Economic Development and Strategic Stability: The Know-How of the 1970s US-China Agreements for Modern Central Eurasia

One of the most important preconditions for the “peaceful rise” of China during the period of reforms (since 1978) was a series of agreements reached by its leaders with the leadership of the United States in the 1970s: the Shanghai Communiqué (February 1972), as well as agreements signed during Deng Xiaoping’s visit to the United States in early 1979. They envisaged a qualitatively new situation in Eastern Eurasia: China expressed its readiness to abandon hostile measures against the strategic interests of the United States in its part of the world and focused on domestic economic reforms. The United States, in response, provided diplomatic support and favourable political conditions for the inflow of foreign capital into the Chinese market. Washington also opened its own market for the import of Chinese goods, creating the conditions for the unprecedentedly long (almost 40-year) period of rapid growth of the Chinese economy.

The Soviet-American conflict (the Cold War) made China a temporary US partner in international affairs. The apogee of this was Deng Xiaoping’s call in January 1979 for the US leaders to create a “united front against hegemony”, i.e. against the USSR. In the 1970s East Asia had three key players: the USSR, the USA and China. The deal, which determined the development of the region for decades (the growth of the Chinese economy in exchange for its anti-Soviet foreign policy) was made by Washington and Beijing at the expense of the USSR. Moscow was gradually squeezed out of the region, and drawn into lengthy conflicts immediately beyond its borders (Afghanistan), or forced to provide large-scale military and economic support to states located much further away (Vietnam).

China’s Road to Global Leadership: Prospects and Challenges for Russia
Oleg Barabanov
The latest multilateral summit of the Belt and Road Initiative (BRI), which took place in Beijing in late April, was a significant event not only for continental but global politics as well. In his speech, President Putin clearly emphasized Russia's commitment to further strengthening pan-Eurasian cooperation and the levels of association already achieved between the Eurasian Economic Union and the Belt and Road Initiative.

Today, history is repeating itself, but in a modified form: the Russian-American conflict has made Moscow a partner of Beijing, and the BRI project clearly confirms this. Deprived of any strategic vision, Washington’s sanctions policy, in accelerating Russia’s movement towards China, has had the effect of devaluing the status of the United States as a leading diplomatic and economic player in Central Eurasia. Today, as in the 1970s, there are three key players in the region: China, Russia, and the United States. But it is properly the position of the United States that increasingly resembles the position of the USSR in the 1970s: loss of leadership in world affairs due to growing isolationism, a decline of the US share in the world economy, and the remoteness of Central Eurasia from the territory of the United States or their allies, NATO and Japan. 

After the beginning of the current sanctions war between Washington and its allies against Russia (2014), a unique opportunity appeared to ensure strategic stability in the region by displacing the United States from there and forming a Beijing- Moscow consensus on the basic features of the new balance of power. In our opinion, these are the following factors:

1. The central Eurasian powers and Russia support large-scale Chinese investments in the region’s transport and logistics infrastructure. Its constituent elements will be transport corridors passing through Kazakhstan and competing with each other in the direction of the Mediterranean Sea and Europe: 1) through Russia, 2) through the Caspian Sea and the South Caucasus, and 3) through Iran and Turkey.

2. The preservation of the CSTO as the main organisation dealing with serious security issues in the region and institutionalising Russia's special role in this area.

3. China’s positive attitude towards deepening the economic integration of the majority of the states in the region with Russia within the framework of the Eurasian Economic Union; the formation of a system of legal norms and institutions governing the relations between the EAEU and China with the prospect of creating a free trade zone.

4. A tolerant attitude among the Central Eurasia powers and Russia toward the presence of Chinese capital and its increase in the regional economy, coupled with a prevention of Chinese diplomatic interference in their internal affairs. Sinophobia is quite prevalent in Central Eurasia; therefore, exhibiting a cautious foreign policy in the region benefits the national interests of the PRC. Actually, this is precisely the current diplomatic style of China; it is being actively promoted with the current generation of Chinese leaders: a peaceful economic elevation with a respectful attitude towards the sovereignty of other states.

BRI: China Shows Strength, Coming Out From the Shadows
Anastasia Pyatachkova
China is still rethinking its role on the world arena, and the answer to the question of what role it assigns itself has not yet been found. That is why the theory of the “Chinese threat” is so effective, as it reflects more the fear of the unknown and presumed destruction of the values ​​of the neo-liberal order, than the real ability of the PRC to turn relations with its partners into an analogue of a traditional 'tributary system'.

From the point of view of geo-economics, China’s main interest in implementing the BRI project in Central Eurasia is to ensure the free movement of raw materials and goods to the west of its borders in the event of a possible closure of the Strait of Malacca. Thus, China is preparing to aggregate its relations with the United States, which has been striving since January 2012 (the time of publication of the Pentagon’s Defense Strategic Guidance, titled “Sustaining US Global Leadership: Priorities for 21st Century”) to contain China’s growth and fulfil Washington’s mission of remaining the world hegemon.

Under no circumstances should the states of Central Eurasia and Russia be parties to the US-China conflict. It is in their interest to provide favourable conditions for peaceful economic growth in the region. A consensus between Russia and China regarding stability in Central Eurasia, as well as a controlled reduction of the US role in the region to a modest level (where it is only one of several major economic partners), will allow them to repeat, amid new conditions, the successful experience of interaction between China and the US at the end of the Cold War. Located outside the zone of future conflict between the United States and China, the region will be able to concentrate on solving the acute problems of socio-economic development.

Like China, the states of Central Eurasia today completely reject the notion of integrating along the lines of an EU model, including the creation of supranational governance structures. Russia should preserve the purely economic nature of the EAEU, and address military security issues in two formats: through the CSTO in relation to the states of Central Eurasia, and the SCO (in the long run) to build a security apparatus that extends throughout continental Eurasia. With such guarantees of stability, the region will dramatically increase its attractiveness for investment and will be able to pursue a path of sustainable economic growth.

Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.