There is a good chance that economic jockeying between China and Russia in Central Asia will intensify in the coming months. For Russia, Chinese economic expansion could put a crimp in President Vladimir Putin’s grand plan for the Eurasian Economic Union.
It has been a chastening few months for gas-rich Turkmenistan. Two long-standing energy buyers have indicated they will stop purchasing the country’s natural gas, potentially leaving Ashgabat dependent on Chinese demand.
On the Chinese side of the border, a four-story shopping mall offers Kazakhstani shoppers a stunning variety of duty-free goods—from iPhones to auto parts and children's clothes. Visitors can stay in a well-appointed hotel and enjoy solicitous service at a number of Chinese banks.
Driving south from Dushanbe, it seems there’s a Chinese investment story at every turn. But as cash pours in from Tajikistan’s powerful neighbor to the East, local concerns are building over Beijing’s opaque plans.
It appears Turkmenistan is about to lose its second-best customer for natural gas, Iran.
Iranian Oil Minister Bijan Namdar Zanganeh said on August 11 that his country no longer needed gas from Turkmenistan. Zanganeh went so far as to say, "Iran is importing Turkmen gas just because it is important to promote political and economic relations with Turkmenistan."
Aside from a famously bland brand of diplomatic rhetoric, the Shanghai Cooperation Organization represents the only major Eurasian club that caters to both Russian and Chinese interests. Yet with Moscow and Beijing presenting visibly divergent visions for economic cooperation in Central Asia, it is unclear how those competing views can be reconciled.
China is striving to forge Central Asia into a streamlined conduit for its regional trade and energy ambitions. But Beijing is finding that domestic insecurity and fractious bilateral relations among the region’s five former-Soviet republics have created a web of obstacles.