Vladimir Putin’s official visit to Beijing, which began today, may be a pretty contentious one behind closed doors. As they discuss a long-awaited energy deal, which has been stalled over pricing for more ten years and is being negotiated concurrently with the visit, soon-to-be (again) President Putin and outgoing Chinese President Hu Jintao will have the two countries' growing competition for high-tech weapons and influence in Central Asia on their minds. This was illustrated last week by Russia’s accusations that a Chinese spy had attempted to buy plans for its S-300 missile system, and Putin’s announcement of plans to form a Central Asian version of the European Union.
The trip is Putin’s first out of Russia since announcing his arrangements to return to the presidency, and, with Russian and Chinese official media busy lauding ‘ever-deepening China-Russia cooperation that is sure to help build a more balanced world,’ it’s unclear why Russia brought up the spying accusations directly before the visit. Nonetheless, they seem to confirm SIPRI’s recent argument that Russia's trust in China, never great, is eroding over perceptions that China is stealing Russia’s advanced weapons technology.
Despite much talk of the close relationship, the two countries appear to have little to show for it. While the energy agreement, still in talks after a decade, would make Russia China’s dominant energy supplier, it is currently supplying only 8 percent of China’s energy imports. China, for its part, isn’t waiting around, instead expanding its existing pipeline across Central Asia.
Meanwhile, the two countries appear to be on course for serious competition in Central Asia. Putin’s bid to form a customs, and eventually currency union, would make life harder for China in the region.
Yet China is making a quieter, but perhaps more persuasive, case for its side. Beijing has begun to talk a great deal about the Silk Road, arguing for a historical connection to Central Asia, and the opening of two major Special Economic Zones in China’s Central Asian Xinjiang Province, both backed by a great deal of funding from the central government. Policymakers in Beijing hope it will be seen as a tempting way into the world’s second-largest economy for neighboring countries.