Fear and Loathing in Siberia

Vladimir Putin, like Russia’s double-headed imperial eagle, has two faces. Both have lately been very much in evidence. At a meeting of G8 energy ministers in Moscow last week, the Russian president showed his Western visage, presenting Russia as a reliable energy partner and playing the superpower alongside the big hitters of the democratic, industrialized world. This week he travels to Beijing to cement a growing partnership with Asia’s other booming authoritarian-capitalist country, China. There he will sign deals on oil pipelines, sales of sophisticated weaponry and nuclear reactors, and security accords reminiscent of the old days of Sino-Soviet entente.

Putin clearly relishes his—and Russia’s—newfound clout. But his visit to China raises an interesting question: which of the two nations, in fact, is the real superpower? On the surface, Russia seems to take the laurel, playing an energy-hungry East and West to its advantage. Awash in oil money, Moscow has recently been asserting itself as never before in the post-Soviet era—involving itself in Iran and the Middle East, wielding oil and natural gas as a political weapon against its neighbors in Eastern (and Western) Europe and reasserting control over its near abroad from Belarus to Uzbekistan.

Yet for all its new bullishness, Moscow looks East with a fearful eye.

The reality is that China is rising as a military power—thanks in large part to the $5 billion of high-tech Russian arms it buys every year. And long ago it surpassed Russia economically. Yes, Russia may be sloshing with petrodollars. But China’s surplus of trade capital is even bigger—to the point that Chinese investment threatens to swamp Russia’s dysfunctional economy, particularly in its impoverished but strategically critical Far East. Western G8 members may have objected, fruitlessly, to Putin’s inviting China to the Moscow summit. But in truth, it’s China—the world’s fourth largest economy, with Russia just ahead of Mexico in 12th place—that has the greater claim to a place at the top table. “Russia is shifting from being a junior partner of the United States to a junior partner of China,” says Dmitry Trenin, director of Moscow’s Carnegie Fund.

Nowhere is China’s growing dominance more evident than in Siberia, a vast land far larger than China itself but inhabited by a mere 30 million Russians. Chinese goods are everywhere. In Novosibirsk, the owner of a new hotel can’t think of a single thing in the place that isn’t from China, from the electric sockets to the beds and furniture. The town’s citizens will soon ride to work on Chinese buses; in the markets of Khabarovsk bargain-hungry Russian babush-kas even know the Chinese names for the vegetables they buy from Chinese traders. “Everything we have comes from China—our dishes, leather goods, even the meat we eat is from China,” complains Vyacheslav Ilyukhin, head of the Building Department at Novosobirsk’s city hall. “Siberia is becoming Chinese.”

But Siberia is more than just a market for Chinese goods. Its vast oil and gas reserves make it the ideal gas tank to power China’s growth. Earlier this month Putin ordered officials to speed up plans for an $11.5 billion, 4,100km crude-oil pipeline from eastern Siberia to the Pacific Ocean that will eventually carry 1.6 million barrels per day to China and Japan. And Russia’s state energy utility, Unified Energy Systems, plans to spend $8.2 billion to build four giant hydropower complexes on the Aldan, Uchur and Timpton rivers in eastern Siberia to help meet China’s annual demand for 40 billion kilowatt-hours of power.

Newsweek