Energy concerns drive China-Central Asia defence ties

Here’s the latest of my Central Asia series of Oxford Analytica briefs. This one is from late February.

—-

In shaping its relations with Central Asian states, Beijing has primarily focused on developing energy imports and forging economic ties in other areas. At the same time, China faces several security concerns emanating from the region, most importantly, Islamic radicalism and regional separatism. Beijing has been attempting to address these concerns via multilateral and bilateral cooperation with Central Asian states. The conflicts and tensions are likely to become more acute as NATO begins to withdraw from Afghanistan.

Impact

• China’s desire to avoid alienating Russia has prompted it to de-emphasise military ties in favour of economic and trade relations.
• Most Central Asian states prefer the focus on trade relations with China, although Uzbekistan has recently sought to increase military ties.
• Chinese leaders favour multilateral initiatives, which countries in the region regard as less threatening than bilateral approaches.

Analysis

Although China has long sought to increase its influence in Central Asia, it has sought to do so largely through economic and trade relations, rather than in the security sphere. As a result, China’s military ties with Central Asian states are relatively limited. This is due to a combination of factors:

•  Beijing is keen to avoid alienating Moscow, which continues to see itself as the primary guarantor of Central Asian security.
• Central Asian leaders are concerned that China is already enjoying a disproportionate degree of influence in the region. This has led them to be extremely cautious in extending military cooperation.
• China is reluctant to become the region’s main security guarantor, due to a combination of its long-standing policy of non-interference abroad, and more significant security challenges elsewhere, especially in its maritime region.

Multilateral initiatives

The primary mode of interaction between China and the Central Asian states in the security sphere revolves around multilateral initiatives organised through the Shanghai Cooperation Organization (SCO). These are closely related to China’s desire to combat terrorism, separatism and extremism. As a result, most multilateral security activities in the region that involve China revolve around counter-terrorism.

Peace Mission exercises

The Peace Mission series of counter-terrorism exercises have been held since 2003. The most recent took place in Tajikistan in June 2012 and included participants from all of the SCO member states except Uzbekistan. This was the smallest of the eight exercises held to date, highlighting the lack of emphasis on the military component of regional cooperation within the SCO. Uzbekistan has consistently refused to participate in the SCO exercises. The Uzbek leadership’s fear of domination by external powers — Russia, in particular — has made it keen to avoid any possibility that potential conflicts among Central Asian states might be internationalised.

RATS

China has also established a regional organisation dedicated to fighting terrorism. The Regional Anti-Terrorism Structure (RATS) of the SCO is dedicated to coordinating the anti-terrorist activities of member states, with a particular focus on radical Islamist organisations. RATS was established in 2004 and is headquartered in Tashkent, capital of Uzbekistan. In recent years, it has expanded its activities to include counter-narcotics coordination.

Bilateral cooperation

Kazakhstan is the most significant partner in China’s bilateral security activities in Central Asia. The two countries have had regular military exchanges since 1993 and have engaged in numerous, though mostly small-scale, military exercises since 2002. As with the multi-lateral activities, China’s military engagement with Kazakhstan focuses on non-traditional threats such as terrorism and drug trafficking. China provides a significant amount of military assistance to Kazakhstan, but it is limited almost entirely to non-lethal equipment.

Kyrgyzstan

China’s security relations with Kyrgyzstan are more limited and opaque. They are focused primarily on countering Uighur separatist networks. Beijing has also provided equipment to the Kyrgyzstani security forces, but as with Kazakhstan, this has been limited to non-lethal goods such as vehicles and computers.

Turkmenistan and Tajikistan

Security relations with Turkmenistan and Tajikistan are not a priority for China. With Turkmenistan, the basis of the bilateral relationship is natural gas exports. Security assistance is provided by Beijing in order to ensure that pipelines and other energy infrastructure are protected. China’s interests in Tajikistan are also very limited due, in part, to the widespread hostility towards the Chinese in Tajikistan, which is largely driven by the success of a recent Chinese effort to renegotiate the border between the two countries.

Uzbekistan

Uzbekistan withdrew from the Russia-led Collective Security Treaty Organization (CSTO) in June 2012, not long after President Islam Karimov had signed a strategic partnership agreement with China on the sidelines of an SCO summit. These circumstances, in conjunction with a prior visit to Tashkent by the chief of the Chinese General Staff, have led to speculations that Karimov decided to strengthen the security partnership with China at the expense of the traditionally strong ties with Russia’s military and security establishment. So far, China has not given any indications that it is eager to make this relationship deeper than its security relations with the other four Central Asian states.

Afghanistan concerns

Beijing is concerned with the potential spread of Islamic radicalism and political instability in Central Asia in the aftermath of NATO’s planned withdrawal from Afghanistan. It is particularly worried that instability in Central Asia would negatively affect its ability to import energy. The potential for the instability to spread to Xinjiang is an important secondary concern. Both of these threats may be realised if Afghanistan returned to a state of civil war or if the Taliban came back to power and began to export its ideology and methods of governance to Central Asia.

China will continue to tread cautiously, since the political reservations that limited its military involvement in Central Asia are equally relevant for Afghanistan. It will seek to ensure that its security initiatives in the region remain largely multilateral.

What next

China will continue to emphasise economic relations with Central Asia while soft-pedalling military ties, which will largely focus on the security of Chinese energy imports and continued stability in Xinjiang. Despite increased security concerns in the aftermath of the NATO withdrawal from Afghanistan, China will not attempt to become a regional security guarantor. It will leave that role primarily to Russia and focus instead on establishing its economic dominance in Central Asia.

Read Full Post »

Russia and China vie for influence in Central Asia

I’m still swamped with various projects, so in the meantime, here’s another Oxford Analytica brief. This one is from mid-December…

—-

Although China and the United States have focused greater attention on Central Asia in recent years, Russia remains the dominant power in the region. Its size and the cultural, political and economic connections that remain from the Soviet period are such that Central Asian countries are reluctant to take any actions that would antagonise Moscow. For Russian leaders, Central Asia serves as a buffer zone that protects Russia’s southern border from potential threats.

Impacts:

• Increasing Chinese economic presence in Central Asia will curtail Russia’s efforts to limit China’s regional political influence.
• After NATO’s exit from Afghanistan, Russia and Central Asian states will cooperate to prevent radical Islam from destabilising the region.
• Shifting patterns of energy demand and supply will reduce Russia’s ability to use energy as a tool for political influence.

ANALYSIS:

Russia’s various initiatives in Central Asia are shaped by three interest groups with widely divergent interests that often work at cross-purposes to each other:

• The military and defence industry is focused on the role of great power competition in the region; it seeks to promote arms sales and to increase Russia’s military presence.
• The energy industry focuses on securing exclusive rights to gas transit from Central Asia to Europe.
• The security services concentrate on the transnational threats to Russia from radical Islam, terrorism and drug smuggling.

Maintaining monopoly

Throughout the last decade, Russia sought to maintain its energy-transit monopoly on the export of petroleum and natural gas from Central Asia. Until 2005, all major export pipelines from the region went through Russia giving it control over transit fees. Russia’s monopoly over natural gas transit to Europe also gave it political and economic leverage over downstream countries dependent on supplies of Russian natural gas for domestic consumption.

The construction of alternative pipelines over the last decade has eliminated Russia’s monopoly on hydrocarbon transit from Central Asia. Energy-producing states in the region can now sell their products to China and Iran. At the same time, changes in patterns of supply and demand for natural gas in Europe have decreased the political and economic significance of Russia’s remaining monopoly on natural gas supply to some European countries. The development of new methods of shale gas extraction in the United States has increased the supply of LNG to Europe at the same time as the 2008-09 global financial crisis has led to a sharp drop in demand for natural gas.

These factors decreased Russia’s ability to set prices and to use its control of energy supply for political ends, thus reducing the importance of future Caspian pipeline transit. Russia is now likely to focus on energy production in the Caspian Sea region and has already begun to develop several oil and gas fields that it controls jointly with Kazakhstan.

Keeping China at bay

China has sought to increase its economic and political influence in Central Asia without alienating Russia for a number of reasons. For example:

• Central Asia has become one of China’s primary energy suppliers;
• Central Asia serves as a security buffer zone between China and both Russia and the United States; and
• China seeks to prevent Uighur separatists in Xinjiang from using Central Asia as a safe haven.

To further these goals, China made large investments into the Central Asian economies and, in particular, in energy infrastructure. The region provides raw materials to China in exchange for finished products such as machinery, food and consumer goods.

Russian leaders fear that their country’s position in Central Asia is gradually being displaced as China’s political influence and economic power grow. To maintain its sway in Central Asia, Russia has focused on ‘tying’ China into regional networks and institutions while retaining levers of influence through institutions in which China is not a member.

In the security realm, Russia has combined participation in the Shanghai Cooperation Organization (SCO) with its role in the Collective Security Treaty Organization (CSTO). While the SCO provides a neutral forum where Russia can discuss security and plan joint operations and exercises with China, the CSTO allows Russia to address Central Asian security issues without China’s participation. At the same time, Russia has sought to counter China’s economic influence in Central Asia by setting up the Customs Union, which, in 2014, is expected to include Kyrgyzstan and Tajikistan. Recent discussions concerning the establishment of the Eurasian Union in 2015 are also part of the effort to cement Central Asian economic ties to Russia.

Ensuring political stability

Although most of the regimes in the region have endured for over 20 years, Central Asia is now entering a period of potential political instability.

• Uzbekistan, Tajikistan and Turkmenistan are all bracing for a potential resurgence of Islamist radicalism in the aftermath of the likely US withdrawal from Afghanistan in 2014.
• Kazakhstan and Uzbekistan — both states ruled by authoritarian presidents in their mid-1970s — are highly vulnerable to succession risks.
• Kyrgyzstan is still recovering from two episodes of violent regime collapse in the last decade.

The potential destabilising influence of radical Islamist groups and drug smuggling networks is a key concern for Russia. Moscow believes that the current Central Asian leadership has been able to contain the threat of radical Islam and is worried that a regime change, combined with the withdrawal of NATO troops, would facilitate the spread of radical Islam to Russia.

These concerns have led Russia to provide various forms of security assistance to the region’s more vulnerable states. In the last year alone Russia has:

• extended leases on military bases in Kyrgyzstan and Tajikistan;
• sold weapons to Kazakhstan and Turkmenistan;
• sought to persuade Uzbekistan to re-engage with the CSTO; and
• agreed to provide 1.3 billion dollars to Kyrgyzstan and Tajikistan to modernise their military forces and ensure their security after the departure of Western troops.

The extension of Russia’s military base agreements with Central Asian countries, together with Kyrgyzstan’s decision to ask the United States to vacate the Manas base after the NATO departure from Afghanistan, will leave Russia as the sole security provider to vulnerable states in the region.

CONCLUSION: Russia’s security relations with Central Asian states will strengthen as they face the consequences of NATO’s withdrawal from Afghanistan in 2014. At the same time, Moscow’s efforts to remain the dominant economic partner of the region’s key players will likely falter as China strengthens its position as the main recipient of Central Asian energy exports and a key supplier of imported consumer products.

Read Full Post »

Turkmenistan’s isolationist strategy eases, to a point

While I hang out in Russia, here’s another Oxford Analytica brief. This one was written right after a quick trip to Ashgabat, back in early December 2010.

—

SUBJECT: The shift from an isolationist foreign policy towards selective engagement.

SIGNIFICANCE: Since President Gurbanguly Berdymukhamedov took office four years ago, Turkmenistan has started to shift away from the isolationism that characterized its international relations under former President Saparmurat Niyazov. However, its willingness to engage in international cooperation remains highly selective and largely limited to the economic sphere.

ANALYSIS: Since becoming independent in 1991, Turkmenistan has largely pursued an isolationist foreign policy, as symbolized by its declaration of permanent neutrality, which was recognized by a vote of the UN General Assembly in 1995. Since then, Turkmenistan refused to join any regional alliances or organizations that have military components, though it has participated as an invited guest in meetings of the Shanghai Cooperation Organization. It is also a member of NATO’s Partnership for Peace program, having joined in 1994 prior to the neutrality declaration.

Regime Preservation. The over-arching goal of Ashgabat’s foreign policy is to preserve and stabilize the ruling regime. Although the tenure of President Gurbanguly Berdymukhamedov has led to greater openness in principle towards international cooperation, Turkmenistan remains mostly isolationist in its foreign policy, using its neutrality as a shield to avoid unwanted international entanglements. Neutrality continues to play more or less the same role under the new regime as it did under President Saparmurat Niyazov:

• Masking weakness. It is an excuse that the country’s leaders use to mask their state’s fundamental weakness. Neutrality allows them to reject any cooperation that they fear may lead to excessive dependency on a single outside power. While Russia presents the greatest threat for them in this regard, the authorities are also concerned about the potential designs of the United States, Iran and, increasingly, China.
• Resisting critics. Neutrality also helps Ashgabat resist criticism about domestic repression from international organizations. Calls by the EU and the Organization for Security and Cooperation in Europe for improvements in human rights have resulted in government declarations that these are efforts to interfere in the internal affairs of a neutral state.
• Non-compliance. Likewise, neutrality is often used as justification for not complying with the demands of various international organizations or foreign states critical of the domestic political situation.

These rationales have not changed since Berdymukhamedov’s succession. While the new president is somewhat more open to the outside world than his predecessor, he remains focused on using his country’s neutrality to strengthen his hold on power in what is by many measures a weak state.

Economic engagement. At the same time, Turkmenistan has always been more open to international cooperation on economic matters. Its preference was for bilateral cooperation over participation in multinational organizations or projects, and it continues to focus on bilateral engagement. This is especially important for its economic development, as Turkmenistan lacks sufficient domestic expertise in key economic sectors. The bulk of international investment in Turkmenistan has been confined to the energy and construction industries:

• Construction. The gleaming white marble palaces (and equally gleaming apartment buildings) that dominate Ashgabat have been built by Turkish construction companies. Foreign contractors have also been brought in to build major showpiece projects, such as the work by a French company to refurbish Ashgabat’s international  airport. Firms from Turkey, France, and Russia have been involved in the construction of facilities and infrastructure at the new Avaza resort on the Caspian Sea.
• Oil and gas. In energy, Turkmenistan does not have the expertise for offshore oil and natural gas exploration, and has leased sectors in the Caspian to companies from a number of countries, including the United Arab Emirates, the United States, Russia, China, and Germany. Most export pipelines for Turkmen natural gas are also constructed by foreign partners. Indeed, in private, officials state that they will fill any pipeline built to their proverbial doorstep. China and Iran have recently taken advantage of this informal policy by building new pipelines to import Turkmen natural gas.

Nabucco implications. If a consortium of some kind were to build a trans-Caspian gas pipeline to connect to the Nabucco project, Turkmenistan would almost certainly sign a contract to export natural gas through it. At the same time, because of their fears of negative reactions from Russia and Iran, officials are very unlikely to take any proactive measures to join such a consortium prior to the start of construction.

This cautious approach is not limited to Nabucco; in general, Turkmenistan remains quite reluctant to participate in multinational economic projects, especially if there is a realistic chance that its participation might antagonize one of its neighbors or a regional power such as Russia or China.

Security isolationism. As for security issues, Turkmenistan’s foreign policy remains virtually unchanged from the Niyazov era. Neutrality is still the dominant paradigm, and the calculus behind this approach is largely unchanged. The authorities recognize that their country is one of the weakest states in the region: it has virtually no real capacity to defend itself in military terms, and continues to depend on its neighbors for the transit of natural gas, its main source of revenue.

This dependence was brought home to Turkmenistan’s leaders by the nine-month cut-off of exports through Russia in the aftermath of a pricing dispute in 2009. Though the opening of alternative pipelines to Iran and China has decreased Turkmenistan’s dependence on Russia, its leaders nonetheless want to ensure that no foreign power has reason to feel that Turkmenistan is turning away from it.

Limited re-engagement. At the same time, it has undertaken some bilateral initiatives that were unimaginable under Niyazov, especially in permitting overflights to supply the US war effort in Afghanistan and in accepting foreign assistance to build its maritime forces. However, these initiatives are organized through informal means and are never publicized, allowing Ashgabat to maintain at least an appearance of plausible deniability. The authorities consistently leave open the possibility that an initiative might be canceled if the international situation changes or if the government comes under criticism from more powerful neighbors.

Caspian Sea security is the one realm where Turkmenistan seems willing to participate in multilateral initiatives, albeit only on a limited basis. It has always participated in summits of the Caspian littoral states and has indicated that it would be willing to sign an agreement on maritime border delimitation as long as all five states agree to it. At the same time, Turkmenistan has consistently refused to join multinational security initiatives , such as the Russian-sponsored CASFOR and the US-sponsored Caspian Guard. Given the likelihood that joining any such organization would create problems with unaffiliated states, this stance reinforces the focus of Turkmenistan’s leaders on using foreign policy to ensure that they can maintain power.

CONCLUSION: Though Turkmenistan under Berdymukhamedov is somewhat more open to the outside world, its engagement is focused on economic projects and sectors where it lacks domestic expertise. On security issues, Ashgabat remains highly insular, using its permanent neutrality as a shield to maintain distance from more powerful neighbors out of fear that it might be turned into a satellite state.

Read Full Post »