Russia is keen to build closer relations with China, but in doing so it may be overly enthusiastic. China pursues its own strategic interests, which demand Russian resources. As for the prospects of technological cooperation between the two countries, they are not clear yet. Russia could sell nuclear reactors to China but Beijing maintains very close relations with the West in many areas. That means the Chinese market will become the object of many economic battles in the future. Alexander Rahr, a German political scientist and the director of the Berthold Beitz Center at the German Council on Foreign Relations (DGAP), shares his view of whether China is going to become Russia’s main partner in its modernization effort in an interview with Yevgeny Shestakov, the host of the Debating Club (a joint project of the Rossiiskaya Gazeta website and the Valdai Club).
Yevgeny Shestakov: During President Dmitry Medvedev’s recent visit to China agreements were signed for supplying gas to China. Do you think we are signaling that we have staked our bets on China as our main ally to spite Europe, which is obstinate and sometimes even openly hostile toward Russia?
Alexander Rahr: I think we can say that. For the Russian leadership, an alliance with China has a tactical, if not strategic importance. So far, there has been practically no progress in Russia’s relations with the European Union. Tough visa regulations are still in place while EU officials cannot help talking to their Russian counterparts in invariably didactic manner, constantly reminding Russia that it is not a member of the World Trade Organization yet. Therefore, Russia faces certain restraints in its cooperation with the European Union from time to time. Besides, even during economic negotiations, the European Union likes to bring up the issue of its values and make further cooperation conditional on Russia’s compliance with them. All this, of course, tends to slow further progress.
Russian companies realize that they are unlikely to get a warm reception in the European Union, sensing that many Europeans are somewhat reluctant to engage in cooperation with them. I think that these considerations, that is the realization that Europe is in no hurry to create a common economic space or a free trade area with Russia and is only dragging the process out, have prompted a decision to seek cooperation with China.
At first, there was only talk about laying pipelines to Asia. Europeans were skeptical about this scenario and still seem to be. They believe that they are the only potential energy partners for Russia, which will never set up a similar energy alliance with China.
However, there is more trust today between Russia and China than between the European Union and Russia. At the same time a rapprochement with China is associated with certain risks, as China needs increasingly less from Russia. Previously, Beijing used to buy technologies from Russia whereas now it manufactures many of them on its own. Now there is a risk that China will start treating Russia as nothing but a source of raw materials.
Shestakov: Does this mean that Russia should be wary of China’s economic expansion?
Rahr: I would say that the problems China faces in Russia are the same as in Europe, which keeps out Chinese capital. But China has money, its business knows how to sell and has plenty to offer. Finally, it has its own huge domestic market. As I see it, China’s economic expansion into Russia has been on a fairly modest scale. However, they have done remarkably well in Central Asia, actually forcing Russia to compete with Central Asia in the Chinese market, with Uzbekistan, Turkmenistan and Kazakhstan selling their resources to the Chinese. Russia is aware of the need to follow suit lest it should be too late.
Shestakov: Then it appears we should welcome China’s expansion rather than fear it, as it tends to align the two countries’ economic interests and promote mutual penetration?
Rahr: I think your country’s actions are too emotional. The disappointment at the lack of progress in its relationship with Europe immediately leads [Russia] to make a U-turn and stake all bets on China. At the same time one should keep in mind that both Europe and China need Russian gas and oil. However, in the 21st century, Moscow must by no means consider itself a raw materials appendage. The government needs to decide on who is going to become its key partner in its effort to modernize Russia. You need to catch up with Europe in the next 10, 20 or 30 years and become a leading industrial nation in your own right.
This could be achieved by developing your own technologies and cooperating with those who already have all this. I cannot say if in this respect China is better and more reliable than the European Union. At this stage China is probably a more convenient partner but this may change quickly if it starts showing an appetite for certain things and begins to perceive itself as the second great power that can treat Russia as its junior partner.
The main thing today is to understand what Russia wants from China, apart from selling its natural resources to this country. Perhaps Moscow should consider developing joint nuclear power engineering projects and stepping up military cooperation with China. On the other hand, taking into account that the Chinese are developing a military sector of their own, the presence of Russia’s military-industrial complex on the Chinese market is likely to be short-lived.
Shestakov: At a meeting with Valdai Club political analysts Prime Minister Vladimir Putin said that China should not be treated as Russia’s rival on the world markets.
Rahr: Indeed, Putin’s words were very interesting because he wanted to emphasize that there was competition between Russia and Europe or America but not between Russia and China because their economies were mutually complementary. This means that today Russia can offer the Chinese what they need and vice versa. There will be no direct tough competition as this seems to be Russia’s current policy choice. China does need Russia’s enormous resources, and Russia has both the resources and technology to sell. China will continue buying [from Russia] until its own nuclear industry is put in place. However, it is not clear yet how the situation will develop further on. Russia would like to enter into an alliance with China in order to create a multipolar world, something that is very important for Russia as this will help it put an end to all talk that it can only survive as a junior partner of the West. Russia is now aware that it has a chance to become one of three or four, or five main geopolitical centers in the world, first, together with China and later, perhaps, together with India, America and the European Union. To achieve this it needs to cooperate with China rather than work against it. In turn, Russia expects China not to work against it either.
Shestakov: Does China pose a threat to Russia, given its billion-plus population?
Rahr: China becomes more powerful in economic, political and military terms with each passing year. Although it says nothing about it, its ambition is to become a world power. At the same time we do not know exactly what policy China is going to pursue in the second half of the 21st century and what its real goals are. Is it thinking of becoming a dominant power or is it interested in creating some new multinational and multipolar global system? Russia stands a good chance of developing successful cooperation with China; however, there may be some hazards along the way.
If you look at the situation on the Russian-Chinese border, demographic data speaks volumes: there are 100 Chinese nationals per one Russian in the immediate vicinity of the border. Sooner or later, Chinese, of course, will start emigrating vigorously, and not only to Central Asia.
This situation requires rigorous monitoring but it would be hard to change it. Russia must either rely on its own potential for populating its vacant territories or set tough restrictions on immigration. However, this would fly in the face of the friendship between Moscow and Beijing. I think the Russian leadership is currently seeking a solution to this complex situation. If Europeans are invited to settle in the Far East, there are unlikely to be many volunteers. But sooner or later Russia will need to populate this region. It does not take much imagination to realize that in the end Russia will have to accept some kind of limited and controlled migration from Asia.
Russia is looking for an ally to shape a multipolar world. As for Europe, it is still confident that the West will retain its strong position and is keen to further cement its alliance with the United States by any means possible, building Europe without Russia. In the past decade this fact has become so obvious that Russia was forced to start looking for other allies. Russia realizes fully that the alliance of Europe and America is so solid that there is no room for it there. And this alliance is capable of acting in a critical or hostile manner toward Russia.
In order to offset the situation Moscow is looking for allies in the East. Russia has no such ally in the South, nor is there anything to indicate that it is likely to appear in the future as this area is dominated by Islamic fundamentalism. What remains is China. Cooperation with it is possible if only to keep it at a distance and rein in if it also starts showing outright aggressive ambitions.
Engagement with China is the correct and proactive policy pursued by the Russian leadership because Russia has to do this, given its current geopolitical environment.
Shestakov: Should Russia borrow anything from the famous Chinese model?
Rahr: I believe Russia’s leadership has been looking closely at the Chinese model. Say, the middle class, which has already emerged in China, is something that your country needs very much. It is not yet a middle class of the kind they have in Europe but these people are aware of their economic potential and feel they are citizens of a powerful China rather than the lumpenproletariat. In order to achieve this, the government has offered new economic opportunities to the middle class and improved the country’s record of corruption. China has a better investment climate than Russia. I see it from the willingness of Western companies to do business in China despite certain difficulties that exist there. China is capable of stealing technologies and turning them into their property but as for the investment climate, things have started moving there in a very interesting and positive manner.
Shestakov: What can Russia offer China aside from its resources?
Rahr: This is a key issue for future cooperation. How can Russia get China interested in it? These are unlikely to be joint educational projects as their cultures are very different. I think they should look more closely at each other as likely partners in the modernization effort. So far, Russia has technologies that are of interest to China. But competition with the West is only going to mount, of course.
Shestakov: Do you believe it is true that the Russian civilization and culture belong to Europe rather than Asia?
Rahr: This is a perennial question. In terms of civilization and culture Russia is part of Europe. In my opinion, Russia will lose its identity if it distances itself from Europe and positions itself as an Asian country. Nobody in Asia wants to see such a Russia, and it will never feel at home there. It will be feared, misunderstood and drawn into conflicts. But Europe is also a very difficult partner for Russia today. It has been creating a system of values that suits it but which Russia is simply unable or does not want to accept. That is why today Russia finds it easier to achieve mutual understanding with China. However, this is not going to last long. As I see it, Russia is a country with three powerful poles: the West, Islam and China. For Russia to survive in the 21st and the 22nd centuries it needs to forge the broadest possible relations with all the three of them.