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Russia: The Upshot Of Putin's Asia Visit

Putin left Japan with more than 20 economic agreements in hand (AFP) Russian President Vladimir Putin attempted to reinforce his country's image as a global energy superpower during a recent trip that took him to Turkey, South Korea, and Japan .

In the course of his travels, Putin took part in the opening of the Blue Stream gas pipeline in Turkey, traveled to South Korea to participate in the annual Asian Pacific Economic Conference (APEC) forum, held talks with U.S. President George W. Bush, negotiated with South Korean President Roh Moo-hyun, and headed a state visit to Japan. Seen in the context of Russia's repeated statements that trade and energy will be its primary tools of diplomatic leverage, the importance given to this trip by the Russian media tells a lot about the Kremlin's foreign-policy agenda.

On 17 November in Turkey, together with Turkish and Italian Prime Ministers Recep Tayyip Erdogan and Silvio Berlusconi, Putin inaugurated a trilateral $3.2 billion natural-gas-pipeline project that is expected to make Turkey Russia's second-largest trade partner. The Blue Stream pipeline will initially transit about 4 billion cubic meters of Russian gas to Turkey per year, reaching 16 billion cubic meters annually by 2010, according to the Kremlin. The pipeline will account for approximately 60 percent of Turkey's consumer gas needs, in addition to the 20 percent of its oil supply that is currently imported from Russia.

Putin then traveled on to Seoul for a much publicized state visit that failed to result in an agreement on a promising $11 billion project for the construction of a major gas pipeline from Russia to South Korea via China. The negotiations did, however, prove to demonstrate Moscow's belief that a unified Korea is in the region's future, and revealed Russia's intention of positioning itself to benefit from such a scenario.

Moscow and Seoul had seemingly reached an understanding on the pipeline in 2003, when the two sides agreed on the export of about 6 billion cubic meters of Russian gas per year to South Korea starting in 2008. Russia had proposed constructing a pipeline that would deliver gas from southeast Siberia to South Korea along a route that would cross Chinese territory and run under the Yellow Sea.

South Korea's interest in this energy deal was primarily financial, as Russia offered to sell the gas channeled though this pipeline for 30 percent less than it currently costs South Korea to import liquefied petroleum gas .

However, Moscow unexpectedly revised its position on the pipeline during the summit in Seoul, clearly revealing its preference for energy deals that suit its geopolitical agenda to energy deals of a purely financial nature.

The final draft proposed by Russia contained major changes, including that the pipeline would now transit North Korea on its way to South Korea, " Kommersant-Daily " reported on 21 November. President Roh refused to sign the deal as a result, failing even to mention the project during his joint press conference with Putin.

But the centerpiece of Putin's tour of Asia was his long-awaited visit to Japan, which served to provide evidence of Russia's aims of using its clout as a major energy exporter to increase its political influence in the region.

The meeting had already been twice delayed -- mainly due to the two countries' longstanding dispute over the Kurile Islands -- and ahead of the visit some Russian columnists suggested that Putin should forget about the territorial squabble and concentrate on a more " positive " agenda. Commenting on Russian-Japanese relations, Duma Foreign Affairs Committee Chairman Konstantin Kosachev argued that settling the dispute has never been a high priority for Russia, adding that although Moscow is open to discussing the issue, it is certainly not prepared to resolve it.

Indeed, Putin chose during his 20-22 November visit to present Russia as a promising economic partner that could help Japan counterbalance the economic influence of China and a unified Korean Peninsula in the future. The relationship would be mutually beneficial, with Russia providing natural resources and Japan expanding its presence in Russia's lucrative consumer-goods market and manufacturing sector.

During his visit to Tokyo, Putin signed with Japan's Prime Minister Junichiro Koizumi some 20 economic agreements, including on the construction of a Toyota assembly plant in St. Petersburg and a Toshiba electronics factory in Leningrad Oblast.

But the Russian president did not forget about energy, confirming Russia's commitment to build an oil pipeline from central Siberia to Russia's Pacific Coast, which would facilitate Russian oil exports to Japan and the United States. In addition, Putin pledged that Japan would get 30 percent of the gas extracted from the international Sakhalin-1 project. Gazprom head Aleksei Miller, meanwhile, proposed that Japan participate in the Blue Stream project, as well as in the North European pipeline project in the Baltic region.

However, Russia did not focus entirely on Asia during his trip. Kosachev noted that Russia continues to consider the United States to be a key player in the Asia-Pacific region. Putin met with U.S. President Bush on the sidelines of the APEC forum, marking the sixth time the two presidents have met this year.

In addition to discussions on combating international terrorism and on Iran's and North Korea's nuclear programs, the issue of bilateral trade and Russia ' s efforts to join the World Trade Organization (WTO) were high on the agenda. Officials involved in the WTO negotiations from both countries have been instructed by their respective president to close negotiations by the end of the year.

Thus, a positive outcome can be expected at the executive level. However, the agreement will have to be ratified by the legislatures both in the United States and in Russia. This could open another long debate, as many issues -- notably the United States' insistence that Russia respect intellectual property rights -- remain outstanding.