The move into Africa is not without risk for Gazprom, and it will demand deep pockets. Because multinationals, together with the state-owned NNPC, already control most of the gas fields operating, Gazprom will have to take a gamble and go into the costly and uncertain business of exploration. If that proves too costly, they will concentrate on capturing the gas that comes with the oil, normally burnt in a singularly wasteful process called flaring (environmentalists estimate that about half of the world’s gas production is thus burnt away). The Russians are in for a huge challenge, both from the hostile nature of the terrain and the climate and from the enduring social and political violence in the Niger Delta, where most of the resources are. But they would not go in if they weren’t sure that the gamble will pay both in energy terms and in political influence. A new scramble for Africa, more than a hundred years after the first one, is under way. Gazprom’s move is an unprecedented foray into the global competition for African energy assets. In military terms it would be recognized as a bold pincer movement.
A great power
It is foolish for policy advisers and politicians in the West to deny that Russia is a great power or that its influence continues to grow. For each concession Russia makes, whether over Kosovo or over arms control, the Kremlin quotes a price.
Putin became president in 2000 when Russia’s foreign reserves were down to USD 8.5 billion. Today Russia’s economy is the world’s eighth largest, and foreign reserves are at close to USD 500 billion. It is no longer the Warsaw Pact’s tanks that are threatening European security, but the ever growing dependence on oil, gas and pipelines from Russia, the inability to come up with a coherent and sustainable energy strategy, and the fear of ‘sovereign funds’ gobbling up with their petroroubles ever larger chunks of European industry. The currencies of power have changed. The methodology of power has become more civilized, but the essence of power is still the same. Nowhere is this better understood than in the Kremlin.
What the spookocracy in the corridors of power fails to understand is the fact that the biggest threat to Russia’s future is not foreign enemies but the combination of various factors, all domestic in nature: the looming demographic crisis, the absence of long-term confidence in the leadership, the weakness of the industrial sector still relying almost exclusively on natural resources, the universal corruption and the stifling of transparency, free press, and answerability in the public domain; in short the severe shortcomings of the political culture. What does all of this tell us about the future actions of Russia? Russia’s objectives and performance in the world cannot be divorced from the rules of the game at home.
A U-turn back to the Soviet Union is as unlikely as an enthusiastic conversion to West European or American ways and means. The West’s best hopes were expressed by Dmitri Trenin in his essay ‘Getting Russia Right’ (2007) : ‘Russia is probably not going to join the West, but it is on a long march to become Western, “European”, and capitalist, even if not for a long while democratic. I mean European in terms of civilization rather than part of the European Union, and gradually more Western than pro-Western (or pro-American). Russia will matter in the foreseeable future, and that is why it is important to read it right.’ The outcome will depend on Russia and Russian power elites, first and foremost. But it also depends on the West and on the kind of competition the West manages to put up. If it is, as it should be, the overriding objective to turn the face of Russia and the Russians towards the West, then the presumption must surely be that the transatlantic system gets its own act together, that Western capitalism does not fall apart, that governments and central banks manage their economic and financial affairs with competence, that Western welfare states do not succumb to their inherent weaknesses, mountains of debt and inflationary pressures and that Western leaders find the right balance in managing Russia. Neither an enemy nor a friend. Russia is still in the process of redefining itself and, by implication, its relations with the West.
Russia Inc.
Sometimes, when the outside world seems to be addressed it is really the Russian people who are the recipients. ‘Our pilots have been grounded for too long. They are happy to start a new life’ – this is how President Putin launched the ex-Soviet strategic bomber fleet once again into world-spanning patrols suspended after the end of the great confrontation and the collapse of the Soviet Union, due as much to lack of funds as to the absence of the enemy. The opening of another base on Syria’s Mediterranean coast, the long-term lease dating back to Soviet times, had preceded the flying orders. When it comes to selling military hardware the need for defence contractors to make money often comes into conflict with the more diplomatic strategies of the Kremlin and Russian long-term security. Selling advanced anti-air weaponry to Syria is bad enough, but selling the same materiel to Iran, in addition to fourth-generation fighter bombers, is positively dangerous – certainly in the eyes of those in the Moscow General Staff charged with thinking about the long term.
The planting of the Russian flag with the double-headed eagle on the bottom of the polar seabed in late summer 2007, as close to the North Pole as possible, was a grandiose gesture, claiming that Russia’s continental shelf – with whatever subterranean treasures it might contain – extends all the way to the pole.
All of this should be taken seriously, not as a return to the Cold War stand-off but as a signal, to Russians as much as to the rest of the world, that Russia claims great power rank, second only to the US, and is back in business. Behind all the boasting and showing off, the truth is, as Dmitri Trenin put it, ‘Russia’s business is Russia itself.’ Power and property are, ironically more than anywhere in the West, one and the same. This is also underlined by the fact, reassuring up to a point, that the people who run Russia are also the people who own much of Russia. Post-imperial Russia on its way to becoming a nation state drums up greatness and Russian nationalism, but it is among the least ideological countries of the world, with plenty of natural resources to export but no ideology to match. The true values are capital assets at home and, preferably, abroad, beyond the reach of the FSB and the sniffer dogs of the tax police. Russia Inc. is doing well while expanding markets, controlling the flow of oil and gas, and acquiring shares in whatever lies downstream.
While in Soviet days antagonism to the bitter end was the founding formula and co-existence imposed upon Soviet ideologues only in later days under the grim shadow of intercontinental ballistic missiles and nuclear warheads, today the relationship is seen as competitive rather than antagonistic. Russia’s leaders are not recreating the Soviet Union. ‘We made this mistake once,’ Sergei Ivanov said, when still defence minister, only half jokingly. Globalization, with China and India rising and their insatiable appetite for raw materials growing, has dealt Russian leaders a hand of cards that is sure to help them through the next thirty or more years and allow them to expand their one-dimensional economy into a science-based post-industrial economy. This is the grand strategy in which the West is assigned an important, in fact essential, more as a partner than as an antagonist. China, for a long time to come, will sell growing quantities of low-tech goods to Russia, as to the US. But capital goods, especially machine tools fitted with cutting-edge technology, and also the more sophisticated technical toys and luxury goods which the Moscow and St Petersburg elites cherish, can only come from Western countries.