Today’s issues shape tomorrow’s agenda. This is rarely more true than in today’s transformative climate.
By Valdai Club Program Director Timofey Bordachev
The Eastern Economic Forum 2023 offered a sort of stocktaking exercise to see how Russia’s “pivot to Asia” policy responded to the demands and needs that emerged last year. It met in Vladivostok for the seventh time. It was first held in 2015, and since then only the Covid-19 pandemic in 2020 has forced its suspension.
For the second year in a row, the forum was held against the backdrop of an acute military and political confrontation between Russia and the West, the main consequence of which – for the world economy – was the economic war unleashed against us by the United States and its allies. . Asian countries, with which the EEF has traditionally focused on intensifying cooperation, are, with a few exceptions, not involved in this war. Among all regional powers, only Japan has launched sanctions against Russia, although it takes a more moderate approach than U.S. satellites in Western Europe.
Even today, Japanese companies continue their cooperation projects, for example in the energy sector. Another close US ally in Asia, South Korea, has been reluctant to comply with Western sanctions and apologizes whenever it is forced to impose new restrictions on trade and technology exchanges. with Russia. All other Asian states have avoided imposing their own sanctions, even if they do not always share Moscow’s position on European and international security issues.
In other words, Asia – as a region – has become Russia’s “gateway” to the global economy, is the most active in trade with us and is engaged in dialogue intergovernmental level. This is also confirmed by the results of the analysis conducted by Valdai Club experts in a recently published report on the dynamics of relations between Russia and Asian countries over the past year and a half.
It should be understood, however, that the Eastern Economic Forum was not designed solely as a means of more active dialogue with Russia’s external partners. From the beginning, the main goal of the forum was to encourage the vast Russian Far East to coordinate government policy in this area. This goal was identified as one of the most important in President Vladimir Putin’s speech to the Federal Assembly in 2013. In addition, the accelerated development of this part of the country turned out to be very cautious against the background of general changes of the world economy. and the associated shift of its center of gravity towards the Pacific and Asia.
As the President emphasized at this year’s FEE, the Far East development policy and the “pivot to Asia” in general were therefore very timely. Since the spring of 2022, the West has pursued a policy aimed at excluding us from global markets, and it is our ties with Asia that have ultimately played a decisive role in preventing this from happening. It is the Far East and its main cities, including Vladivostok itself, that have become the main hubs of the new scale of trade and economic relations with Asian countries. Recently, its cargo ports have seen a significant increase in traffic.
It is not surprising that one of the region’s major development challenges is now recognized to be the glaring lack of technical capacity to manage the ever-increasing volume of exports and imports. Much has been done in recent years to move a significant share of trade flows to the Pacific as quickly as possible. But until spring 2022, EU countries remained Russia’s most important partners. And for all the growth in throughput capacity, it has yet to catch up with growing demand. Another traditional problem of the region is that of demographics. The Far East traditionally has a very small population, and in recent years there has been no radical solution to the problem of population growth. Nevertheless, economic activity in the region has increased significantly, new universities have been established and construction is underway.
Today, judging by the discussions within the EEF, the most important area of work is recognized as improving the quality of life, the environment and the state of the environment urban. In general, everything that makes the European part of Russia and its major cities attractive places to live. These efforts are particularly important in the Far East, where only the Primorsky region (the region around Vladivostok) enjoys truly favorable climatic conditions.
It is no coincidence that the northeastern provinces of China, bordering Russia, are also experiencing demographic decline. This should allay any lingering fears in the media regarding a massive influx of Chinese citizens into the Far East. So far, we have not even seen a return to the levels of tourism from the neighboring country that existed before the coronavirus pandemic.
More generally, fears about opening up to external partners contradict the approach put forward by Putin at the Eastern Economic Forum: “Russia should be self-sufficient, but that does not mean isolation. »
The main problem is not foreign investment at all costs, but the distribution of investments between Russian and foreign companies. That is why the FEE traditionally aims not only at trade cooperation, but also at solving development problems of the Far East as a whole. The actions of the Russian government and the initiatives of the business world are closely linked.
Like any region long deprived of objective competitive advantages, the Far East cannot develop according to the logic of the market economy alone. A coherent government policy is necessary. The Eastern Economic Forum 2023 was a kind of time check to see how the “pivot to Asia” policy responded to the demands and needs that emerged over the past year, which has already been done and which questions became the most important. . Today’s issues shape tomorrow’s agenda. The interim results of their implementation will undoubtedly be discussed at the 2024 Eastern Economic Forum.