An American, a German, and a Chinese gentleman walk into a bar in Prague. The first two order a beer, and the bartender then turns to the Chinese man to ask, “What can I get you?” He simply replies, “The accounts please, I own the place.”
The joke is not entirely removed from reality. The Belt and Road Initiative, or BRI – an economic agenda billed as the Silk Road reincarnated – is putting meat on the bones of Chinese interaction with Central and Eastern Europe. BRI investments play a role in the increased priority attached to the “16+1” – a political format that brings China and the region together. The sixth meeting of heads of states of the Central and Eastern Europe countries and China in Hungary has revealed four faces of Chinese activity in the region: connector, shaper, investor and challenger.
In this text, Arctic Yearbook managing editor Heather Exner-Pirot interviews George Soroka, lecturer at Harvard University and author of “The Political Economy of Russia’s Reimagined Arctic,” to better understand Russia’s motivations in its Arctic. These include not only economic ambitions focused on resource development, but also a resumption of its great-power status in the international system, buoyed by its demonstration of pre-eminence in the Arctic region.
Heather Exner-Pirot: There’s been a lot of speculation in the media and elsewhere about Russia’s motivations in the Arctic. They’re often described as nefarious. How would you describe them?
George Soroka: In general, I think Russia’s motivations in the Arctic are what Russia tells us they are, even if we are not always ready to believe them. Moscow has three main priorities in the region and they are all interrelated: (1) fostering Russia’s socio-economic development by exploiting the Arctic’s natural resources and the Northern Sea Route; (2) stemming demographic decline in its peripheral territories and better integrating them with the federal center; and (3) projecting power in the High North, where Russia continues to regard itself as the pre-eminent state actor.
The authors analyse reasons accounting for the growing discontent with globalisation and the liberal establishment in advanced democracies.
Summary
This paper presents five hypotheses to account for support for anti-establishment and anti-globalisation movements. In addition to the predominant perception that the economic decline of the middle classes and the growing xenophobia evident in the West account for Donald Trump’s victory in the US, Brexit and the rise of the National Front in France, among others, the authors set out another three reasons: the difficulties that significant layers of the population are having in adapting to technological change, the crisis of the welfare state and the growing disenchantment with representative democracy.
Analysis
A consensus has existed for decades among the main political forces of the US and Europe revolving around the idea that economic openness is positive. The flows of trade and investment and, to a lesser extent, workers have thus been gradually liberalised over time. Thanks to this liberal order, Western societies have become more prosperous, more open and more cosmopolitan. Although some lost out from this economic openness, the majority of voters were prepared to accept a greater level of globalisation. As consumers they could acquire products more cheaply from countries such as China, and they also understood that the welfare state would protect them appropriately if they temporarily fell into the category of the losers (in political economy this is known as the ‘compensation hypothesis’,1 according to which more open countries tend to have larger state sectors and redistribute more). For their part, developing countries have also benefitted from economic globalisation, exporting products to the wealthy transatlantic market (which is more and more open) and sending remittances from the West to their countries of origin. The invention seemed to work.
If Japanese Prime Minister Abe Shinzo wakes up these days with an extra bounce in his step, it’s with good reason. He has overtaken Nakasone Yasuhiro to become the sixth longest serving prime minister in Japanese history, and he will soon pass Koizumi Junichiro, who set the standard in the post-Cold War era. The ruling Liberal Democratic Party (LDP) just agreed to revise party rules to extend the maximum presidential tenure to three consecutive three-year terms for a total of nine years. (The previous limit was two.) If Abe completes a full third term, he will become Japan’s longest serving prime minister ever.
Changing the rules is a smart move. While in office, Abe built and cemented his party’s parliamentary majority, bringing stability to a political system that was marked by uncertainty and hobbled by ineffectual leaders. The economy has regained its footing, with growth on the upswing, unemployment shrinking, and business confidence surging. Abe has set the standard for a good working relationship with US President Donald Trump and reduced tensions (somewhat) with Beijing and Seoul (although neither relationship can be counted on to continue its current path untended). He has made good on his promise to secure Japan’s place among the first tier of nations and to make it a force to be reckoned with in international relations.
China’s Belt and Road Initiative (BRI) – a plan to build a vast network of roads, rail lines, new ports, and other infrastructure improvements a in more than 60 countries, at a cost of $4 trillion – is an economic policy designed to radically expand trade and investment in Asia and around the Indian Ocean. Critically, however, it is also a security initiative with the aim of facilitating economic integration and promoting longer-run peace in the region.
The economic benefits are likely to be large, but there may be rough patches along the new Silk Road. While the proposed investments are precisely the types of trade-enhancing projects development economists have long called for, the geopolitical implications of BRI are complicated. From the restive western Chinese province of Xianjing to Jammu-Kashmir, the Myanmar-Chinese border, and the Indian Ocean, BRI-related initiatives target or traverse some of the world’s most contested territories. Major power development programs abroad – such as the US Marshall Plan and Alliance for Progress – have always been motivated by a mixture of economic and security concerns. Indeed, BRI is intended in part to address security fears emanating from these regions by improving economic prospects.
