Uncertain World: Russia-China – Change of course?

Published on english RIAN.ru, by Fyodor Lukyanov, March 22, 2012.

The final text of Russia’s Strategy-2020, published last week, contains a small but surprising sentence that has not been given the attention it deserves. From the foreign trade and foreign policy section: “The main risks for Russia, linked with the emergence of new centers of power, are rooted in the growth of China’s economic potential and international status.” 

The authors believe that the impending conversion of the yuan into a “world currency for settlements, and later into an investment and reserve currency…may undermine the stability of the international currency system, and limit opportunities for the use of the Russian ruble in international transactions.”

“The highly competitive Chinese processing industry… will continue to squeeze out Russian counterparts from the Russian market and prevent the trade and investment expansion of Russian companies abroad,” the authors conclude. They believe that “the consolidation of China’s positions in Central Asia may undermine the prospects of the latter’s further involvement in Russia’s integration projects.” Finally, the authors warn that China’s more active negotiating and interventionist conduct typical of a “newly rich member of the world leaders’ club, the consolidation of the G2 format (the United States and China) in running global economic processes and China’s growing influence in the IMF and the WTO” will come at the expense of other countries, Russia included.

It should be noted, however, that the authors later acknowledge that the task of modernizing Russia, especially Siberia and the Far East, is not possible “without using the Asia-Pacific Region as a resource of national economic development. China is Russia’s number one partner in this region” … //

… For all that, it is unclear why it was necessary to voice such concerns in a high-profile document, especially as the authors were discussing the side effects of China’s development rather than a hostile policy towards Moscow adopted by Beijing. Some of these apprehensions have not yet been confirmed – the issue of a G2 was dropped a couple of years ago when it became clear that nothing of the sort was in the offing.

Russia is unable to do anything about this, and counteractions would be simply inappropriate, whereas such an obvious display of lack of confidence will more likely aggravate than alleviate the asymmetrical nature of bilateral relations.

To be fair, the document contains a number of specific proposals on how to achieve balance in Russia’s opportunities in Asia. Its authors write about the need to diversify economic partners to prevent China from remaining Russia’s main and only partner in the Far East, but the general alarmist tone remains.

These apprehensions are understandable, but making them public will not help Russia. Rather, Russia needs an active and positive program of action towards China with numerous proposals for joint development. This program should originate in Moscow and be preventative in nature. If Russia stands on the sideline, the agenda in Russia’s Asian part will be determined by China just for lack of alternatives. Then Russia’s apprehensions will be confirmed, and China will become a real economic threat. But in that case, Russia will have only itself to blame. (full text and links to related articles).

Links:

Russia to Send New Anti-Piracy Force to Gulf of Aden, March 27, 2012;

Tunisie: Le ministère de la Justice demande une déclaration de patrimoine aux juges, March 26, 2012;

Darkness in Paradise – 4, March 17, 2012.

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