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ECONOMIC GEOGRAPHY
In recent years, global geo-econo-mic transformations have been considerably affected by the development of the People's Republic of China, its reviving leadership and ambitions, and its increasing efforts to reformat and integrate the Eurasian space. The One Belt — One Road Initiative is a manifesto and a tool to advance China's long-term geostrategic interests that spread to the bordering states and regions and to the prospects of their socioeconomic development. The initiative encompasses transportation and logistics, production and investment, finances, research and technology, humanitarian affairs, and foreign policy.
In this article, we will highlight the key geoeconomic and geopolitical aspects of the One Belt — One Road initiative implementation, based on the Chinese and Russian studies. Another goal is to weigh up the risks and benefits associated with the extension of the project to Russian territories. Special attention is paid to Russia's western borderlands — 17 regions that account for 8.6% of the country's territory, 17.4 % of the total GRP, and 20.8% of the national population.
We analyse the factors in effect — including geopolitical ones, as well as current trends in the development of Russia's western borderlands. It is shown that the inclusion into the Chinese Eurasian integration initiatives creates additional incentives for a positive re-evaluation of the Russian space as a whole and holds special relevance for Russia's western border-
ONE BELT — ONE ROAD INITIATIVE: A WINDOW OF OPPORTUNITY FOR RUSSIA'S WESTERN BORDER REGIONS
A. G. Druzhinin Y. Dong2
1
1 Southern Federal University, 105 Bolshaya Sadovaya St., Rostov-on-Don, 344006, Russia.
2 Immanuel Kant Baltic Federal University, 14 A. Nevskogo St., Kaliningrad, 236041, Russia.
3 Nanjing Institute of Geography and Limnology, Chinese Academy of Sciences,
73 Beijing E Rd, Xuanwu Qu, Nanjing Shi, Jiangsu Sheng, 210008, China.
Submitted on February 09, 2018 doi: 10.5922/2079-8555-2018-2-3 © Druzhinin A.G., Dong Y., 2018
Baltic Region. 2018. Vol. 10, № 2. P. 39—55.
lands. We analyse the possibility of including Russia's Baltic regions — the in-frastructural and economic island of the Kaliningrad exclave among them — into the One Belt — One Road Initiative.
Keywords: geoeconomics, China, Eurasia, transport and logistics corridors, regional development, core-periphery system, Russia's western borderlands
Introduction
As the highly influential theoretical geographer, David Harvey has repeatedly stressed [1; 2], a sine qua non of productive activities is the 'spatial fix' attained through the construction and reconstruction of transportation and logistics infrastructure, production facilities, residential housing, etc. On this basis, space is 'produced' repeatedly. In the modern geoconomic architectonics, the scale, potential, and directions of dominant spatial changes are largely affected by the 'explosive' economic growth of the People's Republic of China1 and the country's geostrategic, marketing, financial, and investment interests. A geo-ideo-logical manifesto and a tailored strategy enjoying international, resource, and technological support is the One Belt One Road Initiative (^^—ft). A tool to reformat the Eurasian economic space, the national strategy has given rise to hundreds of projects [3—5]. Its complete implementation will create new socioeconomic risks and opportunities for the vast territories of Eurasian periphery and semi-periphery. This article is an attempt to highlight the key geoeconomic and geopolitical aspects of the One Belt One Road initiative and to estimate the prospects of Russia's Western borderlands for the integration into the Chinese project.
The One Belt One Road Initiative as a Geostrategy and a Megaproject Aimed to Reformat the Eurasian space
The One Belt One Road concept was first introduced by the President of the People's Republic of China Xi Jinping, in autumn 2013. In less than a year, it was named the key element of the Chinese leadership's foreign policy course [6]. In March 2015, a detailed implementation plan was published ('Excellent Prospects and Practical Steps...), which inco-
1 According to the World Bank, the PCR accounted for 1.8 % of the gross world product, at the official exchange rate, in 1992, for 3.6 % in 2000, 12.6 % in 2013, and 14.9 % in 2015. The GDP (PPP) of the emerging lobal leader, whose ascension has been predicted by leading analysts, reached 18.6 % in 2017, or 1.22 times that of the US and 1.18 times that of the EU.
rporated such priority aspects as transnational interactions, interconnection of member states' transportation infrastructures, cooperation in energy, agriculture, and other sectors, and favourable conditions for investment and free trade [7;8]. The most probable routes, or geostrategic targets, of the One Road One Belt Initiative were presented at the same time. Furthering the interest of the PRC, these routes run across Eurasia and the adjacent seas (see figure).
- Ore Belt ------ One Road
Fig. Priority routes of the One Road One Belt Initiative* * compiled based on [6; 9—11].
Partly following the navigation routes of ancient Chinese seafarers [12], the One Belt runs along the main maritime arteries of today [13, 14]. Holding the historical memories2 of the thoroughfare that crossed Iran, Iraq, and Syria to link China to the western Mediterranean, the One Road is a reflection of China's terrestrial geoeconomic priorities. As early as 2016, it became evident that the initiative would not limit itself to transportation and logistics but would include investment, industrial, R&D, financial and humanitarian components. China announced its intent to support international research projects in digital economy, nanotechnology, biotechnology, and other areas, initiated by members of the One Road One Belt Initiative. Support actions include the establishment and equipment of shared laboratories, research and academic
2 It was brought back to life and invested with renewed urgency by the Silk Road (die Seidenstraße) geoconcept found in the works of the German geographer F F von Richthofen and historian A Hermann [9].
exchange, and other measures. As the prominent Chinese geographer Liu Wei Don stresses, the One Belt One Road Initiative opens up new horizons of economic globalisation through promoting social justice, combating poverty, offering new development trajectories, and supporting cultural diversity [15; 16].
An essential part of systematic efforts to further the development the People's Republic of China, to overcome asymmetry between the country's eastern and western provinces [11; 18; 19], to open up new markets, and to raise the country's geoeconomic stature through 'creative expansion' [5], the One Belt One Road Initiative has become a conceptual framework for China's emerging pan-Eurasian leadership in trade, production, investment, and finance. Committed to the 'win-win' and mutual trust principles [10; 17], the Initiative has been reported to involve 65 countries with a total population of 4.4 billion people [20]. Moving out of the shadow [21], China is expected [22] to become the greatest power in the world. However, a sustainable full-scale implementation of the initiative requires both a stable transportation and logistics link to the still economically powerful Europe and an access to the resource potential of Central, South, and Southeast Asian and Middle Eastern states. This may demand boosting the industrial development of the regions' peripheries [23]. As of today, the PRC is dominating the markets of Pakistan, Tajikistan, Kirgizia, Iran, and Mongolia. The country has long-term interests in Japan, India, the states of the Persian Gulf, and other countries [24]. As Chinese analysts cogently argue, Russia and its regions can make an important contribution to the One Belt One Road Initiative [25; 26].
Risks and opportunities posed by the One Belt One Road Initiative to Russia: The geoeconomic and geopolitical aspects
The current Russian-Chinese relations do not rest solely on the long-term and diverse experience of geographical neighbourhood — an important factor of transboundary cooperation and the development of the vast Russian-Chinese borderland [27]. Another foundation of the countries' relations is bilateral trade. As of the beginning of 2018, the PRC accounted for the unprecedented 17.2% of Russia's international trade. Moreover, amid the conflict between Russia and the West, which has been ongoing since 2014, the similarity between Russia and China's position and the Eurasian interdependence between the two countries are becoming increasingly pronounced.
The countries' social and geographical parameters place Russia and China among the few giant states [28]. However, the balance of power
between the two countries is constantly changing. Russia's advantage is that its jurisdiction extends to a very large segment of Eurasia — 31.5 % of the continent's area. The country boasts a massive geo-historical heritage, although part of it was wasted in the post-Soviet period. Russia's military and strategic influence has been growing over the past decade. According to S. Karaganov, Russia is de facto the largest provider of security in the world [22]. It is also noteworthy that the country is taking attempts — some of them successful [29] — to develop Russian-centred integration formats (the Collective Security Treaty Organization and the Eurasian Economic Union). However, this stands in stark contrast to the country's geoeconomic position. The gap between the sizes of the Russian and Chinese economies is steadily growing. In 1992, the countries were at near-parity in terms of GDP. However, the GDP of China was 4.7 times that of Russia in 2000 and 8.3 times in 2015. According to the World Bank, the PRC accounts for almost a quarter of the GDP of Eurasia, whereas Russia's contribution to the continent's GDP is 2.83 % and that of all the EAEU countries 3.37%. At purchasing power parity, China accounts for 26.5 %, and Russia for only 4.4 % of the GDP of Eurasia. Against this background, the 2014—20153 Russian-Chinese agreements on the harmonisation of Eurasian integration initiatives take not only an economic but also a geopolitical character, the latter being prevalent. These agreements are declarations and shapers of a new Eurasian reality, as well as logical attempts to avoid a collision of interests through outlining strategic common grounds.
It is important to understand that China's integration project — which is very much in line with the idea of a 'turn to the East', dominant across Russian research and political discourse, and with that of a 'Big Eurasian Partnership' [30—32]) — is aimed to promote the interests of the 'Middle Kingdom' and to develop its periphery. Against this background, it would be unwise for Russia to count on any special treatment. Giving priority to the 'northern' corridor of the One Road — the one that runs across Russia — is not beneficial to China. The southern corridor, which crosses Central Asia, Pakistan, Iran, South Caucasus and Middle Eastern states, provides access to sixteen countries, home to 538 million people. In the last decade, the demographic potential of these states has increased by 18 %. Thus, they are more likely than Russia to show accelerated rates of socioeconomic growth. Moreover, their incorporation into the area of China's interests is not associated with significant geostrategic risks, as it might be in the case of Russia.
However, one should not overestimate the chance (and possible negative consequences) of the One Road's Russian direction being
3 ïs^Û
2015^5^8 0O (Joint Statement on Cooperation on the Construction of Joint Eurasian Economic Union and the Silk Road Economic Belt, Москва, May 08, 2015) http://www. kremlin. ru/supplement/4971
ignored. Russian authors [33] have addressed these concerns in their research works. In line with the established tradition, the PRC will most likely diversify its transcontinental routes. Probably, China will take part in the Northern Sea Route projects and the exploration of the Russian region of the Arctic. However, sea freight traffic — the One Belt, in China's case — will remain a priority because of the huge difference in sea and railway freight rates. The same holds true for Russia, which has been expanding the infrastructure of its Baltic and Black Sea and Pacific Ocean ports [34; 35] to boost the development of strategically valuable coastal territories. Naturally, Euro-Chinese trade will not dominate the Eurasian geoeconomy forever, as it does today. The development of the countries of South and South East Asia — partly prompted by Chinese initiatives — will inevitably turn the European subcontinent into one of equally powerful economic centres. It is in the interests of both Russia and China to coordinate their efforts and to build and modernise not only latitudinal East — West corridor but also the Eurasian communications infrastructure as a whole, including its longitudinal Northeast corridors. Common Russian-Chinese goals and shared responsibility are emerging in the field of security. Both countries seek the improvement of the political, social, and, in a long-term perspective, environmental situation in the countries south of Russia's border. The geopolitical congruity of Russia's and China's Eurasian efforts is creating a solid foundation for upcoming large joint infrastructure projects, for the much needed collaborations in research and technology (which are already taking place in the defence industry [36]), and for prioritising the Russian direction within the One Belt One Road Initiative. Engagement in Chinese Eurasian integration initiatives prompts a positive 'revision' of the whole Russian space, which is asymmetric, poorly integrated, sparsely populated and insufficiently involved in the national economy [37]. Although it may seem paradoxical, the above considerations and increasing geopolitical risks have lent urgency to the incorporation of Russia's western regions, including border and coastal territories, into the One Belt One Road Initiative.
Russia's Borderlands: Society and Geography in a Changing Eurasian Context
Russia's western borderlands (RWB) are a multiscale, multifaceted, non-static phenomenon with blurred spatial boundaries.4 Incorporating the territories that serve as a barrier between Russia and the West (in the military, political, and civilizational sense) and yet ensure contact between them, the U-shaped Western borderlands skirt Russia's north-
4 The content of the 'Russian borderlands' category may vary significantly and accommodate a most broad interpretation: '... lands, countries, and peoples on either side of our new and traditional borders' [43, c. 3]
western and southwestern peripheries. At the same time, in terms of location, mentality, and institutions, RWB are part of the metaregional trans-Eurasian limitrophe, or buffer, structures, the so-called 'strait' territories [38]): the Intermarium [39], the Baltic region [40], the Black Sea Region [41], and the Barents Region [42]. Serving as both a façade and a buffer, as border and transboundary space, these territories are closely integrated into the current national architectonics — the country's core-periphery structure and the Moscow-centric system. Russia's borderlands include not only regional and municipal frameworks contiguous with the national borders but also numerous semi-external elements. The latter extend to transportation, logistics, customs and border infrastructure, etc. Thus, it is logical to consider the RWB as comprising 17 Russian border or coastal regions, four of them having only maritime boundaries (see table).
Russian Western borderlands at the regional level: Key economic and population characteristics
Percentage of the national total, %* <U v=> g % se ion p irgest seaports al cargo handled )17, m tonnes)** * *
Region erritory GDP n io ta 3 ft rnational trade Population chan in 2010—2016, öS ip s a§ loop,00 gp0 tg o a ® in ö & h eg in at r nt <u
o ft int > Lot 2 Ä.S es 1
Northern segment
Arkhangel 2.4 0.6 0.8 0.5 - 5.2 — — (3B1)
sk region
Nenets 1.0 0.3 0.03 0.0 + 4.8 — — (3B2)
autonomo
us region
Murmans 0.8 0.6 0.5 0.5 - 4.6 — Murmansk (3B1)
k region (51.7)
Republic of Karelia 1.1 0.3 0.4 0.2 - 2.5 — — (3C1)
North-western (Baltic) segment
Saint 0.01 4.7 3.6 7.9 + 7.8 Saint Pe- Big port (1A)
Petersburg tersburg (approximately 6.5 m people) Saint Petersburg (53.6)
Leningrad 0.5 1.3 1.2 1.6 + 4.2 — Ust-Luga (3A1)
region (103.3); Primorsk (57.6); Visotsk
Kaliningrad region 0.1 0.5 0.7 1.5 + 4.7 Kaliningrad (approximately 600,000 people) (17.5) Kaliningrad (13.8) (3B1)
End of table
Percentage of the national total, %* <U vp g% « <u .2 ö H io Largest seaports (total cargo handled in 2017, m tonnes)**
Region territory GDP population international trade Population chan in 2010—2016, Urban agglomeral with a populati of over 500,000 pe Investment rating
Pskov region 0.3 0.2 0.4 0.1 -4.3 — — (3B2)
Western segment
Smolensk region 0.3 0.4 0.6 0.5 -3.1 — — (3B1)
Bryansk region 0.2 0.4 0.8 0.2 -4.3 — — (3B1)
Kursk region 0.2 0.5 0.8 0.2 -0.3 Kursk (550,000 people) (3A1)
Belgorod region 0.2 1.0 1.1 0.8 + 1.4 — — (2A)
Voronezh region 0.3 1.3 1.6 0.4 0.0 Voronezh (1.1 m people) (3A1)
South-western (Black Sea) segment
Rostov region 0.6 1.8 2.9 1.7 -1.1 Rostov (over 2 m people) Rostov-on-Don (14.9) (2A)
Krasnodar region 0.4 3.0 3.8 2.0 + 6.5 Krasnodar (approxim-tely 1.2 m people); Sochi — Tuapse (550,000 people) Novorossiysk (147.4); Tuapse (26.6); Port Kavkaz (35.3); Taman (14.9) (1A)
Republic of Crimea 0.2 0.4 1.3 0.02 -2.6 Sevastopol Yalta (550,000 people) (3B1)
Sevastopol 0.0 0.1 0.3 0.0 + 12.9 — (3B2)
* According to the Federal State Statistics Service
** According to the Association of Russian Commercial Seaports (http:// www.morport.com/)
*** Investment ranking according to the Expert RA rating agency (https:// raexpert. ru/: (1A) is maximum potential — minimum risk; (2A) is medium potential — minimum risk; (3A1) is low potential — minimum risk; (3B1) is low potential — moderate risk; (3B2) is insignificant potential — moderate risk; (3C1) is low potential — high risk.
Surrounded by multiple neighbourhoods [28], Russia has an economic and settlement framework that is Europe-centric [30], or skewed westward. Diverse and [44] still germinating, the Western borderlands emerged in their current configuration just over a quarter of a century ago — almost 71 % of Russia's 5750 km western land border is post-Soviet. Nevertheless, the countries western regions are far from being periphery in terms of their socioeconomic development, which is proven by statistics. Occupying 8.6% of the country's territory, the RWB account for 17.4% of its GDP and 20.8 % of the total national population.
Amid globalisation, the 'opening up' of the transforming Russian economy, and the growing economic gap between Russia and the West (which was especially pronounced in the 1990s), the Western borderlands were assuming leadership in transportation and transit, resources and raw materials, agriculture and manufacturing. In 2017, Russia's western terminals accounted for 73 % of the cargo handled by seaports nationwide. Symptomatically, the RWB regions handle 18.1 % of Russia's international trade. The Western borderlands are home to the largest national trade and logistics hubs — Saint Petersburg, Kaliningrad, and Novorossiysk. They are centres for production, technology, innovations, and education. The Saint Petersburg, Rostov, Voronezh, and Krasnodar agglomerations boast strong consumer and investment demand. Notably, with the exception of the northern segment and the Bryansk and Pskov regions, the RWB have a positive net migration. The resulting favourable demographic and economic effects corroborate the idea of the advanced development of capital and coastal regions [45—47] and fit well with the coasta-lisation principle [48] — the gravitation of population, manufacturing facilities, and infrastructure towards coastal areas. The historical path-dependence reinforced by prevalent post-Soviet trends predetermined the alternating/zonal/insular pattern of the RWB economic and settlement landscape. The polymorphism of the Western borderlands and their significance for the country has come strongly to the fore amid the geopolitical and geoeconomic turbulence observed since 2014.
The Western borderlands were joined by the Crimean peninsula. The territory of a controversial geopolitical status and restricted geoeconomic capabilities, it became defacto a national investment priority: in 2014—2017, fixed capital investment in the two Crimean regions increased 4.9-fold. With the national borders with Ukraine, Poland, Lithuania, and other countries assuming a pronounced barrier function, traditional transboun-dary contacts were broken off and the Kaliningrad region was turning into an island. Affected economically and infrastructurally, Russia's exclave was faced with the isolation of the power transmission system and partial termination of transboundary cooperation. Against this background, the flow of goods and raw materials along the major — Baltic
and Black Sea — transport corridors [49] was growing. The socioeconomic potential of the RWB was boosted not only by the preparation for 2018 FIFA World Cup (the host cities include Saint Petersburg, Kaliningrad, Rostov-on-Don, and Sochi) but also by the strengthening of military presence and the defence industry in the area. During the downturn of 2015—2016, the economies of thirteen out of the seventeen RWB regions were growing. Nine regions were witnessing an increase in investment.
The socio-geographical characteristics of the RWB regions — a favourable geography for transport and transit, an established settlement system, a developed infrastructure, major producers' orientation to export, and experience in transboundary cooperation [49—51] — are creating new opportunities. At the same time, the growing rift between Russia and the West, which is aggravated by the 'blurred' identity of some RWB segments and the neighbourhood-related stress [52], necessitates geoeconomic diversification. In this content, new prospects may lie with the Chinese Eurasian integration project.
Incorporating Russian's Western Borderlands Regions into the One Belt One Road Initiative: Priorities and Possibilities
The rates, directions, and the very possibility of China's geoeconomic exploration of Russian space, including the RWB, depend on the structures, functions, resources, logistics, and other characteristics of Russian territories. Most probably, the incorporation of Russia's economy into the One Belt One Road Initiative will start from the country's major centres, which are already familiar to Chinese businesses. One of them is Saint Petersburg.5 It is safe to assume that the harmonisation of the new Eurasian integration megaproject with the targets and opportunities of the RWB will draw on the experiences of Western partners and the performance of industrial, including transboundary, clusters with Western participation. In particular, this will help to attract Chinese investment in automobile assembly projects not only in the Saint Petersburg
5 A representative office of the Export-Import Bank of China (China Exim Bank) is quartered in Saint Petersburg. Since 2005, Chinese businesses have been running a large real estate development project — the Baltic Pearl. A Russian-Chinese business park and a logistics hub of the Alibaba Group are being built in the region. There are regular direct flights to Ürümqi, Shanghai, and Beijing and charter flights to Beijing, Wuhan, Macao, and Taipei from the Pulkovo airport in Saint Petersburg. Scheduled air services invigorate business communications and attract thousands of tourists to the city [53].
agglomeration, which accounts for 27% of national automobile production, but also in the Kaliningrad region. From the perspective of the Chinese market, the latter region opens up an even more attractive opportunity of investing in the amber mining and processing industry.
In the northern RWB segment, Chinese businesses — whose preferences are not yet completely clear — may be interested in Murmansk and Arkhangelsk as hubs, an Arctic exploration foothold, and the capitals of regions with a significant resource potential for fertilizer production and metallurgy. As to the western and Southern (Black Sea) borderlands, the Chinese may show interests in the agro-climatic resources and the related horticulture clusters, most of which are export-oriented [49]. These clusters — spanning Russia's border regions from Smolensk to Crimea — account for 30% of the national agricultural produce.
An increase in the number of investment projects and a wider sectoral scope may be attained through the implementation of large real estate development projects with Chinese participation and the forging of alliances with Russian large6 and medium enterprises. A possible accelerator (and indictor) of the incorporation of the RBW into the geoeconomic space of the 'Middle Kingdom' is Chinese investment in Russia's ports and other transportation and logistics facilities. However, all these projects are still under discussion. In view of the overall geopolitical situation and the growing Turkish influence in the Black Sea region, Russia should seek to attract Chinese businesses to the Crimean peninsula, thus partly lifting the geoeconomic 'siege'.
Despite the opportunities and priorities discussed above, it is premature to expect a rapid 'sinofication' of the RWB. Our partners will continue to look into the regional situation, analyse general national economic and political trends, and study and create 'neighbourhood' alternatives in Belarus, Ukraine and, probably, Turkey, Poland, the Baltics, and other countries. For decades to come, the Western borderlands will remain a crucial7 territory for Russia. At the same time, the country should continue to modernise its transport infrastructure, to make better use of 'targeted' development tools (special economic zones, advanced development territories), and to expand the 'Chinese component' in the place marketing of cities and regions. At the same time, it is important to consider the long-term socioeconomic and environmental interests of the Russian territories.
6 Partnerships with Chinese businesses have been forged by many companies 'entrenched' in the RWB. Among them are Gazprom, EuroChem, Phosagro, RUSAL, the United Shipbuilding Corporation, and others.
7 In the Concept of the Spatial Development Strategy of the Russian Federation until 2030, it is rightly stressed that 'inertia will continue to skew the proportions towards the West' [54, p. 25].
Conclusions
In a rapidly changing Eurasia, the potential of the Chinese One Belt One Road Initiative cannot be ignored. Nor should it be exaggerated. It is very unlikely that incorporation into the scope of Chinese integration initiatives will meet all the overblown economic expectations of the moment. This holds true for both the RWB and the country as a whole. The stronger Russia's geopolitical and geoeconiomic standing in the Eurasian space (this includes the resumption of a dialogue with the West) the more likely it is that the One Road One Belt Initiative will meet the country's spatial development needs and contribute to the modernisation of its transcontinental transport and logistics network and to its various integration projects. The Chinese Eurasian megaproject is another incentive to maintain and develop the 'eastern' component in the development of Russian society. In this context, a modest yet important landmark is growing cooperation between Russian social geographers and their Chinese counterparts who have been developing Russian studies at the universities of Beijing, Urumqi, Xi'an, Lanzhou, Harbin, and Kunming and such research centres as the Chinese Academy of Sciences, the Institute of Russian, Eastern European, and Central Asian Studies of the Academy of Social Sciences of the PRC.
The study was supported by a grant from the Russian Science Foundation, 18-17-00112, 'Ensuring the Economic Safety of Russia's Western Borderlands amid geopolitical Turbulence '.
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The authors
Prof. Alexander G. Druzhinin, Director of the North Caucasus Institute for Economic and Social Studies, Southern Federal University; Research Professor; Immanuel Kant Baltic Federal University, Russia.
E-mail: alexdru9@gmail.com
Prof. Yawen Dong, Nanjing Institute of Geography and Limnology, Chinese Academy of Sciences, China.
To cite this article:
Druzhinin, A. G., Dong, Y. 2018, One Belt — One Road Initiative: A Window of Opportunity for Russia's Western Border Regions, Balt. Reg., Vol. 10, no. 2, p. 39—55. doi: 10.5922/2079-8555-2018-2-3.
