Moscow Can’t Maintain Economic Dominance in Central Asia

 By 2013, China's trade with the five Central Asian states increased from about $1.5 billion in 2001 to approximately $50 billion, compared with Russia's $31.5 billion

By 2013, China’s trade with the five Central Asian states increased from about $1.5 billion in 2001 to approximately $50 billion, compared with Russia’s $31.5 billion

Russia Losing the “Great Game” to China

The world is supposed to believe that Russia and China are chumming it up, signing mutual commitments left and right. But the underlying reality is that Russia is being pushed back from large portions of its traditional spheres of influence — by China!

Beijing’s ambitious Silk Road Economic Belt project, intended to encourage infrastructure development in formerly Soviet Central Asia which Russia sees as its home turf, has caused unease in Moscow. China has promised to coordinate the project with the Russia-dominated Eurasian Economic Union, but clearly has put an emphasis on bilateral deals with Kazakhstan and other members of the bloc.

“Moscow can’t preserve its economic domination in Central Asia,” Alexander Gabuyev of the Carnegie Moscow Center wrote in a commentary.

___ WaPo

A strong move into Central Asia provides China with yet another strategic approach to the soft underbelly of Russia, should the need arise to move in force.

Silk Road Invasion Route

Silk Road Invasion Route

Markets are full of Chinese products, infrastructure is heavily built by Chinese firms with Chinese loans, leadership visits — either Chinese to the region or regional to China — are followed by announcements of massive deals being signed, and increasingly China is playing a more prominent role in regional security questions. __

Russia’s economic and global political problems have made Muscovy into an international pariah of sorts, with even Chinese businesses hesitant to get too close to Russian investments and commitments.

Russia is Out and China is In

The reversal in Russia’s dominant role in Central Asia is hardly surprising. Russia’s recent economic woes are well documented. Quite simply, they no longer have the money to support the region. As a result many countries have been left hanging, as is the case of Kyrgyzstan which recently had to cancel a Russian partnership on one of the aforementioned hydro-electric projects due to serious setbacks because of Moscow’s inability to fulfill their commitments.

Additionally, Russian ties may be becoming compromised due to Russia’s domineering behaviour, with Moscow treating the region like its exclusive hoard. Buying oil and gas at below market rates only to re-export it to elsewhere at a mark-up has pushed countries like Kazakhstan and Turkmenistan into the arms of China, which offers better trade terms. In this environment it is easy to see why China has come to be viewed as an economic stabiliser and a necessity by Central Asian governments in the past few years.



Russians Begin to Fear Chinese Invasion

Russia’s state television recently aired a program hosted by famous film director Nikita Mikhalkov that included a video describing a hypothetical Chinese invasion. The video ended with China quickly overrunning all of Russia’s Far East and Siberia and drawing a new border along the Urals, the mountain range that traditionally serves as the boundary between Europe and Asia. __ WaPo

Surface agreements between China and Russia are window dressing, not actually backed up by genuine commitment on either side. The dragon will struggle with the bear, with Asia as the final prize. This is the great game that only one can win. And that may result in a Pyrrhic victory, even so.

The Hitler – Stalin pact of the late 1930s helped to usher in World War II. The Xi – Putin pact of the current era may result in something even worse, unless the two belligerent powers smother and choke in each others’ flames.


China slow to invest in Russia, but buys Putin’s inner circle with sweetheart deals, and keeps Russia on life support via loans:

Russia has only managed to attract $560 million in foreign direct investment from China, less than 0.5 percent of China’s total outbound direct investment in 2015 and much less than the $4 billion in Chinese investment Russia received in 2013, before the Ukraine crisis. The biggest bright spot is that loans from China to Russia totaled $18 billion in 2015, making China the largest source of external financing that year, according to the Russian Central Bank. But even that is still a far cry from $261 billion that Russia was able to attract from the European Union and the United States in 2013, up until the Ukraine crisis.

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