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Intermating of success: why Russia turns to the East so slowly

Intermating of success: why Russia turns to the East so slowlyRussian turn to the East was two years old. The main turning success is often referred to as a statement on cooperation in the pairing of the Eurasian Economic Union (EAEC) and the "economic belt of the Silk Road" (EPSHP) which was signed by Vladimir Putin and Xi Jinping on 8 May 2015.

The document was immediately started to be called historical, as the two largest Eurasian powers have agreed to discuss the possibility of coordinating their initiatives in the vast continent for the first time. They have also discussed the division of labour in Central Asia. The agreement could have meet the expectations of all three parties: China, Russia and Central Asian countries.

Failure in tempo

Recognition of EPSHP as having power equivalent to Russia, has raised the prestige of the flagship initiatives of Xi Jinping. As a result of pairing, China would have received consent for laying the ground transportation routes to Europe, a new market for their infrastructure companies, facilitation of access to local markets for Chinese goods and the possibility of tying resources of Central Asia to China, and the ability to strengthen the role of the yuan as a regional currency. In addition, it is important to be able to prevent the battle for governance with Moscow. For Russia, the recognition of EAEC by China would satisfy the need for respect - especially against a background of unsuccessful attempts to get it from the European Union. Moscow is also expected to have access to Chinese preferential loans and investment in infrastructure linking the EAEC countries together. Construction of highway from China to Europe would receive revenues from transit and logistics services, and at the same time would give a new road that Russian producers could use to supply their products for sale. Moreover, the route through Kazakhstan, Russia and Belarus looks like the most suitable among the land-sea route alternatives - because of the speed of delivery and the Customs Union, because of which there are now only two boundaries from China to EU. Russian partners in EAEC would receive loans and investments, transit revenues and jobs. Finally, the economic development of Central Asia would help to reduce the potential for conflict in the region, and hence the risks to its neighbours, including China and Russia.

However, a year later, no powerful movement in the direction of pairing could be seen. EAEC summit, which took place on May 31 in Astana, did not bring clarity. Leaders of "Five" have only approved directives for the Eurasian Economic Commission to negotiate with China on establishment of trade and economic partnership. The tempos speak for themselves: from the decision to start negotiations to issuing directives a year has passed, and the entire negotiation process, according to the expectations of officials will take at least 10 years. List of joint investment projects for pairing or detailed road map are not available yet. In these conditions, China agrees with everyone on a bilateral basis - example is the agreement with Kazakhstan on EPSHP conjunction with the infrastructure program "Nurly Zhol" ( "Shining Path"), a similar agreement with Kyrgyzstan and Belarus. The Central Asian countries do not use the EAEC as a platform for collective negotiations with China and implement projects with China "here and now", albeit on more favourable conditions for Beijing. What exactly does Russia win in such a scheme, is not clear. And so it is Moscow that should quickly correct the mistakes. What are they?

Obsolete hegemon

Intermating of success: why Russia turns to the East so slowlyFirst and foremost - Russia perceives its partners in Central Asia as passive objects whose fate should be determined in a conversation between two great powers. This attitude is expressed even in the little things, which are treated very carefully in the East. For example, an application for pairing EAEC with EPSHP was written by Moscow which hasn’t considered the opinions of its alliance partners: it was presented to them as a fait accompli. As a result, when other leaders of the EAEC countries have begun to build up a direct dialogue with China, in Moscow it was regarded almost as a betrayal. Irritation was caused by the Central Asian plans, especially Kazakhstan, for laying routes from China to Europe via the Caspian Sea, bypassing Russia.

Disrespectful attitude towards interests of Allies reflects a deeper problem - the lack of clear understanding of what role Russia wants to play, and most importantly - physically able to play in Central Asia in the long term. The region is still seen as a sphere of substantial Russian influence, which must be protected against the penetration of external forces, and where Russia must maintain a dominant position in the economy, politics and security. Discussion on the influence of Russia in Central Asia, as well as throughout the former Soviet Union, smacks of ideology. Saving dominance in this area – is an attribute of a great nation, the status of which is an independent important feature for the Kremlin. At the same time no one is trying to assume how much does it cost to control the zone for Russia and what real benefits does the country receive for that money, and whether there are cheaper alternatives. Little is said about the reasons for which the post-Soviet countries are attracted to external partners.

In Central Asia, the reality is that Moscow cannot maintain the economic dominance even if they really wanted to. Countries with similar export profile, even in the neighbourhood, do not trade much with each other - just look at the trade statistics of Saudi Arabia, Kuwait and Oman. As the cooperative ties of the Soviet-era fall apart, and considering the lack of the new ones, China will inevitably play a big role in the region- as the biggest neighbour, by importing raw materials. Trading and investment charts show a steady trend: China's role in Central Asia is growing faster than Russia’s. There is probably nothing we can do about it, and to be honest it isn’t necessary.

Intermating of success: why Russia turns to the East so slowlyIn the medium term other factors would be questioned, the ones ensuring the Russian influence in the region. The elites, oriented towards Moscow, gradually leave the stage, and for the new generations Russia is just one of the centres of power, alongside with China, the West and regional players such as Turkey and Iran. The Russian language will not be the world language – this role better suits English language, and in the future, perhaps Chinese. Russia's role as a guarantor of security is beyond doubts, but China is already beginning to think whether Moscow will be able to continue playing it in 20-30 years, if the economic stagnation continues and the number of available resources for the Kremlin will be reduced. This is evident from the discussion of this previously taboo topic within experts in China, as well as the start of bilateral cooperation of Beijing with the armed forces of the region.

Collector of Asian nations

What should be the strategy of Moscow to secure its interests in Central Asia, taking into account the growing influence of China? And how to fit pairing into this strategy? First of all, it is time to stop treating EAEC members as "junior partners", who are just waiting for direct instructions from Moscow, as to how to co-operate with China. Both Russia and the countries of the region, considering the gap between them in terms of economy, are still weaker players in relation to China. It is this relative weakness that can become a ‘breeding ground’ for joining forces. Moscow shall be sufficiently foresightful and wise to try on a new role – the role of the leader of coalition, which may establish rules of the game for stronger players by the fact of collective behaviour. The basis of such a model should be respect towards the interests of partners. Especially in areas where they do not threaten the positions of Russia. An example is the transit route from China to Europe. Calculations show that only the route through Russia and Kazakhstan may be of a great commercial value. So, Russia's task is to not to try to prevent the implementation of alternative plans, and make sure that it is the Russian routes that look the most attractive - in terms of working conditions and safeguards for investors. All this will enable Moscow to restore harmony in the relations with partners in the EAEC, by starting to discuss the problem of pairing within the narrow circle of allies.

The next step is not to be afraid of EPSHP as China's economic expansion tool. Moscow's efforts should not be focused on how to block Chinese multilateral initiatives in Central Asia - in this case, Beijing will cooperate with regional countries on a bilateral basis, generally bypassing the Russian Federation. Russia should include itself in such initiatives, actively participating in the formulation of rules of the game, along with its allies in the EAEC. For example, instead of for years of putting spokes in the wheels of creation of the SCO Development Bank, Moscow could be involved in the process of writing the constitution and investment principles, which would reflect the interests of the most EAEC countries. A successful example of this intellectual leadership recently showed UK and Germany by joining the Asian Infrastructure Investment Bank, which China had established as a bank totally dominating Beijing, but under the influence of London and Berlin it has turned into the Institute, taking into account the interests of minority shareholders and using the best international practices.
Intermating of success: why Russia turns to the East so slowly

Thirdly, in order to implement specific projects within the pairing process, Moscow will have to take not only partners in the EAEC as allies, but also national business, particularly private. Public-private partnership will select those projects that can potentially pay off - especially if the business will have to enter the capital, but not just carry out the construction contracts for the budget money and Chinese loans under state guarantees. Creating the Business Council of EAEC as the site where businessmen from Union countries could find a common language - a step in the right direction.

All this will give Russia an opportunity to test himself in a new role in Central Asia - an experienced player, which compensates for the loss of former power by the ability to articulate common interests and defend them in diplomatic negotiations with the new regional superpower. Of course, with the benefit for themselves.
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