To be, or not to be the Russian Tsar

(Analysis of the results of Xi Jinping’s visit to Moscow)

Part 1

The state propaganda and mass media usually try to present official visits of leaders more significant and productive than they really are. The state visit of Xi Jinping to Moscow and his meeting with Vladimir Putin appeared to be an exception.

The Russian and Chinese state news services, as well as mass media, demonstrating strange restraint, made no attempt to exaggerate or even show in full the real significance of the Russian — Chinese summit. Moreover, confusion, signs of misunderstanding and misbelief appeared in the Russian political elites and among the state officials.

However, the essence of what happened during negotiations in Moscow was succinctly expressed by Chinese leader Xi Jinping when he said goodbye to Vladimir Putin, before taking seat in his limousine standing at the front doors of the Grand Kremlin Palace.

Their last conversation was recorded by TV reporters. Xi told Putin: “The changes are taking place now that have not been seen for hundred years. When we are together, we are driving these changes.” Putin replied: «I agree.» Xi shook Putin’s hand and ended the meeting with the words: «Take care of yourself and be safe, my dear friend.»

Photo: Xi Jinping and Vladimir Putin leaving the Grand Kremlin Palace, March 21, 2023

What was behind this scene, and why during the visit and after Xi Jinping’s departure, the faces of the Russian officials expressed not only satisfaction with the results of the Chinese leader’s visit to Moscow, but also concern and anxiety?


The Moscow-Beijing Axis and the New World Order

There were several circumstances that made the visit of the Chairman of the People’s Republic of China to Moscow special. That were the 40th talks between Putin and Xi in the decade. This was Xi Jinping’s ninth visit to Moscow, and most important, this was the second official state visit of Chinese leader to Russia, — the first one took place exactly ten years ago, in 2013, — although, according to diplomatic protocol, the head of state makes only one official state visit to another country during his term in office.

With the official status of the state visit, Xi wanted to emphasize that in ten years since his previous state visit, China, like Russia, has become qualitatively different state, and that this visit will bring relations between Beijing and Moscow on qualitatively new level. That will be relations not just between two state-powers, but between two great civilizations supporting each other. As Xi Jinping put it in his article published in the Russian media few days before the visit, Russia and China have become «fellow travelers» (VM — the translation does not fully convey the meaning that Xi put in Chinese).

The peculiarity of the visit was that the visit took place on March 20-22, the dates that Beijing insisted on, but that dates did not quite suit Moscow. The Kremlin wanted the visit to take place after March 23, because on March 20, the day Xi Jinping arrived, Vladimir Putin had to attend and to speak at the plenary session «Russia-Africa in Multipolar World» of the Second International Parliamentary Conference «Russia — Africa» that was held in Moscow exactly at that time, in which 40 parliamentary delegations from African countries took part.

Speaking at the Conference few hours before the arrival of XI Jinping, Vladimir Putin stated that «Africa will become one of the leaders of the emerging new multipolar world order.» After the speech, Putin was forced to hasten to prepare for the first meeting with the Chinese leader, the most important negotiations, face to face behind closed doors, that lasted 4.5 hours.

Beijing insisted that the visit of the Chinese leader to Russia should begin exactly on March 20, on the day of the vernal equinox, that for the Chinese civilizational mentality, as well as for many other peoples of Asia, for example, the Iranians, is symbolic point to start something important. Xi expressed this in his article in a formula typical for Chinese mentality: “The year begins with spring, and success begins with action.”

There are other features that distinguish Xi and Putin’s meeting in Moscow in March 2023 from their previous meetings, such as their meeting in Beijing in February 2022, a few days before the start of the Olympics in China, followed by Russian invasion in Ukraine. At their meeting in 2022, Xi and Putin called on the West, primarily the United States, for change in the world order, for creation of multipolar world and new system of international relations, for equality of world civilizations.

This time, Xi Jinping and Vladimir Putin did not appeal to the USA or NATO. They resolved issues of bilateral cooperation, as well as problems of international relations, including the settlement of the conflict in Ukraine, in bilateral negotiations that lasted two days. Their personal meetings in Moscow lasted 10.5 hours, including 4.5 hours, as I have already noted, in private.

It was clear signal to the whole world, not only to the West, but also to the Russian and Chinese partners and potential allies, that the world new order has been created and has begun to operate. That was said in a manner typical of Putin and Xi: quietly for those who need to hear, and as a signal, like an echo, for those who need time to understand what happened.


Pillars and Structures of the New World Order

The alliance of Russia and China has become a fait accompli. The existing system of international relations has split, it was divided, and the new system is being created within the existing one. This new system is already operating according to “matryoshka”, the Russian doll, principle traditional for Russia and China.

The Moscow-Beijing Axis has already become the organizational center of the new zone created within the existing system of international relations to transform it into new world system from within.

Those who share the position of Moscow and Beijing can join them at any moment. Those who want to wait and see from outside, or who cannot join for any other reason, can wait. Those who are against may disagree, oppose, fight, but then the new order will be created without their participation. Those who join earlier and start building it together with Russia and China will receive advantages, because their interests and vision will be laid in the foundations of the new world order for the “next hundred years”. That is how the new zone created as smaller “matryoshka”, the Russian doll, will gradually transform and absorb the remnants of the larger old “matryoshka”.

The mechanism approved by Xi and Putin for the formation, expansion and development of the new order zone has also become clear. China and Russia will use the Shanghai Cooperation Organization (SCO) and BRICS as political and economic platforms and organizational systems.

The members of the SCO, apart from China and Russia, are currently India, Iran, Kazakhstan, Kyrgyzstan, Pakistan, Tajikistan, and Uzbekistan. Afghanistan, Belarus, Mongolia are the observers. The territory of the SCO countries occupies 65% of the territory of Eurasia, and the population exceeds 3.5 billion, more than half of the world’s population.

BRICS was created by Brazil, Russia, India, China, and South Africa. Candidates awaiting admission to the BRICS are Iran, Argentina, and Algeria. Another 16 countries have already expressed their desire to join the BRICS, including Indonesia, Mexico, Saudi Arabia, Turkey, Egypt, Thailand, Nigeria, Bangladesh, Greece, and Syria, as well as the SCO countries that were not included in the BRICS yet.

Now the BRICS countries occupy 26.7% of the world’s land, they account for 41.5% of the world population, and their GDP has already exceeded the GDP of the G7 countries and reached 32% of the world GDP. In case of admission of applicants by 2024, BRICS share in the world’s population will exceed 70%, they will occupy more than 65% of the planet’s land area, and the share of GDP will exceed 60%, or may be even more depending on the growth of their GDP in the coming years.

At the same time, Russia and China intend to fight for the new world order using existing international organizations, primarily the UN and the G20. In this struggle, the SCO and BRICS should play important role as instruments for pursuing joint policy and reforming, for example, of the UN. And again, Moscow and Beijing apply the “matryoshka” principle: the SCO and BRICS will operate within other systems, primarily the UN and the G20, not opposing them, but trying to reform, change and adapt them to the new order from within.

The possibilities and potential of the BRICS were demonstrated by Russia and China shortly before Xi’s visit to Moscow, when representatives of the Kingdom of Saudi Arabia and Iran, two countries that intend to become members of the BRICS, but that have been in confrontation for decades, the countries that determine the future of the Middle East, signed agreement on restoring of diplomatic relations and ending hostilities. That agreement opened the way for interaction between these two key states in the region and the main suppliers of oil and gas in the world, including to China, and from now onwards, Saudi Arabia and Iran will trade with China for yuan.

In the process of normalizing relations between Iran and Saudi Arabia, both Moscow, especially at the first stage, and Beijing played active role, but the final stage was led by Beijing. Moscow remained in the shadows. And this is interesting fact that shows that China and Russia have their own areas of responsibility. They stand and oppose the West not “shoulder to shoulder”, not as one front, not as Greek phalanx, but “back-to-back”, as Xi Jinping put it.

The Kremlin gave Beijing the place of the leader of peacekeeping process in relations between Iran and Saudi Arabia, because, first, that status was more important to Xi Jinping than to Putin. Symbols are important to China, so Xi took the lead in the process of restructuring international relations immediately after his re-election. Second, the tension between the West and Russia has reached high level, and Putin does not need to attract additional flurry of attacks. He needs to deal with Ukraine and NATO, and he diverted attention from himself by dispersing attention, fury and efforts of the West to counteract the construction of the new world order by turning them towards China.

In addition, the next stage of the peace process has already been prepared — the restoration of diplomatic relations between Syria and Saudi Arabia, as well as other Arab countries, and in that process, Moscow will become the main peacemaker, in any case. Not surprisingly, the day after Xi Jinping left Moscow, news outlets reported that Syria and Saudi Arabia were ready to exchange embassies, ten years after breaking off relations.

Relying on the already established and successfully developing international alliances, BRICS and SCO, that China and Russia can turn into supporting structures or foundation for new world order, makes the visit of the Xi Jinping to Moscow even more significant for the Kremlin and personally for Vladimir Putin.

Then why did the faces of the members of the Russian delegation, including the face of Putin, in addition to satisfaction, constantly expressed concern and internal tension?


In the face of the inevitable

Now we should pay attention to another feature of Xi Jinping’s visit to Moscow.

Unlike Xi Jinping’s first official visit to Moscow in 2013, exactly 10 years ago, this time his meeting in the Kremlin was organized rather modestly. The welcome ceremony was neither particularly solemn, nor magnificent. There was no parade of the troops of the Kremlin Regiment on the Cathedral Square of the Kremlin, as it was ten years ago.

The impression was that although all the main documents that were to be signed in Moscow had been agreed and worked out in advance, before the visit, there were important topics that the working groups could not agree on. These topics were to be discussed by the leaders of China and Russia personally, directly, behind closed doors. And these topics were fundamental and most significant. Moreover, the impression was that the Kremlin was not sure that Putin would be able to reach understanding with Xi.

If you look at the signed documents, it becomes clear that cooperation between Russia and China is reaching a new level. China is ready to increase not only the investments in the Russian economy, primarily in the areas and industries that require lot of energy, materials, natural resources, but also in the development of industries based on the latest technologies, primarily weapons production, nuclear energy, and space technology. Thus, China recognized that it needs not only Russian resources, but also development of cooperation in science and science-intensive industries based on the powerful scientific base created in Russia in Soviet times, preserved in post-Soviet period, and resurrected in modern Russia.

This is because the new technological order that most of the developed countries, including China and Russia, are now rising to, requires the priority development of areas for application of human intelligence, its potential, creative and social. The human intelligence, its interaction and cooperation become the essence of new capital. Those countries that slow down development of human intelligence and creativity and focus on, for example, artificial intelligence or old traditional industries, will miss the chance to get into the forefront of development and go second league.

The areas of application of human creativity already now bring greatest effect, capital, and profit. It is around them, as pillars, that future social and political systems will be formed and developed. That is why the role of culture, science, creativity, moral principles that form interactions in society, that is, cultural and historical factors, will rapidly increase, providing domination to civilizations as social systems, over the existing state forms of social management, transferring state to subordinate position of executive instrument.

Old and traditional sectors of the economy will not be able to maximize profits. Society and civilization will not be interested in this. The products of traditional industries should be accessible to people and new sectors of the economy and spheres of social life. The most developed countries will provide accessibility and minimum prices to what is produced by the old and traditional sectors of economy, allowing new economy to benefit, as well as to benefit people, by giving them opportunity to focus on activities that require highly developed human intelligence.

However, the traditional branches of industry and agriculture will also be able to develop under two conditions:

First, if deep processing and production of products is concentrated in territories provided with cheap energy resources and raw materials, that eliminate expensive transportation and other redundant costs, while maintaining and transforming transport system for delivery of final products. The need for human resources in the old, traditional industries will decrease, because place and functions of labour will be taken over by robotics and artificial intelligence.

This will result in relocation and concentration of industrial production with high level of energy and material consumption to countries rich in energy and natural resources, such as Russia, Kazakhstan, Iran, the USA, Australia, as well as to some regions of Latin America and Africa. The ongoing transfer of enterprises in the metallurgical, chemical industries, as well as mechanical engineering and car industries from European countries to the United States and China is natural and inevitable process that received additional and strong impetus by the sanctions against Russia.

China understands well what is happening and is ready to invest in Russia, including in the industries that produce not only for consumption in Russia, or for export to third countries, but also for import by China.

However, in China, powerful economy has already been created, including by the world transnational corporations, linking together both traditional industries and most advanced. Chinese economy is based on huge human resources, requires maintaining high rates of development and cannot be relocated to other countries soon without huge social tensions. The Chinese communist regime that primarily protects interests of the traditional working class, cannot allow this.

China needs to develop all industries that are profitable and of strategic importance. This requires the import of energy resources, and Russia, Saudi Arabia, Iran and other states that can supply resources reliably and inexpensively allowing China to ensure necessary profitability of traditional industries, should play their important role.

However, Russia appeared unable to fulfill the tasks assigned to it for the supply of resources to China, as well as to other countries of East Asia, not because Russia does not have these resources, but because the transportation system, including by rail and roads, pipelines, and power-grid lines, does not have necessary capacity. Russia has become hostage to its two hundred years orientation towards the West and is not ready for new challenges.

To meet the needs of China, Russia needs to build several times more railways, highways, pipelines and electric power networks in the vast Eastern regions of Russia over a period of several years, much more that was built in the entire history of the Russian Empire and the USSR. It is necessary to develop the system of maritime transportation at incredible pace, including along the Northern Sea Route.

During the time after the collapse of the USSR, the potential created earlier was partly lost and has not yet been fully restored. Recovery began in recent years and is still going on not so much in the interests of the country, people, regions, but in the interests of political and business clans. Suffice it to recall the story of the arrest and conviction of the Governor of the Khabarovsk Territory Sergei Furgal, who dared to put the interests of the region and people above the interests of the St. Petersburg clan and local ruling clans, including criminal groups.

The conflict with the West and sanctions forced Russia to turn to the East. Even if the relations with the West are normalized, Russia will no longer be able to stop accelerated development in its Eastern direction, as well as in Southern, towards India. It became inevitable. Russia, the Kremlin, Vladimir Putin personally and his government cannot escape the tasks facing them. However, the turn to China, the Southeast Asia and India requires not only enormous efforts and concentration of resources, including human, but also huge investments.

There is money for this in Russia, but not enough, and China and India are ready to help. However, such turn requires not only money, investments, resources, but also political elite, entrepreneurs and management capable of organizing this breakthrough, but Russia has problems with that. And this is understood not only by Putin, but also by the political and business elites themselves, by the Government of the Russian Federation and the State Duma.

The challenges they face scare them…


How many people work in your company?

Here I would like to recall one episode from my life. In the early 2000s, when China was just picking up the pace of development, the Chinese delegation arrived in Moscow, that included General Managers of four Chinese largest state-owned construction corporations.

The delegation was met by Vladimir Resin, at that time First Deputy Mayor of Moscow, head of the Complex of Urban Planning Policy and Construction. To meet the Chines delegation, Resin invited heads of the largest Moscow construction companies, by that time private, but created in Soviet times as state organizations, the main enterprises of the Moscow construction complex. Among them were the General Managers of two corporations that carried out construction works in the State Kremlin Palace. My company was the General designer and General contractor on that project in the Kremlin, and I was also invited to join Vladimir Resin and managers of the former Soviet state corporations facing the Chinese delegation.

In those years, the former Soviet leaders still retained attitude towards Chinese as “little brothers”, and Resin, as well as the Russian builders present at the meeting, looked at the Chinese patronizingly, although they already knew about ongoing construction boom in China.

At some point, Resin, waving his hand in the direction of General Manager of one of the Chinese construction corporations, asked:

— And how many builders work, for example, in your company?

“Thirty-five million builders,” he replied.

Silence, long and full of surprise…

It was almost twenty years ago…

(To be continued)

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