RUSSIA’S DISREGARD FOR JAPANESE INTERESTS MAY REDUCE JAPANESE ECONOMIC INVESTMENT

Publication: Eurasia Daily Monitor Volume: 2 Issue: 153

As Russian President Vladimir Putin looks toward a scheduled state visit to Japan November 20-22, the pace of bilateral diplomatic activity has recently quickened. The upswing in contacts is also related to the resumption of the six-party talks over North Korean nuclearization and Russia’s efforts to intensify its relations with ASEAN and Southeast Asia more generally.

Yet the history of state visits by Russian and Soviet leaders to Japan is an unbroken series of futility, frustration, and even occasional crisis, as the basic issues blocking resolution remain. Japan still insists on recovering the Kuril Islands, and while its businessmen seek profitable investment and trade opportunities in Russia, particularly now with regard to energy, both domestic bureaucratic and political pressures and Russia’s inability to produce an attractive scenario for large-scale investment has frustrated hopes of a “natural complementarity” of both states’ economies going back a generation. At the same time, Moscow seems to be under the impression that it need not undertake any concrete large-scale action to attract Japanese capital but merely reiterate its desire for trade and the Japanese will come running.

Certainly Russia feels no need to make concessions to Japan. Instead, it evidently feels that it can ignore Japanese interests regarding East Asia and Russia and still obtain this increase of trade and investment that its officials believe Japan so desperately needs and will pay for to get good relations with Moscow. They also evidently believe that fear of a rising China will induce Tokyo to turn to Russia even more despite Russia’s rejection of key Japanese interests.

Russian Foreign Minister Sergei Lavrov and Defense Minister Sergei Ivanov each publicly stated during July that Russia could live very well without a treaty with Japan and would certainly not return the Kuril Islands. Touring the region on July 30, Ivanov asserted, “We do not intend to make any territorial concessions; we do not intend to leave.”

Indeed, the two officials said that this is a minor issue, and Ivanov announced plans for a qualitative reinforcement — or even augmentation of — Russian military capability in and around those islands, including the submarine capability of the Pacific Fleet. The Defense Minister discussed the imperative of a federal program to develop the infrastructure of Russia’s Far East and the Southern Kuril Islands, particularly improving air links, harbors, and roads. He said: “The most important thing here is the infrastructure, i.e. transport in the broadest meaning of the word.” Ivanov also pointed out the need to improve the region’s energy sector, which is heavily reliant on deliveries of fuel by tankers, and he mentioned the need to expand schools and housing. While this military upgrade may be warranted given China’s rising capabilities, it still looks like a calculated insult to Japan.

Nor does this dismissive attitude toward Japan end here. Russian negotiators at the six-power talks with North Korea made it clear to Japan that it would not be advisable for Tokyo to raise the immensely important domestic issue of North Korean abductions of Japanese citizens. Commenting on the Japanese position that the final document for the Korea talks should include a point about human rights, Russian delegate Valery Yermolov noted that Russia “is not against a humanitarian issue being mentioned in the document, but [Moscow] considers that the main aim of the six-sided talks is the denuclearization of the Korean peninsula.” Whether or not this is a sound approach toward those talks, it certainly seems like a calculated effort to dismiss Japanese political and domestic interests from consideration in those talks.

Third, it appears that Moscow now is veering back to preferring China over Japan as the target market for its projected Siberian oil and gas pipeline network. This comes after Japan offered to subsidize much of the construction of this pipeline and believed it had an inside track for receiving Russian preference here. Russian policy seems contradictory on this issue, with Deputy Prime Minister Viktor Khristenko saying Moscow needs external financing and Lavrov saying that Russia can finance the project all by itself.

Russia’s condescension toward Japan is not a recent development. Moscow and Tokyo are merely repeating a pattern of frustrated bilateral relations that is over 30 years old. The ideas about the supposed natural complementarity of the two economies took root in the 1970s along with the supposed hunger of Japanese capital and business for Russian investment and trade, particularly in the energy sector. And Russian policymakers have always believed that they did not need to make any substantive political gestures to Japan to obtain that trade and investment, whereas Japanese diplomats have always ultimately placed the islands and their skepticism about Russian economic promises above other considerations. As recently as August 2, Konstantin Pulikovsky, Putin’s envoy to the Far Eastern Federal District, dismissed Japan’s concerns, saying, “The problem of the so-called disputed territory is mostly a public-relations platform for Japanese politicians, upon which they build their election campaigns.”

Although Putin now calls for mutual trust, it remains unclear what steps Moscow is prepared to take to earn that trust. For decades, Russian attention in Asia has been focused on China, not Japan, and Japanese interests have ultimately always seemed dispensable to Moscow. That pattern apparently is continuing, but because the world has changed, it is by no means clear whether this continuing pattern benefits either Japan or Russia.

Moscow Times, July 15: Jiji Press Ticker Service, July 14; Itar-Tass, June 28, July 13, 14, 25, 28, 29, 31; RIA-Novosti, July 8, 26; The Times, July 23; Nezavisimaya gazeta, July 28; AFX, Asia, July 29; Agence France Presse, July 30; AP, August 2)