Abstract: China has proposed a number of integration concepts that are compatible with the interests of Russia but contradict efforts by the United States to maintain a unipolar world order under its hegemony. The author’s aim is to assess the pluses and minuses of RF and PRC integration projects in Eurasia, identify the obstacles standing in the way of their execution, and find ways of eliminating existing problems.
The start of the 21st century was marked by stronger economic positions of a number of developing countries in Asia, Latin America, and Africa (most prominently the BRICS member states), while the countries of the West were mired in crises of their own making in Europe, North Africa, and the Near East (including the fight against influxes of migrants and the redistribution of spheres of influence around the world). In light of these trends, the initiative proposed by PRC Chairman Xi Jinping in September 2013 is of great importance.
China’s Integration Concepts
Speaking in the capital of Kazakhstan, Xi presented the ideas of a Silk Road Economic Belt and a Maritime Silk Road of the 21st Century aimed at bringing the nations of Eurasia closer together, opening up their economic potentials, and increasing trade turnover on the broad lands between the Asia-Pacific Region and Europe.
The possibilities and prospects of executing such an ambitious project are due to the world’s current political trends and the establishing of new centers of economic development. The Central Asia region will be the bridge that joins them.
It is only natural that China, aspiring to leadership of the Asian world and expanding trade in the zone of European Union, would be deeply interested in the stability of the Eurasian subcontinent. The increase in regional cooperation is being driven partly by the weakening of the unipolar world order. Recurrences of the weakening (but still aggressive) superpower tendencies of the United States are compelling nations that care about their development and sovereignty to move toward closer integration with one another. We are speaking here not only of regional economic ties but of new currency unions, or the common desire to overcome a global problem: the hegemony of the US dollar in the world economy. (An important step in this direction was the October 1, 2016 decision to add the Chinese yuan to the IMF’s SDR basket.)
As is clear from the document The Wonderful Prospects of and Practical Actions toward the Joint Creation of a Silk Road Economic Belt and Maritime Silk Road of the 21st Century drafted under the aegis of the PRC State Council, international cooperation within the framework of this project would follow five basic lines: political coordination, unification of infrastructure, continuous trade, free movement of capital, and closer ties among peoples.1
From 2013 through 2016, PRC Chairman Xi Jinping, Premier Li Keqiang, and other Chinese leaders visited more than 20 different nations. In the course of bilateral contacts and a variety of forums, they managed to achieve mutual understanding on a wide range of issues in creating One Belt, One Road. In a number of cases, agreements were signed on cooperating in the project, along with memoranda on interregional collaboration. Plans were made with neighboring countries for the joint development of border regions. Since the Chinese project presumes the creation of strategic points for developing the interiors of nations participating in its execution, this will contribute to the economic prosperity of the countries lying along the route of the Great Silk Road and bring about cooperation between civilizations. The mainlands of Asia, Europe, and Africa are joined in the promise of One Belt, One Road. The energetic drivers of East Asia will be at one end of the road, and the developed economies of the EU countries at the other. Between them will lie the broad expanses of the Central Asia nations with their potential for economic development.
A transportation bridge between Europe and Asia that includes the China- Mongolia-Russia, China-Central Asia-West Asia, and China-Indochina corridors of economic cooperation will be developed to bring them closer together. At their heart lie large international routes with base points in key cities and trade, economic, and production zones.
It is proposed that the main overland routes of One Belt, One Road run from China through Central Asia and Russia to the Baltic Sea, through Central Asia and West Asia to the Persian Gulf and the Mediterranean Sea, and through Southeast and East Asia to the Indian Ocean. The creation of China-Pakistan and Bangladesh-China-India-Myanmar economic corridors is envisioned.
The routes of the Maritime Silk Road are planned to run from China’s ports through the South China Sea to the Indian and Pacific oceans, and through the North Sea to Europe. Safe routes with key points at major ports will be created in these waters.
To strengthen multilateral collaboration, China will not simply utilize the advantages of such mechanisms as the Shanghai Cooperation Organization, China-ASEAN, APEC, the Asia Cooperation Dialogue, the Asia-Europe Meeting, and other international organizations in which it participates. Altogether, these projects are destined to embrace the entire Eurasian continent through the building of railways and other transportation routes.
Eurasian Integration as Viewed by Russia
The Chinese initiative of One Belt, One Road is being viewed with growing interest in Russia. Incidentally, Moscow prefers to use the term “Eurasian integration” and is doing its best to preserve its traditional influence in one of Eurasia’s most important regions: Central Asia. It has good reasons for doing so, since Russia remains the sole leader in the post-Soviet area.
- First of all, the existing political systems in most of the nations of Central Asia are much closer to Russia’s than to any other: the republics in the region frequently copy different institutions and elements of RF legislation. In the countries of Central Asia, the approach to projects that would affect their fates is, therefore, very pragmatic. As a rule, they are prepared to support projects of all nations (if they will bring financial and other types of investment and not undermine the foundations of the existing system). Uzbekistan, Kazakhstan, Tajikistan, and Turkmenistan do not, therefore, encourage Western programs of “humanitarian cooperation” for the development of society, but they do support Russian projects aimed at developing their national economies. Moscow also plays a positive role in maintaining the balance of power in the region, and such diverse actions by Russia are needed in the countries of Central Asia.2 So far as laying the more than 12,000 kilometers of highway for One Belt, One Road (intended in some versions to join Asia to Russian ports), it would give the countries of Central Asia an outlet to the Baltic Sea and allow the development of hub sectors on their territories. The growing need for transshipping cargoes between Europe and Asia opens up new investment and integration opportunities for the nations of Central Asia.
- Second, the standard gauge for railroads in Russia and Central Asia is 1,520 mm. This is wider than the gauge used in China and Europe (1,435 mm).3 The uniform standard gauge on railroads in Russia and Central Asia makes it easier to ship heavy cargoes greater distances without substantial delays at border stations.
- Third, the strategic interests of Russia and China in Central Asia are similar on a number of issues, e.g., guaranteeing the security of existing borders, countering terrorism and maintaining regional stability. The same is true for geopolitical cooperation in limiting the military presence of the United States and NATO in the region, and opposing the policy of “democratic reforms” that leads to Color Revolutions. Moscow plans to participate in Eurasian integration and to strengthen its role in it by utilizing such multilateral mechanisms as the Eurasian Economic Community, the Shanghai Cooperation Organization, the Collective Security Treaty Organization, the Union State of Russia and Belarus, and other organizations in which Russia plays a key role. However, the economic problems associated with the disintegration of the Soviet Union have long prevented Moscow from pursuing true integration. Concrete steps to correct this situation were taken only at the start of the 21st century, after Russia had sufficiently rebuilt its economy and political system.
In 2010, three of the five members of the Eurasian Economic Community (Belarus, Kazakhstan, and Russia) founded a Customs Union. Once the 17 basic agreements between these countries came into effect, the formation of a unified economic zone was declared. In the interests of its development, an agreement on a more advanced form of integration was signed in Astana in 2014: the Eurasian Economic Union (EAEU), which Armenia and Kyrgyzstan joined in 2015.
Eurasian integration is currently proceeding in the form of a number of unions of varying levels and depths, the most important of which are the Customs Union and the EAEU.
In addition to the economic aspects of integration, cooperation being stepped up in the field of security. The main role here is being played by the Collective Security Treaty Organization (CSTO), of which the countries of the EAEU are members. The CSTO is important to the Central Asian countries because only Russia and its allies are capable of coming to their aid in the event of an external threat.
Things other than following in the wake of the European Union (which is generally hostile to Moscow) are needed for Russia’s further integration into Eurasia. Such a path was chosen on May 8, 2015: Russia and China adopted a resolution to interlock One Belt, One Road project with the EAEC. Along with strengthening Russo-Chinese cooperation in Eurasia, this will allow Moscow to solve the eternal problem of road quality and infrastructure development in particular. A working mechanism has also been set up to link the two projects. In October 2015, a memorandum was signed between Russia and China on the construction of a Moscow-Kazan-Beijing speed railroad linked to the Baikal-Amur and Trans-Siberian railroads.4 A 1,965 kilometer China-West Europe highway will also run through the territory of the Russian Federation. The road is scheduled to open in 2019, and the total cost of its Russian section is estimated at $6 billion.5 Execution of these projects could be a critical stimulus not only to the growth of the Russian economy but to the countries of Central Asia as well.
American Concepts for the Central Asia Region
American actions are of a completely different character. To preserve a unipolar world, Washington is working toward the disintegration of Eurasia by supporting radical nationalism, separatist movements, and inciting internal civil conflicts.
This is largely due to economic interests, since Central Asia is rich with strategic resources.6 Proven reserves of oil total around 27 billion tonnes (second only to those of the Persian Gulf). Of these, onshore reserves account for 8.5 billion tonnes. Reserves of natural gas total 5.5 trillion cubic meters.7 In the waters of the Caspian Sea, estimated oil reserves vary from 2.3-4.5 billion to 5.4 billion tonnes. Predicted reserves range from 16 billion to 32 billion tonnes – almost double those of the Arctic Ocean and about the same as all the reserves of North America.8 They are thus comparable to the reserves of the world’s largest oilbearing regions.9 With the growing importance of the nuclear factor as a guarantee against military pressure, the region’s rich reserves of uranium acquire special importance. Approximately 25% of the world’s reserves are found in Kazakhstan, and there are other large uranium deposits in Uzbekistan, Tajikistan, and Kyrgyzstan.
Finally, Central Asia’s location at the intersection of Eurasian transportation arteries is a factor of both economic and strategic importance, which is of special interest to Washington. The US presence in Central Asia, the very heart of Eurasia, would allow it to control virtually all of its territories and influence regional security.
The most glaring example of the American influence on regional security is the war in Afghanistan. Under the pretext of a global war with international terrorism, Washington began to penetrate the region while increasing its influence on all of the countries there. To accomplish this, the United States developed a number of theoretical concepts.
An American model for a New Silk Road was thus proposed in 2005. Bound closely to the concept of a “Greater Central Asia,” it was energetically promoted by the US Armed Forces Central Command. Both concepts were associated with the name Stephen F. Starr, head of the Central Asia-Caucasus Institute at Johns Hopkins University. In the July-August 2005, issue of the journal Foreign Affairs, Starr called for the creation of a Partnership for Cooperation and Development of GCA, a regional forum on implementing a number of programs under the aegis of the United States. This would essentially mean development of the nations of Central Asia and Afghanistan without the participation of Russia, China, or Iran. The aim of the forum would be to help turn Afghanistan and the region as a whole into a zone of countries with market economies, along with secular and open systems of national government maintaining positive relations with Washington.10 The active participation of the Pentagon means that the project was aimed at creating a strategic military alliance in Central Asia and Afghanistan under the aegis of the United States with future involvement in GCA and other nations.
This would help the Americans further their ideas concerning an even greater geopolitical and economic project: a Greater Near East that would include the Near and Middle East, the Caucasus, and the Caspian Sea basin.We are speaking here of a domain covering areas with both resources and convenient transportation corridors for their transit. American political scientists were essentially planning to establish close ties with India and Pakistan through Afghanistan, in the hope of weakening their orientation toward Moscow and Beijing.11
The influence these ideas had on the White House was evident from US Secretary of State Condoleezza Rice’s reorganization of the State Department’s South Asia desk in October 2005, when it was given the responsibility for reviewing the state of affairs in five Central Asian nations. Assistant Secretary of State Richard Boucher went even further at hearings on US policy in Central Asia, held by the House of Representatives’ Committee on Foreign Affairs in April 2006, by using Starr’s ideas as an ideological pretext for promoting American influence in the region. In his report, he made it clear that he did not consider Russia or China to be major players in establishing ties between Central Asia and South Asia. At meetings with Kazakhstan’s foreign minister and the presidents of Turkmenistan and Azerbaijan in 2008, Senator Richard Lugar, one of the authors of the doctrine of containing Russia, emphasized that “the United States is interested in creating in the Caspian region a transnational system for supplying oil and gas to Europe in order to reduce the dependence of the European countries and Central Asia on Russia’s energy monopoly.”12 Washington would also like to divert Central Asian oil away from China toward the market controlled by the stock exchanges of New York, London, Tokyo, and Singapore. 13 These and other reasons for isolating Russia and China were given in the work Strategy of the Silk Road of the 21st Century.14 In practice, oil from Kazakhstan is already being delivered to the West through the Europe-Caucasus- Asia and Baku-Tbilisi-Ceyhan pipelines (elements of the New Silk Road in the American model), bypassing Russia.15
Attaching great geopolitical importance to these processes, Rice discussed with the presidents of Afghanistan, Pakistan, Kazakhstan, Kyrgyzstan, and Tajikistan the possibility of creating a regional organization that would be oriented toward the United States and act as a counterweight in relations with the SCO. As part of implementing this project, the United States would allocate $1.4 million to the countries in the region for “simplifying customs procedures.”16
The United States invited Kazakhstan, Kyrgyzstan, and Uzbekistan to participate in NATO’s Partnership for Peace program. Washington also promised it would annually increase financing for military cooperation. In this context, Americans would work in such spheres as training personnel, providing technical assistance in implementing the US Caspian Guard program, and so on. Special attention is now being given to training Kazakhstan’s Kazbat peacekeeping battalion according to NATO standards.17 NATO headquarters for communication and cooperation with the countries of Central Asia have been set up in Alma- Ata, and contingents from the Central Asia republics have served in Afghanistan and Iraq.18
However, realizing the idea of GCA in the region has encountered serious difficulties, since it is largely based on the prospects for rapidly stabilizing the situation in Afghanistan and was drawn up after President George W. Bush declared “victory over terrorism” in 2004. As the situation in Afghanistan grew worse, Americans in subsequent years were forced to discard a number of their plans and programs.
It was against this background that the American concept of a New Silk Road was revised in 2009. In an article written by Stephen F. Starr and Andrew Kutchins, the need for Afghanistan to become an “interchange on a New Silk Road from India to Southeast Asia with motorways and railroads leading to the north, south, east, and west” was declared once again. As an example, the authors cited the construction of a ring road 3,362 kilometers long in Afghanistan that was used to perform military tasks, including the withdrawal of Northern Alliance Coalition troops from the country.19
Relations with China and Russia are somewhat better in the latest interpretation of the American New Silk Road: the possibility of their participation is not excluded, but the role of South and Southeast Asia continues to be fundamental. The stress on road building shows that the American strategy in Afghanistan views the country mainly as a transportation corridor, for which a Northern Distribution Network has been created – a transportation infrastructure oriented toward the north (through Uzbekistan, Kazakhstan, and Tajikistan) and the southwest (through Turkmenistan). Experts friendly to the White House view this as a step in the direction of realizing the concept of a New Silk Road. Most, however, believe that Starr’s ideas cannot be implemented because of the complicated situation in Afghanistan.
In the near and middle terms, US aims with respect to the nations of Central Asia include keeping them in the orbit of the American regional and global strategies through economic, military, political, ideological, and cultural and humanitarian influence. An increase in the influence of other powers, especially Russia and China, would be extremely undesirable for Washington. The United States will, therefore, do its best to perform a number of priority tasks in the region: In the economic sphere, to gain access to the energy resources of Central Asia and control over the routes of their delivery to world markets; to create conditions for organizing blockades of raw materials to China, should the need arise; and for ensuring control over strategic reserves of uranium ore.
In the military and political spheres, to maintain a military presence in Afghanistan with the aim of keeping a staging area for possible intervention in the affairs of Pakistan and Iran, containing China, and putting pressure on Russia; and to guarantee the possibility of reacting rapidly to situations in the countries of Central Asia.
In the ideological sphere, to further processes of Western-style democratization in the countries of Central Asia, and to encourage their leaders to build states along the lines of Turkey.
In performing these tasks, Washington is taking measures aimed at gradually drawing the nations of the region out from under the influence of Moscow and Beijing; gradually including the nations of Asia in trade and economic alliances under American control; and drawing them into more active collaboration with NATO. This multiplies and aggravates many of Russia and China’s problems in Eurasia.
Problems Interfering with the Implementation of China’s and Russia’s Integration Projects
For China, the American programs in Eurasia create obstacles on the road to implementing its own integration projects. Most important in this context is the Sino-American “rivalry and partnership.” Because of the policies followed by Washington in Afghanistan, there is a real threat that terrorists and separatists will penetrate from there into China, endangering the security of the Xinjiang- Uyghur Autonomous Region through which routes of the Silk Road Economic Belt are planned to run.
The United States already does not deny the possibility that Sino-American cooperation will amount to nothing because of the issues associated with Taiwan, Tibet, North Korea, human rights, the rise of PRC military power, and so on. China is in turn concerned about the creation of an American antiballistic missile defense system in the Pacific, the embargo on deliveries of “sensitive” technologies, and the enormous imbalance in trade.20 In the Asia-Pacific Region, for example, Washington kept China out of the Agreement on Transpacific Partnership signed by 12 nations in October 2015.21 Beijing also worries about most of the petroleum resources it imports coming through the Persian Gulf, which is controlled by the US Navy.
In competing for leadership in the Asian part of the Pacific Ocean, the United States and China create hotbeds of tension in the region. The growing military might of South Korea, the presence of US bases in Japan, and the militarization of that country are reasons for concern among Chinese strategists. If China tries to solve its territorial problems in the South China Sea and unite Taiwan with the mainland by force, this would strengthen the fears of neighboring countries and the United States. Their relations with China would, therefore, develop according to the formula: coexistence, cooperation, rivalry, and (in the extreme case) managed confrontation.22 This could not help but affect the charting of sea lanes from Chinese ports to the southern waters of the Pacific Ocean.
In addition, China has a number of other problems. The restoration of the Great Silk Road on the Eurasian continent obviously cannot be expected in the near future, since the project has yet to be financed and is burdened by a great many organizational and technical difficulties. These are also present in the concept of the One Belt, One Road project, which remains unsystematic and unclear about how it will be implemented. Among the mechanisms listed by Beijing, the EAEU is not even mentioned. China and Russia need to refine the parameters for interlocking the strategies of existing Eurasian formats for economic cooperation, and they must create legal bases for collaboration.
Compared to China, Russia has many more problems complicating the implementation of integration projects in Eurasia. These are primarily associated with the deterioration of Russo-American relations. Topics of continual conflict between Russia and the United States are NATO’s expansion to the east; the Treaty on Conventional Armed Forces in Europe; the Georgia-South Ossetia conflict; and the creation of an antiballistic missile defense system in Europe. Clear signs of growing conflict emerged in the spring of 2011, when US Vice President Joe Biden said during a visit to Moscow that Vladimir Putin’s candidacy for the presidency of Russia was unacceptable to the American political establishment.23 Commenting on the Russian proposal to establish a Customs Union and create a Eurasian Union as she attended a December 2012 conference on human rights in Dublin, the then US Secretary of State Hillary Clinton called the plan “a new attempt to Sovietize the region.” She made it clear that the United States was working on measures to prevent the project, which was “hostile to the interests of the West,” and that Washington was focusing on blocking any integrational aspirations of Moscow.24
With its actions in the Crimea in 2014, Russia openly challenged the United States’ ability to maintain the world order created after the disintegration of the Soviet Union. To the Americans, these actions were punishable; otherwise, Washington’s position might have teetered on a global scale. A swing in the policy of deterring Russia was inevitable and would be of a long-term nature. The White House’s official position with respect to the Kremlin remains harsh and is unlikely to change before President Barak Obama leaves office. Should Hillary Clinton win the 2016 presidential election, sanctions against Russia will undoubtedly continue. Under pressure from the United States, the countries along Russia’s western border began integrating themselves into NATO and the European Union at an accelerated pace, and followed Washington in extending anti-Russian sanctions to 2016.
Aggravation of the Russian problem threatens not only the West but the East as well. In 2016, China will obviously be the country with which Russia has the most economic disputes, since the “turn toward Asia” announced by Moscow after the levying of sanctions has yet to go beyond declarations. The Russian government does not have means sufficient to fund plans for the development of the Far East, so its conflict of interests with China will be most apparent in executing the project for the advanced development of this region, and in creating a transportation corridor from China to the European market.
Russia would like China to have a large portion of the Silk Road run through its territory. Beijing, however, is also analyzing routes for its window on Europe that bypass Russian territory by running through Kazakhstan, Turkey, Azerbaijan, and Georgia. This coincides with the plans of the European Union, which is also considering the possibility of a window on Central Asia through Turkey and the Caucasus, and not Russia.
The Baltic nations are competing among themselves (and with Russia) for the right to become logistical centers for China, with access to the Baltic Sea.25 So far, Lithuania is in the lead: in 2015, the Chinese corporation China Merchants Group (CMG) signed an agreement with the Klaipeda Free Economic Zone and the port of Klaipeda. The CMG plans to build a logistical park there, to invest funds in the port, and to manage one of its terminals. The Chinese have also agreed with AO Lithuanian Railroads to create a joint venture responsible for expediting cargoes between Lithuania, Belarus, and China. Lithuania is actively working with Kazakhstan as well, further bolstering its role as a key point along the Silk Road route. It should be noted that the president of Lithuania is extremely hostile toward Russia.
Latvia and Estonia have not been as successful as Lithuania in competing for Chinese and Kazakhstani cargoes, but they are eager to join the New Silk Road. At the end of 2015, a business delegation from China visited Latvian ports and met with representatives of the Latvian railroad company. CMG director Hu Reng described China’s plans to invest in Lithuanian ports after analyzing their possibilities. Estonia also envisions its ports as being part of the Silk Road, since it has a much more modern infrastructure than Lithuania.
Under these circumstances, the Russian ports competing with Baltic ports for cargoes are at risk of being marginalized. The transit of cargoes to Europe through the Baltic nations with “surrogate sovereignty” incidentally entails considerable risk for China. Moscow, therefore, continues to promote the idea of a northern branch to the Silk Road route, through Russian ports on the Gulf of Finland.
Belarus also aspires to the role of hub for cargoes from China to Europe. Minsk is actively pursuing cooperation with Lithuania and Latvia. In 2012, President A. Lukashenko announced Belarus’ intentions to redirect flows of cargo from the Baltic to the ports of Leningrad Region and Kaliningrad, but this was a purely political move. In reality, Minsk is expanding its ties with Baltic ports. The share of Belarus’ cargo flow in the overall structure of shipments through the port of Klaipeda is almost 35%.
The Belarusian state enterprise Belaruskaliy ships around 90% of its export goods through Klaipeda. It is, incidentally, shorter and, therefore, cheaper to ship cargoes from Belarus to the Baltic than to Russian ports. It should be noted that in February 2016, the European Union lifted sanctions from A. Lukashenko and 170 other Belarusian officials. It is no accident that the European Union is backing the Belarusian president, who de facto refused to recognize Russia’s annexation of the Crimea and took a more pro- Ukrainian position on the Donbass. When Moscow closed its free trade zone with Ukraine, Minsk kept its zone, ensuring the flow of Ukrainian goods to Russia. Finally, Belarus refused Russia to establish air bases on its territory. (This would have violated the provisions of the Treaty on the creation of the Union State of Russia and Belarus, where Articles 2 and 17 stipulate that “the aims of the Union State are to conduct a coordinated foreign policy … and a common trade and customs policy in relations with third countries … and joint use of a military infrastructure….”26)
There remain other interstate problems holding back Russia’s integration programs in Eurasia as well. The most worrying and costly of these have to do with Ukraine, which intends to participate in the building of the Silk Road and plans to join it with its own transportation infrastructure and bypass Russia. However, Ukraine’s financial default will likely prevent Ukraine from carrying out this strategy in the near future. In addition, Russia has begun the construction and repair of railroads bypassing the territory of Ukraine.27
Russia has lingering conflicts with Turkey, due to the downing of a Russian aircraft in Syria and Ankara’s support of the Islamic State; with Bulgaria, for refusing to allow construction of Russia’s South Stream pipeline along the bottom of the Black Sea; with Romania, after it joined NATO; and with Moldavia, because of Transnistria. Relations with the Baltic nations, Poland, and Great Britain are de facto frozen.
As mentioned above, trade relations with its EAEU partners, Kazakhstan and Belarus, pose low-level but nevertheless dangerous threats to Moscow’s integration projects. Neither country is prepared to support Russia’s embargo against Ukraine, which is now part of the EU free trade area. The countries of Central Asia, members of the Eurasian Economic Union and the Collective Security Treaty Organization, are in no hurry to follow Russia in breaking off relations with Turkey. Astana is, therefore, not ready to sacrifice its economic ties with Ankara, which are worth around $3.5 billion in trade turnover each year. Kyrgyzstan is doing its best to buy time for considering its own future actions, and is seeking ways to distance itself from Moscow without conflict while counting on further nonreciprocal aid.
There is one other problem: Implementation of the One Belt, One Road project on Russian territory assumes it would be done using the resources of Russia and China. However, falling oil and gas prices, sanctions, and general economic confrontation have led to devaluation of the ruble and changes in RF investment policy. Russia’s economic indicators for 2015 fell on average by 4%; the average person’s income, by 8%-10%. Inflation tripled in 2015, compared to 2012 (by 15.5%).
Against this background, Russia is regularly restructuring its foreign debt. In recent years, it has forgiven debtors around $140 billion – a sum that would cover its 2015-2016 budget deficit by 3-4-fold, and exceeds all transfers to the Russian regions from 2000 through 2015.28
Forgiveness of foreign debts is often inopportune. Russia completely forgave the $9.5 billion debt of Vietnam, where it had to part with its naval base at Cam Ranh Bay. The $4.6 billion debt of Libya, with its massive reserves of oil, was forgiven not long before the death of Muammar Gaddafi. Oil-rich Iran’s debt of $12 billion was also forgiven after the pro-Russian regime was replaced with one pro-Western. With interest, the money forgiven these countries would have paid for all of Russia’s Eurasian integration projects.
With such an approach to RF creditors, foreign countries are naturally concerned that Moscow’s plans for integrating itself into Eurasia and having the Eurasian Economic Community overlap with the New Silk Road system could remain on paper.
There is, however, a way out. The Shanghai Cooperation Organization could be an ideal platform for solving problems with China and its Silk Road project partners in Central Asia. A feature of the organization’s Central Asian dimension is that in relations with Russia and China, the above countries are independent nations in the spheres of politics, economics, and security, but are simultaneously objects of Russo-Chinese initiatives. Such subject-object relations are due to the sovereign status of the Central Asian countries, which have the right to conduct independent policies, and to the different economic and political potentials of these countries relative to Russia and China, the economic superiority of which allow Beijing to launch initiatives in the region in cooperation with Moscow – important projects. Russo-Chinese relations in Eurasia would be given a boost as this collaboration grows within the New Silk Road project, while the combination of its mechanisms of cooperation and those of the SCO would offer the possibility of using China’s resources (investment, transportation, technological) to develop Russia and the nations of Central Asia.
It is, therefore, thought that the plan for creating the Silk Road Economic Belt could act as a catalyst of multilateral economic cooperation between the member nations of the SCO, and be executed under the aegis of this organization, in coordination with other international institutions (the UN Development Program, UNESCO, and so on).
Finally, as analysis of the current situation in Eurasia shows, Russia essentially has no reliable strategic partners. It has often been in similar circumstances, but always came out of them with dignity. Multiplied by historical experience, that of recent times shows how only a strong and combat-ready Russian Army and Navy are able to guarantee the country’s peaceful development and free its integration plans for Eurasia from foreign interference. As always, only nations that are strong militarily and economically count in this world.
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Translated by Terence C. Fabian