Tuesday, July 28, 2015

China, Russia and BRICS: a leader and an outlier

BRICS is a perfect illustration of the asymmetry that characterises the Sino-Russian relationship. China – number two in international affairs – is the natural leader of the non-Western world. Russia – a power whose economic decline became conspicuous in the aftermath of the falling oil prices and Western sanctions – does not fit into the Global South. Paradoxically, however, China still needs Russia and no other ‘brick’ can replace it.

From the very beginning of BRICS, scholars and commentators, especially in the West, pointed to a large number of differences between participants, first and foremost between Russia and the remaining states. Russia does not regard itself as a developing state and part of the global South – nor is it perceived as such externally. Despite all its shortcomings, the Russian economy is much closer to those of developed Western countries. In political terms, Russia tends to identify with Europe and the Global North. The living memory of the Soviet Union’s superpower status does not allow the Russian elites to consider themselves part of what used to be depicted as the ‘Third World’. Even Russian commentators tend to stress that Russia is an ‘outlier’ in the BRICS group.

China, in turn, looks like the natural leader of BRICS. It remains part of the Global South and faces similar political and socio-economical challenges. While it is plausible for BRICS to function as a forum for non-Western emerging powers without Russia – which was the case during negotiations on climate change, it seems impossible for BRICS to exist without China.

BRICS took shape in the midst of the global economic crisis. Consequently, the bulk of its member states’ attention was focused on issues related to the global economic and financial system, global trade, sustainable development and climate change. BRICS summits served to press for the reform of international financial institutions, the IMF in particular, and focused on the Millennium Development Goals. BRICS’ members consistently upheld the G20 as the most suitable forum for global economic governance. All these issues are close to the hearts of Chinese elites, who are centred on economic development, but they remain alien to the geopolitical mind-set prevailing in the Kremlin. The regional focus of BRICS – on Africa in 2013 and Latin America in 2014 – is in line with China’s goals, especially given its large economic presence in both continents.

The institutional development of BRICS has followed China’s rather than Russia’s interests in the international order. Regular meetings take place at the level of finance ministers and central bank governors, trade ministers, ministers of science, technology and innovation, trade councils, business and financial forums. Foreign ministers tend to meet at the fringes of other global events, such as the G20. The most recent decision to establish the first two fully-fledged institutions – a reserve fund and a development bank – has only confirmed China’s potential for creating a parallel global governance structure. This impression was only reinforced by Beijing’s successful establishment of the Asian Infrastructure Investment Bank (AIIB), readily joined by China’s partners from BRICS.

But there is a paradox. Despite having the potential to take on the role of BRICS leader, China continues to need Russia. As an economic and developmental outlier, Russia remains the only state in the grouping with which China shares not only a non-democratic political system, but – more importantly – a great-power identity. Neither India, Brazil nor South Africa are able to offer substantial political support to China on the international stage. These states fall behind Russia in terms of material capabilities (military potential) and institutional arrangements (a permanent seat on the UN Security Council). Moreover, they lack the determination to challenge or resist the US primacy.

BRICS illustrates the extent of shifts that have been taking place in the Russo-Chinese relationship since the global economic crisis. Both states play different roles in this forum. China shapes the overall agenda of BRICS, and co-operation with other developing states fits Beijing’s foreign policy interests. Russia, for its part, influences the political agenda and attempts to present BRICS as an alternative to the Western institutional order. Beijing invests in tangible economic arrangements, such as the new development bank. Moscow cares much more about appearances by making sure that BRICS summit communiqu├ęs fit the vision of the international order preferred by Russia and China. Notwithstanding the power asymmetry between the two, Russia and China still need each other.