Caught by Surprise: Chinese Challenge for Russia in Central Asia

For a long time Central Asia has been part of Russian empire and only in the 1990s did this region fully gain independence. Immediately, it faced a choice: either these states could continue to follow Russian-led path, or they could set off for the search of their own place in the world. Current foreign policy of this region can be best described as multi-polar: Central Asian countries do their best to benefit from all involved parties: China, Russia, USA, the European Union, and Middle Eastern Muslim countries.

First, as for Russia, has been historically interested in the region – it was the last frontier between the empire and its rivals (depending on the historical period this meant China, Great Britain, or United States). Yet, Moscow`s role has started to diminish due to two main reasons. First, other big players – the EU, the USA and China – came to Central Asia, being able to offer the region more investments. Moreover, these financial flows come with “no political strings attached” – they do not ask for loyalty to any political regime.

Second, Russia turned its back on its former satellites – Georgia and Ukraine – once revolutions overthrew pro-Russian governments there. Apart from anti-revolution discourse, Moscow put sanctions on both countries. Central Asian states learnt from these examples and preferred to switch to multipolar foreign policy rather than a Russia-focused one. Despite cooling attitude towards Russia, Central Asia is interested in further regional integration in the post-Soviet space (Eurasian Development Bank, 2016).

Russia’s biggest opponent in this region is China – equally interested in and attractive for Central Asia. Its presence became visible only in the 1990s once regional states gained independence and Beijing acquired first benefits of its economic revolution. One of the first Central Asian projects in which China participated as a major investor was connecting China, Kyrgyzstan and Uzbekistan with a chain of motorways. Chinese contribution to the project was non-repayable $7659 mln for construction of Kyrgyz part of the road (Ministry of Commerce of People`s Republic of China, 2006).

Russia’s President Vladimir Putin and China’s President Xi Jinping attend an agreement signing ceremony during a bilateral meeting at Xijiao State Guest house ahead of the fourth Conference on Interaction and Confidence Building Measures in Asia (CICA) summit, in Shanghai on May 20, 2014. AFP PHOTO / RIA-NOVOSTI / POOL / ALEXEY DRUZHININALEXEY DRUZHININ/AFP/Getty Images

Overall, Chinese approach is focused on two main spheres: economy and finance. Thus, Beijing became the centre of its own initiated and realized system of transportation and energy infrastructure. This enables China to reach the West without a need to seek its way via Russia, which would be more demanding compared to negotiations with Central Asia.

Yet, Chinese approach differs from one regional state to another – it takes their peculiarities and needs into account. Kazakhstan is by now probably the biggest regional player. Its trade with China amounts from $27 to $40 bln, which is twice more than trade with Russia ($14.5 bln) (Zinzin, 2015; Kapital, 2017). Chinese capitals are also active in oil extraction (quarter of Kazakh oil is extracted with its help) and automobile industry.

China is the main trade partner for Kyrgyzstan as well. 56% of all imports coming to this Central Asian country originate in its eastern neighbour (Vorobyov, 2017). However, the most of Chinese investments go to the sphere of logistics due to Kyrgyz position between China and Turkmenistan – region`s richest country in hydrocarbons.

For Tajikistan, China became the main creditor after Russian economy entered recession. As in case with other Central Asian republics, Beijing heavily invests in country`s infrastructure. Its financial infusions in the form of joint ventures are also present in gold mining (Lain, 2016). The same is true for Uzbekistan, where China shares its status of major trade and investing partner with Russia (Regnum, 2017).

Since the main interest of Beijing in Central Asia is energy, this naturally brings it to Turkmenistan – the most closed of all Central Asian countries. For decades, its gas marked was directed to two states – Russia and China. However, as global demand for gas along with a need to diversify its exports grew, Turkmenistan looked at Turkey (equally interested in breaking its addiction for Russian gas). Currently, Ashkhabad is working on the project of a East-West pipeline that will end in Europe (Shustov, 2016; Vesti, 2015).

Overall, China is now deeply engaged in economies of Central Asian states. It invests hugely in energy and other spheres connected to it, such as logistics and resource extraction. Despite Russian prevalance in the security sphere of Central Asia, China also started selling military equipment to Kyrgyzstan and Tajikistan.

Due to the current state of Russian economy, Chinese prevalence in this sphere is no longer disputable. Central Asian states even started to cooperate with China across their strategies of economic development. Yet, long history of Russian importance for the region could not be overthrown in a couple of decades. For instance, its role remains visible in soft power – politics, culture and language. Although Russian remains an official language only in Kazakhstan and Kyrgyzstan, it has a status of a language of inter-ethnic communication in Uzbekistan and Tajikistan.

The current state of global affairs enables to talk about growing importance of soft power. As seen on the example of Russian official discource around its involvement in the Ukrainian crisis (birth of the notion of “Russian world”), Moscow is prepared to use this power against its former allies. To prevent the Ukrainian scenario along with other considerations, first Kazakhstan and then Kyrgyzstan decided to switch their national languages to Latin alphabet. Other reasons behind this decision include signal of these countries` independence from Russia in political questions and search for their own place in the global world.

Feeling diminishing role of Russia in Central Asia, China approched soft power realm there. Beijing introduced about 25 thousands grants for students coming from this region to study in China. Although their overall number is still twice lower than of those going to study in Russia, it is growing (Regnum, 2017).

All discussed process take place parallel to several developing regional integration projects. The biggest and most discussed in the media now is, certainly, the Eurasian Economic Union. Inspired and facilitated by Russia, this projects aims at full economic integration of its member-states in one entity. However, as Beijing becomes a real threat to Russian presence in regional economies, it motivates Moscow to further develop the organization based on equality of its members.

There is also an opinion that by fostering integration within the EEU, Russia tries to set a multilateral entity against Chinese preference to negotiate bilaterally with each of Central Asian states (Vorobyov, 2017). Judging by the growing number of China-led realized projects there (bilateral and multilateral), this proposition seems to be far from reality. What is more likely is that the two big players would rather take their niches and complement each other in overlaping spheres.

Last but not least, one shall not forget the Shanghai Cooperation Organization – Russian-Chinese child and a positive example of their attempt of joint regional integration. In the near future, it has an opportunity to balance Chinese economic prevalence in Central Asian and Russian ambitions to behold its importance in the region. Yet, the questions remains, if Moscow will be able to coordinate with China that became the main creditor of Central Asia.