Chinese Domination

ЭКСПАНСИЯ КИТАЯ

«ТЯНИ-ТОЛКАЙ»: РЕАЛИИ РОССИЙСКО-КИТАЙСКОЙ ДРУЖБЫ

ИНСТИТУТ STRELKA

2015

CHINESE DOMINATION

INSTITUTE

PUSH-PULL STRATEGY: THE REALITIES OF THE RUSSIA–CHINA FRIENDSHIP

ЭКСПАНСИЯ КИТАЯ Китай перекраивает карту мира. Направляемая государством экспансия Китая подталкивает перераспределение мирового населения, политического влияния, капитала и природных ресурсов. После окончания холодной войны Китай стал новой сверхдержавой, развитие которой обусловлено не внешним противостоянием, а наличием огромного населения. Если в рамках внутренней политики страна отдает приоритет поддержанию долгосрочной стабильности национального государства, то в глобальной стратегии главное для Китая — обеспечение доступа к жизненно важным ресурсам. Россия, северный сосед Китая, также придает большое значение укреплению своего влияния на мировой арене, однако существует в принципиально иных политических, культурных, демографических и экономических условиях. Несмотря на различия, Россия и Китай имеют схожие политические интересы и взаимодополняющие экономические потребности: Китай нуждается в ресурсах, а Россия строит свою экономику на экспорте ресурсов. Проект предлагает концепцию особой пограничной территории, на которой пересекаются российско-китайские интересы ­— зона сельскохозяйственного, инфраструктурного и военного развития. Есть у этой территории и символическое значение: она отражает контраст между интенсивной урбанизацией на китайской стороне и обширными незанятыми землями на российской. Проект предлагает новое видение российско-китайского альянса в 21 веке — союз двух супердержав, основанный на взаимодополняющем развитии во всех сферах — от производства продуктов питания до космических разработок — и противостоянии другим глобальным державам. В проекте мы задаемся вопросом о том, насколько вероятен сценарий более плотного сотрудничества между Китаем и Россией и как в таком случае может выглядеть пограничная территория? Проект строит модель сотрудничества, мотивируемого расчетливым интересом каждой из сторон, равновесия ресурсов и их потребления, направляющего смещение мирового баланса с запада на восток. ­— Николас Мур, куратор проекта

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CHINESE DOMINATION China is reorganizing the world map, redistributing populations, political power, capital, and natural resources according to the designs of the state. Following the Cold War, China is a new model of superpower, motivated and enabled not by conflict with an external enemy, but rather by the tremendous size of its domestic population. Chinese power, at home is oriented towards the long-term stability of the nation-state, and globally it is oriented towards sustained access to necessary resources. To the north, China’s neighbor is Russia, a nation-state equally committed to maintaining international power and influence, but with vastly different political, cultural, demographic, and economic conditions. In spite of their differences, these two states have mutual interests politically, as well as complimentary economic conditions, with Russia as resource supplier and China as consumer.

This project envisions a border territory where Sino-Russian needs intersect, a zone of agricultural, infrastructural, and military development. This zone is symbolic; it is a reflection of China’s intense urbanization on one side of the border, and Russia’s extensively undeveloped territory. The zone is also pragmatic: these typical national conditions, so different from one side of the border to another, are unified by the needs of each state as it seeks to maintain a powerful course for the future. The project is a proposal for a new kind of Sino-Russian alliance, an infrastructural interdependence that maintains peaceful relations between these super-neighbors as they strive to counter other major powers in the 21st century.

Here, from food production to the exploration of deep space, Russia and China are bound together in a net of mutual and complementary development. The project raises questions about the possibilities for the intensification of relations between the two states; further, it delineates that part of the world where the future of global power may be manufactured. It is a vision of cooperation motivated by self-interest, an international yin-yang of resources and consumption that seeks to tip the balance further from West to East.

— Nicholas Moore, tutor

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CHINESE DOMINATION

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China must be a superpower and key economic player in the world to survive. The Geopolitical situation pushes Russia and China towards each other. They might have been a perfect partnership: one has resources, another wants them. Common interests but different priorities will lead this alliance to the ‘push-pull’ scheme.

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CHINESE DOMINATION

Definition of the Trend To survive, China needs to continue its expansion. Geopolitical and economic reasons push Russia and China to each other. However there are too many things preventing this alliance becoming a reality.

Russia-China alliance concept

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DEFINITION OF THE TREND

Over the last 30 years, China has turned from a developing country to the world’s leading economy. As a result a new global trend appeared — Chinese domination. China is a superpower not due to ambition, but because of survival. In order to respond to the food demands of its steadily growing population and keep political stability within the country, the Chinese Party requires continuous economic growth. Being the world’s biggest resource consumer, China has to expand its channels of import.

The Russian response to the Chinese domination trend is somewhat ambivalent. Being under sanction Russia has an opportunity to find a powerful partner. Officially established Russia-China cooperation is a result of geopolitical environment. Moreover Chinese strategic needs match resources that Russia can provide. However Russia is not satisfied with the role of re-source supplier. Differences in Russian and Chinese priorities will influence the development of their relationship to the ‘Push-Pull’ scheme, where both parties will continually converge on and push away the other.

Chinese ancient painting; British Museum of art / Source: britishmuseum.org

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CHINESE DOMINATION

Global Development China is a superpower. The driver of its domination is a huge population. Emerged Chinese power challenges the world order.

China in numbers

There are several reasons that drive countries to dominate: territory, resources, money, ideology and geopolitical influence. All these drivers are about the ambitions of governments. The driver of Chinese domination is different. “China needs to be the key economic player in every part of the 7

GLOBAL DEVELOPMENT

world. This is not the question of ambitions this is a question of survival” said Vasily Kashin, expert on China at Moscow’s Center for Analysis of Strategies and Technologies.

“China needs to be the key economic player in every part of the world. This is not the question of ambitions this is a question of survival” Vasily Kashin, Moscow’s Center for Analysis of Strategies and Technologies

China’s population growth and its living conditions

Despite the fact that China is the second world economy now and as experts predict will be bigger than America by 2050, GDP per capita is still low, twice as small as that of Russia. According to data from the World Bank, the amount of people living on less than $5 a day in 2011 was 804 million. China’s large population has always been a major headache for the Government: how to feed such an enormous population and increase the nation’s standard of living. “Development is of paramount importance and stability is the paramount task,” was the main message of Hu Jintao during the Chinese Communist Party’s 90th anniversary in 2011. And by the 100th anniversary in 2021, the main goal, according to Xi Jinping’s administration, is an in-crease of national standard of living. To respond to the expectation of a continuously rising population, the Party needs a constantly growing economy.

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CHINESE DOMINATION

China’s energy consumption

To fuel the demand for energy from its fast-growing economy China has to be the key economic player in every part of the world. Since the beginning of the 21st century, China’s demand for gas and oil have increased 7- and 4-fold, respectively. This led China to diversify its suppliers in order to reduce dependency. This is why China can’t limit its interest to only one country, as witnessed by their foreign investment being allocated all over the world.

Chinese foreign investments

Chinese expanded power became a factor affecting the behavior of all governments around the developing world. In the 20th century, if any country had problems with the USA, it was basically doomed, as they could just destroy its economy.

Emerged China’s power created the alternative. China plays 9

GLOBAL DEVELOPMENT

an enormous role in countries under sanctions from the US: Iran today is China’s largest oil importer, Sudan has the biggest trade with it, and the Zimbabwean government purchases large amounts of military hardware from China.

Countries under US embargo, collaborated with China

Growing Chinese power shifts the center of the world from the Atlantic to the Pacific and China claims its superiority in Asia. China is not only becoming an economic power, its military budget is the second largest in the world behind the US. It needs to become a military power to play an important role in the international community. As said Liu Mingfu, a colonel and author of the book “The China Dream”, “The World is too important to be left to America”. After the construction of 2,000 acres of artificial land in the Spratly Islands by China (parts of which are also claimed by other nearby countries) we see growing tension between the two superpowers of the USA and China in the South China Sea.

CONCLUSIONS: əə

he driver of Chinese domination is not ambition T but survival. To have stability inside of the country with fully fed people its economy must grow.

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s a result of economical influence Chinese geoA political importance has increased, and made China a center of the new geopolitical pole.

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CHINESE DOMINATION

The Russian Condition Russia and China could have been a perfect partner to each other: one has resources, another wants them. Difference in expectations leads to an unstable relationship, to the ‘Push-Pull’ scheme.

Many experts have said that the gas contract was unfavorable to Russia, but the sign that was sent to the West was more important

In March 2014 Chinese reaction couldn’t prevent the inclusion of Crimea into Russia and a war in Ukraine. But whether Russia was isolated from the world or not at that moment depend-ed on China. “The Chinese authorities preferred to avoid expounding their views, but even the smallest nuances of the intonation of Chinese diplomats’ statements were scrutinized both in the West and Russia,” said Vasily Kashin. Moreover, immediately after the incident Russia and China signed a gas contract as a symbol of a future cooperation. Many experts have said that the gas contract was unfavorable to Russia, but the sign that was sent to the West was more important. This contract is profitable for China not only in terms of finance but also in terms of sustainability, because Russia (like Iran) is independent of the USA’s influence.

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THE RUSSIAN CONDITION

China and Russia had naval In May 2015 China and Russia had naval exercises in the Amer- exercises in the Americanican-dominated Mediterranean dominated Mediterranean Sea, Sea, around which neither Rusaround which neither Russia nor sia nor China has any coastline.

China has any coastline It was a declaration of their alliance, and response to exercises between the US and Georgia, allies in Asia, as well as NATO’s last movements in Europe. Each side has its own interests in this region. China invested €4.3 billion at the Greek port. It gives China’s Silk Road an important outlet for its trade. Russia wants to build a new gas pipeline bypassing Ukraine via Turkey and Greece. Both countries demonstrating their military power and interests in the region insisted that the military exercises were not directed at any third country. In such a way, common exercises were mostly a performance aimed to send a message to the West, rather than the establishment of a real alliance.

Both countries (for different reason) resist US power and promote ‘multi-polarity’. “The future of a China-Russian relationship depends “China and Russia may indeed largely on relations these two move towards a formal alliance, countries have with the West, even if that may not have been especially the United States. If what they originally wanted”: HuiWashington pushes too hard on yun Feng, Utah State University oil prices, Ukraine, and NATO expansion toward Russia, and if the US rebalances too far against China in the Pacific, China and Russia may indeed move towards a formal alliance, even if that may not have been what they originally wanted” said Huiyun Feng, professor of Utah State University. The two countries have nowhere else to go if they want to defend their geopolitical interests and challenge the World order. They support each other in the UN Security Council and now are actively signing lots of business contracts in different areas, especially in resources and military.

However neither of the countries had an obstacle caus12

CHINESE DOMINATION

ing them to collaborate intensively prior to the Ukrainian crises in 2014. China and Russia have mutual interests but different priori-ties that influence their relationship. Besides geopolitical support, Chinese interests include natural resources and raw materials, weaponry and arable land. Russia in turn expects huge financial investments from China for infrastructure development, industry and technology development. The difference in expectations leads to continuing bargaining and lack of tangible development.

During Xi’s stay in Moscow, Vladimir Putin announced the creation of “a common economic space of Eurasia” which would harmonize China’s ‘One Belt, One Road’ strategy with the Russian-fostered Eurasian Economic Union. As said Slepnev, minister of Russian trade: “union is especially interested in investments in the industrial and transport sectors, services and infra-structure”. Russia had similar discussions with the EU and the US before 2014 and a new negotiation with China is intended to show the West that Russia has another way for developing its strategic projects.

“China gradually beginning to displace Russia from the region as a geopolitical competitor”: Adjar Kurtov, Russian Institute for Strategic Studies

However China is rapidly overtaking Russia as the most important economic actor in Central Asia, and economically Russia cannot contest the investments that China can offer. “This consistent and well thought-out policy has led to China gradually beginning to displace Russia from the region as a geopolitical competitor,” said Adjar Kurtov, a researcher at the Russian Institute for Strategic Studies.

Taking into account specificity of relations and the fact that Russia views Central Asia as its traditional sphere of influence, ‘same belt’ but different dreams could lead Russia and China to conflict in Central Asia.

The Russia — China border is one more concern of the Russian government. A huge inequality of the population density on both sides of the border is the cause of a potential migration wave.

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THE RUSSIAN CONDITION

Conditions of living on Chinese and Russian sides

China as a country doesn’t have an ambition to conquer the Far East, but high population density and low standard of living in China make Russia an attractive place for millions of poor Chinese. They want to enter Russia because for reasons of survival rather than ambition. The Government understands this and is trying to control migration. That is why the official amount of Chinese in Russia is 35 000 and the informal is 400 000, why Russia continue to toughen up laws, and the reason why the number of Chinese in the country decreased last year since the establishment of the Russia-China alliance.

CONCLUSION: əə

hinese economic power allows Russia to find a C powerful partner despite being under sanctions.

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lliance between Russia and China depends on A current geopolitical situation and their relationships with the West.

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here are lots of reasons that could prevent this T relationship becoming a real alliance: different priorities in business, their individual ambitions in Central Asia as well as Russian government concerns about Chinese migration to the Far East.

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CHINESE DOMINATION

Russian Trajectories Migration problem, benefits priorities and geopolitical interests lead to interaction ceasing in some areas and the appearance of more close cooperation in others.

The Russia — China collaboration smacks of theatricality.

The gas contract signed right after the Crimea incident (the cost of gas is still not defined), common naval exercises in the Mediterranean Sea — these are more about symbols than about real partnership. Each party uses the other as support for their own message to the West. Nevertheless, besides a geopolitical profit there are several areas where Russia and China have mutual interests: resources, military, space, infra-structure and agriculture.

The main areas of Russia-China collaboration

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RUSSIAN TRAJECTORIES

Sifting mutual interests through the two countries’ priorities, we see what areas can become a point of growth.

OIL AND GAS The active phase of Russian and Chinese cooperation started from the signing of a $400 billion gas contract for 30 years in May 2014. By 2045 the contract between Russia and China will be finished and not be prolonged.

China is extensively developing renewable energy and by 2045 will not be needing Russian oil and gas.

The use of renewable energy in China

MILITARY Both are increasing military spending at a time when America and its NATO allies are cutting defense budgets. Russia and China (since 1989) are under arms embargo and they can’t buy weapons from the West.

Russia is planning to buy micro-electronics for the military sector from China. They signed a memorandum for cooperation on the development of wide-body air-craft and world’s largest helicopter.

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CHINESE DOMINATION

China’s and Russia’s military spending

China is the first country to be allowed to buy the most advanced S-400 anti-aircraft missiles and could use them to strike targets over Taiwan and Japan. Until now, Russia has never sold its latest weapons for fear of copying and to maintain its military advantage. Today’s selling of such weapons is seen, by experts, as proof of economic despair. If Russia continues to sell the latest arms to China, it might lead to Russia losing of its current advantage. In the future interaction in this area can be reduced to a theatrical performance as happened last May in the Mediterranean Sea.

SPACE In 2011 China became the second country in terms of amount of space launches. Taking into account the ambitions of the Chinese space program (a permanent space station and base on the moon) as well as the arms embargo, the Russians’ huge experience in space exploration will be invaluable. Russia has similar plans and is ready to collaborate with China. The two countries have already signed a memorandum on the joint application for navigation systems of the BeiDou and Glonass. They began work on a set of unified standards to be used in manufacturing space technologies, including for an orbital space station and mission to the Moon.

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RUSSIAN TRAJECTORIES

From a historical viewpoint, research and technology aimed at a human presence in outer space are significantly associated with the Cold War. Russia-China cooperation in a military-space program and common geopolitical interests can provoke a new era of space race with benefits for the whole of humanity.

However Russia-China cooperation will only continue whilst they are profitable for each other. When China gets its own space station or the arms embargo is lifted they can find a more advanced partner.

INFRASTRUCTURE

One of most ambitious projects is the construction of a $6 billion The amount of ghost cities inside high-speed railroad the country and built in Africa shows that Chinese construction from Moscow to Kazan companies have to find new territories to work. Russia really needs infrastructural projects and investments. That is why dozens of contracts were signed last May between both sides. One of most ambitious projects is the construction of a $6 billion high-speed railroad from Moscow to Kazan that can in the future be extended to Beijing.

Whilst leaders are signing ambitious projects, the bridge between Russia and China across the Amur River still is only half-constructed. The project started in 2008 but administrative disarray has allowed it to go unfinished from the Russian side. Such problems will continue to influence Russia-China infrastructure projects: some of them, such as a gas pipe line will be finished, but most will be left on paper.

AGRICULTURE Following fast industrialization, ecology in China was destroyed, so it lacks arable lands. The Russian Far East has an enormous territory with a huge potential for agriculture. Today the countries are creating a pilot agricultural free trade area between the province of Heilongjiang and the Amur region.

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CHINESE DOMINATION

Chinese agriculture is under threat

In terms of forecast population growth, China will need more food. Climate change will lead to the rise of using Russian land for the purpose of agriculture. Automation of this sphere and growing Chinese agroholdings profit will alert the Russian authorities to the value of arable land. It will lead to the gradual displacement of Chinese companies from Russian territory. By the 2060 food production will be fully state-controlled, as the main strategic and beneficial area. Private food production will be outlawed.

ILLEGAL AREA The Russian — Chinese official relationship is traditionally accompanied by a shadowy side. Chinese attention to the Russian forest is large due to an internal moratorium on deforestation. As a result the Primorye region is illegally deforested annually by around 1.5 million cubic meters of timber.

This area is controlled by the ‘Chinese mafia’, the Triads. In the future the Triads will control not only timber but privately grown food due to its illegality.

CONCLUSION: Differences in expectations will lead to an unstable relationship, to the ‘Push-Pull’ scheme, where the parties will continually converge and then push away each other with no trust.

Taking into account specifics of their relationship they will cooperate on the occasions they are useful to each other.

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THE FUTURE SETTLEMENT

The Future Settlement Frozen typical post-soviet science city and china-town on its outskirts reflect mutual Russia-China fusion The Russia — China border mostly goes along the Far East. In terms of the amount of re-sources, the building of ‘Vostochny’ spaceport and economic conditions made especially for the Far East and Chinese investors, this region can be the most fruitful for the cooperation between the two countries.

Far East resources

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CHINESE DOMINATION

In 2050 it still looks like a typical post-soviet science settlement where Chinese and Russian scientists work and live together in similar conditions. On the outskirts, the community of Chinese who work in the service sector, created a typical Chinatown.

The agriculture boom that began from private land renting was developed by China to become fully automated by companies. It became highly profitable and attracted Russian corporations who became their main competitors.

The Russia — China relationship is established as ‘top-down’; it is artificial and not culturally penetrated. Space industry, as a science, didn’t bring national identity; automation of agriculture also erased the Chinese footprint. Only the statue of friendship built by local authorities remained as a symbol of the Russia-China great fusion.

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THE FUTURE SETTLEMENT

Future settlement

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EXPERTS

PROJECT PARTICIPANTS DIRECTORS Anastasia Smirnova, David Erixon TUTOR Nicholas Walker Moore STUDENTS Valeriya Tabakova, architect, Moscow; Irina Shmeleva, architect Moscow; Valeria Kurmak, engineer, Moscow; Guilherme Vieira, landscape architect, Portugal EXTERNAL EXPERTS Jacob Dreyer, Lifestyle Magazine; Olesya Gerasimenko, Commersant; Vasiliy Kashin, the Moscow-based Center for Analysis of Strategies and Technologies; Alexandr Gabuev, Moscow center of Karnegi; Ivchenko Taras, RGGU Confucius Institute; Karneev Andrey, ISAA; Denis Sokolov, Cushman&Wakefield; Vasily Auzan, MSU; Richard Rhodes, Rhodesworks; Evgenia Pospelova, Strelka Institute; Dalia Seifullina, KB Strelka; Sergey Zapara, Telecommunications market; Peng Han Wu, ASYMPTOTE ARCHITECTURE; Anton Nikolov, chinese market; Benjamin Hart, Capital Dynamics; Elena Korotkova, Skolkovo Moscow School of Management; Ekaterina Gromova, RVC.; Jiang Jun, Urban China.

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BIBLIOGRAPHY

KEY RESOURCES FOR THE RESEARCH FRIEDMAN, G (2009) The next 100 years : a forecast for the 21st century, New York: The Doubleday Publishing Group.

SAID, E (1978) Orientalism, United States: Vintage Books SASSEN, S (2014) Expulsions, UK: Harvard University Press JACQUES, M (2009) When China Rules the World. The Rise of the Middle Kingdom and the End of the Western World, London: the Penguin Group PAN, H (2010) The China Syndrome, India: Harper Collins MIDLER,P. (2012) Poorly Made in China: An Insider’s Account of the China Production Game, BXV-Peterburg LEONARD, M. (2008) What does China think?, Bardain Price

China country annual report (2013) Malaysia: World vision PRICEWATERHOUSECOOPERS (2015) The World in 2050. Will the shift in global economic power continue? UK: PricewaterhouseCoopers LLP. BROMLEY, M., WEZEMAN, S. (2013) Current trends in the international arms trade and implications, Sweden: SIPRI Watts, B. D. (2008) The US Defense Industrial Base: Past , Present and Future. Strategy for the Long Haul, US: CSBA Hedlund, S. and Rosefielde, S. (2009) Russia Since 1980. Cambridge University Press Graham, S. (2004) Postmortem city — towards to urban geopolitics. In: CITY: Analysis of urban trends, culture, theory, policy, action. Volume 8, Issue 2, pp. 165-206

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Berlin: Jovis Easterling, K. (2014) Extrastatecraft: The Power of Infrastructure Space. Verso

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CHINESE DOMINATION

ACKNOWLEDGMENTS Our team would like to thank all the people who generously assisted to make our project successful. Thanks to all Strelka Institute faculty, especially to our tutor Nicholas Moore, to Daria Paramonova, Brendan McGetrick and Evgenia Pospelova. Thanks to Aleksandr Gabuev, Vasiliy Kashin, Olesya Gerasimenko, Anton Nikolov, Jiang Jun and Jacob Dreyer for their assistance for the project and to our families for help and support.

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