The Ukrainian War Is Destabilizing Central Asia and Expanding Beijing’s Influence

The KTZE-Khorgos Gateway Dry port, a logistics hub on the Kazakh side of the Kazakhstan-Chinese border, on April 15, 2019. Abduaziz Madyarov/AFP via Getty Images

Commentary

The war in Ukraine is precipitating far-reaching changes around the world.

In addition to the devastation it has wrought on the Ukrainian people and their homeland, it has caused significant increases in the price of energy, food, and fertilizers, among other things, aggravated inflation in the world’s major economies, and roiled Europe’s energy market. It is also destabilizing Central Asia, facilitating the expansion of Beijing’s financial and diplomatic influence and laying the foundation for an expanded Chinese military role in the region.

Historically, Central Asia has been defined as the region north of the Hindu Kush and east of the Black Sea to the Himalayas and the Gobi Desert. It encompasses the five major “stans,” the Central Asian Republics (CARs): Kazakhstan, Turkmenistan, Tajikistan, Uzbekistan, and Kyrgyzstan.

Mongolia sits at the very edge of Central Asia, separated from Kazakhstan by a narrow corridor of Russian and Chinese territory.

The Caucasus (Armenia, Azerbaijan, and Georgia) are on the opposite side, along the western flank of the Caspian Sea. On the periphery of Central Asia are Turkey, Iran, Afghanistan, Russia, Pakistan, and China. All the countries of Central Asia, with the exclusion of the periphery, except for Russia, were constituent republics of the former Soviet Union.

The collapse of the Soviet Union opened the door for the expansion of Beijing’s influence in Central Asia. Moscow sought to retain its political and economic clout in the region by binding many of the former Soviet Republics to Russia in the Collective Security Treaty Organization (CSTO), the Eurasian Economic Union (EEU), and the Commonwealth of Independent States (CIS).

Shipping containers sit beside railway lines running into Mombasa port in Mombasa, Kenya, on Sept. 1, 2018. China's Belt and Road Initiative aims to revive and extend trading routes connecting China with Central Asia, the Middle East, Africa, and Europe via networks of upgraded or new railways, ports, pipelines, power grids, and highways. Luis Tato/Bloomberg via Getty Images

Initially, China’s role in Central Asia was only possible with Moscow’s tacit consent. Over the last two decades, however, Beijing has expanded its bilateral relations with Central Asian countries and established multilateral organizations like the Shanghai Cooperation Organization (SCO) in 2001 and the Belt and Road Initiative (BRI) in 2013. Significantly, the BRI was launched in Kazakhstan, underscoring the region’s central role in the BRI.

In 1990, bilateral trade between Russia and the CARs amounted to around $90 billion and represented approximately 80 percent of the region’s external trade. By 2021, trade with Russia had declined to $18.6 billion, while China, now the region’s largest trading partner, had increased its trade to around $27 billion. Under the weight of the economic sanctions imposed on Russia by the United States and its allies, the trade balance has likely shifted even more dramatically in favor of Beijing.

Moscow’s and Beijing’s goals in Central Asia are fundamentally at odds, as both countries compete for political and economic influence there. That has not prevented the emergence of a duopoly, with China assuming responsibility for economic and financial cooperation and Russia retaining the role of primary guarantor of the region’s security and political stability. However, even Moscow’s reduced role is now in danger of being eroded further by the fallout from the Ukrainian war.

Despite the dramatic increase in China’s economic role in Central Asia, Russia still figures prominently in the region’s economy. Approximately 4 million workers from Central Asia are employed in Russia: 1 million each from Tajikistan and Kyrgyzstan, 2 million from Uzbekistan, and around 200,000 from Kazakhstan. Collectively, these workers remit approximately $7.5 billion to their home countries. These remittances are significant components of the region’s GDP. They represent around 28 percent of Kyrgyzstan’s GDP, 30 percent of Tajikistan’s GDP, and 12 percent of Uzbekistan’s GDP.

The contraction of the Russian economy in the wake of the economic sanctions imposed by the United States and the European Union has reduced these remittances by around 25 percent. Moreover, transferring those funds has become more complicated since Russian banks lost access to the SWIFT interbank payment system, and Russia’s Central Bank imposed controls over foreign currency transfers. Rising energy and food prices have also had an adverse impact, resulting in an average inflation rate of around 16 percent. Food prices rose significantly when Russia banned grain export to EEU members.

Moreover, despite the billions of dollars of Chinese investment in regional transportation infrastructure, Soviet-era transport links still play a prominent role. Roughly 66 percent of Kazakhstan’s oil exports, 1.4 BOPD, for example, move over Russian pipelines and rail networks and are shipped from Russian ports. Although the sanctions expressly excluded commodities coming from the CARs, they still negatively impacted their exports.

U.S. sanctions, for example, specifically exempted the Chevron-led Caspian Pipeline Consortium. The pipeline transports Kazakh oil from Kazakhstan’s Tengiz field to the Novorossiysk-2 Marine Terminal in Novorossiysk’s Russian Black Sea port. Notwithstanding the exemption, Kazakhstan has had difficulty finding customers for its oil exports.

In addition to Beijing’s BRI projects, approximately 8,000 Chinese companies are active in Central Asia. Collectively, Chinese entities, both state-owned and private, have invested roughly $40 billion in the area over the last two decades. The lion’s share of that investment has occurred since 2010.

The region’s still significant dependence on Russia makes it particularly vulnerable to an economic downturn and social instability that rising unemployment, especially among the young, could create.

Russian President Vladimir Putin talks with Russian Foreign Minister Sergey Lavrov (back to a camera) during a Commonwealth of Independent States, former Soviet republics, summit in Astana, Kazakhstan, on Oct. 16, 2015. Alexei Nikolsky/RIA-Novosti/Kremlin Pool Photo via AP

Over 70 percent of the region’s population is under 40. Unemployment among youth and recent college graduates, 15 to 25 years old, is, according to the World Bank, around 20 percent. The World bank’s number, however, is probably understated. Local sources put the youth unemployment rate at between 35 percent and 50 percent, depending on the country.

Central Asia is surrounded by states subject to various degrees of economic sanctions: Russia, Afghanistan, Iran, and to a lesser extent China. Additionally, transportation links are still underdeveloped. Many of the existing ones are tied to Russia. Other transportation infrastructure, both new and historical, must be all transit-sanctioned states.

The CARs have maintained a neutral posture concerning the Russian invasion of Ukraine, neither condemning the Russian attack nor supporting it. In U.N. votes, both in the General Assembly and on the U.N. Human Rights Council, they have officially abstained or not voted.

Kazakhstan and Uzbekistan have expressed support for Ukraine’s territorial integrity and have sent humanitarian aid. Kyrgyzstan has offered to provide a venue for peace negotiations. Significantly, none of them have recognized the Russian annexation of Ukrainian territory. Moscow has pressured the CARs to supply troops to its war effort. Kazakhstan has publicly declined. The others have, presumably, privately, done the same.

Beijing’s objectives in Central Asia, beyond securing access to the region’s hydrocarbon and mineral wealth and developing and retaining access to the transportation infrastructure linking it to Eastern Europe and port facilities in the Indian Ocean and the Black Sea, is to ensure regional stability. Historically it has looked to Moscow to accomplish this, both in mediating disputes between the region’s states and ensuring the stability of the current governing regimes.

The Kremlin, for example, has played a significant role in mediating and, at times, dampening the conflicts between Armenia and Azerbaijan and between Tajikistan and Kyrgyzstan. The CSTO’s Collective Rapid Reaction Force, consisting primarily of Russian troops and other CSTO members, intervened in Kazakhstan in January 2022 when anti-government unrest threatened to bring down the government of Kazakh President Kassym-Jomart Tokayev.

Chinese leader Xi Jinping and Kazakhstan President Kassym-Jomart Tokayev review an honor guard during a welcoming ceremony at the Great Hall of the People in Beijing on Sept. 11, 2019. Mark Schiefelbein/AFP via Getty Images

Beijing denounced Kazakhstan’s unrest, saying it resembled a typical Western-backed “color revolution.” Political and economically induced social unrest is particularly problematic for Beijing if it leads to color revolutions that replace the ruling political elite, which Beijing has assiduously courted, with pro-Western governments. Such revolutions would likely lead to a diminution of China’s economic influence. Beijing, for example, controls about 40 percent of Tajikistan’s and Kyrgyzstan’s national debt. A color revolution in either country could repudiate that debt.

Equally concerning to Beijing is the threat that anti-Chinese militants, especially Islamic fundamentalists, could pose to Beijing’s control of Xinjiang. China moved quickly to recognize Afghanistan’s Taliban government. It has declared it is ready to incorporate Afghanistan into its BRI and to invest there. It has also expressed concern that Afghanistan could become a haven for the anti-Chinese militants that operate there and have been active in stirring up unrest among Xinjiang’s ethnic Uyghur population.

Beijing appears to be hedging its bets should Moscow ultimately fail to maintain the region’s stability. Particularly concerning for China is Tajikistan’s 814-mile border with Afghanistan and its proximity to Xinjiang. China is building a new military base in Tajikistan and has taken over the management of several military bases along the Tajik-Afghan border. Since 2016, Tajikistan and China have conducted military exercises involving up to 10,000 troops. Equally problematic for China is the presence of militant groups along Pakistan’s lawless northwest frontier region.

China has also declared that it would support Kazakhstan “in protecting its independence, sovereignty, and territorial integrity” in what was seen as a warning to its erstwhile Russian ally. In 2014, for example, Russian President Vladimir Putin, in language reminiscent of similar comments about Ukraine, declared, “Kazakhs never had any statehood” before the dissolution of the Soviet Union. He also reminded the Kazakhs to “remain in the greater Russian world.” Likewise, when Russia declared its “special military operation” against Ukraine in February of 2022, he reminded the Kazakh government of Russia’s role in assisting it “when it faced a challenge to its statehood and integrity.”

Kazakhstan shares a 4,750-mile border with Russia and is home to 3.5 million ethnic Russians. They comprise about 20 percent of Kazakhstan’s population and are heavily concentrated along the Kazakh-Russian frontier.

Turkmenistan and Mongolia are two other countries impacted by the Ukrainian war.

Turkmenistan sits on the southeast corner of the Caspian Sea. Iran, Afghanistan, Kazakhstan, and Uzbekistan surround it. Though officially neutral, it’s still highly dependent on its economic ties to Russia. It possesses the world’s fifth-largest natural gas reserves and considerable petroleum. Historically, its gas could only be exported via the Russian pipeline network.

New pipelines have recently been established that supply natural gas to Iran (Dovletabat-Sarakhs-Khangiran pipeline) and China (Turkmenistan-China Gas pipeline). Turkmenistan also wants to connect to the proposed Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline, although construction of the 1,100+ mile pipeline is currently stalled. Its access to the Caspian Sea allows it to ship its oil to Azerbaijan and, from there, connect with pipelines carrying oil to the Black Sea. It also proposes building a Transcaspian gas pipeline to bring natural gas to Turkey.

Turkmenistan has long-standing territorial disputes with Iran and Azerbaijan and depends on Russian security guarantees to defend its sovereignty. Its language and population are predominantly Turkic. Should Moscow’s ability to protect Turkmenistan weaken, it is the most likely place in Central Asia where Turkish and Iranian interests will most directly clash.

At the very edge of Central Asia is Mongolia, wedged between Russia in the north and China in the south. It was part of China’s Manchu Empire until it revolted in 1911, when the Manchu dynasty collapsed. It was a satellite of the Soviet Union from the 1920s on and only achieved practical independence in 1990.

Mongolia is a microcosm of the new Central Asian security reality created in the wake of the Ukrainian war. Since 1990, Mongolia has followed a carefully nuanced foreign policy to find a balance between Russia and China while pursuing a “third neighbor” strategy of building relationships with other countries. Economically, it is heavily dependent on China. Roughly 85 percent of its exports, primarily raw materials, go there. Prices, mandated by the Chinese regime, are often discounted to prevailing world prices.

Most of its armaments are of Soviet and Russian origin, with token amounts from Germany, Israel, China, and the United States. Mongolia has relied on Russian security guarantees for its defense. In 2019, while on an official visit to Mongolia, Putin and Mongolian President Khaltmaagiin Battulga signed a new treaty upgrading the Russian-Mongolian relationship to a “permanent comprehensive strategic partnership.”

Mongolia has had a similar partnership with China since 2014, but the Russian agreement was notable for lacking either an expiration or a repudiation clause. The treaty also called for the two countries to perfect their “ties in the defense and military-technical spheres, viewing these as an important component of maintaining regional and global security,” and included a Russian pledge to “provide military-technical assistance” to Mongolia in perpetuity.

Moscow has repeatedly pressured Mongolia to join the EEU and the CSTO. Ulan Bator has, to date, declined.

According to one high-ranking Mongolian official in Ulan Bator, speaking on condition of anonymity, “the Ukrainian war has significantly complicated Mongolia’s regional foreign policy, upsetting the delicate balance Ulan Bator has maintained between Moscow and Beijing.” Mongolia’s dilemma, while more extreme, is one that other nations in Central Asia now face.

Mongolian supporters listen to the speech of Mongolian presidential election candidate Battulga Khaltmaa from the Mongolian Democracy Party during a rally in Ulan Bator on June 23, 2017. Fred Dufour/AFP/Getty Images

The erosion of Russian posture in Central Asia may open the door for expanding Turkish and Iranian influence in the region.

Turkey shares many cultural and linguistic links with Central Asia. On numerous occasions, Ankara has declared itself the protector of Asia’s Turkic people. The offer has not resonated in the region.

The Nationalist Movement Party, a conservative and nationalist political party that is part of Turkish President Recep Tayyip Erdogan’s governing coalition, has advanced the concept of Turan: an alternative Turkic state that would incorporate all the Turkic people of Central Asia. The idea has been fluid. At times, it has also included the Uralic, Altaic, and Mongol peoples.

Turanism evolved in the late 19th century as a political movement calling for the close cooperation or political unification of all Turkic people and possibly the broader Ural-Altaic language families. Both groups were seen as sharing a common culture, language, and ethnicity, and an origin in Inner and Central Asia.

The movement was closely associated with the Young Turks political party and the rise of Turkish ethnonationalism in the late 19th and early 20th century. It was also an Ottoman response to Russian historical expansionism in Central Asia, its subjugation of the Turkic people, and the recurring Ottoman-Russian wars from the 18th century.

Modern Turanism is linked to Turkish nationalism and the Neo-Ottoman revival promoted by the Erdogan government. It was the pretext for Turkish assistance to Azerbaijan in its war with Armenia in 2020. The concept has little appeal in Central Asia, however, and within Turkey is limited to fringe, ultra-nationalist elements. It remains, however, a recurring theme in Turkish foreign policy.

Nonetheless, Turkey could be a source of investment and technology in Central Asia and a market for the region’s mineral and hydrocarbon exports. It can also play a critical role as the terminus of various transportation corridors linking Central Asia to the Black Sea and the broader world.

Turkish participation in NATO, however, will complicate and likely limit Ankara’s potential role as a guarantor of regional security should Russian influence continue to weaken. However, Turkey’s large and sophisticated armaments industry is making inroads in the region and could emerge as an alternative to Russian suppliers.

The Iranian perspective parallels the Turkish one. The region has been, at various times, part of a broader Persian political and cultural zone. Tajik, the language of Tajikistan, is very similar to Farsi. Uzbek cities like Samarkand and Bukhara have a sizeable Farsi-speaking population and are deeply woven into the fabric of Persian/Iranian culture.

On the other hand, Tehran’s current focus is on the historic Shia core in the Persian/Arabian Gulf and across the Middle East. It lacks the capital and technology to make it an important regional partner to the CARs. Its status as a sanctioned state also limits its role as a transportation corridor.

With roughly a third of Iran’s economy controlled directly or indirectly by the Iranian Revolutionary Guard (IRG), it’s unlikely that sanctions will be reduced to a point where transshipment through Iran is a viable alternative. Moreover, historical Iranian-Turkic rivalries, as well as Shia-Sunni tensions, also limit its influence.

Like Turkey, Iran is a potential source of armaments to the region. Its support of militant Islamic groups is also a factor. However, its focus is on Shia-backed groups in the Gulf and elsewhere in the Middle East, not the predominantly Sunni regions of Central Asia. Iran’s more likely role is to block Turkish ambitions in the area.

Fresh from its disastrous withdrawal from Afghanistan, there is little appetite within the United States or NATO for any new engagement in Central Asia. Officially, the United States is still committed to supporting “color revolutions,” although it remains unclear to what extent it is actively fomenting them. The EU has consistently declared its support for building greater economic links with Central Asia, especially now that it is engaged in a desperate attempt to diversify away from Russian sources of natural gas. Still, to date, little in the way of concrete steps have been taken.

Beijing is in the driver’s seat for now. The continued diminution of Russian power and influence will tip the historical trajectory of Central Asia toward China. One more unforeseen and dramatic consequence of Putin’s disastrous war in Ukraine.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times.