Moscow, February 2014 valdaiclub.com Toward the Great Ocean—2, or Russia’s Breakthrough to Asia Valdai Discussion Club Report Toward the Great Ocean—2, or Russia’s Breakthrough to Asia Valdai Discussion Club Report Moscow, February 2014 valdaiclub.com Executive Editor and Head Authors of the Authors’ Group Igor Makarov Sergei Karaganov principal author, lecturer at the Department of Dean of the Faculty of World Economy World Economy, National Research University and International Affairs at the National Higher School of Economics; Research University — Higher School of Ph.D. in Economics Economics; Honorary Chairman of the Presidium of the Council on Foreign and Oleg Barabanov Defense Policy (CFDP); D.Sc. in History Head of the Department of Policy and Functioning of the European Union and the European Council, Moscow State Institute of International Relations; professor at the Project scientific supervisors Department of International Affairs, National Research University — Higher School of Sergei Karaganov Economics; D.Sc. in Political Science Dean of the Faculty of World Economy and International Affairs at the National Timofei Bordachev Research University — Higher School of Director of the Center for Comprehensive Economics; Honorary Chairman of the European and International Studies, National Presidium of the Council on Foreign and Research University — Higher School of Defense Policy (CFDP); D.Sc. in History Economics; Ph.D. in Political Science Victor Larin Evgeny Kanaev Director of the Institute of History, professor at the Department of International Archaeology and Ethnography of the Affairs, National Research University — Higher Peoples of the Far East, Far Eastern School of Economics; D.Sc. in History Branch of the Russian Academy of Sciences; D.Sc. in History Victor Larin Director of the Institute of History, Archaeology and Ethnography of the Peoples of the Far East, Far Eastern Branch of the Russian Academy of Sciences; D.Sc. in History Vladimir Ryzhkov professor at the Department of International Organizations and European Integration, National Research University — Higher School of Economics; Ph.D. in History The views and opinions of authors expressed herein do not necessarily state or reflect those of the Valdai Discussion Club. Сontents 5 Synopsis 9 1. Toward the Great Ocean: From Calls to Action 9 1.1. The 2012 report Toward the Great Ocean, or the New Globalization of Russia: main theses 10 1.2. The pivot to the east two years later: What has changed since the publication of the report? 16 2. Economic and Political Processes in the APR and Russia’s Place in Them 16 2.1. Asia’s growth in the face of new challenges 19 2.2. The growing conflict potential of the Asia-Pacific region 22 2.3. The “demand for Russia” in Asia-Pacific countries 30 2.4. Increasing Russia’s integration on the Asia-Pacific region 34 3. Siberia and the Far East: Redefining Risks and Opportunities 34 3.1. Threats 40 3.2. Opportunities and capabilities 45 3.3. A new understanding of the situation in Russia’s Arctic 50 4. International Cooperation for the Development of Siberia and the Far East 50 4.1. Siberia and the Far East as room for compromise 51 4.2. Economic interests of foreign partners in Siberia and the Far East 54 4.3. Foreign partners’ interests in the development of Russia’s Arctic regions 59 4.4. Barriers to international cooperation in the development of Siberia and the Far East 62 5. Toward a New Development Strategy for Siberia and Russian the Far East 62 5.1. A philosophy for the region’s development 64 5.2. Toward new management practices for Siberia and the Far East 68 5.3. A transport framework for Siberia and the Far East 71 5.4. Northern Sea Route as the heart of Russia’s Arctic regions 74 Notes Acknowledgements This publication is a follow-up of the report Toward the Great Ocean, or the New Globalization of Russia, published by the Valdai Discussion Club in July 2012 and is based on the conclusions drawn in that report. This paper also widely uses the material contributed by a group of authors (headed by Vladimir Ryzhkov and Rostislav Turovsky) of Russia Is a Country of Regions section of the CFDP project Strategy XXI. The authors of the present report gratefully thank the participants in the meeting of International Academic Consortium “Developing Asia’s Last Frontier” (Russia–Singapore– China–Japan–Norway–South Korea), held on September 17, 2013 on the margins of the 10th annual meeting of the Valdai Discussion Club, for their constructive ideas and proposals. They are also grateful to all the participants of the conference “Developing Asia-Pacific’s Last Frontier. Fostering International Cooperation in the Development of Russia’s Siberia and Far East”, held by the Consortium and the Valdai Discussion Club on December 16–18 in Singapore. The authors express their special thanks to Prof. Huang Jing, Director of the Center on Asia and Globalization, National University of Singapore; Dr. Lee Jae-Young, Head of Russia/CIS Team at the Institute of International Economic Policy, South Korea; Ambassador Yukio Satoh, Vice Chairman of the Japan Institute of International Affairs, Japan; Prof. Ulf Sverdrup, Director of the Norwegian Institute of International Affairs; Prof. Nobuo Shimotomai, professor of Hosei University, Japan; Prof. Feng Shaolei, Dean of the School of Advanced International and Area Studies, East China Normal University. Analytical notes, prepared by Consortium members, were an important source of information on the positions of foreign partners. In addition, the authors are grateful to all participants in the expert seminar “The Future of Siberia: Problems and Prospects of Development,” held on October 12–13, 2013 in Krasnoyarsk, for their ideas. The authors rely on many of the ideas presented in the report Scenarios for the Development of Eastern Siberia and the Russian Far East in the Context of the Political and Economic Dynamics of the Asia-Pacific Region until 2030, edited by Andrey Kokoshin; the article Continent Siberia. From a Colony to a Global Player by Vladislav Inozemtsev, Vladimir Ryzhkov and Ilya Ponomaryov; the book The Siberian Challenge by Vladislav Inozemtsev and Valery Zubov; the report Siberia as New Central Russia. How the South of Western Siberia Will Become the Economic Center of the Planet, edited by Yuri Krupnov; the materials of information-analytical bulletin At the Map of the Pacific Ocean, published by the Institute of History, Archaeology and Ethnography of the Peoples of the Far East, Far Eastern Branch of the Russian Academy of Sciences, and in many other works. Of course, the authors have taken into account some provisions of the State Program Socio-Economic Development of the Russian Far East and the Baikal Region. The authors thank Yulia Litvinova, a researcher of the Russian Presidential Academy of National Economy and Public Administration, for preparing information and analytical material that was used in some parts of the report. The authors express their gratitude to the NOVATEK Corporation and SUMMA Group, whose financial assistance helped with writing some sections of the report. Toward the Great Ocean—2, or Russia’s Breakthrough to Asia Synopsis Almost two years have passed since the pub- conflicts and the absence of confrontation lication of the Valdai Club report Toward the with any Asia-Pacific country enables it to Great Ocean, or the New Globalization of claim the role of guarantor of security in the Russia.1 At the level of declarations, Russian region. Russia’s place in the national strate- politics has really turned toward to the East. gies of APR countries is steadily growing too, The larger part of the Russian political and albeit rather slowly. Whereas earlier Russia intellectual elites is aware of the importance of was viewed only as an Eastern European but stepping up cooperation with the Asia-Pacific not a Pacific country, now Asian countries region (APR). However, the Asian vector of pay more and more attention to opportunities Russia’s policy has not yet been filled with real that their mutually advantageous cooperation content. The policy of developing the country’s with Russia may open. Russia should continue eastern regions has stalled. Despite the hopes to stick to its status of “non-aligned power” pinned on the APEC Summit in Vladivostok, in the framework of multilateral diplomacy, Russia has never achieved a breakthrough in while actively developing bilateral relations its efforts to integrate into the APR. with countries of the region and pursuing a policy of small-scale initiatives – the initiation By being active on multilateral negotiating of cooperation in narrow formats, where Rus- platforms and using its objective advantages, sia can act as a full-scale participant or even Russia has made some progress in position- a leader. ing itself in the APR. There is now a growing demand for Russia’s participation in efforts to But most importantly, Russia will be able to solve regional problems. Amid a growing dis- fully integrate into the APR only if it ceases trust and the growth of conflicts in the region, to be a periphery for this region. The devel- Russia’s emphasis on peaceful solutions to opment of Siberia and the Russian Far East 5 VALDAI DISCUSSION CLUB REPORT Synopsis would be Russia’s window to Asia. It must be tics is rapidly returning to international rela- viewed as an essential tool for Russia’s pivot to tions and natural factors have an increasing the East as a strategic goal of the new, “Pacific” influence on the world economy, the area and century. Long-term political strengthening of geographical position of Siberia are becoming the country can only be a consequence of its a powerful resource for development. But this economic presence in the region.