Can Russia’s own ‘belt and road’ project make a big impact?

_ Anton Tsvetov, expert, Centre for Strategic Research. Moscow, 29 September 2017.

Moscow’s reasons for rolling out the Greater Eurasian Partnership aren’t hard to understand, given today’s great power competition. But its inexperience may undermine its ambition.

Even though the Trans-Pacific Partnership (TPP) is in limbo, large-scale economic projects remain the latest trend in geo-economic competition among great powers. Central, South and East Asia seem to be in the focus of such schemes, from China’s “belt and road” to South Korea’s Eurasia Initiative. Russia has rolled out a mega project of its own – the “Greater Eurasian Partnership”.

The project has so far remained largely unnoticed, but those who do speak or write about it tend to fall into two categories. Some dismiss it as a neo-imperial idea, empty of substance and meant merely to bolster Russia’s great power image. Others – mostly Kremlin-inspired pundits – see it as Russia’s new civilisational project of the century, bound to propel it towards leadership in all Eurasia.

Both visions are equally wrong. The Greater Eurasian Partnership is not void of substance; it actually has some precise economic content – surprisingly so, given the general incoherence of Russia’s Asia policy. At the same time, it is meant to produce a decent public relations effect, regardless of the actual success, which may come in handy since implementing the initiative in full will be an extremely challenging task.

The Greater Eurasian Partnership is now regularly mentioned by President Vladimir Putin, Deputy Prime Minister Igor Shuvalov, who’s in charge of Russia’s economic relations with Asia, as well as various economic ministry officials. The initiative has been in the making for about two years before coming into notice in May, when Putin added the latest touch to it at the Belt and Road Forum in Beijing.

It all started, however, as a reaction to the Trans-Pacific Partnership and China’s plan for a Silk Road economic belt. Moscow chose an “if you can’t beat ’em, join ’em” approach by announcing the coordination of the Silk Road belt with the Russia-led Eurasian Economic Union. That was a quick fix to the asymmetry of strategic initiatives that was becoming visible in the region.

As the enormity of China’s belt and road became evident, along with growing interest in the US-led TPP and Asean’s Regional Comprehensive Economic Partnership, Russian policymakers decided to roll out a project of their own.

The idea first appeared in Putin’s annual address in November 2015: an economic partnership that would bind the Eurasian Economic Union, the Association of Southeast Asian Nations and the Shanghai Cooperation Organisation (SCO) – arguably an attempt to strengthen the ties of the five Eurasian Economic Union states with the growing economies of East and South Asia.

By now, the idea has become far more ambitious. Russia’s Greater Eurasia initiative now has two tracks. The first is the Greater Eurasian Partnership, a loose network of agreements that Russia and the Eurasian Economic Union may have with any country or grouping on the vast Eurasian continent. This may include a trade agreement with Serbia, a memorandum between the Eurasian Economic Commission and the Asean secretariat, or a joint investment project with Japan. One big element of this network will be a “Eurasian Trade Facilitation Agreement”, which Putin suggested at the belt and road forum in Beijing. This decentralised approach is reminiscent of the Belt and Road Initiative.

The question is, can Russia handle such an ambitious plan?

The second track is much more concrete, but no less ambitious. The Eurasian Economic Partnership represents a non-preferential Russia-China agreement on trade in services and investment, which will then be open for accession by members of the Eurasian Economic Union and any other states of Eurasia. The obvious reservation is that any state joining a Russia-China agreement will no doubt look like it is making a political statement in the era of perceived global competition among great powers, and Russia’s not-so-great relations with the West.

Moreover, it would mean signing a document that was negotiated only by two countries – precisely the approach that drew strong Russian criticism of the Trans-Pacific Partnership.

What is the point of the greater Eurasia idea then? First, it is an attempt to create substance in Russia’s pivot to Asia, often seen merely as a reaction to worsening relations with Europe and the US. Second, it is an attempt to bring greater international legitimacy to the Eurasian Economic Union by marketing it as a bloc. Finally, the two Eurasian partnerships are there to create an economic pull for Eurasian countries by making Russia a rule-maker and an advocate for more economic connectivity, amid fears of protectionism.

The big question is, can Russia handle such an ambitious plan? It has little experience in leading integration projects and carries the stigma of being a rebel in the eyes of the West. The answer will much depend on Moscow’s ability to talk to players in Asia in the language of economic benefits and strategic vision, and Russian policymakers’ readiness to explain time and again that the Greater Eurasian Partnership is more about partnership than greatness. The biggest obstacle, however, is still the lack of Russia’s own economic prowess and limited competitive power on global markets.


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