RUssia - a counterbalancing agent to the Asia.
1.Asia in the sphere of Europeís economic interests
†††† After involvement of East Asia in the sphere of Europeís economic interests, the last region of autonomous trend of development existed no longer. Since that time the course of events in the region was determined by the major European Powerís interests rather than the logic of its own development. The world market already actually formed and Great Britain exercised global control over it.
†††††††† Economic development of the Caucasus, Central Asia and the Far East by Russia after defeat suffered in the Crimea Campaign was more or less successful attempts to find a weak point in the overall Great Britainís control over the markets.
†††††††† Japanís position was far more difficult. After the USA seized the Japanese home market by force, Japan struggled for East Asia, the only source of funds for its economic development.
†††††††† In that historical situation, having developed the American continent the USA, as well as Japan, had an opportunity for further economic growth only by means of expanding their presence in East Asia.
†††††††† In the Pacific, as well as everywhere, Great Britain pursued the policy to maintain its own predominance through mutual neutralization of the rivals.
†††††††† The extent of Russiaís presence in East Asia upset the then balance of power in the region and grew into an imminent threat to the rivals.
†††††††† Japan most vigorously counteracted growing Russiaís influence in China and Korea as this region was really of vital importance for it.
†††††††† In 1902 Great Britain and Japan entered into a defensive and offensive alliance directed immediately against Russia but mediately against the USA as well. That showed the greatest promise for Japan. That is why it was extremely quick to take advantage of the opportunity offered. After 1905, the growth of Russiaís influence in the Far East was curbed. Whatís more, the influence was considerably contained in Japanís favour
Under the term of the Portsmouth peace treaty Russia had recognized Korea as Japanís sphere of influence, transferred a right to Liaotung Peninsula including Port Arthur and well Ė equipped port Dalny, the south part of Sakhalin Island and assigned Japan the right to fishery in the Russian Far Eastern waters. In addition to it, Japan got the south section of Chinese Eastern railroad of 715 km long and a number of railroad and commercial subsidiaries as well as ship- and steam-engine-repair plants in Dalny, coal mines in Shibeiline, Fushuni, etc. Russia was found to be isolated from China along the most important Manchuria line. The communication leading from the Russian-Chinese frontier to Yellow Sea and to the North China through Mukden-Shanghaiguan were concentrated in Japanís hands, thus it was in a position to control trade between Russia and China conducted through Manchuria.
But Japanís supremacy in South Manchuria was accompanied not only by rapid ousting of Russian capital from all the spheres of economy. Great Britain and the USA which were about to get their hands on the north-east part of China by using Japan as a striking force were deeply disappointed. When the war began the USA expected Japan to protect their interests in Manchuria as well as its own ones. The USA completely took Japanís side. As regards this point Franklin Roosevelt said that it fought in our struggle in the Far East (Dulles F.R. Behind Open Door, New York, 1944.p.48). When the USA declared their neutrality in the war, rather auspicious for Japan, the American banks invested a major part of their capital to finance the Japanese military operation.
In Great Britainís policy, Japan acted as a counterbalancing agent to Russia, to advance its own interests Japan went farther ahead. The next impediment to Japan was the USA, and contradictions between them began aggravating. It was already Japanís excessive strengthening that upset the balance of power.
Dynamic equilibrium in the Asian Pacific region was a part of the global equilibrium system. Qualitative changes of any kind in the region were feasible only provided that the global correlation of forces between the major Powers changed. In the long run they depended on Great Britain Ďs ability to gain global domination over Germany.
The fact that Russia failed to settle its economic problems in Europe during the Crimea campaign and was not in a position to enter actively the Far Eastern market after 1905 eliminated any possibility for Russia to develop under a free-market economy (division of the sphere of influence between Russia and Great Britain in 1907 in Persia and Afghanistan didnít make up those disadvantages). Whereas a role of Great Britainís ally held out promises for Russia to manage itís economic problems in Europe and East. During World War I, Russia acted as a counterbalancing agent to Germany in Great Britainís global policy.
The war in Europe made it possible for Japan to expand its presence in East Asia at the expense of Germany. Furthermore, taking advantage of the predicament Russia was after 1917, Japan had seized some of the Russian territories. After seizure of vast territories during that period Japan ďhad overactedĒ the role given. It was just that fact which caused political reorientation of forces in the region. The British Ė Japanese alliance was dissolved. At the Washington conference a group of Powers led by Great Britain emerged which was in direct or indirect opposition to Japan. That thing initiated containing of Japanís presence in East Asia and rapprochement of the USA and Great Britain concerning the East policy matters.
As Soviet Russia came to appreciate the position and role of East Asia in its national concerns, the relations with Japan began aggravating. For the most part, Russiaís interests were concurrent with that of the USA and Great Britain.
It was in 1918 that Soviet Russia began reestablish its presence in China and to pursue actively the policy of its own. And beginning from 1923 Russia rendered aid to China. But the Comintern strict ideology neglected the overall complexity of the political powers alignment in China and led to national unity destruction. The Kuomintang party was compelled to break off relations with the USSR and to join Japan. That had resulted in weakening not only the USSRís position in China but also that of Great Britain.
Having taken advantage of that situation, in 1931 Japan persistently set about expanding its presence in China.
The fact that the USSR international position had consolidated considerably was rather unexpected for the Japanese and interested observers. Since 1935 due to a number of diplomatic moves made in Europe the Soviet Union had fortified the western borders and thus enabled to use part of resources for the Far East. In the shortest time, fortifications, communications networks, airfields were built there and armed forces reinforced. It was in 1937 that the Soviet-Chinese treaty was concluded.
The USSR directly participated in the military operations in China as well as the arms deliveries. Among those facts were the 1938 Soviet border incident and the 1939 Mongolian border one. There are strong grounds to believe that an initiator of these events could have been the Soviet Union supported by Great Britain and the USA. Therefore it was already the USSR to act as a counterbalancing agent to Japanese penetration into China. The Soviet Union would have been unable to pursue actively its policy in the Far East (China) and in Europe (Spain, Finland) if it hadnít served Great Britainís and the USAís interests. Otherwise, they had rather strong economic and political levers to influence the Soviet Union.
Strengthening of Germany in Europe and Japan in Asia made the USSR a key element of Great Britainís strategy in those regions. It was given a role of a counterbalancing agent to Germany as well as to Japan. In the 1930s, rapprochement of Great Britain, France and the USA with the USSR and extension of their cooperation was brought about. In many respects that thing accounted for not only simultaneous participation of the USSR in military operations in Spain, Mongolia, and Manchuria but also the possibility itself of their implementation under the then international situation and the state of the Soviet economy.
Tension in Asia and Europe went on enhancing. Great Britain made an attempt to implement stereotype political step. Russia was expected to neutralize Germany and Japan in just the same way as it happened with Napoleonic France. The policy of the so-called appeasement pursued in Europe and Asia just aimed at clashing the USSR with Germany and Japan. For this reason the Soviet proposals on the joint operations with Great Britain and France in the event of war with Germany failed to arrive at a favorable reply, and it could not be otherwise.
The paramount objective of Germanyís foreign policy was to set up its world supremacy.† To gain that goal Germany needed the USSR to be neutralized. There were two ways to fulfil it: either to conclude a treaty with Japan and to grip Russia in a vise or to sign a pact with the USSR.
In contrast to Germanyís end, Japanís tasks to cope with were more particular and regional. To clash with the USSR was not an end in itself for Japan as well. The goal of Japanís foreign policy was to develop Indo-China. As Japan expanded its presence there, Great Britain and the USA through the USSR exerted more and more pressure on it. To attain its aim it was also necessary for Japan to neutralize the USSR. And it sought to arrange with Germany about entering into a treaty under which security from the North was insured for Japan but it was not obliged to get involved in the European events on the side of Germany. As the first option was unacceptable for Japan, Germany had to take the second option to neutralize the USSR, that was the Molotov-Ribbentrop pact. Berlin and Moscow realized fully the policy of London and chose rather to come to an agreement between each other. By having concluded a pact with Germany the USSR cleared off a clash with it and gave Germany a free hand in relation to France and Great Britain.
For Japan it meant that it got isolated but the USSRís position in China had been enhanced. And Japan came to appreciate clearly that its predominance was but conjectural not only throughout East Asia but even in China. The way out of that situation was the Rome-Berlin-Tokyo Axis and pact with Moscow. Hence the threat from the North was eliminated but Japan was to define sharply its place held in the pre-World War II alignment of the world forces. Quite apparently, it pursued the aim of settlement of its own challenges rather than the allied ones.
By having signed a pact with Japan, the USSR cleared off the clash in the Far East as well. It was realized in Moscow that Russia would also have no place in a new world order and that in the future it would fail to evade clash with Germany and Japan. After occupation of France, Great Britain and USA were face to face with Germany and Japan, thus the USSR obtained the allies and it became inadmissible to expect Germany to gain a victory. There came a time for the USSR to define its position in the world conflict. Evidently, Moscow had made a choice.
Whereas Germanyís plan involved no conflict with the USSR. As far back as March 27, 1941, Germany didnít intend to attack the USSR. But having found out the Soviet policy alteration and for unwillingness to expect the strike from the East, Germany made a preventive strike. That was just the cause that accounted for ďthe lack of logicĒ in Germanyís invasion of Russia.
Since October 1941, the Todzio Cabinet conducted active preparations for war. The fact that the spheres of influence were divided between Japan and Germany, the USSR was involved in a war† (as well as in the Soviet ĖJapanese pact) made it possible for Japan to proceed to setting up ďthe Greater East Asian Co-Prosperity SphereĒ.
After the war the spheres of influence were divided between the USA and the USSR. But the bipolar world structure was evident as far back as 1943. It was reasonable for either side to extend the sphere of its influence. And the border between them was to divide the vanquished countries. The thorough division in Europe resulted in the status of Berlin. The situation was more favourable to Japan as the border between the USSRís and the USAís spheres of influence could have lain southward to partition Japan into the North and South ones (in a similar way as Germany and Korea).
The problem of the ďNorthern TerritoriesĒ is that of the confrontation between the USSR and the USA in general. Inasmuch as the West-East confrontation doesnít exist any longer, taking into consideration todayís situation in Europe where transformation of the post-war state frontiers is in process we are of the opinion that Japan has the sufficient reason not to recognize the post-war status of the islands. Similar case, it will be recalled was the situation when Russia was neutralized in the Black Sea in 1870 and then it violated its obligations under the Paris peace treaty.
In the course of war the allies faced the question as to the extent of the military-political defeat of Germany, Japan and Italy. The decision was reached to liquidate their military-industrial potential to exclude a possibility of rebuilding it up.
Between 1945 and 1948 the vigorous campaign was being waged towards Japan to break up military-industrial corporations into smaller units and to liquidate them, a ban was imposed on the foreign trade. Re-orientation of the Japanese economy as a whole was under way. The campaign of a similar nature was also launched towards Germany.
But the USSRís post-war position enabled it to adhere to an independent foreign policy based on its own national interests. It goes without saying that it was radically contradictory to the USAís interests. Implementation of the American policy throughout the world was so much complicated by the post-war events in Eastern Europe and China that in 1948 the USAís initial intentions in relation to Germany and Japan had already been reversed.
The post-war period saw another alteration in the balance of power in the world. As confrontation between the USSR and the USA grew, a need was created for the USA to form a new system of counterbalancing agents.
The USAís new policy towards Japan and Germany was already of a mercantilist character. It was based on setting up the export-oriented branches of the national economy and on providing them with the appropriate niches to occupy in the world market controlled by the USA, it was just the thing that accelerated the rate of the USA economic growth. It is pertinent to note that Germanyís and Japanís post-war destiny was historically paradoxical, that is, to lose a war meant for them to win it, to put it otherwise, they had gained the aim they were striving for. In economic terms it has come to be known as the German and Japanese economic miracle. By this expedient the anti-Soviet bloc of countries was set up to oppose resolutely the Soviet foreign policy. As the Soviet foreign policy was vitalized in Asia, the centers were coming into view for the American counteraction to the USSRís influence they were later referred to as ďnewly industrialized countriesĒ. Their economies were developed in a similar way. The same is true for European and Middle East countries. All of those countries performed solely one function in the American policy, that of a counterbalancing agent to the USSR. High economic growth rate of just those states stemed from the fulfilment of the mission mentioned. Needless to say that after demolition of the confrontation between the USSR and the USA they will lose the functions performed in the USAís policy, therefore the favourable economic conditions granted to them will go along with the functions. Demolition of confrontation between the USSR and the USA will change the face of the world beyond recognition in the foreseeable future.
††††††††††††††††††††††††††††† 2.Russia and Asia: the issues and prospects
††††† †† The economic development of the Soviet Far Eastern territories depended on the growing requirements of the Soviet extensive economy, which could mainly be supported by the home resources. It was precisely that cause which induced to involve the raw material resources located in the areas of extremely inhospitable nature and climate such as the Far East in the national economic turnover.
The annual atmospheric temperature amplitude is peak here; it is over 40 C. in the most part of the territory and even over 60 C. in number of areas.
†††††††† Permafrost occurs in 90% of the territory. The economic activities in the region is considerably complicated by these adverse natural factors as well as high seismicity. Construction and other operations are restricted in the territory; these factors cause the exceeding costs for power, heating and heat insulation. The suitable materials, equipment and processes adapted specially for the north conditions are applied here.
†††††††† The rise in the cost entails the fact that the capital investment in the Far East to produce the output comparable with that of the countryís central areas is about 20% more and operating costs are 25% more.
†††††††† Consequently, it is apparent that solely the scarce goods and raw materials were produced here, as their production was impossible in any other area of the country.
†††††††† The priority development of three industries was promoted in the Far East. There are as follows non-ferrous metallurgy, fishery and timber industry. Diamonds and almost all amount of gold were produced here. The territory held a leading position in the country in production of tin, lead, zinc and other kinds of raw materials. 40% of the Union fishery output and 8% of the Union timber and woodworking output were produced in the Far East.
†††††††† It is clear that the overwhelming bulk of the output produced in Far East was shipped to the European part of the country. Quota for non-ferrous output to be shipped totaled 91%, that for fishery was 47% and so on. Whereas the materials required for those industries were procured from other territories. 74% of chemical and oil products, 86% of rolled metals and the most part of foodstuffs consumed were procured to the Far East.
†††††††† Under the specific conditions of the USSRís closed extensive economy the Far East was a major supplier of the non-ferrous raw materials, timber and fishery. The Far Eastern enterprisesí production costs are far prohibitive than that of the countryís similar ones, to say nothing of the foreign enterprises. As a case in point, up to 1985 the Union direct and indirect subsidies granted only to the Primorye Territory totaled 2 billion rubles per year in accordance with the 1984 prices.
†††††††† To set up the enterprises here was expedient in terms of economy only under the USSRís former economic pattern that met its requirements mainly due to the home resources (growing of north-kind cotton in Central Asia and tea in Georgia and Krasnodar territory and so on). That is why the rigid economic policy was followed by the government to develop mining industries and to restrict manufacturing ones. It is self-evident that the course was worth-while as that policy served to evade investment (prohibitive beyond belief) getting scattered and to use comprehensively the tight manpower resources of the Far East. The arguments above substantiate the view that the Far East is not the right region in world to attract foreign investment. There are a lot of regions throughout the world to exploit the same resources rather profitably and, what is more, without any subventions. To be of the opinion that not only manufacturing but also mining industries will be developed by the foreign entrepreneurs is the height of economic absurdity. This point was fully comprehended even by the authors of the Soviet national economic plan on location and development of manufacturing industries. It was only of necessity that the enterprises to mine the scarce raw materials were located here and infrastructure was under development. A foreign entrepreneur has nothing to do in the Far East; the same will also be true of Russia itself if it enters the world market.
†††††††† Let us appraise the prospects for the Russian Far East not only in the light of economic concerns. Recall the post-war situation when a bloc of states was being formed to act as a military Ėstrategic counterbalancing agent to the USSR. Was Germany war-ravaged and partitioned of any slightest economic interest for the USA? (To say nothing of Japan and Taiwan as their economic potential was not to be compared with German one, namely, the Japanese industry was completely destroyed during the war, Taiwan had no industry at all, the raw materials base was unavailable in those states and beyond those points to take into consideration Ė a great distance away from market outlets.)
†††††††† Obviously, it was not the USAís economic concern that launched the overall cooperation with them. The German and Japanese ďeconomic miraclesĒ, the amazing economic growth rate of Taiwan and other ďnewly industrialized countriesĒ arose from their military-strategic position in the American system of the counterbalancing agents. It was only after formation of the Peopleís Republic of China and beginning of the Korean War (1950) when USA in addition to the gratuitous aid of 2 billion dollars started placing their military orders in Japan that investment flowed to give an impetus to economic growth and the pre-war level of industrial production was restored next year. When the Korean War ended and investment flow was reduced (1953), Japan went into an economic recession.
†††††††† Under conditions of the global economic crisis, the contradictions between the major industrial states will aggravate, on the one hand, and on the other hand, formation of the states with centralized economy will be in process.
†††††††† The situation in the Asian Pacific region will be rather intricate and drastically changeable. As the confrontation between the USSR and the USA ceased, a number of Asian countries has lost their military-strategic functions they performed to contain the Soviet influence in the region. These countries are Japan, South Korea, Taiwan and other ones. Because of the global crisis and cessation of the confrontation between the USSR and the USA they will be deprived of the favourable conditions for trade with the USA and Western Europe and consequently the high rate of their economic growth will slow down. Making attempts to settle their economic issues by means of expanding their presence in Asia these countries will inevitably collide with the vital interests of the USA and Western Europe.
†††††††† Since Japanís interests on the world market will be infringed on by the USA and Western Europe, it will try to center the region statesí economies on the Japanese economy. (Such was the case with Germany and Eastern Europe prior to World War II.)† In our view it will surely lead to setting up a military bloc of these states to protect their common interests. The East Asia countries conglomerate associated economically and pursuing the common aims will exert the great impact not only on the Asia Pacific region but also on the world as a whole. We are of the opinion that economic cooperation between Japan and the ďnewly industrialized countriesĒ, on the one hand, and China and other East Asian countries, on the other hand, will be expanded.
†††††††† After ďa lost decadeĒ of the independent attempts to stabilize the national economy, China was drawn into an orbit of the American policy towards the USSR and since late 1970s the favourable conditions for its economic advance were created by the USA. The Western aid to China was increased especially during the Soviet armed forces presence in Afghanistan and the Vietnamese ones in Cambodia. Now that the Soviet presence in these countries, as well as in the region, is no longer, further assistance to Chinaís economy makes no sense. It is worth nothing that for China it implies that the newly-emerged faint traits of the free-market economy will vanish.
†††††††† In the overall alignment of world forces and in the Asian Pacific region in particular, China will take the place of the former USSR and play its role. It will oppose both the USAís interests, on one hand, and that of Japan, Korea and Taiwan, on the other hand.
†††††††† To summarize our speculation about the Asian Pacific region prospects as well as probable future alignment of forces in the region we emphasize that after disintegration of USSR, the West-East confrontation will be replaced by the North-South confrontation and Russia will fulfil the function of counterbalancing agent in Asia and Middle East. In the nearest future the situation in Asian Pacific region will be defined as the growing confrontation between two powerful groupings. A mighty bloc of Asian and most likely the Middle East countries will oppose the USA and Western Europe, Japan being a coordinating center of the bloc. Already today Japan is the second industrialized country in the world.
†††††††† Russia will inevitably act as a counterbalancing agent to the Asian countries bloc in the policy of the USA and Western Europe towards the Asian Pacific region, the Middle East, the Balkan countries and Eastern Europe. Russianís position is strategically beneficial both in Asia and Europe; it has abundant raw material resources and used to play a like role.
†††††††† In our view, as the confrontation stated above will strengthen, Russia will have the ďeconomic miracleĒ similar German, Japanese, Korean etc. when these countries executed function of a counterbalancing agent to the USSR.
It is evident from the above that the Russian Far East will not have pure economic attraction as well as post-war Germany and Japan. Under new overall alignment of world forces, it will become a region of strategic significance to implement the policy of the North in Asia. All the more so, as there are excellent opportunities to initiate the military-strategic cooperation, that is, rather powerful military-strategic complex and Pacific Fleet bases.††††††††††††††††††
† †††††† Ph.D. Alexander Kuliabin
††††††††† Ph.D. Sergey Semin
††††††††† ďZavtra RossiiĒ, #28, 17 July 1997.
USSR ACADEMY OF SCIENCES
FAR EAST DIVISION
INSTITUTE FOR ECONOMIC & INTERNATIONAL OCEAN STUDIES