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(2016) Issue 9 by Alexander Gabuev, Paul Lirette, Konstantin Simonov RUSSIA-DIRECT.ORG VOL. 4 (2016) ISSUE 9 AVAILABLE FOR SUBSCRIBERS ONLY $4.99 By Alexander Gabuev, Paul Lirette, Konstantin Simonov, Victoria I. Zhuravleva, Ivan Kurilla CONTENTS EXECUTIVE SUMMARY Russian President Vladimir Putin has stated on several occasions his commitment to 04. The Russian Far East: Between make the development of Siberia and the Far East a “national priority for the entire the Trans-Pacific Partnership and 21st century,” including most recently at the Eastern Economic Forum that took place the Great Eurasia in Vladivostok in September. In many ways, this strategy dovetails with the nation’s BY ALEXANDER GABUEV pivot to the East, in the form of stronger trade and economic ties with China and the nations of Southeast Asia. But how realistic are these plans? 07. Russia’s Far East strategy: Fact In this report, we detail a number of political and economic factors that are complicat- or Fiction? ing Russia’s vision to develop its Far East and become a true player in Asia-Pacific – BY PAUL LIRETTE including geopolitical rivalries, historical grudges, the lack of infrastructure in the Far East and the rise of Central Asia. At the heart of all these issues is one central factor 11. Russia’s pivot to Asia through – energy. In many ways, Russia’s ability to build ties with Asian powers such as China the lens of energy cooperation is based on its capacity to supply enough energy to power these growing nations. BY KONSTANTIN SIMONOV And that’s the crux of the matter: Will Russia’s pivot to the East lead to real economic and technological progress? Or will the focus on the energy relationship just lead to the 15. Interview with Yaroslav Lisso­ construction of more pipelines and more dependence on oil and gas as an economic volik: The Russian Far East looks to lifeline? the American West for inspiration In a series of interviews and discussions, the report outlines that Russia’s goal should BY PAVEL KOSHKIN be greater economic integration with Eurasia and the formation of regional trade partnerships with the nations of Asia-Pacific. To help answer these questions, this 18. Interview with Alexei Che­ report includes a viewpoint on the historical development of Vladivostok in the Far kunkov: Tapping into the invest­ East, which some in Russia have conjectured could become the focal point of a robust ment potential of Russia’s Far East technological hub similar to Silicon Valley. BY PAVEL KOSHKIN Ultimately, Russia’s ability to develop the Far East will require more than just a fond reminiscence about the past or a doubling down of the nation’s current energy strategy. 20. Interview with Alexis Rod­ It will require real investment in infrastructure and telecommunications networks, and zianko: What can Russia offer for­ a real focus on diversifying the national economy into innovative new IT products. If eign investors during a time of cri­ that happens, Russia could be positioned far better than its Western rivals to make the sis? pivot to the East. BY ANNA GURYANOVA 22. How the US and Russia once were partners in the Far East BY VICTORIA I. ZHURAVLEVA 29. The most ‘Americanized’ terri­ tory in Russia BY IVAN KURILLA 31. Book review: Is Central Asia go­ ing to become part of a new center of the world? BY DIMITRI ELKIN 33. Further reading KO UT G la IRILL K | 1 | russia-direct.org AUTHORS Alexander Gabuev Senior associate and the chair of the Russia in the Asia­Pacific Program at the Carnegie Moscow Center. His research is focused on Russia’s policy toward East and Southeast Asia, political and ideological trends in China, and China’s relations with its neighbors — especially those in Central Asia. Prior to joining Carnegie, Gabuev served as deputy editor in chief of Kommersant­Vlast, one of Russia’s most influential newsweeklies. Paul Lirette Senior economist at the Warsaw­based Center for Social and Economic Research (CASE) with a focus on international trade and macroeconomic policy. Previously, he was a senior policy analyst at the Canadian Department of Finance and an economic market analyst with the Canadian Department of Agriculture. Lirette holds a master’s degree from the University of Guelph. Konstantin Simonov Director general of the National Energy Security Fund and first vice­rector for Exter­ nal Communications of the Financial University under the Government of the Russian Federation. Simonov specializes in political risks within the energy sector, geopolitical problems in connection with production of hydrocarbons and their supply to the global market, strategic development of companies, new production and transportation proj­ ects, the executive power of Russia, and the economic interests of Russia’s political elites. Victoria I. Zhuravleva Professor of American History and International Relations, the Director of the Program on American Studies and the Vice­Director of the Department of International Rela­ tions and Area Studies at the Russian State University for the Humanities (Moscow). Zhuravleva is the author of books and numerous articles on the history of the U.S. and Russian­American relations. Ivan Kurilla Former Kennan Institute fellow and professor of the European University at St. Peters­ burg. His current academic projects include the history of Russian­American relations in the years of the American Civil War, American Studies in Russia and Russian Studies in the U.S. as academic and pedagogical projects, a collective monograph on history of Russian­U.S. relations. | 2 | russia-direct.org FROM Russia’s Far East: Punching above its weight? THE EDITOR The double-headed eagle, Russia’s national emblem, suc- cinctly and vividly conveys its current political challenges and the nature of its foreign policy. Russia straddles be- tween the East and the West, both politically and economi- cally. The St. Petersburg International Economic Forum, targeting primarily European businesses, and the Eastern Economic Forum in Vladivostok, with its focus on Asia- Pacific investors, exemplify the Kremlin’s dual approach. Yet, in an attempt to rebalance its foreign policy amidst confrontation with the West, Moscow is shifting its priori- ties to the Asia-Pacific region. The goal is to bolster the Far East, which has become one of the nation’s top priorities given the fact that it is geographically at the crossroads of the East and the West. But the key question is whether Russia is really able to become the bridge between the East The report also features interviews with Russian econo- and the West, taking into account the numerous challenges mists and officials, including the Eurasian Development that hamper the investment climate in the country. In short, Bank’s Yaroslav Lissovolik, the Far East Development is the Far East punching above its weight? Fund’s Alexei Chekunkov, and American Chamber of Our new report tries to answer this question. It brings Commerce’s Alexis Rodzianko, who give their takes on the together a number of prominent Russian and foreign prospects of attracting foreign investment to the Far East experts. Alexander Gabuev of the Carnegie Moscow Center amidst its challenges. Finally, the report presents a review and Paul Lirette of the Warsaw-based Center for Social of the book “The Silk Roads: A New History of the World” and Economic Research (CASE), look at the Far East’s by Oxford University’s Peter Frankopan, who examines challenges in the context of the rivalry of the numerous in- how the West has been interacting with the East for the tegration projects in Asia-Pacific. Konstantin Simonov of past two millennia. the Financial University under the Government of the Rus- I hope you enjoy this report. Please, do not hesitate to sian Federation assesses Russia’s pivot to Asia through reach me directly at [email protected] with the lens of energy cooperation. Victoria Zhuravleva of your questions. Thank you for being our loyal reader. the Russian State University for the Humanities, and Ivan Kurilla from the European University at St. Petersburg, shed light on U.S.-Russia cooperation in the Far East by examining the history of the region. Pavel Koshkin, Editor-in-Chief Write to us [email protected] for general comments, subscription and distribution questions; Send an email to: [email protected] for your submissions, article proposals, topic suggestions, and content-related comments; [email protected] for sales and advertising. Eugene Abov Chairman, Russia Direct, Deputy Director General, Rossiyskaya Gazeta Publishing House, Publisher, Russia Beyond The Headlines Julia Golikova Director for Development, Russia Direct, Deputy Publisher, Commercial and Foreign Partnership Director, Russia Beyond The Headlines Elena Potapova Deputy Publisher, Circulation, Digital Strategy and Operations, Russia Beyond The Headlines Pavel Koshkin Editor-in-Chief Ksenia Zubacheva Executive Editor Dominic Basulto Executive Editor, U.S. Andrei Zolotov Executive Editor, Europe Alexey Khlebnikov Senior Editor Maria Stambler Social Media Director Julia Sinitsky Intern Anna Guryanova Contributor Olga Fastova Associate Publisher, Sales, Marketing, Events Ekaterina Belan Digital Marketing Manager Anna Sergeeva Representative, New York Olga Guitchounts Representative, Washington, D.C. Andrey Shimarskiy Art Director Nikolay Shiyanov Senior Designer Alexander Kislov Designer Milla Domogatskaya Production Designer Andrey Zaitsev Head of Photo Department Nikolay Korolev Photo Editor © Russia Direct 2016 All rights reserved. ISSN 2412-8171. A product of No part of this publication may be reproduced or transmitted in any form or by any means, including photocopying, or by any information storage and retrieval system. The views expressed are those of certain participants in the discussion and do not necessarily reflect the views of all participants or of Russia Direct. | 3 | russia-direct.org The Russian Far East: Between the Trans-Pacific Partnership and the Great Eurasia VLADIMIR SMIRNov/TASS Russia faces conflicting choices n Sept.
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