Demidova I.V. Challenges and Prospects of the Russia’s Far East District in the Context of Cross-Border Cooperation with the North East of China

Данные об авторе. Демидова Ирина Викторовна, ст. преподаватель кафедры иностранных языков №2 РЭУ им Г.В. Плеханова, г. Москва. Сфера научных интересов: межкультурная коммуникация, лингвистика, экономика, международные отношения.

Аннотация. В статье описываются демографические и экономические проблемы Дальневосточного Федерального округа. Согласно экспертным данным, в ситуации демографического кризиса и депопуляции дальневосточного региона, в целях сохранения территориальной целостности и геополитической безопасности, необходимо разработать ряд мер социально-демографического и экономического порядка. Особое внимание обращено на последние инициативы по стимулированию сотрудничества между дальневосточными регионами России и северо-восточными провинциями Китая.

Abstract. This paper describes demographic and economic problems in the Russia’s Far East Federal District. According to the analysis, no notable population growth in is expected in the near future, therefore geopolitical security and preserving the indignity of the country cannot be seen without economic and sociodemographic policy of the federal and local authorities. Most emphasis is done on the most recent initiatives to stimulate cross-border cooperation and emergence of joint projects of the Russia’s Far East regions and the North East of China.

Проблемы и перспективы российского Дальневосточного федерального округа в контексте трансграничного сотрудничества с северо-восточными провинциями Китая

Challenges and Prospects of the Russia’s Far East District in the Context of Cross-Border Cooperation with the North East of China

Russia’s Far East Federal District is a vast territory (6,169,300 km2) uniting 9 federal regions. It makes about 36 % of the territory of the Russian Federation. The region has access to two oceans: the Pacific and the Arctic. The district borders China by land and Japan and Alaska by sea.
The region is rich in natural resources:
– it accounts one-third of all coal reserves and hydraulic power resources in Russia;
– Far East forests account for over 35% of Russia’s resources;
– 80% of soybeans come from the district;
– 40% of Russian fish and seafood;
– wide swathes of unfarmed fertile land;
– 95% of Russia`s reserves of strategic raw materials (molybdenum, vanadium, timber, copper and tungsten)
The main branches of industry of the Far East district are extraction and processing of non-ferrous metals, diamond mining, fishing, forestry, pulp and paper, shipbuilding, ship repair.
Russia’s 2010 census said that the population of the Far East was 6.3 million, of whom three-quarters live in the cities, primarily the port of Vladivostok. But the population has been shrinking at an alarming rate as young people move to the European regions of the country in search of better economic opportunities. The future of the Russian Far East has been a troublesome issue for the authorities for many years. The depopulation of the Russian Far East is particularly troubling because just over the border, in northeastern China’s Heilongjiang and Inner Mongolia regions, 70 million people live with too little land and resources. As a result of the depopulation and the opening up of Russia’s borders, there is a fear of massive Chinese immigration into the region. Given the vast mineral deposits, fertile land, energy reserves, the region is unlikely to remain underdeveloped for long.
The most recent research on the sociocultural environment in Russia’s Far East was done by Anna Nemirovskaya, Senior Research Fellow at the HSE’s Laboratory for Comparative Social Research, who examined a number of ratings and indices reflecting both economic development and sociological aspects environment in the region[1]. The research showed that despite the wealth of natural resources and good economic potential, the area’s macroeconomic indicators are fairly low for Russia. For her research Anna Nemirivskaya used data available from Rosstat and from the Centre for the Study of Social and Cultural Change (CSSCC) at the RAS Institute of Philosophy. A. Nemirovskaya published her findings in the Sociological Research journal.
The following are the main conclusions which were reached after thorough examination of the data:
– despite all the efforts to support economic development in the Far East of Russia, this area still lags behind in terms of modernization. Many of its residents are planning to migrate to elsewhere in Russia or even another country. It is obvious that without large investments, including international, the goal to populate the empty territories cannot be achieved.
– depopulation roots in many factors: undiversified economy, underdeveloped social infrastructure and harsh climate, high cost of living, poor housing, etc. More than half of the local respondents (64%) have not noticed any positive changes in the local situation, while 10% believe it is getting worse;
– paternalistic attitudes appear to prevail, the survey found the highest level of agreement in the Far East with the statement the state should provide a minimum income to citizens’, surpassing even the federally-subsidised North Caucasus in this respect. The local public seems to rely on the federal government to make it happen. Therefore, Anna concludes, that the federal authorities should step up their efforts to assist the region and monitor its development;
– uneven development across its constituent regions is a major challenge for the Far East Federal district. The decline in modernisation indices was observed in Kamchatka between 2000 and 2005. In Primorsky Krai and the Amur Region, modernisation does not seem to be moving forward, while Chukotka and Sakhalin – Russia’s leading local economies coming first and third, respectively, in terms of per capita GDP – still experience economic instability. Yakutia is the only part of the FEDF with positive modernisation dynamics;
– to analyze the factors influencing economic development process in the district correctly we have to distinguish between primary modernization, based on the economic, social and knowledge-related characteristics of society, and secondary modernization driven by innovation, knowledge transfer, quality of life and quality of economy.
Thus, the federal and local authorities are expected to take steps to ensure economic development and social stability in the district, to strengthen control over the Far East. There can be numerous geopolitical and economic risks if the steps are not taken. That is why in May, 2012 Ministry for Development of Russian Far East was established. According to the expert s, up to 700 billion dollars (30% of Russia’s GDP) were needed for the modernization of Russian Far East, while the federal budget allocates annually only $3 billion annually.
The government has introduced a program of incentives for ethnic Russians from Central Asia to move to the Russian Far East. The federal authorities have also tried to mitigate the problem of the vast distance between the Far East and European Russia: Vladivostok, on the Pacific Ocean, is a seven-day train ride from Moscow, and seven time zones away. So, the Russian government has subsidized airfares for some Russians in the Far East to travel to Moscow. There was an attempt even to decrease the number of time zones in the country to three or four so that businesspeople and bureaucrats at both ends of the country could work more easily together. One of the recent solutions of the demographic problem was so-called “homestead act”. Free land (1 hectare) was offered free to anyone willing to move from the western Russia to the Far East and to the residents of the region. The authorities expected this act to be a good start in a private business like forestry, farming, game fishing and hunting, etc. Unfortunately, this initiative has not created any enthusiasm among people. The free homesteads are far more likely to attract Chinese pioneers than increasingly city-oriented Russians.
Vladivostok, which is considered to be the country’s ‘Gateway to the Pacific,’ hosted the Asia-Pacific Economic Cooperation (APEC) summit in 2012.The idea of the event was to boost the integration of the Russian Far East with the economic powerhouses of northern Asia. That summit was the reason to lavish at least $21 billion on building roads, bridges, airport terminals, universities and business districts [2].
On May 29, 2015 the International Conference “Russia and China: a New Partnership in the Changing World” was held. It gathered about 500 participants who represented different areas of life: Russian and Chinese governments, expert community and civil society. It was noted that the foreign trade turnover of the Far Eastern regions with China is more than 10 billion US dollars. Cooperation with the Chinese partners is perspective and beneficial. Joint programs between the Fare East regions and Northeast China are implemented. But only 10 out of 30 of them are in the active productive stage. The current level of trade, investment and economic interaction between the Russia and China is not satisfying and has to be intensified. Considering the situation with the sanctions on the western markets, Russia is interested in prospective cooperation with China.
Innovative initiatives on the creation of fast-track development territories, implementation of Free Port Vladivostok project and state support for investment projects will be discussed in detail at East Russia Economic Forum in Vladivostok from September 3 to September 5, 2015. In the Far East, nine approved fast-track development territories are being created, and at least three of them have Chinese residents. Thus, the first foreign investor of FDT Khabarovsk was the company Baoli Bitumina. Chinese investors intend to build two compact building material production plants in FDT Kangalassy (Yakutiya). At the same time, Sirius Group, as well as becoming a resident of FDT Priamurskaya, wants to take part in the management of this territory in the Amur region. Mr. Shereikin also recalled the law prepared by the ministry on the Free Port Vladivostok. This new Free Port regime will include the international transport corridors Primorye-1 and Primorye-2 (from North-Eastern China to the Pacific ports of Russian Primorye).This will make cargo transit as simple as possible as well as the entrance of our Chinese and other partners in the southern part of the Primorsky Region.
There is considerable scope for cooperating on technology and innovation and therefore making use of growth prospects that are going to unfold for the countries.
One of the reasons of slow cooperation of the two countries is bad cross-border infrastructure. A few projects of construction of bridges connecting some regions of the countries will intensify economic and cultural ties. The 2,215-metre bridge Nizhneleninskoye (Jewish Autonomous Region) – Tongjiang (PRC) will be put in motion. The project of the Russian-Chinese Investment Fund, it will make it possible to handle 21 million tons of cargo traffic annually and will be finalized by 2016. China has already invested about $153.7 million in the project with its total investment expected to be $425 million. The new route will reduce the distance to customers by about 700 kilometers compared to other rail routes. Moreover, today the projects of construction of similar bridges in Blagoveshchensk and Poltavka in Primorsky region are considered as well. The framework of bilateral agreements was considered to be prospective. For example, Great Ussuriysk island development plan was based on the principle «one island – the two countries.»
One of the major areas of cooperation for the countries is energy security. Russia is an energy surplus country, whereas, China is energy deficient. At present, around 80 percent of China’s energy is imported from the Middle East and West Africa. New joint projects can facilitate the flow of oil and gas from Russia into China. About 80 % of China’s energy is imported from the Middle East and West Africa. In case of any conflict in these areas the supplies of the vital resources may be cut off, which represents a major strategic vulnerability for China. Closer economic cooperation in this area with Russia must help reduce this problem: oil and gas supplies will be provided via more easily protected and controlled overland pipelines.
There are important areas of cooperation in innovation and technology activities, entrepreneurial projects, education, skilled labor and manufacturing capability, cultural exchanges and space exploration. I would add the vital possibility to stem the shipment of drugs from Afghanistan to the West via cooperation between the FSKN (anti-narcotics agency in Russia) and the Chinese authorities. One more aspect of constructive cooperation between our countries should be reaching agreements on use and protection of water resources in cross-border rivers as well as establishing of cross-border nature reserves to protect biodiversity. China and Russia have also stepped up financial cooperation on such multilateral platforms as the Silk Road Fund and the Asia Infrastructure Development Bank.
More and more people realize that international cooperation will help develop the district. A recent research has shown that in the light of recent global developments, a growing number of Russians have a positive view towards China. According to a September 2014 poll conducted in 130 cities and 42 regions across Russia by the All-Russia Center for Public Opinion, 51 percent of Russians see China as Russia’s main geo-political ally, up from 23 percent in 2008. China is developing at a rapid pace and that it would be in Russia’s interests to invite the Chinese to jointly develop the border areas. Russia and China have had a long history of interaction, exchange, cooperation and close relationships. There have also been periods of near-total breakdown and actual hostilities. However, what has become clear to state that in the Russian Far East there is a good deal of Sinophilia. Russian public opinion with attitudes towards China is rapidly improving as those towards the West have soured. Indeed, according to an opinion survey conducted by the Levada Center in January 2015, a full 81 percent of Russians now regard the United States negatively whilst 80 percent have positive views of China. Each figure is the highest recorded in the history of the survey [3].


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