Russia’s Turn to the East: Seeing Is Believing

To begin with, I consider “Russia's turn to the East” a lame phrase in its modern interpretations. The real turn was made when Russia (succeeded by the Soviet Union) developed the vast expanses of Siberia, annexed the Amur Region and Sakhalin, built the Trans-Siberian Railway and the Chinese Eastern Railway, the Vladivostok Fortress and the Pacific Fleet, developed the Russian-Chinese border infrastructure and created and supported communist movements and regimes in Pacific Asia. The country was addressing its current needs and responding to relevant challenges and threats from the East.

Today, the challenges are ephemeral, and the needs are not so pressing as to justify using the country’s limited resources to address them at the expense of other interests. It was enough to declare the development of the Far East a national priority for a century, assign a group of diligent officials to carry out the task, fill the information landscape with relevant content, pleasing a small group of Russian intellectuals who are persistently trying to advance the Asian agenda in Russian domestic and foreign policy by launching a process that none of today’s stakeholders will ever see completed.

There is no way Russia can make an effective pivot to the east today – not least of all because Moscow is compelled to look to the east with a kind of side vision. The main challenges and threats continue to come from the west and south, while the country's economic potential is clearly insufficient to help shape the vectors of the global economy, and Euro-Atlantic geopolitical arrangements and plans still top the list of Moscow's strategic priorities. The reorientation to the east is also hindered by the powerful resistance of the central bureaucracy, which, while enthusiastically supporting the President’s philosophy, tends to imitate and sabotage the “turn” more than it actually works on it.

Asia – Eurasia
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These days Vladivostok hosts the 5th Eastern Economic Forum (EEF), the largest representative event at the highest political level in Russia. This year, the forum will be attended by the heads of state and government of India, Malaysia, Mongolia and Japan as participants in a panel discussion, along with the President of Russia Vladimir Putin.
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However, this cloud has a silver lining. The creation of preferential zones and tax regimes to attract investment (priority development zones and free ports), although a belated decision – suffice it to remember the sad fate of the Nakhodka Free Economic Zone and similar attempts made back in the 1990s – did give an impetus to the development of the region's economy. The investment climate has certainly improved. The accumulated volume of foreign direct investment in the Far Eastern Federal District has grown by 86 percent over the past five years, and its share in Russia’s total FDI went up from 11 to 19 percent. In the last two years, the local industries began to revive, and GRP is on the rise. International humanitarian contacts are booming. There has been a surge in Chinese and South Korean tourism, especially in the southern part of Pacific Russia. In 2018, 365,000 Chinese and 220,000 Korean tourists visited the Primorye Territory, and 101,000 visitors from China traveled to the Amur Region. Although they do not yet enjoy any special hospitality, hostility is also absent on a massive scale.
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But the good news sort of ends there. Investment continues to go predominantly to the mineral production, giving the region the role of some raw materials periphery, supplying countries outside Russia. We can cheerfully report an influx of foreign investment while keeping modestly silent that 90 percent of it is concentrated in the Sakhalin oil and gas industry, and two-thirds of Chinese funds ($412 million out of $619 million) goes into its only large investment project, the Amazar pulp and paper plant in the Trans-Baikal Territory. No high-tech facilities are being built. There is no investment into creating new intellectual products, technologies and materials or into mechanisms for using the region’s science and technology potential, primarily the Academy of Sciences. The growth of tourism is limited by the shortage of hotels and the undeveloped transport infrastructure and services.

The region is faced with the problem of staffing the newly created industries. Talented high school graduates leaving for central universities is not even the main problem. The main thing is that few return after experiencing the drastic difference in the quality of life and opportunities for self-realization in Russia’s central regions compared with its eastern periphery. The quality and areas of training in regional universities, including federal universities, are neither adequate to the structure of the regional economy, nor to the requirements of modern enterprises.

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Viktoria Panova
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The problem of trust and guarantees for business also remains relevant. Foreign investors still consider Russia a risk zone for long-term capital investment, and regular scandals surrounding existing projects (such as the Chinese factory for the extraction of water from Lake Baikal) do not increase their optimism.

In addition, both local residents and regional authorities are distrustful of foreign investment, especially Chinese. According to a survey conducted by the Institute of History of the Far Eastern Branch of the Russian Academy of Sciences in 2019, about half of the population in cities along the Russian-Chinese border, from Chita to Vladivostok, are at least wary of investment from China. It is not surprising that the Program for the Development of Russian-Chinese Cooperation in the Trade, Economic and Investment Spheres in the Far East of Russia for 2018-2024, signed in November 2018 and aimed at attracting broad Chinese financial resources to the Far Eastern Federal District, has not even made it to the Russian information space.

A serious obstacle to the development of Russia’s eastern territories is that the government, in fact, lacks a clear idea of the mission of the region and its people. The neocolonialist ideas about using the natural resources of the Far East “for the development of all of Russia” (Russian thinkers) or “in the interests of the whole world” (their foreign colleagues), seeing the region as a “bridge” between Europe and Asia and a “springboard for Russia's integration into the Asia-Pacific Region” do not meet the realities of the 21st century, nor the volatile situation in the North Pacific. China’s policies are changing, and so is the situation on and around the Korean Peninsula; new factors are being added to Japan’s political agenda. All this directly affects the capabilities of Pacific Russia, whose future is very closely connected with the surrounding Asian world. The idea of “integration in the Asia-Pacific Region,” on which the concept of accelerated development of the Far East was originally based, has already lost its relevance. The eastern regions of Russia are mechanically and nominally added to the theoretical concept of Greater Eurasia, as well as China’s Belt and Road Initiative. At best, they are seen as a transit zone and a raw materials appendage of the two metropolises.

But the main trouble is that positive trends in the financial and economic sphere are not accompanied by any serious innovations in social policy, by something that would make the lives of people in eastern Russia more comfortable and attractive. The social, transport, housing, and communication infrastructure is practically not improving, their levels still significantly lower than the national average.

The local residents react to this injustice mainly with their feet: the region’s population continues to decline. The Far East naturally supports the government’s plans to develop the region, to cooperate with the Asia-Pacific countries (China is an absolute priority here), but for the most part they no longer believe the declarations and promises, the majority of which are never implemented. The short-lived euphoria that arose in the wake of the APEC Forum and the boisterous media activity from certain government members and the leadership of the Ministry for the Development of the Russian Far East soon disappeared.

In 2019, respondents from four of the six cities in the south of the Far Eastern Federal District (Blagoveshchensk, Khabarovsk, Chita, and Ulan-Ude) cited the “the federal government’s insufficient consideration for the interests of the Far Eastern territories” among the threats to the security of Russia and its Far Eastern territories in the Pacific Ocean. In Birobidzhan and Vladivostok, this threat was considered second only to “US policy.” In 2010 (before the so-called “turn to the East”), the population of the southern part of the region saw the main threat in the “growth of China's economic and military power” and foreign migration. The federal government’s policy and Chinese migration were in the second or third place in terms of danger. Today, only one in five residents fear the rise of China, which has fallen to sixth place in the list of threats to the region’s security. This situation definitely has its advantages – but not at all what we had expected.

Anyway, regardless of how many times one pronounces sugar, it will never make one's mouth sweeter. There are indeed some positive aspects to the imitation of the “eastward turn,” if only the fact that the region is constantly in and out of the headlines. But still, “the development of the economy of the Far East” and “the development of the Far East” are far from the same thing. And Russia is obviously failing on the latter.

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