Caspian Report - Issue: 08 - Fall 2014

Evaluating the new China-Russia agreement
requires an analysis of the character of these
states’ decision-making process in relation to
multi-level interest balances.
A deal for Russian pipeline gas exports
to China has been one of the
most anticipated global gas developments
since the end of the Cold
War. Recently, Russia and China
signed a 30-year, $400 billion deal for
Gazprom to deliver the Russian gas to
China. At the same time, Moscow and
Beijing signed a series of cooperation
agreements in many fields, including
banking, telecommunications, space,
transportation, engineering and
other industries. 1 Russia will supply
China with 38 billion cubic meters
(bcm) of gas. Under this agreement,
over 1 trillion cubic meters of gas
from Russia’s East Siberian fields
will be supplied over the 30 year
contractual period, starting in 2018.
Also, Russia and China have advocated
for the establishment of a new
security and sustainable development
architecture in the Asia-Pacific
region. This article seeks to contribute
to the understanding of the institutional
framework of China-Russia
energy cooperation and its possible
management by results. To this end,
1.
Should this agreement be considered another example of the growing military, economic and political ties aimed at deepening
practical cooperation If yes, will China and Russia support each other on the global stage Outside the energy sphere, the binding
agreements signed include: the exploitation by the E+ group and the Shenhua company of coal deposits; the construction
of a thermal power plant by RAO ESV (which is part of RusGidro) and the Dongfang Electric International Corporation; the construction
of a car factory in Tula by Great Wall Motors (US$500 million); the construction of a synthetic rubber factory in Shanghai
by Sibur and SINOPEC; and the delivery of parts for assembling cars by the Derways and Huatai companies. According to the
Russian press, an agreement was also signed on financing the construction of a new railway bridge over the Amur, although it
does not appear in the list of documents signed at the summit. The deal would reportedly include Russia selling China as many as
four Lada Class air-independent propulsion submarines as well as 24 Su-35 multirole fighter jets. The Su-35 fighters, in particular,
would greatly enhance China’s ability to project air power in the South China Sea. More recently, there have been reports that
Vladimir Putin has approved the sale of Russia’s most advanced air and missile defense system, the S-400, to China. However,
it is striking that, contrary to the expectations, no agreements in the military-technical field were concluded. The sales of Su-35
fighters to the Chinese were not finalized, despite several years of negotiations, nor were the 2012 framework contract for the
supply of submarines signed. The coincidence of the summit with the ‘Maritime Cooperation-2014’ joint Chinese-Russian naval
maneuvers, with the two leaders attending the opening ceremony, can be considered as an important signal demonstrating that
Russian-Chinese cooperation also has a military dimension. Zachary Keck: “China, Russia Military Ties Deepen With Naval Drill in
East China Sea”, The Diplomat, 2 May, 2014, http://thediplomat.com/2014/05/china-russia-military-ties-deepen-with-navaldrill-in-east-china-sea/,
Witold Rodkiewicz: “Putin In Shanghai: A Strategic Partnership On Chinese Terms”, Fortuna’s Corner, 24
May, 2014, http://fortunascorner.com/2014/05/24/putin-in-shanghai-a-strategic-partnership-on-chinese-terms/.
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CASPIAN REPORT, FALL 2014