The Russia Conundrum

There is, however, a difference: in former times, Russia held the whip hand, while China was the weaker party, economically, politically and militarily. Moscow could therefore manipulate the relationship to its own advantage. But that has changed. China has outstripped Russia in all respects, making Putin’s gambit decidedly risky. His hope is that Russia could find a strategic and civilisational solution to its struggle with the West by offering to become China’s junior partner. It has been done before – Putin’s role model is the great Russian prince, Alexander Nevsky, who agreed to kowtow humiliatingly to the rulers of the Horde in return for their support against the West. But Putin is in a weak position if he thinks he can use economic talks with the Chinese as a counterbalance to deteriorating relations with the USA and Western Europe. My own experience of working with Chinese companies taught me that the Chinese are tough negotiators. We supplied them with several million tons of oil per year, helping to construct rail border crossings to transport it, and we reached agreement on a pipeline to China from Angarsk in Siberia. In all our negotiations, the Chinese were quick to exploit every advantage they held over us. The only way we could get a fair price for our oil was by demonstrating to them that we had the capacity to sell it on the European market where rates were higher, so the Chinese could not demand a cut-price deal from us. Putin does not have that luxury. If he wants to sell to China to spite the West, Beijing is not going to be generous in the terms it offers. The Chinese offers so far have been remarkably bad. According to the leading Russian oil and gas analyst, Mikhail Krutikhin, Gazprom’s sales in 2021 went for an average of $170 per thousand cubic metres of gas, compared with the European gas price of $270 per thousand cubic metres. Rosneft’s sales of oil were similarly uneconomic. Putin has failed to learn the lesson that China and Chinese companies will never fail to take advantage of the geopolitical follies of a would-be trading partner. Not only has Putin agreed to unprofitable commercial contracts, he has also made concessions in the historic border disputes on Russia’s eastern frontier, ceding territory to China on the Amur and Ussuri rivers.

The geopolitical benefit to Russia from all these concessions is very doubtful. But Putin’s real aim in signalling that the Kremlin is willing to take on the role of junior partner to Beijing is to cause alarm in Washington. It has raised the stakes in East–West negotiations, forcing the West to turn a blind eye to some of the domestic and foreign policy misdemeanours of the temporary occupant of the Kremlin. There is real alarm in some European capitals that Beijing will henceforth have a hidden role in determining Moscow’s future policy direction. In my opinion, the alarm has been raised too late – this is now the reality with which we have to live. Indeed, the main problem for Putin is not the reaction of the West, but the potential discontent of the Russian people. Russians are much more wary of Beijing gaining influence over their domestic affairs than they are of Paris or Berlin. Putin’s spin machine has helped to dampen domestic discontent, but it won’t be able to do so forever.

Putin is the victim of a disastrous geopolitical miscalculation. Strategically, China doesn’t need a junior partner, and it will never quarrel with the West in order to side with Russia. Quite the opposite. China’s long-term interest is possibly to see Russia fall apart so it can snap up our Siberian territories. It doesn’t want Russia clinging on to its coattails; and it has no interest in helping to prolong the lifespan of Russia’s unviable centralised state, if that were to become necessary. China will not go to war over this, but neither will they offer to help us.

CHAPTER 19

A BLUNT INSTRUMENT

Despite their nations’ long and recent history of antagonism towards each other, the world was somewhat surprised by the friendship on show between Vladimir Putin and Donald Trump. There were theories about the Kremlin using compromising material to blackmail Trump into acquiescing in Putin’s international scheming, and other suggestions that Trump felt indebted to Putin in helping him win the presidential election. But the real reason for their mutual affinity was that both men are cut from the same cloth.

Donald Trump looked enviously at Putin’s model of autocracy, his regal style, his contempt for civic institutions and his crude populism. It seems to me that he would have liked to enjoy such powers himself, overriding the democratic checks and balances that maintain democratic continuity in the US. But this was not a model on which future East–West stability could be built.