Russia lacks economic clout in tentative pivot to Asia

Russia lacks economic clout in tentative pivot to Asia

The deterioration in U.S.-Russian relations continues to impact Russia’s pivot to Asia.  However, it is important to distinguish between Moscow’s pivot to Asia versus its pivot to China, as well as the role economics and security play in both.

Pivot to Asia vs. pivot to China

Much attention has been given to Russia’s strategic turn, or “pivot” to China in the wake of U.S.-Russia tensions. However, the more consequential picture is one of Moscow’s desire to not become Beijing’s junior partner due to the latter’s economic power. Historically, Russia has threatened to turn eastward only whenever its relations with the West became strained.

Because of these factors, Russia faces both internal and external pressure to demonstrate that its Asian pivot is indeed genuine. Ironically, Sino-Russian trade has actually fallen in recent years. It was initially hoped that increased trade linkages between the two giants would lead to enhanced security cooperation as well.

This economic cooperation would have taken place along the model of the Eurasian Economic Union’s cooperation with the Silk Economic Road. However, these two initiatives overlap in Central Asia, an area which Russia has historically seen as its own backyard.  This, combined with current Russian economic difficulties, resulted in the “big gun, big wallet” approach. This division of labor sees Russia more as the security guarantor to the region, while China assumes the role of its economic guarantor.

In order to decrease its potential reliance on China as the anchor to its Asian pivot, Russia has reached out to different countries in both northeast and southeast Asia. Russia is also seeking to counterbalance China’s influence in these different parts of Asia by emphasizing its security expertise. However, this outreach to different regional players must also emphasize the clear economic benefits Russia can bring to the table as well.

Northeast Asia

In addition to central Asia, Russian influence has historically been strong in northeast Asia. As such, while it may recognize China’s claimed primacy in this region, as China does Russia’s in central Asia, Russia’s still taking steps to balance its erstwhile ally. It currently does this through outreach to Japan.

This desire drives its diplomatic efforts, despite the Kuril Islands dispute between the neighbors. However, these efforts are not limited to the security realm only. They are undergirded by a clear value proposition in which Russia’s vast energy reserves would also help ensure Japanese economic security.

South Korea has also come to see Russia as an important security partner in dealing with the North Korean threat. Like Japan, South Korea realizes that a nuclear-free Korean peninsula is beneficial to the entire region. Unlike Japan, however, its economic ties to Russia face more difficulties.

Russia’s economic plans via South Korea include a possible rail linkage connecting both Koreas to Europe via Russia, echoing the original Silk Road. Additional plans include a Russian proposal for the North Korean city of Rajin to become a regional trade hub. However, because of international and, specifically South Korean, sanctions on North Korea, these schemes would face an additional implementation hurdle.

Southeast Asia

In the past, Russia has struggled to be perceived as a serious partner to the southeast Asian region. Its remoteness from the area has only exacerbated this difficulty. Like the U.S., Russia’s official position is one of neutrality regarding the many island disputes in the region.

However, at the recent Shangri-La Dialogue, Russia proposed that its counterterrorism experience might be something southeast Asian states would find invaluable. This experience was highlighted through its recent Syrian campaign, as well as Russia’s domestic counter-terrorist operations against potential returning terrorists.

This security experience would certainly be of benefit to countries such as Indonesia, Malaysia, and the Philippines, all of whom are dealing with terrorist dilemmas of their own. However, this security resume lies atop a shaky economic foundation. Simply put, Russia’s economic efforts in the region pale compared to China’s and Japan’s.

While Russia’s security expertise was highlighted at Shangri-La, at most this would translate into more defense deals, such as aircraft and naval weaponry.  With respect to massive investment deals which would impact local civilian populations, Russia continues to falter. The one notable exception would be with proposed Russian investment in offshore Vietnamese oil blocks, but this is a legacy of Cold War-era ties.

Here again, China demonstrates its regional economic clout through its Maritime Silk Route and Asian Infrastructure Investment Bank (AIIB). Even Japan, which has its own economic difficulties despite being the world’s third-largest economy, has had a major regional impact. In a bid to offset China’s economic power, Japan has just concluded a massive investment deal to improve the infrastructure of the lower Mekong River region.

In summary, in order for Russia to enhance its security role in east Asia with respect to China, it will need to have a stronger economic proposal as to how it can add value to the region in the long-term.

Categories: Asia Pacific, Economics

About Author

Robert Matthew Shines

Robert Matthew Shines is a U.S. Foreign Policy Analyst & Project Manager with Bright Group Consulting, where he provides confidential geopolitical forecasting services regarding various aspects of U.S.-China foreign policy. Additionally, he is an Expert | Geopolitical Intelligence with RANE, an information and advisory services company that connects business leaders to critical risk insights and expertise. He is also an Analyst with the Foreign Policy Association where he writes blogs on foreign policy analysis. As a Senior Analyst and Editor with Global Risk Insights, he provides analysis on political risk & geopolitics. Lastly, he is a Writer for Geopoliticalmonitor Intelligence Corporation, an international intelligence publication which provides comprehensive geopolitical analysis. Having previously consulted in Ukraine, his area of focus is U.S.-Russia relations. He received his MBA from the Thunderbird School of Global Management with a focus on U.S.-China relations.