Russia’s ambitions to expand its Eurasian Union could encroach on China’s dominance in Central Asia. Why is China unconcerned by this development?

Vaughan Winterbottom:

I think for a few years now there has been a developing narrative that is fairly well known in the West about this rivalry between China and Russia, especially in Central Asia.

And to a certain extent that rivalry does exist, and I think the two sides, although they do downplay this rivalry – they have statesmen on either side saying ‘no we are not in competition for resources in Central Asia’ – it does exist.

That being said, the Eurasian Economic Union which is being proposed, probably, on the basis on analysis would not contribute to any further rivalry developing for a number of reasons.

Firstly: the economic impact of the Union on China is not very significant.

Secondly: some of the proposals of this EEU, the Eurasian Economic Union, will have a certain degree of overlap in terms of the purview of the Shanghai Corporation Organsation security bloc.

However, it is a security bloc, and in those terms if there is an added layer of security in terms of the EEU, that’s potentially a benefit. Although the countries that have already signed up to the EEU have said ‘no this will not be security, it is purely economic’.

And in terms of the actual agreement itself on this EEU, which will come into force in January next year (2015), there is a tariff on trade with countries outside the union. But a lot of Chinese goods that are in Central Asia already enjoy a very strong comparative advantage there, so it will be the traders, effectively, the Central Asian traders that will lose out in that.

And in terms of energy deals, the agreement is actually not very well formed as it stands, and allows significant scope for bilateral negotiations right through until the middle of the 2020s.

(Photo credit: dpa)

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