The Eurasian Economic Union and the Silk Road Economic Belt

Working Paper No. 2016/5

The Eurasian Economic Union and the Silk Road Economic Belt: the impact of the Sino-Russian geopolitical strategies in the Eurasia region Fabio Indeo¹ August 2016

© The authors, 2016 ¹ Center for Energy Governance and Security, EGS Korea, Hanyang University, Seoul, South Korea

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The Eurasian Economic Union and the Silk Road Economic Belt: the impact of the Sino-Russian geopolitical strategies in the Eurasia region FABIO INDEO Center for Energy Governance and Security, EGS Korea, Hanyang University, Seoul, South Korea Haengdang-Dong, Seongdong-Gu, SEOUL, KOREA 133-791 [email protected] www.egskorea.org

1. INTRODUCTION In the last years, Russia and China are engaged to implement two geopolitical strategies which involves the Eurasia region, with the aim to develop the economic cooperation between East and West by means of trade and energy routes crossing Central Asia. At present, the implementation of the Eurasian Economic Union represents one of the most influent attempt to promote cooperation in the region, potentially including the creation of a supranational framework in order to upgrade the cooperation also in the political dimension (starting from the coordination of the respective national foreign policies), even if this option is strongly feared by Central Asian countries. At the same time the Chinese strategy of the Silk Road Economic Belt is an attractive project involving all Central Asian countries in a profitable energy and economic network, following the Chinese huge investments aimed to boost infrastructures and to develop national economies. Since 1991 post soviet Central Asian republics have had a different approach towards initiatives and projects of regional cooperation in the economic, political and security fields: Kazakhstan, Kyrgyzstan and Tajikistan have always supported and participated in regional cooperation initiatives, while Turkmenistan and Uzbekistan appear reluctant to be involved. It is evident that the implementation of these two projects - which apparently seems in competition but they could potentially merge - will have interesting repercussions on the economic relations with the EU, widening the opportunities for a lucrative East-West business, opening new trade routes and consolidating the interdependence between Eurasia region and the EU member states. Furthermore, these two geopolitical strategies will influence the political and economic evolution of Central Asian countries as well as their foreign policies.

2. RUSSIA AND CHINA IN CENTRAL ASIA, BETWEEN GEOPOLITICAL COMPETITION AND COOPERATION Since the independence of the five Central Asian republics in 1991, Russia and China - the two most powerful regional geopolitical players – have developed strong relations with these new states in order to achieve their strategic aims in the reshaped geopolitical regional scenario. In addition to economic, energy and geostrategic aims, security concerns and stability issues have always represented the main shared goals of Russia and China in the post Soviet Central Asia, as a kind of necessary preconditions destined to influence the success of their strategies. Following the implosion of the Soviet Union and the independence of post Soviet states, three different phases have been characterizing the Sino-Russian approach towards the five Central Asian republics. The first phase coincides with the first ten years after the independence of ex Soviet Central Asia (1991-2001): Russia and China undertook independent policies concerning Central Asia also improving their bilateral relations were improving after the previous mistrust and tensions of the Cold War period.

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Russia’s strategic goal was to maintain the “near abroad” under its political, economic, military influence by means of bilateral relations and of the involvement of Central Asian states in the Moscow-backed regional multilateral organizations in the economic field (Central Asian Cooperation Organization, CACO), in the military field (Collective Security Treaty Organization, CSTO) and in the political field (Community of Independent States, CIS). If the Russian foreign policy was initially aimed to strengthen the relations with the West, leaving the post Soviet Central Asia – conceived as an untenable economic and political burden – to its fate, the following concerns about the threats to the regional security and stability (such as the Tajik civil war 1992-1997, the Afghan instability, a potential Islamist insurrection) and the political strategy to maintain its traditional influence over the new independent states pushed Moscow to implement an integration strategy towards Central Asia.1 With regards to these Russian attempts, Central Asian states showed a different approach, strictly linked to economic and political issues: on the one hand Kazakhstan, Kyrgyzstan and Tajikistan have always been included in the supranational organizations promoted by Moscow, while Uzbekistan and Turkmenistan were profoundly mistrusted about the integration policy of Russia, Uzbekistan for its ambition to play the role of regional leader while Turkmenistan did not participate coherently to its neutrality policy adopted in the international relations. When the President Vladimir Putin took power in 2000, Russia has further enhanced its foreign policy strategy aimed to restore Moscow's geopolitical influence in Central Asia: as a matter of fact, the armed attacks of Islamic militants in Uzbekistan and Ferghana Valley in 1999 and 2000 – which stressed the existence of dangerous threats to the regional and internal security and stability – and the important concessions obtained by Western energy companies in Kazakhstan (for the exploitation of Tengiz and Kashagan oil fields) required the strengthening of the Russian presence in Central Asia. 2 Chinese strategy towards Central Asia in the first ten years of independence of the new republics mainly aimed to three main goals: 1.

to guarantee national security and the regional stability, because China feared that the creation of independent states closer to its Western border could push the Uighur population of the Xinxiang region to support separatist tendencies and claim independence from China, considering their religious, ethnic and cultural affinities with Central Asian populations. 3

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to develop political and economic relations with the Central Asian republics, in order to improve the relations with the new border states and to develop economic and commercial relations with them, as a kind of “geo-economic strategy” to ensure stability and security in the region. China developed bilateral relations mainly with the neighbouring Kazakhstan, Kyrgyzstan and Tajikistan and solved the border issues inherited after the Soviet Union collapse. Moreover, the development of deeper economic relations proved to be relatively easy because Chinese and Central Asian economies are complementary: China imports raw materials (energy, ferrous and non-ferrous metals, and minerals) and represents a wide and alternative market for the Central Asia land-locked economies, which import from China consumer goods and finished products. 4

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to ensure the control of Central Asian oil and gas in order to strengthen its energy security. In this first phase, China developed energy cooperation with the oil-rich Kazakhstan and national energy companies began to invest in Kazakh oil fields, with the clear strategic aim to build a new pipeline in order to transport Kazakh oil towards China, allowing a diversification in its energy imports.

The creation of the Shanghai Cooperation Organization (SCO) in 2001 showed the Sino-Russian will to 1 Konarovsky, M. ‘Russia and the emerging geopolitical order in Central Asia’, in Banuazizi, A. and Weiner, M. (eds), The New Geopolitics of Central Asia and its Borderlands (I.B. Tauris, London, 1994), pp. 243-245; Jonson, L. Russia and Central Asia, a New Web of Relations (Royal Institute of International Affairs, London, 1998), p. 16; Zviagelskaia, I. The Russian Policy Debate in Central Asia, (The Royal Institute of International Affairs, London, 2005), p. 4 2 Jonson, L. Vladimir Putin and Central Asia: the Shaping of Russian Foreign Policy (Tauris, London, 2004) pp. 66-68; Laruelle, M. “Asie Centrale: le «Retour» de la Russie”, Politique Internationale, 155, (2007), pp.383-384 ; Burnashev, R. ‘Regional security in Central Asia: military aspect’, in Rumer, B. (ed), Central Asia: a Gathering Storm? ( M.E. Sharpe, London, 2002) p. 134 3 Becquelin, N. “Pékin et l’Asie centrale après la fin de l’URSS”, Pespectives Chinois, 44 (NovemberDecember 1997), pp. 10-21; Zhuangzhi, S. ‘The relationship between China and Central Asia’, in Akihiro, I. (ed), Eager Eyes Fixed on Eurasia (Slavic Research Center, Hokkaido University, Sapporo, 2007) pp. 47-52 4 Liu, Q. ‘Sino-Central Asia trade and economic relations: progress, problems and prospects’, in Zhah, Y. and Azizian, R. (eds), Ethnic Challenges beyond Borders: Chinese and Russian Perspectives of the Central Asia Conundrum (Mac Millan Press, Basingstoke/London, 1998), pp. 181, 184-185, 193

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improve the cooperation in the Central Asian security field, in order to fight the so called “three evils” (ethnic separatism, religious extremism and terrorism) and to ensure the regional stability Russia and China agreed to create this regional organization, where they both participate with the Central Asian states (except Turkmenistan).5 In spite of the existence of colliding interests in Central Asia, Russia and China normalized their relations following signature of a Treaty of Good Neighbourliness, Cooperation and Friendship in July 2001, an equal strategic partnership based on the reciprocal trust and aimed to a strategic cooperation in the international and regional issues. In the second phase (2001-2005), the United States’ military presence in the region contributed to promote the Sino-Russian cooperation based on the strategic convergence of geopolitical interests. Following the the American military intervention in Afghanistan, U.S. strengthened the military cooperation with Uzbekistan, obtaining the use of the Karchi-Khanabad airbase (known also as K2 airbase), and with Kyrgyzstan, obtaining the use of the Manas airbase, in addition to other military facilitations from Central Asian states. Russia and China were obviously worried about a potential long-term American military presence in Central Asia: Moscow was not happy to see the presence of U.S. military forces in the post Soviet space and fears that the increase of the economic and military cooperation with Central Asian states could weaken its traditional and strategic influence in the area. China also distrusted and is concerned about some American goals in the region, considering that Manas airbase and other military facilitations in Tajikistan are strategically close to the Chinese border. Given their strategic geopolitical position, Central Asian countries have successfully exploited the competition among external players, balancing Sino-Russian growing influence as well as enhancing a profitable economic and military cooperation with NATO military forces which also granting them political and diplomatic support. At first Russia and China substantially tolerated this U.S. military presence because this could help to prevent the threats to the regional security linked to the worsened Afghanistan scenario. 6 However, U.S. military presence weakened the Sino-Russian influence in Central Asia, affecting their strategic role in the region: therefore Russia and China early reversed their condition of geopolitical weakness and since 2003 they developed a strategy to restore and extend their influence in the region, strengthening bilateral and multilateral cooperation. As regards their bilateral relations, China’s strategy was mainly oriented to deepen the cooperation in the economic and energy fields with the Central Asian republics while Russia’s policy was focused on the strengthening of the military cooperation: besides, the U.S. military presence in Central Asia (Manas and K2 airbases) helped Russia to gain strategic military concessions in Kyrgyzstan (the Kant airbase which operates under the CSTO) and in Tajikistan (the establishment of a permanent Russian base in Dushanbe after the eviction of Russian border army from the Tagik-Afghan border).7 The expulsion of American military forces from Central Asia and the containment of Western influence in the region represented the Sino-Russian shared strategic goal which they partially achieved by means of the SCO, exercising strategic pressure to the Central Asian members (in order to establish a departure date for the U.S. military forces from Central Asian military airbases) and convincing them that their own national interests and the region’s stability would be best promoted through this regional security organization rather than a strategic partnership with the U.S. 8 Moreover, China and Russia also exploited the progressive cooling of the strategic cooperation between United States and Central Asian republics, which perceived the Western pressures and calls for the Human Rights’ protection, for the adoption of reforms as interferences in the management of their internal affairs. At the same time, the supposed U.S. “longa manus” to support the “Coloured Revolutions” in the post-Soviet space (Georgia, Ukraine and Kyrgyzstan in 2005) enhanced the Central Asian general mistrust about the real aims of the U.S. geopolitical strategy in the region. 9 The Sino5 Zhuangzhi, ‘The relationship between China and Central Asia’, p.57 6 Mohammad R. Djalili, M, and Kellner, T. Geopolitique de la nouvelle Asie Centrale: de la fin de l'URSS à l'apres-11 septembre (Paris: PUF, 2006); Ong, R “China security interests in Central Asia”, Central Asian Survey, 24, 4, (2005), pp. 426-430 7 Paramonov, V., Strokov, A. and Stolpovski, O. Russia in Central Asia: Policy, Security and Economics (New York: Nova Publishers, 2009), pp. 20-38, 57-59; Allison, R., “Strategic reassertion in Russia’s Central Asia policy”, International Affairs 80, 2 (2004), pp. 286-288 8 Cooley, A. “U.S. bases and democratization in Central Asia”, Orbis, 52,1 (2008), pp. 66-68 9 Olcott, M,B. ‘Eyes on Central Asia: how to understand the winners and losers’, in Akihiro, I. (ed.), Eager eyes fixed on Eurasia, (Sapporo: Slavic Research Center, Hokkaido University, 2007), pp. 6-8; Ipek, P, “Challenges for democratization in Central Asia: what can the United States do?”, Middle East Policy XIV, 1 (spring 2007), pp. 95-106

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Russian strategy achieved its goal following the Andijan events in May 2005: the deterioration of the U.S.Uzbekistan strategic partnership and the eviction from the Karchi-Khanabad military airbase represented a clear signal of the American geopolitical retreat in Central Asia, with the loss of the strategic partner in the region and its temporary realignment to Russia. This new political orientation was confirmed afterwards through the agreement for a Mutual Defence Pact with Russia in November 2005 and with the Uzbek adhesion to the Moscow-led regional organisation CSTO and EurAsEC in 2006. Russia and China politically supported the Tashkent’s official explanation of Andijan events while Western countries condemned Islam Karimov’s regime for its disproportional use of force. The Kyrgyz “Tulip Revolution” in March 2005 – which provoked for the first time the removal of a Central Asian president since 1991 – and the Andijan events spread fears in the Central Asian political leaderships over the stability of their power: consequently the need to strengthen the internal security and to maintain their political power pushed them to re-orient their foreign policy towards the two regional superpowers, considered as reliable security partners able to contain these threats and to preserve the status quo. 10 Following the achievement of their shared goal to expel U.S. military from the region, Russia and China have consolidated their reciprocal spheres of influence in Central Asia, opening the current third phase which has been also characterized by another relevant geopolitical shift, the NATO's withdrawal from Afghanistan and from the region in 2014.11 For Central Asian republics, NATO's redeployment is destined to affect the lucrative implementation of the multi-vector strategy in foreign policy, which has allowed them to balance Sino-Russian influence in military, economic, energy and political field. During this third phase, the different strategic aims of Russia and China towards Central Asia has emerged in the regional scenario, drawing up several elements of tension and a rising geopolitical competition between them mainly in the energy and economic fields. In addition to the growing role of Beijing as main economic and trade partner for Central Asian countries - progressively downplaying the traditional role of Russia - the opening of the China-Central Asia gas pipeline in 2009 has represented an historic change in the regional energy chessboard, ending the Russian monopoly on Turkmen gas exports as well as the implementation of the Sino-Kazak oil pipeline has further weakened Russian control on Central Asian energy exports, triggering another element of tension with China. Moreover, within the SCO, the Sino-Russian geopolitical rivalry on the future development of the regional organization is evident: Moscow privileges the military cooperation and prioritises security issues, while Beijing aims to wide the SCO’s competencies in the economic domain. In 2007 CSTO and SCO signed a Memorandum of Understanding in order to enhance the cooperation in the military and security field. This agreement could be interpreted as Moscow’s attempt to engage China into a fully-fledged military alliance, even if the Russian real goals appears to limit Chinese freedom of manoeuvre in Central Asia, engaging the regional rival in a deepen military cooperation in the framework of a multilateral organization with the aim to better control Chinese ambition and demonstrating Russia’s preeminence in the field of regional security. 12 At the level of military cooperation with Central Asian republics, China cannot compete with Russia: Beijing has no military bases in the region (partly due to the fierce opposition of Central Asian public opinion fearing a potential Chinese expansionism in their national territories) and a potential deployment of Chinese troops is currently hampered by the foreign policy principle of non interference in domestic affairs of other countries. Russia appears the main security provider for Central Asian states, involved in the bilateral military cooperation and in the CSTO activities: the Eurasia region is considered by Russia as an exclusive sphere of influence to protect from external interferences through the CSTO activities, which can be defined as a counter-balance to Western and Chinese influence in the former Soviet space .13 In this reshapes geopolitical scenario, Russia and China have launched their respective geopolitical strategies, the Eurasian Economic Union backed by Russia and the Silk Road Economic Belt promoted by China.

10 Indeo, F. “The geopolitical consequences of the US-Russian “military airbase race” in Central Asia”, The China and Eurasia Forum Quarterly, 8, 3, (2010), pp.149-160 11 Kim, Y. and Indeo, F. “The new great game in Central Asia post 2014: the US "New Silk Road" strategy and Sino-Russian rivalry”, Communist and Post-Communist Studies, 46, 2. (2013), pp. 278-279 12 Kaczmarski, M. “Russia attempts to limit Chinese influence by promoting CSTO-SCO cooperation”, Central Asia Caucasus Analyst, 17 October 2007, http://www.cacianalyst.org/? q=node/4716. 13 Frost, A., “The Collective Security Treaty Organization, the Shanghai Cooperation Organization, and Russia’s strategic goals in Central Asia”, The China and Eurasia Forum Quarterly, 7, 3 (2009), pp. 8492

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3. THE EURASIAN ECONOMIC UNION: RUSSIA’S STRATEGY IN A TRANSFORMING REGION The Eurasian Economic Union (EEU) represents the Russian attempt to restore its influence in the post soviet space, promoting the economic integration in a reshaped geopolitical scenario within which Moscow wants to play a leading role. Russian President Putin supports the idea of the multipolarity of the international system, which appears divided in “geopolitical zones”, and the EEU should play the role of pole of power. In an article in the Russian newspaper Izvestia in 2011, Putin called for the creation of an Eurasian Union as ‘a powerful supranational union, capable of becoming one of the poles in the modern world and laying the role of an effective link between Europe and the dynamic Asia-Pacific region‘.14 According to Putin's vision, Eurasian integration will allow the post soviet space to become an independent centre for global development, reassuring potential members that Russia has not plans to restore the Soviet Union. However, the geopolitical dimension of the EEU emerges considering that this regional organization aimed to promote economic integration and it is also conceived as a kind of counterbalance to the EU, NATO as well as must contain Chinese ambitions to expand influence in Central Asia. As a matter of fact, the adhesion to the EEU should prevent the geopolitical attractiveness of other regional initiatives such as Chinese initiatives of regional cooperation and the EU Eastern Partnership. 15 The EEU entered into force on 1 January 2015, as the necessary evolution of the economic integration in the post soviet space - even if limited to Russia, Kazakhstan, Kyrgyzstan, Belarus and Armenia - after the establishment of the Custom Union and the Common Economic Space. The first step to create the EEU was the decision to establish a trilateral Customs Union (CU) among Belarus, Kazakhstan, and Russia in October 2007, during a session of the EurAsEC Intergovernmental Council in Dushanbe. The other three EurAsEC members - Kyrgyzstan, Tajikistan, and Uzbekistan - were excluded from the initial organization due to their low levels of economic development, though the first two countries have since expressed interest in joining. Undoubtedly, the effects of the 2008 economic crisis contributed to make progress in the economic integration. In 2010 the Russia, Kazakhstan and Belarus launched the Custom Union, abolishing many trade tariffs and customs controls between as well establishing some common tariffs against imports from non-member countries. Furthermore, they agreed to allow their citizens freedom to travel among these countries carrying only an internal passport. On November 22, 2011, the presidents of these three countries signed an agreement to integrate their economies into a Common Economic Space (CES), which entered into force on January 1, 2012. 16 On 29 May 2014, the original core of the CES - Russia, Belarus and Kazakhstan - signed the Eurasian Economic Union Treaty, while Armenia accessed in October. The EEU entered into force on 1 January 2015, while Kyrgyzstan formalized its membership in August 2015, after a long and debated negotiation. Following the establishment of the EEU Russia is able to play as the main pole of power and influence in the region: as a matter of fact, if EEU allows Russia to enhance economic integration and political cooperation in the post soviet space, through the CSTO – which not include China – and bilateral initiatives Russia emerges as the main security provider in the region, following NATO's redeployment from Afghanistan. In order to contain international terrorism and the Islamic threat (represented by Taliban and the foreign fighters linked to the Islamic state) Russia planned to strengthen its military positions in Central Asia, particularly boosting its military presence in Kyrgyzstan (current EEU member) and Tajikistan (a future potential member). Even if EEU aims to achieve economic targets of integration, its geopolitical and strategic

14 Putin, V. “New integration project for Eurasia – a future which is being born today,”, Izvestia (in Russian), 3 October 2011,www.izvestia.ru/news/502761. 15 Glazyev, S. ‘Russia and the Eurasian Union’, in Dutkiewicz, P. and Sakwa, R. (eds.), Eurasian Integration – The View from Within. (Routledge, New York, 2015), pp. 84-96; Popescu, N. “Eurasian Union: the real, the imaginary and the likely”, Chaillot Paper, 132, (2014), pp. 19-21, http://www.iss.europa.eu/uploads/media/CP_132.pdf 16 Weitz, R. ‘The Customs Union and Eurasian Union: a primer’, in Starr, S.F. and Cornell, S.E (eds), Putin’s Grand Strategy: The Eurasian Union and Its Discontents, (Central Asia- Caucasus Institute Silk Road Studies Program, Washington, 2014) pp. 32-35, http://www.silkroadstudies.org/resources/1409GrandStrategy.pdf

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dimension is often predominant, as appeared in the case of the EEU enlargement to Kyrgyzstan. Russia convinced Kyrgyzstan to join EEU after the decision to cover most of Kyrgyzstan’s accession cost ($200 million), to finance with $1 billion the Russian-Kyrgyz Development Fund and to promising to accommodate Kyrgyz migrant workers in Russia by providing registration and jobs. 17 Through the EEU Russia seeks to contain Chinese rapid economic expansion into Central Asia, which threatens to oust Russia in both the economic and security fields. 18 Nevertheless, the EEU integration project appears hampered and delayed by a combination of economic and geopolitical factors which could downplay Russian ambitions. If the initial creation of the Customs Union coincided with a boost in intra-regional trade – i.e it was up by 32.1 per cent in 2011 and by a further 7.5 per cent in 2012 – this positive trend was interrupted. In 2015, trade among EEU members fell by almost 26 per cent and by 34 per cent with other countries.19 This economic decline was driven by factors like the effects of EU sanctions against Russia and low oil prices, but the main issue to manage and to solve is that the economic problems undermined confidence in the bloc, and trade barriers were re-introduced between some member states as they tried to protect their domestic markets.20 Kazakhstan and Kyrgyzstan don't have economic benefits for their EEU adhesion. Of course, the abolition of customs barriers from the Kazakh-Kyrgyz border in August 2015 and from shared EEU borders is a concrete result but there are some economic distorsions to address. The single external tariff adopted by the EEU members is based on pre-existing higher Russian trade tariffs and consequently, for Kazakhstan and Kyrgyzstan imports are more expensive: mainly for Kyrgyzstam this regime implies higher prices on Chinese imports and difficulties for wholesale and re-export trade. Moreover, the devaluation of national currencies has further affected intra-regional trade: Kazakhstan was forced to ban imports of much cheaper Russian goods – due to the devaluation of the Russian Ruble - to protect domestic producers. On the other hand, Kazakhstan’s exports, became expensive for the EEU market leading to a sharp decline in exports.21 The adoption of an EEU single currency could be an option to overcome existent distortions, but Astana e Biskhek governments strongly rejected this option conceived as an infringement of their sovereignty. 22 The economic crisis in Russia linked to the EU sanctions and low oil prices leaded to a considerable fall of remittances of Kyrgyz migrant workers in Russia, which represented a relevant share of the national GDP (28.6 percent in 2014, the second most remittances-dependent country in the world after Tajikistan).23 Furthermore, the current economic weakness has pushed Russia to revise and to freeze all expected plans to provide investments and funds to promote economic integration within the EEU framework. Between 2015 and 2016 Russia was not able to provide promised investments in hydro-electric plants in Kyrgyzstan as well as to allocate $1 billion for the Russian-Kyrgyz Development Fund, which received only $350 million. Moscow was obliged to downgrade its military presence in Tajikistan, while in the economic sphere Russia also lost its status of main trade partner for Uzbekistan, taking over by China. 24

17 Mashrab, F., “Eurasian Union’s expansion falters amid Russia’s economic woes”, Eurasia Daily Monitor, 13, 42, 2 March 2016, http://www.jamestown.org/single/?tx_ttnews%5Btt_news%5D=45160&tx_ttnews%5BbackPid%5D=7&c Hash=941df08ef9e8a6c42fbc27a5f39455a0#.VxWfdRIrLfY. 18 Bugajski, J. and Assenova, M. Eurasian Disunion. Russia’s vulnerable flanks (The Jamestown Foundation, Washington DC, June 2016), pp. 386-388, http://jamestown.org/uploads/tx_jamquickstore/Eurasian_Disunion2.pdf 19 ‘Eurasian Economic Union’, Official EEC statistics, available at 20 International Crisis Group, ‘The Eurasian Economic Union: power, politics and trade ’ (ICG Europe Report N°240, Brussels, 20 July 2016), pp. 10-11, https://www.crisisgroup.org/europe-centralasia/central-asia/eurasian-economic-union-power-politics-and-trade 21 Gretsky, S. “‘Hanging in the trade balance: is free trade a curse for Kazakhstan?”, Central Asia Caucasus Analyst, 10 June 2015, http://cacianalyst.org/publications/analyticalarticles/item/13228-hanging-in-thetrade-balance-is-free-trade-a-curse-forkazakhstan?.html. 22 International Crisis Group, ‘The Eurasian Economic Union: power, politics and trade ’ , p.13 23 Kubayeva, G. ‘Economic Impact of the Eurasian Economic Union on Central Asia’ , (OSCE Academy, Central Asia Security Policy Brief, Biskhek, February 2015), p.10, http://www.osceacademy.net/upload/file/Policy_Brief_20.pdf 24 Pannier, B., “Kyrgyzstan revokes hydropower deal with Russia”, Radio Free Europe/Radio Liberty, 20 January 2016, http://www.rferl.org/content/qishloq-ovozi-kyrgyzstan-energy-dreams/27499926.html

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Furthermore, Russia’s invasion of Crimea and the explosive crisis with Ukraine have heavily damaged Russia's image in Central Asia, spreading serious concerns about Russian integration project in the security (CSTO) and political-economic field (Eurasian Economic Union). Central Asian presidents fear this perceived neo-imperialist approach of Moscow in the region, which could affect and limit the profitable multi-vector strategy adopted in foreign policy as well as their national sovereignty. 25 The Kazak President Nazarbayev has clearly stressed that the EEU will only have an economic dimension, refusing the idea to create a supranational political institution organization: in order to preserve its sovereignty and political independence, Kazakhstan has threatened to leave EEU. 26 Given its political stability and its economic wealth deriving from the oil exports, Kazakshtan has continued to play its multivector policy after the annexation of Crimea, adopting decisions which clash with Russia's orientation: firstly, Kazakhstan refused to implement countersanctions against the West, as Russia demanded; secondly, it boosted relations with Ukraine with mutual presidential visits and developing an action plan for cooperation and trade; thirdly, Astana signed an Enhanced Partnership and Cooperation Agreement with the EU. 27 On the contrary, Kyrgyzstan appears not able to oppose to Russian integration projects, even if the country is unsatisfied for the unrealized promises. The political mistrust about Russian projects of economic and political integration and the current economic downturn appear destined to limit a further enlargement of the Eurasian Economic Union to other Central Asian countries. In the next years, Tajikistan could be a potential future member: at present Tajikistan is assessing the benefits and disadvantages of joining the EEU but given the economic and military dependence on Moscow of the poorest Central Asian countries its accession the EEU will represent another Russia' geopolitical success, with no benefits for the Eurasian economic integration and development. The remaining Turkmenistan and Uzbekistan appear not interested to join EEU: since independence Turkmenistan has adopted a neutrality approach in its foreign policy refusing to join all multilateral regional projects, while Uzbek President Karimov has rejected Russia's proposal to join EEU (and to restore its participation in the CSTO) because he perceived them as a threat to the political independence and sovereignty of the country and an imperialist attempt to restore the Soviet Union. Nevertheless, Tashkent declared to consider taking part in a free trade agreement with the Eurasian Economic Union following Russian decision to write-off a large debt and to invest in the country. This deal shows how Uzbekistan wishes to mantain bilateral relations with Moscow even if Tashkent remains cautious about becoming a member of the EEU’s free trade zone. However, Russia disposes of some relevant levers to make pressure on Central Asian republics to force them to change approach about integration projects. Moscow’s aim to protect Russian-speaking population in the post soviet space is perceived as a looming threat for the five Central Asian states, which are home to sizeable communities of ethnic Russians. Moreover, Putin’s claim that pro-Russian troops in Crimea were only protecting Russian military facilities is perceived as an incumbent threat for Central Asian republics such as Kyrgyzstan and Tajikistan – which host Russian and CSTO military bases – or Kazakhstan, which hosts the Baikonur Cosmodrome. Among Central Asian countries, Kazakhstan appears the more vulnerable to Russian pressures: as Ukraine, Kazakhstan shares a long borders with Russia, with large ethnic Russian minorities (22 per cent of the population) and an interlinked economic cooperation as a members of the CU, the CES and currently of the EEU.28 So Kazakhstan must carefully balance its foreign policy with Russian initiatives and cooperation, considering that Russia could deploy significant tools to convince Kazakhstan about its desire to withdraw the EEU if it becomes a supranational political organization. Labor migration is another significant card which Russia could play with Uzbekistan, Kyrgyzstan and Tajikistan, considering the relevance of remittances on the national GDP and the dangerous repercussions on domestic stability linked to the return of Central Asian workers from Russia in a national context of 25 Dragneva, R. and Wolczuk, K., “Eurasian Economic Integration: Institutions, Promises and Faultlines”, The Geopolitics of Eurasian Economic Integration London, 2014, pp. 12-15, http://www.lse.ac.uk/IDEAS/publications/reports/pdf/SR019/SR019-Dragneva-Wolczuk.pdf; Indeo, F., ‘Central Asia beyond 2014:building regional security architecture’ , (ISPI Analysis, No. 262, Milano, 2014), pp. 7-8 26 Satpayev, D., Kazakhstan: ‘Economic Integration without relinquishing sovereignty’, in Felix Hett and Susanne Szkola (eds), The Eurasian Economic Union Analyses and Perspectives from Belarus, Kazakhstan, and Russia, (Friederich Ebert Stiftung, Berlin, 2015), pp. 11-16, http://library.fes.de/pdffiles/id-moe/11181.pdf 27 Bugajski and Assenova, Eurasian Disunion. Russia’s vulnerable flanks, p. 408 28 Indeo, F., ‘Central Asia beyond 2014:building regional security architecture’, pp. 7-8

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unemployment, poverty and lack of professional perspectives. Consequently, the threat to adopt restrictive immigration policies or the promise to offer better conditions could influence the approach of Central Asian presidents. The presence of Russian military bases in their territory and the economic and military assistance provided by Moscow severely influence Kyrgyzstan and Tajikistan attempts to lead an independent foreign policy. Moreover, Moscow has also exploited tensions over water management between Uzbekistan and the two upstream countries (Tajikistan and Kyrgyzstan), supporting their large hydropower projects, even if the difficulty of Russia to invest money in these projects has undermined this strategy. Also Turkmenistan could be vulnerable to Russian pressures, mainly if Asghabat decides to support the realization of the Trans Caspian pipeline, shipping its gas to EU market and consequently affecting the geopolitical relevance of Russian exports. Moscow could play the card of of ethnic Russian living in Turkmenistan: given Moscow's orientation to protect Russian-speaking population in the post soviet space, Russia could consider as discriminant some of cultural and administrative decisions adopted by Turkmen government, intervening to defend the rights of Russian community. In the security field, Turkmenistan could need Russian support to address the growing Taliban threat on the Turkmen-Afghan border, a factor of dangerous instability which could also affect the whole regional security architecture.29

4. THE SILK ROAD ECONOMIC BELT: CENTRAL ASIA A KEY TRANSIT AREA Following the launch of the Silk Road Economic Belt geopolitical project China has undertaken a concrete strategy to extend its influence in Central Asia, which aimed both to protect its interests and to react against Russian attempts to exclude Beijing from the regional scenario. As a matter of fact, Russia announced the creation of the Eurasian Economic Union, a project of regional cooperation in the economic sphere which excludes China, after rejecting the Chinese initiative to create a free trade zone in the SCO framework, involving Russia and the four Central Asian republics (Kazakhstan, Kyrgyzstan, Uzbekistan and Tajikistan).30 Chinese President Xi Jinping exposed the Silk Road Economic Belt (SREB) at Nazarbayev University on 7 September 2013 as part of his state visit to Kazakhstan: during its speech (titled ‘Promote Friendship between Our Peoples and Work Together to Create a Bright Future’ ) Chinese President pointed out that ‘to forge closer economic ties, deepen cooperation and expand space for development in the Eurasian region, we should take an innovative approach and join hands in building an ‘economic belt along the Silk Road’. We may start with work in individual areas and link them up over time to cover the whole region’ . 31 The SREB is the overland route of the wider One Road One Belt strategy, which also includes the New Maritime Silk Road - which was announced in October 2013 during Xi Jinping’s state visit to Indonesia. In 2015, the project was formalized through the presentation of an official document called the Vision and Actions on Jointly Building the Silk Road Economic Belt and 21st-Century Maritime Silk Road.32 The SREB initiative envisages to create a comprehensive network of transportation, consisting of railways, highways, air ways, oil and gas pipelines, and transmission lines as well as communications networks which will cross Central Asian region, helping Cjina to enhance its economic integration with the West. The main goal was to create a Eurasian economic corridor – through «transportation infrastructure diplomacy», trade liberalization, and monetary cooperation - able to further develop Central Asian economies and integrate them into both European and Asian markets. 33

29 Indeo, F. ‘Turkmenistan 2014: security concerns and unfulfilled diversification of export energy routes’ , in Torri, M. and Mocci, N. (eds), Asia Maior 2014, (vol. XXIV, Emil di Odoya Editions, Bologna, 2015), pp.450-451 30 Brugier, C. ‘China’s way: the new Silk Road’, (European Union Institute for Security Studies, Brief Issue, 14, Paris, May 2014) p.1, http://www.iss.europa.eu/uploads/media/Brief_14_New_Silk_Road.pdf 31 Yiwei, W. ‘China’s “New Silk Road”: a case study in EU-China relations’, in Amighini, A. and Axel Berkofsky, A. (eds), Xi's Policy Gambles: The Bumpy Road Ahead, (ISPI, Milan, 23 March 2015), p.93, http://www.ispionline.it/it/pubblicazione/xis-policy-gambles-bumpy-road-ahead-12911 32 National Development and Reform Commission (), ‘Vision and actions on jointly building Silk Road Economic Belt and 21st Century Maritime Silk Road’ (Ministry of Foreign Affairs and Ministry of Commerce of the People’s Republic of China, 28 March 2015 http://en.ndrc.gov.cn/newsrelease/201503/t20150330_669367.html 33 Congiu, F. ‘China 2015: Implementing the Silk Road Economic Belt and the 21st Century Maritime Silk Road’, in Torri, M. and Mocci, N. (eds), The Chinese-American Race for Hegemony in Asia, Viella

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We can observe that one of the key element of the SREB initiative is its inclusive nature: as a matter of fact, unlikely the Russian-backed initiatives - the EEU or the CSTO - all Central Asian republics have been included in the SREB strategy, also Turkmenistan which has progressively become the main energy partner for China. The participation of Central Asian countries in the SREB is strategic for several reasons, allowing them to benefit of massive investments to develop national infrastructures also connecting them within an Eurasian economic framework. Moreover, as transit countries between China and European market, they will benefit of lucrative transit fees. Transport routes from East Asia to Europe mainly pass through Xinjiang in China, Kazakhstan, and Russia. At present, there are eight Sino-Europe rail trains in regular operation, among which two rail trains start from the north east city Manzhouli in China, travel through Russia and then to Europe. The other six routes start from the Alataw Pass of Xinjiang and run through Kazakhstan and Russia. The Aktau port in Kazakhstan and the Turkmenbashi port in Turkmenistan will be linked to the new Baku International Sea Trade Port (NBIST port), and then westwards onto Turkey and Europe, opening an alternative route and diversifying trade corridors. In August 2015, the Trans-Caspian International Transport Route (TITR) was launched; the Nomad Express carrying goods from China (Shihezi) traveled through the port of Aktau and arrived at Baku.34 The Sino-Kazakh border is strategic to improve the SREB capacity: many of Xinjiang’s cities at the border with Central Asia - Horgos, Kashgar and Alataw - have been transformed into free-trade economic zones to play the role of the largest land port along the Silk Economic Belt. The transcontinental highway from Lianyungang (a Chinese port in Jiangsu Province, in the east coast) to St. Petersburg in Russia crosses Kazakhstan:he logistics terminal in the port of Lianyungang was jointly built by China and Kazakhstan in order to make it a platform for transporting Central Asian goods to overseas markets. 35 The inclusion of Central Asian republics in the Silk Road initiative is also positive to enhance their export, overcoming the structural hindrances linked to their condition of landlocked countries and allowing them to reach the global markets. However, the development of this Eurasian economic corridor needs to achieve a necessary precondition: political stability and security. China fears that the weaknesses of the Afghan central authority as well as of the Central Asian governments could lead to the creation of safe bases for Uyghur separatists and foreign terrorists aiming to operate in Xinjiang. 36 Xinjiang is located in a strategic geographic position, as exclusive gateway for trade and commercial relations as well as for Central Asian oil and gas imports. From the Chinese perspective, the security dimension is strictly correlated to economic and development issues: economic growth in Central Asia will strengthen stability in both China and the region, because close commercial relations with Central Asian countries will ensure prosperity, also preventing potential political instability and spillover into its western territory. 37 In addition to the east-west trade corridor, in these enhanced cooperation between China and Central Asia the development of a "reverse" west-east energy corridor has progressively assumed a growing strategic relevance. Energy and trade cooperation between China and the Central Asian republics was further boosted during the visit of Chinese President Xi Jinping to Central Asia in September 2013. Xi promoted the idea of the “Silk Road Economic Belt” and signed an estimated $48 billion worth of investment and loan agreements ($15 billion with Uzbekistan, US$30 billion with Kazakhstan, US$3 billion with Kyrgyzstan and an undisclosed sum with Turkmenistan) with a focus on energy, trade, and infrastructure. 38 editions, Rome, 2016, p. 35 34 Lianlei, B. “Azerbaijan in the Silk Road Economic Belt: A Chinese perspective”, Caucasus International, 25 July 2016, p. 30, http://cijournal.az/post/azerbaijan-in-the-silk-road-economic-belt-a-chineseperspective-bai-lianlei 35 Congiu, ‘China 2015: Implementing the Silk Road Economic Belt and the 21st Century Maritime Silk Road’, p. 37 36 Weitz, R. “China and Afghanistan – Time of Decision”, Central Asia Caucasus Institute Analyst, 3 September 2014, http://www.cacianalyst.org/publications/analytical-articles/item/13035-china-andafghanistan-%E2%80%93-time-of-decision.html 37 International Crisis Group, China's Central Asia Problem, (ICG Asia Report, 244,Brussels, 27 February 2013), p.11 38 Rejepova, T. “Turkmenistan, China reach new energy deals”, Central Asia-Caucasus Institute Analyst, 16 October 2013, http://www.cacianalyst.org/publications/field-reports/item/12834-turkmenistan-chinareach-new-energy-deals.html; Yakobashvili, T. “A Chinese Marshall Plan for Central Asia?”, Central Asia Caucasus Institute Analyst, 16 October 2013, http://cacianalyst.org/publications/analyticalarticles/item/12838-a-chinese-marshall-plan-for-central-asia?.html

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Central Asian oil and gas supplies play a significant role in Chinese energy security: Kazakh oil contributes to the diversification of import sources and to the implementation of alternative territorial energy routes, considering that over 80 per cent of Chinese oil imports are delivered through oil tankers. Another significant aspect of Chinese-Kazakh energy cooperation is represented by the fact that Beijing is the main purchaser of Kazakh uranium. At present Turkmenistan is China’s main partner in the Central Asian gas sector: since 2012, half of Beijing's total gas imports have been covered by Turkmen gas, delivered to China through the Central Asia-China gas pipeline (CAGP), which also crosses Uzbekistan and Kazakhstan and, by 2016-2017, Kyrgyzstan and Tajikistan, following the expected realization of Line D. The Chinese government strongly invested in the Turkmen energy sector, granting an $8 billion loan (for the period 20102011) to bring the giant Galkynysh gas field online. In this way, all five Central Asian republics are included in the Chinese energy strategy: the upgrade of the Caspian Sea-Xinjiang pipeline - shipping Kazakh oil – and the CAGP pipeline has allowed Central Asian countries to develop an alternative energy export route not under Russia control, also benefiting of Chinese loans and investments to realize infrastructures and to exploit national energy reserves. 39 It is evident that the Silk Road initiative and the Chinese engagement in Central Asia represent a serious geopolitical challenge for Russia's integration projects: the success of the Chinese strategy is progressively reducing the influence of Moscow in the post soviet space. 40 After losing the position of semi-monopole in the Central Asian energy exports, since 2010, China has progressively become the main trade partner for all Central Asian states, undermining the traditional role of Russia. For the first time since the fall of the Soviet Union, in 2015 Moscow also lost its its top trading partner status with Uzbekistan. Furthermore, compared to Russia China is concretely fulfilling its promises of investing in Central Asia, granting loans and financing the realization of important infrastructures which will contribute to develop domestic connections, to promote an integrated regional market as well as to ship Chinese goods to the West. Even before the launch of the SREB, China provided economic assistance to Central Asia: in 2009, China provided the SCO with a $10 billion loan to help Central Asian members to mitigate the effects of the economic crisis and another $10 billion loan was offered in 2012.41 In November 2014 China announced the creation of the US$ 40 billion Silk Road Fund to support project aimed to realize transport infrastructures and it was exclusively founding by China. The Energy Development Fund has been conceived to focus investments on energy infrastructure along the Silk Road land and maritime routes, and it is a multilateral fund open to foreign investors. Following the constitution of the Asian Infrastructure Investment Bank (AIIB) China dispose of a influencing tool to develop OBOR strategy and SREB initiative in both economic and energy dimensions. The main strategic of the AIIB is to support the ‘development of infrastructure and other productive sectors in Asia, including energy and power, transportation and telecommunications, rural infrastructure and agriculture development, water supply and sanitation, environmental protection, urban development and logistics […]’ . 42 China also supports the development of road infrastructure in Tajikistan and Kyrgyzstan, granting loans for their realization. In Tajikistan, with a US$ 900 million loan, Chinese companies have been building roads linking Dushanbe, with other important towns. In Kyrgyzstan, China has invested in the realization of the China-Kyrgyzstan-Uzbekistan railway – which will be linked to Turkmenbashi and Baku ports - will go from Kashgar in Xinjiang through Torugart and Kara-Suu in Kyrgyzstan, onto Andijan in Uzbekistan, and then across Afghanistan, Iran, the Caspian Sea, Azerbaijan, and Turkey - as far as Europe.43 In 2015 Uzbekistan inaugurated the Angren-Pap railway, a infrastructure which benefited from Chinese investments, which hold a strategic relevance for Uzbekistan – which could connect the whole national railway system, and also for China because the Angren-Pap will be a key stronghold in the One Road One Belt geopolitical strategy.

39 Indeo, F. ‘China as security provider in Central Asia: a realistic perspective?’ Central Asia Security Policy Brief, 17, (OSCE Academy-GCSP International Security Programme, Biskhek, 2015) pp.6-8, http://www.osce-academy.net/upload/file/Policy_Brief_17.pdf 40 Rickleton, C. ‘Central Asia: Can China’s Silk Road Vision coexist with a Eurasian Union?’, Eurasianet, 12 November 2014, http://www.eurasianet.org/node/70891 41 Jarosiewicz, A. and Strachota, K. ‘China vs. Central Asia The achievements of the past two decades’, OSW Studies, 45, (OSW, Warsaw, 2013), p.68, http://www.osw.waw.pl/sites/default/files/prace_45_cina_vs_asia_ang-net.pdf 42 The Asian Infrastructure Investment Bank, Official Website, http://euweb.aiib.org/html/aboutus/introduction/aiib/?show=0 43 Jarosiewicz and Strachota ‘China vs. Central Asia The achievements of the past two decades’, p.62,

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Lastly, China has successfully signed strategic partnership with all five Central Asian republics, which are based not only to deep economic and trade cooperation but also to enhance political and military cooperation. The strategic partnership between Beijing and Tashkent has a relevant geopolitical impact in order to prevent Russian projects of regional integration:in September 2013, the two signed a Treaty on Friendship and Cooperation and a Joint Declaration ‘On Further Development and Deepening Bilateral Relations of Strategic Partnership’ , which stated that the two countries would not adhere to any alliances or blocs which would damage the sovereignty, security and territorial integrity of the other side. 44 The strategic partnership between Kazakhstan and China is the most "dangerous" initiative aimed to affect Russian ambition to promote integration projects in the region, mainly considering that Kazakhstan is one of the EEU founder members. As a matter of fact, this strategic partnership includes several fields of enhanced cooperation: to undertake joint efforts to fight against terrorism and cooperation in the security field, to develop energy infrastructures as well as to extend the export of oil, natural gas and uranium to China, to enhance bilateral trade. Moreover the political will expressed by the Kazakh and Chinese President to integrate the SREB with Kazakhstan's new economic policy, called the Bright Road, stressing the complementarity of these two projects both focused on infrastructure developments. This existing strategic partnership shows the high level of cooperation between them, and the clear intention of Kazakhstan to undertake an independent and multivector foreign policy, in spite of the EEU membership, challenging the impact of Russian strategy toward post soviet region. 45 However, in spite of an open competition the current rapprochement between China and Russia could lead to a potential merge, or cooperation, between the EEU and the SREB. Following events in Ukraine and the impact of EU sanction targeting Russian interests, Moscow has decisively reoriented its foreign policy to East, mainly enhancing the partnership with China. In the energy sector, Russia and China signed in 2014 a deal to realize the Power of Siberia pipeline, aimed to ship 38 billion cubic metres of Russian natural gas per year to China, even if the financial problems of Russia are delaying work on the pipeline. In 2015 these two countries agreed to realize the Altai pipeline project, to deliver Russian gas to China crossing Xinjiang region. After Putin-Xi summit in Moscow in May 2015, the two leaders signed a joint declaration

‘on cooperation in coordinating development of EEU and the Silk Road Economic Belt.’ Moscow and Beijing declared a goal to coordinate the two projects in order to build a “common economic space” in Eurasia, including a Free Trade Agreement between the EEU and China. 46 This convergence between the Sino-Russian geopolitical strategies represents one of the major shift in the regional scenario. Russia and China has started discussions concerning the practical implementation of this cooperation. The Eurasian Economic Commission (the governing body of the EEU) plans to sign a comprehensive treaty on economic and trade cooperation with China There are no plans to develop a free trade area between China and the EEU; the treaty will instead focus on specific sectors (transportation is especially important in this sense), as well as support and protection of mutual foreign direct investments. 47 The coexistence of the SREB and the EEU could create benefits for both promoters. The transportation and infrastructure projects of the SREB can clearly benefit from the liberalization of trade and movement of capital and labor within the EEU. However, this potential benefit depends on the EEU decision to avoid the adoption of prohibitive trade barriers on its external borders. Moreover these two strategies share the relevant goal to develop transport infrastructures: planning common infrastructures and connecting them will expand the economic cooperation in the region involving Russia, China and Central Asian states. As a sign of that cooperation, China agreed to invest $5.8 billion to extend the Moscow-Kazan high speed railway into China. However there are some hindrances which could delay the idea to link these strategies. At present, the rise of protectionism in Russia and also in Kazakhstan represents one of the main barrier which will be difficult to overcome. The EU sanctions have pushed Russia to privilege domestic production of goods, and the effects

44 Tolipov, F. “What does it mean for Uzbekistan and China to be Strategic Partners?”, Central Asia Caucasus Analyst Institute, 13 November 2013, http://www.cacianalyst.org/publications/analyticalarticles/item/12858-what-does-it-means-for-uzbekistan-and-china-to-be-strategic-partners?.html 45 Guschin, A. “China, Russia and the Tussle for Influence in Kazakhstan”, The Diplomat, 23 March

2015, http://thediplomat.com/2015/03/china-russia-and-the-tussle-for-influence-in-kazakhstan/ 46 Gabuev, A. “Eurasian Silk Road Union: Towards a Russia-China consensus?” , The Diplomat, 5 June 2015, http://thediplomat.com/2015/06/eurasian-silk-road-union-towards-a-russia-china-consensus/ 47 Libman, A. “Linking the Silk Road Economic Belt and the Eurasian Economic Union: mission impossible?”, Caucasus International, 6, 1, (2016), pp. 42-43 http://cijournal.az/post/linking-the-silkroad-economic-belt-and-the-eurasian-economic-union-mission-impossible-alexander-libman

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of the currency devaluation have made some Russian goods cheaper than Kazak ones, severely damaging national production. The prevalence of protectionism in Russia has long been seen as a problem by China, which, for example, promoted the idea of a free trade area within the Shanghai Cooperation Organization (SCO) – an idea Russia definitively rejected.48 Furthermore, a revamp of the geopolitical rivalry could negative influence the idea of the EEU-SREB strategic cooperation. Russia has widely lost its economic influence in Central Asia, while China has become the main trade partner for the post soviet countries: so, for Moscow could be more profitable to develop the EEU as an alternative geopolitical option attempting to challenge the rising power of China in the region.

5. CONCLUSION Following the launch of the EEU and the SREB, Russia and China appear strongly motivated to enhance their presence and influence in Central Asia. The huge Chinese investments to develop Central Asian energy and transport infrastructure mean that China intends transform the region following its strategic needs. For China, Central Asia represents the overland corridor of trade and energy which allow Beijing to diversify its economic strategy reducing the relevance of the maritime corridor. In order to promote a regional integrated trade and cooperation, SREB project appears more attractive for Central Asian republics than the EEU, mainly because the Chinese initiative does not impose a membership and it is not an organization, but it is a program of investments aimed to develop infrastructures, which could help Central Asian landlocked countries to be connected with the global market. On the contrary, the EEU appears as a rigid organization, within which Russia often propose the idea to transform it in a supranational political organization, merging and coordinating foreign policies and with a single currency. This perspective is feared and rejected by Central Asian states, making them more interested to the Chinese initiatives. Moreover, at present Russia is not able to fulfill its promises, having problems to grant the economic benefits which have been offered to convince reluctant countries (Kyrgystan and now Tajikistan) joining the EEU: it is evident that in this way the EEU loses its attractiveness as geopolitical pole of influence. However, we should also observe that this growing activism of China is feared by Central Asian public opinion: the threat of Beijing’s hide long-term intentions of territorial expansionism and interference could push Central Asian countries to limit the cooperation, even if in the medium term, the impact of Chinese investments in the region should further promote trade and energy cooperation among them. For Central Asian republics, a renovated competition between Russia and China could be profitable, allowing them to balance Sino-Russian aims in the region and obtaining strategic gains. On the contrary, a long-term rapprochement between Moscow and Beijing could affect the development of independent foreign policies, because all the region will be under the influence of these powerful geopolitical players. Through SREB and EEU initiatives, China and Russia want to achieve clashing and colliding goals, making difficult to draw up a common framework of cooperation in Central Asia or to agree about a division of functions – Russia in the security field and Cina in the economic field – mainly because both strategies focus on the economic dimension. Otherwise, Russia’s financial difficulties and its inability to invest in the region could reorient Moscow strategy: as a matter of fact, Moscow will benefit of the regional transport infrastructures backed by Beijing in order to promote an integrated regional market. Consequently, Russia could abandon its ambition to promote an economic cooperation leaded by Moscow, focusing on a coordination and cooperation between EEU and SREB. In this case, Russia must handle and solve some distortions, easing protectionist measures and also removing hindrances to the implementation of free-trade agreements. As a Customs Union, the EEU restricts members’ ability to conclude separate trade deals, but they remain free to make significant agreements (such as the Kazakhstan Enhanced Partnership and Cooperation Agreement between Kazakhstan and EU in 2015).

48 Ibidem, pp. 45-51

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While SREB has been conceived to reach EU markets, delivering goods through different routes mainly crossing Russia and Kazakhstan. In terms of regional cooperation, both strategies have been promoted by external players which want to achieve their strategic needs rather than to enhance trade and political cooperation in Central Asia. The regional countries appear interested to develop an integrated regional market only to realize domestic and national goals, enhancing exports to global markets, boosting national economies, while the traditional elements of conflict which affects crosssborder relations remains (water management, status enclaves, political rivalries, porous and weak-controlled borders which allow illegal trafficks and armed incursions of terrorists).

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