the current transport arrangement through Kazakhstan, leaving Eastern Siberia and the Far East of Russia cut off. It is important that Russia participates as a member of the EEU, raising its political status, but the EEU defends the internal markets of its members, while China’s project is oriented toward wider free trade zones. Kazakhstan participates in the EEU and the Silk Road, creating a contradiction between its south, where China’ influence is strong, and its north. Russian dependency on China carries the risk small and medium enterprises being driven by the illusion that they could actually enter that market. Citing Aleksei Maslov repeatedly, the article emphasizes the risks with little optimism.

Rustem Foliakov in gazeta.ru business on April 24 described Russia failing in its turn to the East, despite the real possibility that the goal of doubling trade to $200 billion by 2024 is realistic. He states that China prefers business with Americans, not Russians. Looking ahead to October when the two states will celebrate 70 years of diplomatic relations and recognizing that they share confidence in having reached complete mutual understanding in politics and security, he noted that the two leaders are presenting each other with symbols of respect—two pandas to Putin and a special honor to Xi. Yet, even as trade climbs from $70 billion in 2016 to $84 billion in 2017 and $107 billion in 2018, and in the first quarter of 2019 by 6 percent more, Russia is still only China’s 11th partner and Russia’s exports are heavily natural resources—a 62 percent rise last year to $43 billion. Oil, natural gas, ores, minerals, and lumber predominate, while even processed wood products are at measly $5 billion and foodstuffs at $2.5 billion. New possibilities exist for soybeans, which China purchased from the US at a level of $12 billion a year until tariffs were raised, but Russia is able to supply only 1 percent of China’s annual consumption of soy, and there are logistical hurdles such as the absence of a single worthy bridge across the long Amur river border. Only in 2019 will the first railroad bridge open from Nizhneleninskoe in the Jewish Autonomous Republic to Dongjiang in Heilongjiang, for which Russia only had to build 3 of 20 sections, dragging the process out. As for the bridge between Blagoveshchensk and Heihe, that is finally planned to open in 2020, but the timing is in doubt due again to Russia.

Russian planners have ideas about new exports by 2024, but the main hope for increased exports is the “Power of Siberia” gas line to open at the end of 2019. In Europe Russia is an energy supplier, but the “turn to the East” was supposed to be different. For China too, expectations are not being met, as Ambassador Li Hui asserted. In 2013 a rail link between Moscow and Kazan’ was considered part of the Silk Road, but no agreement was reached even as China prioritized transport by land to Europe. Inflexible Russian laws interfere with cooperation, readers are told. While China could reach agreement with Walmart and Carrefour, it could not satisfy Russian norms of trade, sanitation, and veterinary demands. Chinese business is ready for partner ties with Russia or the EEU, which were supposed to start in 2015 and are required for liberalization of trade rules and increases in investment. Lots of projects are on the books, China is waiting, but Russia is holding back. China refrains at the official level from openly speaking of the cool economic relations, but in Russia no longer is there silence. At the BRI forum, Peskov had to acknowledge the reservations of Chinese partners toward economic relations with Russia, including investments, as Chinese banks have to keep an eye on the restrictions adopted by the US and others. Chinese consider partners in Russia to be difficult, recognizing after five years that there is actually no turn to the East, readers learn. China has not replaced cheap Western credits and bypass Russia via Kazakhstan in building the new Silk Road. While authorities do not support the economic sanctions, big business oriented to exports fear being entangled in them. Friendship with Russia takes second place to partner ties to the US, the article concluded on the eve of the outburst of the Sino-US trade war.

Japan

Iaroslav Shulatov on May 17 in Rossiia v Global’noi Politike described Japan as a falling great power and Russia as a big factor in its rise and fall. He calls the dispute over islands just the visible part of the cluster of problems driving Japan’s relationship with Russia. Public opinion in Japan is unfriendly (79 percent), bringing the level of sympathy to Russia even lower than to China and South Korea, in contrast to a stable figure of 60 percent of Russians who feel friendly. For an explanation, he looks through the prism of history, arguing that it has left a painful trauma that Japanese society cannot yet overcome. To extract itself it fixates on the territorial problem.

The problem is traced to Meiji Japan adopting a Western conception of what it means to be a great power, building an empire and expanding to boost one’s status, which coincided with fear of being enslaved by the West. The logic of Japan’s expansionist development made unavoidable confrontation with Western states. The image of Russia as a threat had been building despite the absence of a corresponding image on the Russian side until Japan defeated China in 1895, and Russia joined France and Germany in forcing Japan to retreat from the Liaodong peninsula, causing a sense of humiliation in Japan only exacerbated when Russia got China to lease Port-Arthur as a base. Today in Japan many romanticize the war with Russia as a struggle for freedom, for Japan and its neighbors. With Great Britain and the US establishment pro-Japan, Japanese identified with the West against Russia, as they did again in the Cold War. Russia in defeat lost the status of regional leader. Japan’s success boosted the political weight of the military, which was split into factions—the army targeting Russia, and the navy after the US. Seeking to keep the US out, Japan saw Russia as a partner for a time, but after 1917 that changed, as Japan intervened in Russia and relations led to battles in the late 1930s. Relations fluctuated until after the war Russia became a symbol of the trauma of defeat. While the reality is that the entry of the USSR in the war with Japan was significant for its capitulation and the collapse of its imperial project, Japanese viewed the war as not against Russia and turned their sense of defeat and loss of great power status—an enormous shock—to a new feeling of injustice at the hands of Russia. The Cold War sustained this feeling and the territorial dispute, coupled with Russian demands to recognize the results of the war, exacerbated it. Yet, Abe, in the shadow of China and for personal motives, is trying to change this—despite public opinion on the islands in Japan and a sense of hopelessness. Even more of an obstacle is Russian public opinion against any transfer of islands, leaving Putin no way to proceed quietly, as he did with China. Putin keeps options open, while Lavrov raises obstacles. Yet, both sides need a package deal, complicating the prospects. The trauma is receding, especially for younger Japanese. Much can be done. Russia is calling for travel without visas, and the article ends with an appeal for wider contacts among citizens of the two countries.

#"Belt and Road" Initiative #Beijing Consensus #BRICS #Pax Sinica #SCO #turn to the East