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Pivot to Asia - The Global South is on the march in their attempt to reshape the international system. How will this new order impact the old world? An increasing number of countries from the Global South, especially in Asia, are pushing to redefine the current global order. Three key trends to watch in this attempt to reshape the international system are the (potential) creation of a new economic order, the expansion of the BRICS grouping, and the transformation of China-Russia relationship after the invasion of Ukraine. In this changing international balance, Europe is losing its influence in the Global South, including in Asia. After centuries of global predominance, Europe’s strongest legacy is its role as a major normative power in global affairs. However, this reputation as a rule-setting power is set to change.   Why it matters 1. A (new) economic order. The debate over a “new Washington Consensus” has gained momentum after US national security advisor Jake Sullivan delivered a speech at the Brookings Institution on April 27th. The final communiqué by the G7 countries which met in Hirosahima on May 19-20 is the result of a similar strategic shift within the group, one that implies a move from economic interdependence to economic security. This shift is coupled with a major change in how the G7 intends to deal with emerging economies, such as their rival China and other partners in Asia that might soon become economic competitors in critical technologies. The G7’s sentiment has moved from promoting globalization and open markets to building industrial capacity in critical sectors, while securing existing and creating new strategic supply chains. Europe’s efforts in this context might not be enough: the investments envisaged so far are too little to reverse Europe’s dependency (often on China) in critical sectors. The EU must focus increasingly on diversifying its supply chains through securing access to rising economies in the Indo-Pacific. Here, joining the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) could represent an opportunity.  2. BRICS+? The BRICS foreign ministers’ summit in June was yet another steppingstone toward enlargement. The countries that expressed a significant interest in joining the grouping are Iran, Saudi Arabia, the United Arab Emirates, Cuba, Democratic Republic of Congo, Comoros, Gabon, and Kazakhstan: all these countries sent their representatives to Cape Town. Egypt, Argentina, Bangladesh, Guinea-Bissau and Indonesia participated virtually. While the membership process might be a long one, the group’s upcoming expansion highlights the Global South’s political will to rise its voice, with a plethora of actors eager and able to leverage the new competition between powers which is shaping up after the Ukraine war. In this framework, Asian countries such as China and India are competing with one another to lead the BRICS.   3. China and the Stans. On May 19, Xi Jinping met in Xi’an with the (leaders of) the five Central Asian “Stan”-countries (Kazakhstan, Uzbekistan, Kyrgyzstan, Tajikistan, and Turkmenistan). Russia, the region’s traditional kingmaker, was noticeably absent. The meeting kickstarted – for the first time offline – a summit named C+5 and highlighted Beijing’s belief that it can now make deals within the region without Moscow’s supervision. China’s newfound independence in Central Asia and Moscow’s growing dependence on Beijing after the war in Ukraine provides new insights the on China-Russia relationship: although the two countries are united by their common desire to contest the US-led world order, the Sino-Russian relation seems increasingly tilted in China’s favor. This instable relationship could result in a stronger Chinese presence in Central Asia.  4. Loss of strategic centrality. Europe does not only risk becoming increasingly peripheral in world affairs, but also losing its bargaining power with the emerging Indo-Pacific economies. On the one hand, the EU needs to diversify its supply chains away from China and likely towards the ASEAN; on the other, the Global South – and by default its Asian members – is more aware of the current strategic window of opportunity to redesign the global balance of power.   Our take We are witnessing rapid changes in the international arena. In the coming months there will be increasing requests to review global norms. Therefore, the leading event will be the upcoming BRICS Summit in August: the meeting will probably certify the process to accept new members. Among the countries that are voicing their desire to reset the rules, some are considered by the West (mainly) as rivals, such as China, and as partners, like India. Therefore, Washington and Brussels cannot simply accept or dismiss their requests. Asia is claiming its century: the integration of this claim for a renewed global order into the current world order has just started. Its most important implications will be on the economic side, namely the redistribution of industrial capacity and trade relation in the context of de-risking from China.  Spotlight: G7  The G7 Hiroshima Summit has sent some clear messages to the rest of the world. The decision to invite President Zelensky to the gathering was a move meant to reinforce the unity of the members regarding the Ukraine invasion in the face of Russia — and China, too. The West has criticized China’s 12-point position paper on the Ukraine war, since it does not call for Russia to abandon occupied territories. The G7 countries have also announced a strengthening of the sanctions, seeking to curb products that could be used by the Russian military. The other important takeaway of the G7 is the joint statement directed at China, which includes a strong criticism of Beijing’s “economic coercion” and invites the PRC to play according to international rules. The G7 have also reiterated their position on divisive topics such as security in the Indo-Pacific and Taiwan, retreating their commitment to preserve peace and stability in the region. Despite the joint statement and the declarations by the leaders on the challenges posed by China, the G7’s stance on Beijing is still a balancing act. While concerned about being overly vulnerable with China, G7 economies and their industrial base remain strongly interconnected with the Asian country and despite calls for “de-risking”, such as cutting China out from some sectors like raw materials, it is impossible at the time.  Experts’ viewsThe implications of China’s activism among the BRICS countries  The next BRICS Summit will take place at a critical juncture for the Global South. Russia is still at war, Brazil has a new administration eager to flex its muscles globally, and China has reached unprecedented influence across the developing world. Since they are all connected by the same desire of multipolarity away from US and Western hegemony, it is likely that the BRICS will try to offer a roadmap towards a new international order. This roadmap, however, is far from consensual: will Russia embrace the peace dialogues offered by Brazil or African nations – and what role will China play in brokering any such proposal? Will China and the other BRICS be able to cooperate economically to promote development worldwide? Are the BRICS ready for its first enlargement, and who is most likely to join in the coming years? This arrangement will require some mutual concessions and the outcome will help shape the future world order.  Guilherme Casarões, Fundação Getulio Vargas  The push to strengthen and even expand the BRICS, especially by China, should be viewed more broadly through the lens of a pragmatic Chinese foreign policy. It has not only sought to strengthen ties within BRICS but with other regions and countries who are instrumental for its trade and infrastructure connectivity imperatives.  This happens against the backdrop of a shift towards a multipolar world order with China as a rising power and rising geo-political tensions. Given that this bloc advocates for issues that are relevant to the Global South (global governance reform, support for a rules-based international order and multilateralism in times when countries retreat to unilateral measures), it is no surprise that other countries in the South wish to join. Regarding this summit, I see no major implications for the bloc, the core business of the BRICS will continue with South Africa advancing its five priority areas. However, we can anticipate a discussion on its formal expansion. Trading with local currency seems to have found new impetus following the sanctions placed on Russia. All this notwithstanding, it is important to note that the ‘de-dollarisation’ in trade debate is not a new concept for BRICS and its less about challenging the dollar but strengthening other currencies against external economic shocks. The real test is for the host country depending on whether President Putin attends the heads of state summit in August, given Pretoria’s obligations under the Rome Statute and domestic law.  Luanda Mpungose, South African Institute of International Affairs (SAIIA)  China’s push for a stronger BRICS on the global stage is advancing along a number of trajectories. Firstly, there is the BRICS expansion as well as the BRICS+ format that are likely to bring the majority of the Global South into BRICS-related platforms of economic cooperation. The implementation of the BRICS+ format may serve as a precursor for liberalizing trade across the Global South and exploiting the potential for boosting South-South trade and investment ties. The expansion in the membership of the Shanghai-based New Development Bank as well as the creation of its regional centers will increase the scope for connectivity projects across the developing world. There is also the greater use of national currencies (most notably the yuan) via de-dollarization as well as the R5 BRICS common currency project that if launched would mark a key transformation of the global financial system.  Yaroslav Lissovolik, BRICS+ Analytics   What and Where Thailand is ready to Move Forward   The May elections in Thailand resulted in a clear victory for the opposition parties. Led by Pita Limjaroenrat, Move Forward has won 152 seats, becoming the most voted party in the elections. This party is the heir to Future Forward, which was dissolved by the military government in February 2020, and was born out of the 2020-2021 protests against the army and the monarchy. The second party in the country is the historic Thai opposition party led by the Shinawatra family, the Pheu Thai. However, while the population has expressed its preference, there is no guarantee yet that Move Forward, and the opposition, will govern. Indeed, to be elected Prime Minister, and form a government, Pita will need to win the majority in the bicameral parliament made up of the elected 500 seats in House of Representatives and the 250 seats of the Senate – whose members are handpicked by the military. The Move Forward coalition with Pheu Thai and the other opposition parties so far can count on little more than 310 votes, a long shot from the majority needed to govern. The opposition must garner support among the senators – which generally have little interest in going against the military that put them in power – or among the parties that have yet to declare their allegiance.  Cambodia: Hun Sen is getting rid of the competition ahead of July elections  On the 14 of May, Cambodia’s opposition party – the Candlelight Party – has been disqualified from running in the upcoming July elections by the country’s election commission. The party has allegedly failed to submit the necessary documentation to participate in the electoral race. With the exclusion of the Candlelight Party from the coming elections, the only possible competitor to the ruling Cambodian People’s party (CPP) of PM Hun Sen – who has been in power for 38 years – has been eliminated. This is not the first time that the main opposition party has been cut out of the electoral race. For instance, in the 2017 the Cambodian court, which is heavily colluded with the CPP, dissolved the Cambodian National Rescue Party (CNRP) before the 2018 general elections – a party that was given new life when its members created the Candlelight Party. However, the members of the opposition continue to be persecuted by Hun Sen’s forces with many political exponents arrested on charges of treason, assaulted, or forced to leave the country. With the opposition forces largely depleted and the main party banned from running for elections, Hun Sen is likely guaranteed another term.   The United States seeks to expand influence in the Indo-Pacific  Washington took advantage of two key international events to strengthen its strategic position in the region. During the Quad Leaders’ Summit, which took place on the sidelines of the G7 in Hiroshima, President Biden, Australia’s PM Albanese, PM Kishida of Japan and PM Modi of India stressed their unity and stated their plans to invest in digital infrastructure in the region. Throughout the meeting they did not mention China directly in their statements, but their references to the country were clear. The Quad expressed concern over the militarization of the region and the use of both economic and military coercion to alter the status quo – a clear reference to Chinese activity in the South China Sea. Another important step for the US to consolidate its position in the region is the announcement of the Supply Chain Agreement under the framework of the Indo-Pacific Economic Framework for Prosperity (IPEF). The agreement includes the 14 IPEF partner countries, namely Australia, Brunei, Fiji, India, Indonesia, Japan, Malaysia, New Zealand, the Philippines, Singapore, South Korea, Thailand, the US, and Vietnam. A year following the launch of the IPEF, this agreement is the first practical measure undertaken by the group. The group did not announce any official trade commitments, there is expectation among partners for increased cooperation and monitoring of supply chains fragility. The concrete development is still unclear, but the agreement signals the need for Indo-Pacific countries to avoid supply chain disruption and to minimize their dependence on the region’s main economic player, China.  Semiconductors: China fires back   China has gone on the offensive in competition over the semiconductor sector. The Cyberspace Administration of China (CAC) has stated that products by Micron, the US largest memory chip maker, are a “security risk for the information infrastructure supply chain” barring infrastructure operators from buying them. While additional information has yet to be revealed, some negative impacts are expected for Micron even if China and Hong Kong accounted for only 16% of the revenue of the company in 2022. The measure is a retaliation to America’s effort to cut China out from the semiconductor sector and slow the development of its industrial base. Since October 2022, the Biden Administration has imposed strict controls over chips export, followed by the Netherlands and Japan, preventing China from accessing and producing more advanced semiconductors. China’s declaration comes also after the leaders of the G7 grouping released a statement criticizing the country’s economic coercion tactic. After the move from Beijing, Micron fears that their products will be replaced by South Korean competitors, Samsung and SK Hynix, on the Chinese market. In the rising technological row between the US and China, there is also fear that Beijing might choose to put some export controls over other sensitive technologies, such as solar panels – where China dominates the whole supply chain.    TREND: Despite rate hikes, Asian unemployment is faring well (but not for everyone)  In the current context of high inflation and high rates, unemployment has turned out to be one of the main socio-political issues of Asia. With skyrocketing prices hurting businesses and consumers, many central banks in the West have adopted more hawkish monetary policies during the last year. Yet, the soaring cost of money has forced many businesses into a tight spot with concerning consequences on the employment level. Some countries though – like Japan, China, and Indonesia – have made the unorthodox choice to not significantly raise rates during the last year, while others – like South Korea and India – have adopted similar policies to those of the FED and the ECB. However, the results vary. In Japan the unemployment rate has been quite steady at around 2.6% for some time now, but in China the range (5.2-5.7%) was wider, especially due to the uneven nature of the post-Covid economic recovery. Yet, as the economy is slowly returning to normal, Beijing’s unemployment rate is gradually decreasing. Meanwhile Korea has consolidated a positive trend, with the last available figure at 2.5%, but the reforms of the labor market proposed by President Yoon Suk-yeol may cause some issues. The critical indicator though will be youth unemployment. Employment in aging societies, like those of East Asia, will increasingly become a core issue to maintain the viability of existing social welfare programs. So far China has a staggering 20.8% unemployment rate in the 16-24 years old age group which is particularly concerning, as it is the 7.2% recorded in South Korea. Japan is faring quite well but unemployment in the 25-34 years old age bracket has risen since the beginning of the year from 3% to 4%.

Putin’s plan is to wait out what he sees as inevitable changes in the West and Ukraine. These days, however, Russia’s elites are liable to see defeatism in inaction.Nothing is happening in Russia. At least, that’s the impression given by Vladimir Putin over the past six months. On some level, the president has been extremely active, secretly micromanaging the war effort and publicly pretending to be dealing with routine matters from meetings on the economy to the launch of a tram line in the occupied Ukrainian city of Mariupol. Yet there are no presidential initiatives in the works for adapting the country to the new wartime reality and all that it involves.  Putin has stubbornly remained disengaged in this sense, despite drone strikes on the Kremlin, mercenary boss Yevgeny Prigozhin’s crusade against the Defense Ministry, and even Ukraine’s looming counteroffensive. He prefers to give lectures on history and offer optimistic assessments of Russia’s economic prospects—and pessimistic ones of the West’s. This doesn’t mean, of course, that there really is nothing happening in Russia: quite the contrary. But what is happening has far less to do with the president’s plans or strategic interests than it does with the corporate interests of individual departments and figures. What is happening is largely a response to the worsening conditions facing Russia. Take the digitization of Russia’s system for issuing conscription notices, a move forced by the difficulties surrounding conscription during a war that is not going according to plan. Or how repression has deepened, in an attempt at self-preservation by the system amid fast-growing geopolitical risks and fears of defeat. Repressive inertia and self-aggrandizement by major institutions such as the FSB and the defense and finance ministries have driven many recent decisions, including the return of ideology. Justice Minister Konstantin Chuichenko has spoken openly about the possibility of introducing a new official ideology that would extend to education, cinema, theater, and poetry. This process has long since ceased to be under Putin’s direct control and is now developing independently of him, albeit with his passive consent. Here and in other important debates, Putin’s voice is absent. Should Russia’s borders be closed? Should those who have already left have their rights restricted? Who is to be exempted from mobilization? How are those designated as “foreign agents” by the state to be punished? What should be done about Prigozhin? How should the country respond to incidents like drone strikes and attempts to assassinate “ultra-patriots”?   The stances of parliamentarians, party leaders, cabinet ministers, military bloggers, and the security services on these and other matters are all well known. Yet Putin says nothing, intervening only to take steps such as retreating from the key Ukrainian city of Kherson, suspending Russia’s participation in the New START nuclear agreement, or pulling out of the Treaty on Conventional Armed Forces in Europe. Even in his long-awaited address to the Federal Assembly, he merely listed measures already taken by the government. Today, Putin is just about the only person in Russia who is not increasingly engaged in politics, from former president Dmitry Medvedev, State Duma speaker Vyacheslav Volodin, and Security Council head Nikolai Patrushev to Prigozhin, the war bloggers, and television hosts. It is as though the president has recused himself, devoting himself to secret military and geopolitical matters, the details of which are known to few. This is not a sign of fear or weakness. Rather, it reflects Putin’s growing messiah complex. At present, literally all his political hopes and plans hinge on external changes that are out of his control. Putin has no instruments or resources with which to change the situation in his favor. Yet he believes that the world will change all the same and deliver him Kyiv’s capitulation.  Putin’s plan is to wait out what he sees as the inevitable transformation of the West and Ukraine. Any fear of a Ukrainian counteroffensive has given way to the conviction that little will change on the battlefield, beyond minor setbacks that he is prepared to tolerate. The calculation in the Kremlin is that absent a military breakthrough, Ukraine’s elite will fracture, leading to the emergence of a “party of peace” (i.e., capitulation), while in the West, internal divisions will force cuts to military and political support for Kyiv. Putin’s hopes cannot be dismissed as completely baseless, but his problem is that this approach is anathema to Russia’s restless political class. For all its loyalty and pliability, it has evolved dramatically during the war. These days, Russia’s elites are liable to see defeatism in inaction. All of this creates the conditions for the political ambitions of parastatal actors to soar. Despite their reputation for being instruments of the Kremlin, they are gradually building political capital and may one day run out of patience with the regime and challenge it. Already, Putin is struggling to explain what exactly he is waiting for.    In the first months of the war, many took notice of how the once-marginal pro-war “ultra-patriots” had matured politically and come to dominate the information space. Today, the officious hawks, such as Medvedev, Volodin, and Patrushev, are losing their place in Russian politics to the angry patriots, including Prigozhin, former Donbas commander Igor Strelkov, and the war bloggers. Compared to each other, the former seem like opportunists and armchair generals, while the latter, having emerged in combat conditions, look much more like the real thing.  The regime is not under threat so long as Putin’s ratings remain stable, and besides, the mechanism of power is still completely under his control. Yet his public paralysis and refusal to assume responsibility for the resolution of the most pressing problems facing Russia cannot but render him and his courtiers politically irrelevant and create a vacuum to be filled by the ultra-patriots. The day may come when Putin finds himself dependent on a once harmless bunch made dangerous by his opacity and inaction.

Russia’s annual Victory Day holiday on May 9, when the country marks the Soviet victory over Nazi Germany in World War II, was expected to be a fairly low-key affair this year. Just three days before the festivities, which included a military parade on Red Square, only one high-ranking guest was due to attend: Kyrgyz President Sadyr Japarov.  On the eve of the parade, however, it emerged that the presidents of four other Central Asian nations had also arrived at the last minute, along with Armenian Prime Minister Nikol Pashinyan and Belarusian President Alexander Lukashenko. For over a year now, following Russia’s full-scale invasion of Ukraine last February, the Central Asian leaders have tried to avoid the issue of the war. So why have they now risked both their reputations and their safety (after all, there were drones flying over the Kremlin the week before the parade) to attend Moscow’s military festivities in what is being seen by many as a gesture of support for Russia? Even before the war, the Central Asian presidents preferred to celebrate May 9 in their own countries: any holiday that unites the nation is seen as a way of strengthening their relatively young statehood. Some also tried to use the Soviet-era holiday to make the point that the major victory of the 20th century had not been achieved by Russia alone. Each of the Central Asian capitals held its own military parade and competed with Russia and among themselves to stump up the most lump-sum payments for veterans. Sometimes their leaders still attended the parade in Moscow – that was never a problem. Russia’s full-scale invasion of Ukraine changed everything. Russian President Vladimir Putin began to use Victory Day to justify his aggression, comparing Russia’s historic fight against the Nazis to its current so-called “special operation” against the Ukrainians.  This year’s parade inevitably resulted in images of the Central Asian leaders sitting alongside Russian troops who have been fighting in the war and applauding Putin’s speech about a “sacred struggle for the motherland.” Those images will make it much harder to insist that the countries of Central Asia do not support Russia's aggression against Ukraine. This conclusion was, of course, perfectly clear to those involved, which is why the Central Asian presidents did not initially intend to be there, as evidenced by official statements. Two weeks before the parade, Kazakh President Kassym-Jomart Tokayev announced that on May 9, he would commemorate those killed in World War II in the capital Astana, while Uzbek President Shavkat Mirziyoyev ordered a fireworks display in Tashkent on May 9, with the clear intention of attending himself. Nor did Moscow itself even intend to invite anyone at first. On April 24, Putin’s spokesman Dmitry Peskov said that since it was not a big anniversary this year, no “special invitations” had been sent to anyone. Only Japarov’s visit was planned in advance: both the itinerary and the makeup of the impressive official delegation were made public. It seems, therefore, that everything in Russia is now conducted like a special operation – even invitations to a parade. “Special invitations” were issued one after another just a few days before the parade in the form of phone calls from Putin, as reported on the websites of Tajik President Emomali Rahmon on May 5 and Turkmen President Serdar Berdymukhamedov on May 7. Mirziyoyev and Tokayev’s attendance, meanwhile, was announced with photographs of them exiting their planes in Moscow. In all likelihood, with the exception of Japarov, the Central Asian presidents initially managed to politely decline the invitation to Moscow. But when Putin called them, it became not only difficult to do so, but also dangerous. All of the Central Asian nations are proud of their multi-vector foreign policy, and relations with the West are just as important to them as with Moscow or Beijing. Now that Russia and the West are on the verge of war, it has become far trickier for Central Asia to maintain its partnerships with both sides. The last few years have shown that when the West imposes sanctions against a country, they are observed by everyone, including China. Accordingly, since the invasion, Central Asia’s leaders have tried to strike a balance. None of them have recognized the territories annexed from Ukraine as part of Russia, but nor have they publicly criticized Putin or condemned the war. They have all agreed to comply with sanctions, yet have made no real efforts to stop Russia from using their territory to circumvent the restrictions. It’s a precarious balance. Much to Moscow’s annoyance, Western delegations have repeatedly traveled to Central Asia to advise local authorities on sanctions compliance, and have threatened secondary sanctions for failure to comply. Moscow has responded with veiled and asymmetrical threats, such as halting exports of Kazakh oil to Europe or prohibiting the import of products from Eurasian Economic Union countries, supposedly over GMOs. Central Asia’s leaders are left to decide for themselves how much of this is coincidence, and how much a response to their statements and actions. Therefore, the deciding factor in the presidents’ visit to Moscow was likely that the West’s actions are predictable, while Moscow’s are not. Quite simply, taking part in Moscow’s Victory Day celebrations may have looked bad, but Washington and Brussels were unlikely to impose sanctions simply for attending a parade, while the potential consequences from Moscow of refusing to attend were hard to predict. There were also pragmatic reasons for visiting Moscow. Contrary to expectations, far from severing ties with Russia, Central Asia actually drew closer to it in 2022. The reality is that it can be profitable to be located next door to a giant, isolated economy and diplomatic pariah. Firstly, Central Asian companies have made record profits from the disappearance of Western imports from the Russian market. Exports from all five Central Asian countries to Russia soared in 2022. Secondly, Central Asia is becoming a financial hub for Russians moving their savings out of Russia. Last year, more than $770 million was transferred from Russia to Kazakhstan – an almost sevenfold increase from 2021. Transfers to Uzbekistan, meanwhile, more than doubled to $17 billion. Thirdly, Central Asia is now the focus of far more international attention than ever before, with Western countries trying to persuade the region not to help Russia in any way, and Moscow trying hard to stop it from drifting away. Recognizing that this attention is largely the result of their proximity to Russia and will not last forever, Central Asia’s leaders are trying to milk the current situation for all it is worth. Accordingly, individual actions should not be interpreted as either definitive support for Russia or a move to sever relations with it. Central Asia’s political elites view the invasion of Ukraine through the prism of their own interests, top of which is the preservation of their own regimes. For this reason, they will continue to show loyalty to Putin, attending parades with him and periodically praising Moscow in public speeches. It might look like an attempt to have it both ways, but this is the survival strategy the Central Asian regimes consider most likely to work.

Russia’s invasion of Ukraine has turned neighboring Moldova into a tinder box. Its border with Ukraine stretches for over 1,200 kilometers, and Russian missiles have entered Moldovan airspace on more than one occasion. Moscow has threatened to prevent Moldova from becoming another “anti-Russia,” while making fearmongering accusations that the Ukrainian army has plans to seize Moldova’s breakaway region Transnistria. The direct military threat to Moldova, however, receded after the Ukrainian army defeated Russia in Kherson, and the Moldovan government appears to have successfully adapted to the new situation and restored relative stability. Despite historically strong pro-Russian sentiment, the vast majority of Moldovans now agree that cooperation with Moscow has become too toxic, while the allure of EU integration—such as the opportunity to work there—is more tempting than anything Russia has to offer. Chisinau is accordingly taking increasingly decisive measures in its fight against Russian interference.  A state of emergency has been in effect in Moldova ever since Russia invaded Ukraine on February 24, 2022, affording the government and law enforcement agencies additional powers. So far, the authorities have not resorted to radical measures, but the fact that the state of emergency is extended every two months shows that they are seriously concerned about the threat of destabilization. Throughout the past year, Chisinau has condemned Moscow for the war, but avoided direct confrontation, and was initially reluctant to actively oppose Russian interference. Moldovans welcomed Ukrainian refugees, but declined Kyiv’s requests to sell it six MiG-29 fighter jets, which was a bitter pill for Kyiv to swallow, considering that the Ukrainian army had thwarted Russia’s attempts at the start of the war to carve a corridor through Ukraine to Moldova’s Moscow-backed breakaway region, Transnistria. If it were not for Ukraine’s counterattack, then Moscow would likely have already taken control of Moldova and installed a pro-Russian president there: Russia’s rhetoric about the illegitimacy of the current Moldovan leadership is getting louder and louder. It is unlikely that Moldova, neither a large nor wealthy country, would have been able to put up much of a fight. Chisinau’s caution is understandable: after all, there are 1,500 Russian troops stationed in Transnistria, both as peacekeepers and as guards for Soviet-era arms depots. Moldova only joined anti-Russian sanctions this spring. Before that, the government demurred, citing the country’s dependence on the Russian economy, even though Moldova’s main trading partner has long been the European Union. Last year, almost 60 percent of Moldovan exports went to the EU, while less than a quarter went to the entire Commonwealth of Independent States, including Russia. And while exports to the EU increased by a third in 2022, those destined for Russia decreased by about the same amount. Even Moldova’s long-standing and almost complete dependence on Russian gas supplies has significantly weakened during the past year, largely due to the actions of Russia itself. Last October, Russia’s Gazprom reduced gas supplies to Moldova from 9 million to 5.7 million cubic meters per day in a payment dispute.  Moscow also reduced gas supplies to Transnistria, which almost left Moldova without electricity, since until 2022 up to 70 percent of electricity supplied to the rest of Moldova came from Transnistria and its regional power plant, which runs on Russian gas. The rest was supplied by Ukraine. Due to the reduction in gas supplies, Transnistria stopped selling electricity to Chisinau, while Kyiv also stopped exports due to the Russian missile strikes against its energy infrastructure, which had caused severe energy shortages across the war-torn country. Soon afterward, Chisinau reached an agreement with Tiraspol, Transnistria’s de facto capital. Chisinau agreed to send its own Russian gas supplies to Transnistria in exchange for the resumption of electricity supplies from the latter. To meet its domestic requirements, Moldova began buying gas from the EU, which by January 2023 had enabled it to save $330 per 1,000 cubic meters compared with Russian prices thanks to the relative stabilization of the European gas market.  In the spring, Ukraine resumed electricity exports, and the Transnistria power plant returned to its prewar capacity. The energy crisis hit Moldovan consumers hard, but prod Chisinau to establish alternative gas suppliers, including Romania and Greece, with plans to add Azerbaijan to that list. This energy diversification has strengthened the Moldovan government’s position in its relationship with Moscow. By this spring, following the resignation of the government and a subsequent reshuffle, Moldova had begun to toughen its stance on Russia. New Prime Minister Dorin Recean was previously a national security advisor and interior minister, and his appointment was a signal that security issues are Chisinau’s top priority right now. A few days before the reshuffle, President Maia Sandu said that Ukrainian intelligence had intercepted a Kremlin plan to organize a coup in Moldova through opposition protests and the involvement of foreign mercenaries. It’s hard to verify the claims, but what is certain is that Russia has always had extensive influence in Moldova, and has traditionally enjoyed the support of about half the population. Even now, polls show that while the majority of Moldovans condemn the Russian invasion of Ukraine, about 30 percent still admire Putin. Since last fall, the Shor party has been leading Moldovans in anti-government protests, officially against high utility prices. Russian propaganda portrays the protests as anti-European and nationwide, and describes the party’s head, the fugitive oligarch Ilan Shor, as the leader of the Moldovan opposition. But in reality, the protests only attract a couple of thousand people, and those participants do not hide the fact that they are paid to attend.  Ilan Shor fled to Israel after being sentenced to fifteen years in prison in Moldova for his role in laundering $1 billion in three Moldovan banks. A change of regime in Chisinau to a pro-Russian government would allow him to avoid prosecution and return to Moldova. Many believe that the Kremlin has offered him precisely these guarantees. The Moldovan government was concerned by the protests, but did not dare to take tough action: the Shor party has six seats in parliament, and freedom of assembly is enshrined in the constitution. But the reports of Kremlin plans to destabilize Moldova, and then the emergence of a document titled “Strategic Goals of the Russian Federation in the Republic of Moldova,” which spelled out a plan for regime change, forced Chisinau to act more decisively. The new Moldovan cabinet has appealed to the Constitutional Court to declare the Shor party illegitimate for promoting the interests of a foreign state. Meanwhile, in response to the opposition rallies, Sandu has called on Moldovans to assemble on Chisinau’s main square on May 21 in support of EU integration. About 60 percent of Moldovans are in favor of their country’s accession to the European Union. The reshuffled government has also stopped the broadcasting of Russian TV channels, and stepped up its efforts to publicly refute dubious Russian claims, such as that Ukraine is preparing to occupy Transnistria. The powers of the Information and Security Service, Moldova’s main intelligence agency, have been expanded, and a number of Russian officials—including President Vladimir Putin—have been banned from entering the country. Chisinau’s position on Transnistria has also become tougher. In February, the Moldovan parliament amended the law to make separatism an offense punishable by jail time, prompting outrage in Tiraspol. Chisinau insists that the amendments will not be applied retrospectively: only to future manifestations of separatism. Still, it is not yet clear how the new law will work in practice, so for now, Transnistrian officials prefer not to be seen in Chisinau. Russia’s actions have also prompted a public discussion in Moldova about the country’s armed forces, which will not be able to put up much resistance to a serious security threat. At the Munich Security Conference in February, Sandu asked NATO countries to provide Moldova with air defense systems. The government has not yet abandoned neutrality, but is making it clear that it is ready to turn to NATO for help in the event of an escalation. Chisinau’s course toward more resolute resistance to the Kremlin doesn’t mean that the country will be able to rid itself of its dependence on Russia overnight, of course. Nor will Moscow relinquish its foothold inside the country without a fight. Most likely, the Kremlin will continue to interfere in Moldovan political life by financing pro-Russian parties, portraying NATO as a threat, and accusing Sandu of trying to drag Moldova into the war. It’s possible that the pro-Russian forces will be able to take advantage of the country’s socioeconomic problems to put in a decent showing in the next elections. Even that scenario, however, will not result in fundamental changes to Moldova’s foreign policy. Russia’s aggression against Ukraine is helping to consolidate Moldovan society in favor of EU integration and emancipation from Moscow. No matter who ends up leading the country in the future, they will not be able to ignore that consensus.

With China increasingly assertive in pursuing its economic and geopolitical interests abroad, US–China tensions are rising, leading many traditional American allies to consider following Washington’s lead in pursuing economic ‘decoupling’ from China. Their strategy aims to reduce economic reliance on China through extensive export controls and re-ordered supply chains. Yet in Western Europe, France and Germany are showing an unwillingness to join their allies in decoupling from China. French President Emmanuel Macron’s recent comments that Europe should not get ‘caught up in crises that are not ours’ demonstrate this. If anything, their relationship with Chinese capital is thriving. China is one of France and Germany’s major trading partners outside of the European Union and a significant export market for goods such as luxury goods and pharmaceuticals. Exports to China made up 7.4% of Germany’s total exports and 4.21% of France’s in 2019, with these numbers growing over the last three years to record levels. Given China’s growing middle class, the country presents an enormous potential consumer market in years to come. According to recent reports, France’s bilateral trade in goods with China exceeded US$100 billion for the first time in 2022, an increase of 14.6% on 2021­. The recent signing of 18 cooperation agreements by 46 French and Chinese companies across numerous sectors further emphasises the gathering pace of these trade relationships. As for Germany, its total trade with China saw an increase of 21% from 2021. While exports increased by a modest 3.1%, Germany’s imports from China accounted for much of the growth, soaring by more than a third. Specifically, Germany imports from China about two thirds of its rare earth elements, many of which are indispensable in batteries, semiconductors, and magnets in electric cars. This shows that Germany and France will rely more on China as time passes for the critical raw materials needed to fuel their economic growth and energy transitions. Furthermore, various French and German companies would prefer to grow their established production facilities and extensive sales networks in China. With the trade relationship expanding so rapidly and estimates suggesting that more than 2 million German jobs depend on exports to China, the countries’ economies are set to become even more intertwined. German companies Volkswagen and chemical processor BASF, for instance, are significantly expanding their investments in China. Volkswagen, which already has more than 40 plants in China, recently announced that it will invest billions in new local partnerships and production sites. BASF, which has 30, says it will invest US$10.9 billion in a new chemical production complex there. Given all this new activity, making a show of decoupling from China could cause significant repercussions for France and Germany. Ultimately, the costs of decoupling outweigh the benefits for the two governments. While their allies might come to bemoan their inaction, they just won’t forgo such significant opportunities for French and German companies in China. Additionally, decoupling could trigger retaliation, as it did with Australia, with China halting exports to the two countries, increasing tariffs, or reducing market access to French and German goods. All in all, France and Germany are unlikely to shift from their stance. They’d prefer to let their markets flourish and work out the rest later.

It aims to signal its diplomatic ascendance and challenge Washington as the big shaper of outcomes. Late last month, Chinese President Xi Jinping finally made that much hoped-for call to Ukraine’s President Volodymr Zelensky and informed the world that his nation “always stood on the side of peace.” This was the first outreach by Beijing to Ukraine since  the latter’s invasion by Russia last February, and Zelensky was keen on this engagement, especially after Xi’s visit to Moscow in March. Ukraine views China as an important interlocutor that can engage with Russia and seems to have been encouraged by the “long and meaningful” phone call between the two leaders that in its view would “give a powerful impetus to the development of our bilateral relations.” Last week, Ukraine’s finance minister also suggested that Kyiv should use its bilateral relationship with China as leverage to bring an end to Russia’s full-scale invasion, though he refused to consider China as a friend. The Chinese President has been reported as saying that China, “as a responsible majority country,” would “neither watch the fire from the other side, nor add fuel to the fire, let alone take advantage of the crisis to profit.” But there was no suggestion that Beijing would be doing anything meaningful going forward. The call and associated choreography had more to do with positioning China as a global power that is willing to engage in resolving problems, as opposed to the US that is creating more trouble by continuing to support Ukraine and prolonging the war. China has already laid out its cards on the table when it comes to the Ukraine crisis. It had released a 12-point position paper on the political settlement of the Ukraine crisis earlier this February. In an attempt to present itself as a neutral peace broker, Beijing has enunciated a few standard principles, including respect for the sovereignty of all countries, resumption of peace talks, keeping industrial and supply chains stable and opposition to unilateral sanctions  as well as the use of nuclear weapons. Taking this forward, China has decided to send special representatives to Ukraine and hold talks with all parties in an attempt at peace-making. But beyond these principles, China’s credentials are hardly supportive of a larger role as a peace-maker, as it has long refused to view its ties with Ukraine and Russia at the same level. Russia has shown no inclination to step back from its aggression and Ukraine is seemingly preparing to launch a large-scale counter-offensive against Russian forces in a bid to retake territory in the east and south for which it has been preparing for months now. While Moscow has given no indication of backing down, perhaps assuming that it has time on its side and waiting for the Western consensus on backing Ukraine to collapse, Ukrainian forces feel that the weaponry delivered by the West over the past few months is likely to give them the momentum needed to shape battlefield realities in their favour. China is also unlikely to be viewed as an honest broker, given its ties with Russia that are increasingly becoming tighter. And despite repeated statements that the “sovereignty, independence and territorial integrity of all  countries must be effectively upheld,” Beijing has not only refused to acknowledge Russia’s violation of Ukrainian sovereignty, but has continued to privilege its partnership with Moscow. Though Xi’s visit to Moscow in March did not result in any concrete help to Russia, it did signal to the West that  the China-Russia entente can shape the global balance of power in ways that can be deleterious to Western interests. More than anything else, Chinese posturing in the Ukraine conflict is aimed at the West. In its position paper, Beijing talks about the need to abandon a “Cold War mentality” and argues that “the legitimate security interests and concerns of all countries must be taken seriously and addressed properly,” making it clear that it largely agrees with Moscow’s perspective that it was the West that created the conditions for this war with the expansion of the North Atlantic Treaty Organization (Nato). China has also been critical of Western sanctions on Russia, arguing that “relevant countries should stop abusing unilateral sanctions and ‘long-arm jurisdiction’ against other countries, so as to do their share in de-escalating the Ukraine crisis.” Both of these issues are germane for the long-term trajectory of China’s role on the global stage amid deepening tensions with the US. For China, clearly, this crisis is more about itself than it is about Russia. As China comes out of its covid- induced isolation, it would like to have a stable international environment for a sustained economic recovery. But it is also using an opportunity to emerge as a key global interlocutor by venturing into diplomatic arenas it has been shy of in the past, taking advantage of the West’s recent inward orientation. This effort was exemplified by its attempt to bring Iran and Saudi Arabia together in the highly volatile Middle East. China’s attempt at emerging as a global peace-maker is about presenting a diplomatic challenge to the US on the global stage. Beijing may not have much of an impact on the eventual outcome of the Ukraine crisis, but it is signalling that it is no longer shy of showcasing its growing diplomatic heft.

Macron has raised doubts about how serious France is when it comes to managing the negative externalities of China’s rise. Just when it seemed the European Union was finally achieving strategic coherence as a global geopolitical actor, French President Emmanuel Macron’s recent visit to China has shattered that myth. The French president and the head of the European Commission, Ursula von der Leyen, headed to China last week, hoping to project a sense of unity vis-à-vis Beijing at a time when global fault lines are sharpening among major powers. The two leaders were aiming to stabilise an increasingly difficult trade relationship with their largest trading partner as well as try to push China into taking a more active role in ending the Ukraine war. Other European leaders, like German Chancellor Olaf Scholz and Spanish Prime Minister Pedro Sánchez, have also tried to engage Chinese leadership in recent months. But Macron went beyond others as he advocated “strategic autonomy” for Europe as a “third superpower.” Arguing that Europe faces “the great risk” if it “gets caught up in crises that are not ours, which prevents it from building its strategic autonomy”, Macron stirred up instant controversy by suggesting that Europe must reduce its dependency on the U.S. and avoid getting dragged into a confrontation between China and the U.S. over Taiwan. In case of an aggravation of the U.S.-China conflict, Macron advocated, “we [Europe] will not have the time nor the means to finance our own strategic autonomy, and we will become vassals, whereas we could become the third pole [in the world order] if we have a few years to develop this”. Though von der Leyen went to China at Macron’s invitation, the visit has been overshadowed by Macron’s posturing and Beijing’s apparent glee that it is indeed possible to drive a wedge in transatlantic relations. Macron was given a red carpet welcome in China, and his comments have received widespread coverage. The Chinese Communist Party-run Global Times said the comments were “clearly the result of Macron’s long-term observation and reflection” and represented a path that was “relatively objective, rational, and in line with Europe’s own interests”. Macron has described the visit as an attempt to “consolidate common approaches” over the war in Ukraine and to force China to acknowledge the costs of its ties with China. But it was hardly evident how this was achieved during and after the visit. Ursula von der Leyen, who has been largely given the cold shoulder in China, has been much more emphatic in her denunciation of the Chinese 12-point plan to end the war in Ukraine and has been underlining the need for “de-risking” in Europe’s trade ties with China. But Macron’s intervention has led to an intense backlash from all sides. The Europeans are making it evident that there is hardly any widespread support for the French leader’s position. The Inter-Parliamentary Alliance on China said in a statement that Macron’s comments are “severely out of touch” with sentiment across European leadership and that he does not speak for Europe. In particular, the officials of central and eastern Europe have been vocal in their dismay and opposition to Macron’s policy preferences. “Instead of building strategic autonomy from the United States, I propose a strategic partnership with the United States,” Polish Prime Minister Mateusz Morawiecki bluntly put it to his European partners. Those European nations that are on the frontlines of Russian military aggression see the challenges of today in existential terms. They have no time for a French philosophical treatise on statecraft. With France and Germany devoid of any significant military prowess, the reliance of the EU on the U.S. is a strategic imperative. Macron’s ill-timed comments have once again revealed the divergences between the “old” and “new” Europe, even though “old” Europe has not been supportive of Macron’s worldview. Reactions from the U.S. have been equally scathing. Though the White House has maintained that it is “focused on the terrific collaboration and coordination that we have with France”, the Republicans have latched onto this controversy. The Republican senator Marco Rubio rhetorically asked if, after Macron’s comments, the US should just consider focusing its foreign policy on containing China and leave Europe to handle the war in Ukraine. Mike Gallagher, the Republican chairman of the House of Representatives Select Committee on the Chinese Communist Party, described Macron’s comments as “embarrassing” and “disgraceful.” And of course, former President, Donald Trump was more colourful in his response when he said that Macron “is over with China kissing [Xi’s] ass in China.” Macron’s stance will be concerning to Washington as they are likely to embolden China, even as it reignites the debate about how much America should commit to European security. Macron has been under siege in France, with his approval ratings down in the dumps and his government narrowly surviving a vote of no confidence last month. So posturing on the global stage on an issue that has had a long pedigree in French politics perhaps makes sense for him politically. Ad he has made controversial comments in the past as well, such as NATO experiencing “brain death” and trying to offer Russian President Vladimir Putin “security guarantees” months after his invasion of Ukraine. But at a time when the West has tried with great difficulty to project a serious China policy and when Chinese aggression, especially against Taiwan, has been explicit, making remarks that end up doing exactly the opposite of what the visit was intended for in the first place betrays a lack of resolve that Beijing will be only too pleased to exploit. And for France’s partners in the Indo-Pacific, Macron has raised doubts about how serious France is when it comes to managing the negative externalities of China’s rise.

​Although the dollar continues to be the dominant global currency, Russia and China could dent this dominance. In the aftermath of global financial exclusion, Russia has had to make some strategic adaptations. The West’s sanctions had crippling consequences, and the Kremlin scrambled to find alternatives. In light of these developments, China became an important ally, and the Yuan—its currency—has taken on a more prominent role. It is telling that in Russia, the yuan has surpassed the United States Dollar (USD) in trading volume, a feat achieved a year after the Ukraine conflict, which triggered a series of sanctions against Moscow. As Russia and China band together, one wonders what other shifts will take place and how they will shape the future. Change is afoot, and the Russian market bears witness. The month of February saw a watershed moment as the yuan surged past the dollar in monthly trading volume for the first time. The momentum continued into March as the gap between the two currencies widened, showcasing the growing sway of the yuan. It’s an impressive feat, considering that the yuan’s trading volume on the Russian market was once quite insignificant. The winds of change blew through Russia’s financial system as the year progressed. Additional sanctions had taken their toll on the few remaining banks that still held power to make cross-border transactions in the currencies of countries that had been deemed “unfriendly” by the Kremlin. One such bank was Raiffeisen Bank International AG, whose Russian branch played a significant role in facilitating international payments within the country. However, the lender found itself under the watchful eye of both European and US authorities, which only added to the pressure. These events spurred the Kremlin and Russian companies to shift their foreign-trade transactions to currencies of countries that had not imposed sanctions.Converging coalitionsThe bond between Russia and China is growing stronger, with both nations seeking to bolster their positions on the global stage. Their alliance has spread across various spheres: military, economic, and political. With relations between Russia and the West crumbling, China has emerged as a key partner for Russia, providing it with the necessary support to counter economic and political pressure. On the other hand, China is keen on expanding its global reach, especially in the Eurasian region, and sees Russia as an important ally in this regard. President Xi Jinping’s recent visit to Moscow and his pledge to expand cooperation are likely to take this partnership to greater heights. Trade and investment ties are set to grow stronger, with both nations seeking to reduce their dependence on Western economies. Russia’s focus on infrastructure development and mega projects is also likely to benefit from China’s expertise in these areas. Energy is another significant area of collaboration, with Russia being a leading exporter of oil and gas and China being the world’s largest importer of these resources. Technology is also an essential domain, with both countries investing heavily in research and development to remain competitive in the global economy. While the alliance between Russia and China will likely have far-reaching geopolitical consequences, it is a complicated relationship with both nations pursuing their interests, even as they work towards common goals. As a result of Western sanctions, Russia has shifted its foreign trade transactions away from the dollar and euro to currencies of non-restricted countries. By doing so, the Kremlin and Russian companies hope to decrease their dependence on the Western financial system and explore new avenues for conducting their trade and economic activities. This shift in strategy reflects Russia’s determination to maintain its economic stability despite restrictions on its access to the global financial system. It also underlines the growing importance of alternative currencies in global trade as countries strive to minimise the impact of sanctions and safeguard their economic interests.Structural overhaulsThe Russian Finance Ministry was not immune to the winds of change either. Earlier this year, it made the switch from the dollar to the yuan for its market operations. It even went a step further by devising a new structure for the national wealth fund, earmarking 60 percent of its assets for the yuan. The Bank of Russia joined the chorus, urging its people and businesses to consider moving their assets to the rouble or other currencies considered “friendly.” This would help mitigate the risk of having their funds blocked or frozen. As the world undergoes a seismic geopolitical shift, it seems Russia is moving in tandem, searching for ways to secure its economic future. However, the dollar still reigns supreme in the Russian market. Even with all the changes taking place, it remains the most widely used currency, ceding its throne only occasionally to the yuan. This underscores the enduring dominance of the dollar, which has played a significant role in Russia’s financial landscape for years. However, as the world continues to evolve, one wonders how long it can hold on to its crown.

Mongolia’s prime minister, Luvsannamsrain Oyun-Erdene, recently expressed his country’s fear that the world is heading towards a new cold war as the relations between Russia and China and the west – particularly Nato – have taken a turn for the worse. “It’s like a divorce,” he said. “When the parents divorce, the children are the ones who get hurt the most.” The country sits landlocked between Russia and China and is fearful of antagonising either. It gets much of its power from Russia, and China buys much of its exports – mainly agricultural goods and minerals such as copper. By pursuing a nimble foreign and trade policy since it transitioned to a multiparty democracy in the early 1990s, Mongolia has established a stable economy, receiving a thumbs up from the World Bank in its latest country report: With vast agricultural, livestock and mineral resources, and an educated population, Mongolia’s development prospects look promising in the long-term assuming the continuation of structural reforms. But the war in Ukraine has brought home to Mongolia just how carefully it must now navigate its foreign and trade policies to remain independent.Smooth transition to democracyFrom 1921 to 1990, Mongolia was effectively part of the Soviet bloc, although not part of the Soviet Union itself. The country’s centralised command economy was almost entirely dependent on Moscow for survival. The collapse of communism in the early 1990s resulted in what proved to be a smooth transition. The then leader, Jambyn Batmönkh, refused to even consider quelling pro-democracy demonstrations, instead saying: “Any force shall not be used. There is no need to utilise the police or involve the military … Actually, these demonstrators, participants, and protesters are our children.” His resignation in 1990 and the emergence of Ardchilsan Kholboo (Mongolian Democratic Union) paved the way for the development of a multiparty democracy. The June 1993 presidential election in Mongolia, which was ruled as free and fair by the International Foundation for Electoral Systems, saw the incumbent president, Ochirbat Punsalmaa – who had been appointed after a ballot by members of the existing Presidium of the People’s Great Khural (the national assembly) – elected for a four-year term. A new constitution was adopted, with a three-part structure under the speaker of the parliament, the prime minister and the president and, while there have been instances of political corruption, Freedom House gives the country a high rating for both political rights and civil liberties. All of which cannot disguise that the fledgling democracy remained wedged between (at the time chaotic) Russia and an increasingly assertive and authoritarian China. The obvious policy for Mongolia to pursue was to attempt to balance the two great powers in the region. Initially, Mongolia’s foreign policy relied heavily on “omni-enmeshment”. This basically meant building relationships with as many partners as possible, both regionally and globally – including, significantly, the US. But since 2000, Mongolia has embraced the policy concept of “balance-of-power” to reduce the country’s reliance on any one nation. To this end, they have partnered with strategic states in Asia, such as Japan and India, and rekindled military ties with Russia by entering a “strategic partnership” and conducting joint military exercises, while still maintaining a strong relationship with China. Mongolia has also strengthened bilateral security relations with the US. Mongolia’s relationship with China is complicated by the fact that a significant part of what was traditionally Mongolia is now an “autonomous region” of China (Inner Mongolia), with a population of ethnic Mongolians larger than that of Mongolia itself. This, and the activities of secessionist groups in the province, is a persistent point of conflict between China and Mongolia.Third neighboursBut Mongolia sees its independence increasingly threatened as Russia and China grow closer. Since the demise of the Soviet Union, Mongolia has adopted a strategy of maintaining strong ties with “third neighbours” – countries that embrace democratic values but also practice market economics, including the US (it was a term first articulated with connection to Mongolian foreign policy in August 1990 by then US secretary of state James Baker). The US and Mongolia formalised their relations as a Strategic Partnership in 2019 and in 2022 – clearly with one eye on Ukraine – the two countries announced they were deepening the partnership “in all areas of mutual interest”, including an “open skies” agreement which would guarantee scheduled nonstop passenger flights between the two countries. The US – with other third-neighbour allies – also takes part in the annual Khaan Quest military exercises.Dangerous timesThe war in Ukraine has brought the precarious geopolitical situation in Ukraine into sharp focus. The latest joint declaration from the US-Mongolia Strategic Partnership stressed that “disputes should be resolved by peaceful means and with respect for the United Nations Charter and international law, including the principles of sovereignty and respect for the independence and territorial integrity of states, and without the threat or use of force”. It added: “To this end, both nations expressed concern over the suffering of the Ukrainian people.” Mongolia has abstained from the UN votes condemning Russia’s invasion of Ukraine, while also refusing to criticise the sanctions imposed on Russia by the west, despite the fact that they have affected Mongolia – for example, sanctions against Russian banks have made it difficult to pay for its imports from Russia. And, for all its efforts to forge ties around the globe, Mongolia remains heavily dependent on both Russia and China. The prospect of a new cold war setting the west against the Beijing-Moscow axis is a major concern for Mongolia. As Elbegdorj Tsakhia, a former prime minister and president of Mongolia – now a member of The Elders group of global leaders – told Time magazine in April 2021: “I feel that we have just one neighbour. China, Russia, have become like one country, surrounding Mongolia … Every day, we face very tough challenges to keep our democracy alive. Mongolia is fighting for its survival.”

By continuing to rely on Russia’s ethnic minorities and foreign labor migrants to do its dirty work in Ukraine, the Kremlin is inadvertently damaging ties to its former colonies. A young Uzbek man named Fakhriddin has died in Ukraine after being recruited from a Russian prison, where he had been serving a five-year prison sentence, to work on a construction project in Russia-occupied eastern Ukraine. Fakhriddin, who died when a shell hit the site he was working on, is one of the latest casualties of Russia’s push to use Central Asian natives not only on Ukrainian battlefields, but also in the reconstruction of battle-torn occupied territories. Hundreds if not thousands of Central Asian migrants are being hired to work in Russian-occupied Ukrainian territory, despite dangerous conditions and warnings from their governments not to go to Ukraine. Most of these migrants are used in the reconstruction of war-ravaged cities like Mariupol and Donetsk; others dig trenches and collect dead bodies on the frontlines. Female migrants from Central Asia are also offered jobs in military hospitals, canteens, and factories in occupied eastern Ukraine. Vacancies are posted on major employment websites like Headhunter and the classifieds site Avito, as well as some regional employment websites, and shared via social media and in migrant communities or advertised by construction companies directly. Employers promise to cover travel expenses to Ukraine, accommodation, meals, and uniforms. Salaries range from $2,000 to $3,300 a month: significantly more than laborers can earn in Russia. Yet despite the enticing promises, Central Asian migrants face the same issues in Russia-occupied Ukraine as they do in Russia itself: unsanitary conditions, unheated living quarters, and poor treatment by employers. Multiple reports indicate that migrants are either underpaid or not paid at all. Some disillusioned workers who have tried to leave Ukraine were not permitted by Russian border guards to re-enter Russia, forcing them to continue working in dangerous conditions on the frontlines while facing criminal prosecution from Kyiv and their home governments for participating in the invasion. These hostile conditions in eastern Ukraine put Central Asian labor migrants and their governments in a bind. Central Asia’s population continues to grow rapidly, with around half of the region’s population now under thirty years old. A lack of employment options and underdeveloped education systems combined with economies wrecked by nepotism, the COVID-19 pandemic, and capital flight mean many younger Central Asians are forced to move abroad to find work.  Central Asian governments, particularly those of Kyrgyzstan, Tajikistan, and Uzbekistan, have become accustomed to exporting excess labor capacity in order to generate much-needed revenue for households through remittances, relieve domestic pressure to create jobs, and provide public goods and services. Politically, migration serves as a pressure valve that prevents the buildup of unemployment-fueled social and political frustration and helps undemocratic regimes to stay in power. Russia remains the primary destination for these labor migrants. Familiarity with the Russian language and culture stemming from a shared Soviet past, geographic proximity, and Russia’s acute need for labor migrants continues to keep Central Asia in Moscow’s orbit. Streamlined processes for obtaining citizenship for highly qualified personnel from former Soviet republics, such as doctors and engineers, adds to Russia’s allure, particularly to those from Tajikistan and Kyrgyzstan, the most remittance-dependent countries in the region. After a pandemic-induced dip, the number of Kyrgyz, Tajiks, and Uzbeks registered to work in Russia is peaking again. According to Russian Interior Ministry data, as many as 978,216 Kyrgyz, 3,528,319 Tajiks, and 5,837,363 Uzbeks entered Russia intending to work in 2022. Some people are likely to have been counted twice in these figures, as they reflect the number of registered border crossings, but they are still at a five-year high. Now the economic downturn in Russia and pressure to work in Russia-occupied Ukraine might contribute to changes in regional labor migration patterns—both at the grassroots level and from the top—that started during the pandemic. While Uzbekistan has become a popular destination for migrants from Turkmenistan, Kazakhstan has emerged as a popular alternative destination to Russia for a growing number of Uzbeks, Tajiks, and Kyrgyz (precise numbers are harder to find as many migrants take advantage of the lack of visa requirements to work illegally and avoid paying taxes).  Central Asian governments, facing domestic pressure to keep their nationals from dying in Ukraine, are also looking for ways to reduce their employment dependence on Russia by diversifying migration destinations and providing migrants with more resources. Uzbekistan has been working with Kyrgyzstan and Kazakhstan on the bilateral improvement of migration flows. Last December, the Uzbek and British governments discussed collaboration on labor migration during another round of economic talks. USAID has just opened a second consultation center in Uzbekistan for labor migrants, in Samarkand. In early 2022, Kyrgyzstan’s Labor Ministry created a center for employment abroad; later that year, the governments of Kyrgyzstan and South Korea signed an agreement guaranteeing additional employment opportunities for Kyrgyz nationals in South Korea.  This search for labor migration alternatives is part of Central Asia’s slow realignment away from its all-encompassing dependence on Russia: a nuanced dance the regional governments must perform without directly antagonizing the former metropole.  Central Asian governments refused to side with Russia in condemning the UN resolution to end the war in Ukraine. Russia’s regional integration projects are unlikely to expand, as Uzbekistan continues to decline invitations to join the Eurasian Economic Union, and Russia’s defeats in Ukraine have weakened the reputation of the Moscow-led Collective Security Treaty Organization. Finally, Central Asian foreign ministers in February welcomed U.S. Secretary of State Antony Blinken to the first ministerial-level engagement of the C5+1 Diplomatic Platform—which represents U.S. engagement with Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan—in the region since its 2015 founding. This realignment can also be seen on the cultural front: the popularity of the Russian language is declining, while local languages are seeing growing interest in them since the invasion of Ukraine. Local governments are cutting the number of Russian language lessons in schools and renaming streets. The issue of decolonization and anti-colonial solidarity is as salient as it has ever been since the collapse of the Soviet Union.  By continuing to rely on Russia’s ethnic minorities and foreign labor migrants to do its dirty work in Ukraine, the Kremlin is inadvertently damaging ties to its former colonies. The longer the conflict drags on, the more incentive Central Asian republics will have to manage their dependence on Russia in exporting their excess labor. It’s hard to see Central Asia quitting on Russia entirely, but the relationship is sure to grow more nuanced and less lopsided in the months to come.