vlad.tribnet.com / Issue #589 / Opinion / Reading article...

Some 10-15 years ago when the border with China was opened and the influx of traders from both sides – Russian and Chinese- increased tremendously, Russians looked down on their neighbors who were showing minimum of education and culture and wearing simple military clothes. Several years have passed and now many people admit and awe China’s booming development.

Russians residing in the Far East of Russia, the territory which shares a 4,300-kilometer border with China, fear the possibility of Chinese territorial expansion and at the same time are puzzled with the secret of Chinese economic prosperity.

An expert in Russian-Chinese relations, Andrei Ostrovsky, deputy head of Moscow-based Institute of the Russian Far East for Russian Academy of Sciences, revealed in an interview that Russia loses economic competition to China due to unsound economic policy.

“Russia positions itself in the world as the country selling energy resources. Thus we will soon find ourselves in line with such countries as Iran, Iraq, Saudi Arabia and Kuwait,” Ostrovsky stressed. Pitifully, when a country prefers such stance and relies heavily on oil resources, its industrial growth gets stalled.

“In Soviet times our machinery products made a huge percentage of exports to China but nowadays machinery export hardly makes 1.4 percent while 30 percent of Chinese export to Russia is technologically advanced products,” Ostrovsky pointed out.

China does not develop plans on the territorial expansion of Russia; such ideas are voiced by Russian politicians who fear economic competition coming from the Chinese side, Ostrovsky said. “Instead of developing our own production, Russia prefers to ‘be afraid of China’,” he said.
However, according to Federal Migration Service, some 200,000 currently live in Russia. If we consider this share to Chinese population percentages in such countries as Australia, Canada or America, we will notice that our number is much lower,” Ostrovsky stressed.

Russia’s military and political relations with China are well-balanced and have improved in the recent years, but trade relations leave much space for maneuvers. According to Ostrovsky, infrastructure in the Far Eastern regions of Russia should see urgent upgrade and extension.

“Factually we have only one railroad with a maximum capacity 12 million of metric tons of cargoes annually, two border crossings, insufficient number of highways, bridges and ports,” Ostrovsky said. “We also have problems with banks granting credits for large projects. If we compare local banks to the banks of Asian-Pacific region, they can be classified as cooperative institutions providing peasants with loans for sowing campaigns,” Ostrovsky remarked.

Big projects require massive funding from the federal purse and this funding should not be only voiced but also accomplished, Ostrovsky revealed.

Chinese model of reforms can be successfully used in Russia but the main target is to achieve flexible transition avoiding hasty reforms, Ostrovsky concluded. “It is never too late to learn from our neighbor’s experience,” he added.