суббота, 5 февраля 2011 г.

Eastern Siberia and the Far East of Russia as Prospective Chinese Sources of Raw Materials


          This Review is a logical continuation of «The Macroeconomic Review 2009: Crisis as Payback Time», the previous analytical material of the Constructive Project Foundation which demonstrated the following: 

          1. Financial crisis in Russia is systemic, has intrinsic sources and relates to the world financial crisis only indirectly;

          2. Systemic crisis of the Russian Federation is not coming to an end. On the contrary, it is going deep into economy, despite a brief respite given to the Government from the G20 antirecessionary measures; 

          3. The Government has insurmountable difficulty in combating systemic crisis, and sooner or later there shall be dramatic worsening of the socio-economic situation in the country and destabilization of the decaying political system. In case of maintenance of the current political system without relaxation of the political climate there shall appear a threat of breakdown of the Russian Federation. 

          Leaving aside the issue of prevention of such further developments (it’ll be considered in subsequent works of the Foundation), now it’s necessary to consider objectively the possible geopolitical consequences of the public administration disorganization and disintegration of the Russian Federation. 

          First of all, we have to assess rationally a probable degree of Chinese interest in the East Siberian and the Far Eastern raw materials sources. It will make it possible to predict actions of Chinese leadership if the Russian Federation will be close to collapse. So, it’s necessary to answer the following questions:

          1) Under what conditions would the CPC Central Committee dare take control of Eastern Siberia and the Far East of Russia? 

          2) What will be of greater importance for China – strict adherence to the principles of the international law or the opportunity to get hold of vast territories, doubling of raw material sources and improvement of Chinese geopolitical positions?   

          3) In what areas could the probable sphere of Chinese influence be extended?  

          4) Who will have to gain from this (except China itself)?

          To answer these questions we need to know what is at the stake. 

          This requires a snapshot of the raw input source of Eastern Siberia and the Far East of Russia. These regions are the largest suppliers of oil, natural gas, coal, rare and nonferrous metals, gold, silver and diamonds. Probable reserves of black and brown coal there amount to 1.6 trillion tons. Balance reserves of mineral ore are about 17.7 billion tons. Explored oil reserves are about 954 million tons, natural gas reserves – 64.3 trillion cubic meters. There are large deposits of gold and diamond pipes (total value of mined diamonds – about $ 2 billion per year). 95% of probable reserves of tin in Russia are concentrated on the Far East. The hydropower potential of Eastern Siberia has no analogues worldwide not only in general reserves (848 billion kW·h), but also in high concentration of them. The hydropower potential of the Far East is 270 billion kW·h. Also there is the deepest lake on Earth located in Eastern Siberia – Baikal (19% of world’s fresh water reserves). There are large lumber resources in East Siberia – 25.7 billion cubic meters.  Lumber resources of the Far East are about 11 billion cubic meters. 

          Unfortunately Russia has no longer a required number of working-age populations, capable to provide by staff for dozens of mines, concentrating mills and processing factories. Only 11.2 million inhabitants live in Eastern Siberia and the Far East of Russia. For comparison: in the north-eastern Chinese provinces of Heilongjiang and Jilin, and also in Hulunbuir prefecture-level city and Hinggan league of Inner Mongolia Autonomous Region of the PRC live at least 70 million people. The more serious problem is the reluctance of the Russian Government to sink a lot of money into undeveloped deposits. Allocated money is not enough even for a geological survey. The diagram below demonstrates that deep exploratory drilling in Russia in 2008 has decreased fourfold in comparison with the level of drilling in 1988. 

          But, perhaps, China already has everything necessary and does not need to import minerals from the Far East and Eastern Siberia? Unfortunately, it is not so. Diagrams below show only minerals with serious total volume of import of them to China, that proves acute shortage of balance reserves of them in the PRC.  Meanwhile, rich deposits of these minerals lie in depths of the Far East and Eastern Siberia.
 
Import, Production and Consumption of Mineral Resources to China









          As you can see, China especially needs iron ore, manganese ore, chrome ore, potash fertilizers, refined copper, titanium materials, zirconium concentrates, platinum metals and, certainly, crude oil. Also there is a natural gas shortage in the PRC. 

          However, China maintains the lead in the tungsten output (80% of the world’s output), and Russia ranks only second (3.5%). The PRC takes second place in the world’s phosphorus reserves, Russia takes the third one. China tops the chart in the world’s titanium dioxide reserves, and Russia follows it. So, on the one hand, China isn’t interested in import of these resources. On the other hand, an opportunity to get superiority in their reserves may be even more important for military and political leadership of the PRC than absence of industrial demand for these types of raw materials. Although China needs import of more than 600 million tons of mineral ore per year, Russia with its enormous balanced reserves of iron ore and coal, is not among the main suppliers of these raw materials to the PRC. In 2009, the import of mineral ore from Russia to China was only about 1.5% of the total Chinese mineral ore import. No wonder that 90% of the mineral ore import to China was the share of Australia, Brazil and India, whereas it would be much more profitable for the northern Chinese provinces to import it from Eastern Siberia and the Far East. As for coal, in 2009 China imported about 12 million tons of it from Russia (about 12% of the total coal import in China that year). In the steel industry cooperation between Russia and China amounted to nothing more than import-export of 500-600 thousand tons of steel and rolled metals per year.  

          Nevertheless, the trend is clear: if you look at the percentage of raw materials and machinery in the bilateral trade, its skewed structure becomes clear not in favour of Russia. 


          One may be impressed by the enormous amount of crude oil, oil products and lumber exported from Russia to China (about 75% of the total export). Nevertheless, Russian raw materials export to China does not even approximate to a volume which could be expected by the PRC. However, the Chinese leadership already improves the situation. The bilateral trade in 2009 amounted to 39.5 billion dollars and China entered the top three on trade with Russia (though it was inferior to Germany and the Netherlands). In addition, Russian and Chinese companies in 2009 concluded agreements on a number of joint projects on the territory of Eastern Siberia and the Far East amounted to $ 8.7 billion.

          Finally, in September 2009, Presidents Dmitry Medvedev and Hu Jintao approved a comprehensive «Russia-China 2009-2018 Cooperation Program». This is a very interesting document because it brings to light the Chinese priorities in eastern Russia. The whole point is that the Chinese should build factories in the northeast China, where they are going to use the Far Eastern and East Siberian raw materials. In accordance with the Program, the Chinese shall extract these raw materials from Russian deposits by themselves. In addition, several power plants and lines should be built on the Russian territory for power supply of the new factories in the northeast China (Urgalskaya Heat Station in Khabarovsk Region, Erkovetskaya Heat Station in Amur Region and AC line  from Amurskaya Substation to the state frontier of China).  This AC line belongs to the class of ultra-high voltage (500 kW) and ultra-long length (95 miles). Such AC lines usually connect separated energy systems.

          It should be noted that the Program includes a number of joint project that may be profitable to Russia, but China will have nothing to gain from them, therefore they are unlikely to be realized (for example, creation of modern wood processing complex on the territory of Russia). Such complex should include the complete cycle of timber processing (drying, surfaced timber, plywood, production of furniture, fuel pellets). The matter is that the Chinese are unlikely to refuse of their own free will from contraband round wood from Russia, its further re-export to countries of Asia-Pacific Region or processing on the Chinese territory. During 1997-2005 average annual volume of lumber export from Russia in China rose from 40 to 134 million cubic meters, i.e., more than 3 times in volume and 2 times in value terms. Also it’s doubtful that China will exert itself to establish hi-tech industries, technology parks and industrial zones in eastern Russia, because for China there would be much to gain from them only in case of their construction on the Chinese territory to provide employment at home, not abroad. But there is an alternative – these projects may be realized on the territory of Russia, but under conditions of recruitment of Chinese workers. This alternative is even worse for Russia than absence of new production facilities. 

          Russian raw materials deposits handed over to China for joint commercial developments are described briefly below in accordance with the List of Key Joint Projects contained in the Appendix to the Cooperation Program.
Chita Region (Zabaykalsky Krai)

          1. Berezovskoye siderite ore deposit with reserves of 438 million tons. Estimated capacity of the deposit is approximately 10 million tons per year. Mineral rights were already transferred to China in 2005.

          2.  Noyon-Tologoyskoe complex ore deposit with reserves of 920 thousand tons of lead, 1.92 million tons of zinc, more than 4 thousand tons of silver.

          3. Complex ore deposits of the southeastern Transbaikalia are the following: Novoshirokinskoe deposit of 348.3 thousand tons of lead is the most prospective one and ready for development, its estimated capacity is about 400 thousand tons of ore, 12.8 thousand tons of lead, 5.5 thousand tons of zinc, 1.3 tons of gold и 30 tons of silver per year; Bugdainskoe molybdenum deposit with reserves of 600 thousand tons of molybdenum, 11 tons of gold, 141 tons of silver и 41 thousand tons of lead); Solonechenskoe deposit with reserves over 70 thousand tons of antimony and 3 tons of gold; Kultuminskoe deposit of 587 tons of copper, 121 tons of gold, 948 thousand tons of silver, 33 million tons of iron ore.

          4. Northern Transbaikalia deposits in outskirts of the Baikal Amur Mainline are the following: the first-rate in world’s copper reserves Udokanskoe deposit with reserves of 19.9 million tons of copper and 11.9 thousand tons of silver, and Chineyskoe deposit of vanadium-titanomagnetite ore with reserves about 936 million tons of iron ore and 60 million tons of titanium dioxide. 

Irkutsk Region (Irkutsk Oblast)

          1. Savinskoe magnesite deposit with reserves of 1.85 billion tons (75% of Russian magnesite).

          2. Gold-silver-metallic ores in Nizhneudinsk area (estimated reserves of Malo-Tagulskoe iron-titanium deposit are approximately 45.1 million tons of iron ore, 8.1 million tons of titanium dioxide, 338.5 thousand tons of vanadium oxides). In 2009 China expressed its complete readiness to construct MMC here. Also there is Nikolaevskoe manganese ore deposit in this area (probable reserves are about 3.8 million tons). Probable reserves of Gurbeyskoe gold occurrence are up to 17 tons. 

Amur Region (Amur Oblast)

          1.  Evgenevskoe apatite deposit, the reserves of which are estimated at 20 million tons of apatite concentrate, has already been handed to China, the world’s largest consumer of apatite concentrate and mineral fertilizers, in April 2009. 

          2.  Kulikovskoe deposit of zeolites with reserves of 14.2 million tons.  

Jewish Autonomous Region (Jewish Autonomous Oblast)

          1.  Kimkano-Sutarskoe iron ore deposit with estimated reserves of 591 million tons. In October 2009 there was signed an agreement of the construction of ore-dressing and processing enterprise with estimated capacity up to 3.2 million tons of iron ore concentrate per year. All production will be supplied to China.

Khabarovsk Region (Khabarovsk Krai)

          1. Sobolinoe tin deposit of 46.8 thousand tons of tin and 27.1 thousand tons of copper.

          2. Kutyn gold deposit with probable reserves up to 60 tons of gold.

Sakhalin Region (Sakhalin Oblast)

          1. Mgachinskoe coalfield of 139.8 million tons of black coal.

          2. Novikovskoe germanium coalfield with reserves of 7.8 million tons of brown coal.

Magadan Region (Magadan Oblast)


          1. Coalfields in outskirts of Magadan of 1.47 billion tons of brown coal. These coalfields are unlikely to be attractive for China because of difficult geological conditions of development and impossibility of transporting of extracted coal during winter. 

Kamchatka Region (Kamchatka Krai) 

          1. Yagodinsloe deposit of zeolites with reserves of 19.7 million tons.

          2. Krutogorovskoe coalfield of 250 million tons of black coal.

Chukchi Autonomous District (Chukotka Autonomous Okrug) 

          1. Beringovskoe coalfield (black coal deposit «Coal Bay» on the shores of the Bering Sea) of 398.8 million tons. 

          2. Verhne-Echinskoe oilfield of 1.5 million tons and Olhovoe oilfield with reserves of 5.4 million tons. As a matter of fact, mining operations in Chukotka presume work beyond the Arctic Circle in conditions of rigorous climate and may be profitable only in case of using of all extracted raw materials directly on the spot.

          The absence of many other Russian deposits of minerals in the List of Key Joint Projects above doesn’t mean that China isn’t interested in them. It just means that Russian or western mining companies reckon on them. The most of largest sources of raw materials and industrial zones of Eastern Siberia and the Far East are no further than 600 miles from the state border of China (some isolated important targets are no further than 1000 miles from the border). The main guideline when analyzing the territory of probable interest of China is the route of the pipeline system «Eastern Siberia – Pacific Ocean» (the ESPO). The ESPO ensures swap of Siberian crude oil to China and the Pacific ports of Primorsky Krai. The 1.713-mile long first stage from Taishet to Skovorodino was completed in December, 2009. Its capacity is up to 30 million tons per year. The 656-mile branch pipeline from Skovorodino to Dajing is under construction since May, 2009 (its estimated capacity is up to 15 million tons per year) and should be completed by October, 2010. The 1.300-mile long second stage of the system (Skovorodino – Kozmino) is planned to be commissioned by 2014. It will allow increasing capacity of the first stage of the pipeline up to 50 million tons per year. The first stage of the ESPO is represented by the white line at the map below. 

ESPO

          It’s necessary to pay attention that all oil-bearing areas and natural gas fields of Eastern Siberia and the Far East are on the route of the ESPO, and it’s only natural. There are also many large deposits of minerals in bordering areas. Therefore all areas within a radius of 150 miles from the pipeline to the north and all areas to the south to the Mongolian and Chinese borders could theoretically fall into the hands of the Chinese. In addition, according to the Cooperation Program, China should take part in the joint projects in Russian border regions and construct new and repair existing roads and railway lines and bridges, checkpoints, border freight and passenger terminals, river ports. Of course, realization of these projects will make it possible to increase freight turnover и passenger traffic between two countries. But at the same time the border regions of Russia where the transport infrastructure is expected to be recovered and modernized are exactly coincide with probable directions of moving of the Chinese military units in order to capture strategic areas.  

          First of all, such area is the Southern Yakutia (not more than 400 miles to the north from the state border of China). Here is large Elginskoe coalfield with balance reserves over 2.7 billion tons of black coal (total coal output of the Southern Yakutia is 11.5 million tons per year). Elkon uranium-ore area here with reserves over 316.5 thousand tons is one of the largest worldwide. In addition, Elkon group of deposits has reserves of gold (141 tons), silver (1780 tons) and molybdenum (58 thousand tons). There is also Bolshoi Kuranakh gravel deposit of gold with reserves about 17.5 tons (the average output of gold in Yakutia is about 18.8 tons) in the region. The reserves of diamonds in Yakutia are about 794.78 million carats; the average output is up to 31.49 million carats per year. There is Seligdarskoe deposit of rare-earth metals with reserves of 4.4 million tons. In the south-west of Yakutia (620 miles to the north from the state border) lie Chayandinskoe oil and natural gas field with reserves about 1.24 trillion m3 of natural gas and 68.4 million tons of crude oil, and Talakanskoe oilfield of 123.6 million tons of crude oil and 63 billion m3 of natural gas. Talakanskoe oilfield is already connected to the ESPO.

          Probable reserves are calculated by summing up the categories P1, P2 and P3. The category of Р1 includes probable reserves of partially explored deposits and discovered, but not explored for the present ore bodies in the field area. Reserves of the Р2 category serve for purpose of substantiation of exploratory and appraisal works at objects, identified during field surveying. Reserves of the Р3 category serve as a spare space for organization of large- and medium-scale geological survey, exploratory and appraisal works and as a basis for long-term planning for 20-25 years. 

          So, Yakutia has the following economic minerals: gold, silver, diamonds, uranium, iron ore, crude oil, natural gas, black coal, tin and rare-earth metals.  

          The second strategic direction of the probable Chinese expansion is Chita Region (Zabaykalsky Krai). Of course, the most important target here is Streltsovskaya group of uranium and molybdenum-uranium deposits (no further than 30 miles from the state frontier of China) with reserves of 107.4 thousand tons. Every year Priargunskoe Chemical and Mining Production Association extracts here about 3 thousand tons of uranium (90% of the Russian output). Reserves of fluorspar in this region are the largest in Russia (12.7 million tons). Gold mining in Transbaikalia is one of the main income items of the regional budget (6 tons of gold per year). There is Kruchininskoe deposit of 50 million tons of titanium oxide besides Chineyskoe titanomagnetite deposit with comparable reserves which was already handed to China. Katuginskoe deposit of rare metals of 3 million tons of zirconium oxide puts Chita Region to the 1st place in Russian zirconium reserves.

          Gold, copper, uranium, titanium, molybdenum, silver, zirconium and fluorspar are of great commercial importance in the region. 

          The next region to the west is Buryatia. Here are the following facilities which could be interesting to China. First, Kholodninskoe deposit of 3.3 million tons of lead, 21.2 million tons of zinc, 3536 tons of silver and Ozyornoe deposit with reserves of 1.5 million tons of lead, 8.3 million tons of zinc, 4671 tons of silver. Second, Khiagdinskoe uranium deposit of 11.2 thousand tons at a distance of 340 miles from the Chinese state frontier. Third, gold mining output of Buryatia is about 7.3 tons per year.

          So, Buryat economic minerals are gold, molybdenum, lead, zinc, uranium, titanium, fluorspar, silver, phosphor and tungsten. 

          The last of the Eastern Siberian regions which may fall under control of the PRC is the Irkutsk Region. There are a lot of strategic facilities here too. Verkhnechonskoe deposit of 201.5 million tons of oil and 95.5 trillion m3 of natural gas is already connected to the ESPO. Kovyktinskoe condensed gas deposit has reserves of 1.9 trillion m3. The largest in the Asian part of Russia Rudnogorskoe iron ore deposit of 2.4 billion of tons is also located here. Iron ore average output in the region is about 11.5 million tons per year. Large goldfield Bodaybo (not further than 420 miles from the state border) yields about 95% of the gold production of the region. The regional output of gold is up to 15 tons per year. Irkutsk coalfield’s annual production is about 3 million tons of black coal and 5.7 million tons of brown coal. The important strategic facility is Angarsk city with its largest in Asia industrial zone stretching along the Angara River for 18 miles (620 miles to the northwest from the state frontier of China). Angarsk Electrolysis Chemical Complex is the large uranium concentrate processing facility (it also produces uranium hexafluoride). Angarsk Petrochemical Complex has one of the most high-powered refineries of Russia (its capacity is about 11 million tons of oil per year). Angarsk series of hydroelectric power plants with total capacity of 9 GW is of great importance too. There are also some more industrial enterprises which stand out against a background of the region: the Bratsk and Irkutsk Aluminium Plants with capacity of 1 million tons and 358 thousand tons per year, respectively, and the Bratsk Timber Processing Complex which yields about 715 thousand tons of pulp and paper per year (20% of Russian cellulose output; China imports over 80% of it). There is also of the Chinese interest the Korshunovsky Ore Dressing Plant with capacity of 5 million tons of iron-ore concentrate per year and Irkutsk Factory of Heavy Mechanical Engineering (the unique Soviet enterprise projecting and producing the gold-mining and diamond-mining industries equipment). Irkutsk Aircraft Enterprise produces multirole fighter Su-30MK and amphibious aircraft the Be-200. Finally, the town of Taishet is the most western point where it would be logical for China to stop its probable expansion. First, the ESPO is running from Taishet, second – the Baikal Amur Mainline departs from the Trans-Siberian Railroad at Taishet, third, the Taishet Aluminium Plant with estimated capacity about 750 thousand tons per year is expected to be completed by 2012. Any further movement of the Chinese to the west across the Russian territory would be fraught with scattering of resources and impossibility to control the Siberian spaciousness. 

          Gold, crude oil, natural gas, iron ore, potassium oxide, rare-earth metals, titanium and coal are of commercial importance in Irkutsk Region. 

          Now let’s consider the northeast direction of the probable expansion of the PRC. A main mineral of Amur Region, which is on the route from China to the Southern Yakutia, is gold (alluvial gold and gold ores). Its output is about 15 tons per year. Other minerals in the region are not commercial. An interesting target is the infrastructure of Svobodny Cosmodrome at a distance of 50 miles from the state frontier of China. It has 5 silo launchers of space launch-vehicle «Rokot» (SS-19 based class) and 1 launch pad for launch-vehicles «Start» and «Start-1». The Cosmodrome was closed in 2007 according to an order of the President Vladimir Putin. There are two else strategic targets in the region: Bureyskaya (is now operating 2010 MW) and Zeyskaya (with installed capacity of 1330 MW) hydroelectric power stations. The largest engineering companies in the region are Svobodny Railroad Car Repair Plant, Blagoveshchensk Ship Building Plant (produces seiners, hydrographic boats etc.) and Bureya Crane Plant.

          Jewish Autonomous Region is located to the southeast from Amur region. Probably, South Khingan manganese ore deposit of 8.9 million tons is only interesting target here. But there’re prospects of resumption of tin mining at Khingan field with reserves of 21.4 thousand of tons.

          Thereby, the region has only two economic minerals: manganese and iron ores. 

          Khabarovsk Region is rich in reserves of minerals and the most industrialized territory of the Far East of Russia. Pravourmiyskoe tin deposit with balance reserves of 23.1 million tons of ore and 140.3 thousand tons of tin is the best one in Russia because of its quality and geographical-economic indicators and capable to compete with foreign deposits developed by leading tin-mining countries of the world. Kondyor Massif, the world’s largest deposit of platinum with balance reserves of 8.2 tons, lies at the distance of 466 miles from the state border of China. Total output of gold and silver in the region is 16.3 tons and 111 tons per year, respectively. The strategic target is the largest aircraft enterprise of Russia - the Komsomolsk-on-Amur Aircraft Production Association (KnAAPO). It produces Su-27SM/SKM fighters (NATO reporting name: Flanker), Su-30MK2 multirole fighters (Flanker-C), Su-33 (Flanker-D) and Su-27KUB carrier-based multirole aircraft. They form the basis of the Russian front-line aviation and tactical air forces of many countries, including China. Amur Shipbuilding Plant (ASP) – is the largest shipbuilding facility of the eastern Russia. It produces nuclear-powered attack submarines, for example, the К-152 «Nerpa» (NATO reporting name: Akula II), Steregushchy class corvettes, and civilian ships. The KnAAPO and the ASP are located about 186 miles north from the state border of China. Khabarovsk Shipbuilding Plant is specialized in military and civilian boats, cushioncrafts and trawlers. Thus, it produces the Tsaplya class LCAC («Murena») - a medium size assault hovercraft. The region has 2 refineries – Komsomolsky and Khabarovsky with capacity of 7.3 million tons and 4.3 million tons per year, respectively. A pipeline from northern Sakhalin supplies the petroleum-refining industry here. Production of the unique electrometallurgical plant in Komsomolsk-on-Amur with capacity of 2.1 million tons of steel per year satisfies even the U.S. standards. The region has 5 seaports and 3 river ports. 

          So, Khabarovsk Region has the following economic minerals: tungsten, gold, platinum, tin, silver, coal, titanium. 

          The mining in Maritime Territory (Primorsky Krai) is the most high-capacity mining in the Russian Far East (92% of total Russian output of fluorspar, 100% of boric products, and 73% of lead). City of Vladivostok with its largest pacific seaport of Russia is the most important target in the region and located not further than 30 miles from the Chinese state border. Any type of ships is able to moor here. Furthermore, there are 4 large seaports in the region. The aircraft enterprise «Progress» in Arsenyev produces military helicopters Mi-24 (Hind), Mi-34С (Hermit), Ka-50 «Black Shark» (Hokum A) and Ka-52 «Alligator» (Hokum B), and aerobatic and sports competition airplanes Yak-54, Yak-55М, Yak-152. The P-270 «Moskit» (SS-N-22 Sunburn), supersonic anti-ship missiles were also produced in Arsenyev. Closed city Bolshoy Kamen has the ship repair facility «Zvezda» which is specialized in recycling, repair, re-equipment and modernization of nuclear-powered submarines and surface vessels of any class. Capacity of the facility makes it possible to build ships of 393 feet long and 8 thousand tons’ displacement.

          Tungsten, tin, copper and lead are the economic minerals of Maritime Territory. 

          Island of Sakhalin is the more difficult area for the probable Chinese expansion than all regions described above. Sakhalin is separated from the Russian mainland by the Tartar Strait. The strait is 13-65 feet deep and 4.3 miles wide at the narrowest point. For forced-crossing of the strait the Chinese would have to carry on a landing operation. In winter the strait is covered with ice. The control over Sakhalin means the control over the shelf of Sea of Okhotsk. Total reserves of the shelf are estimated at 1.2 billion tons of oil and 1.5 billion cubic meters of gas. It should be noted that any attempt of China to gain control over the shelf will clash with foreign interests. There are 2 consortiums to produce oil and gas on the island. Sakhalin-1 is managed and operated by Exxon Neftegas Limited (30%), ONGS Videsh Ltd. (20%) and Sakhalin Oil & Gas Development Co. Ltd (30%). Reserves of the developed fields are about 307 million tons of oil and 484 billion m3 of gas. Sakhalin-2 is owned and operated by Sakhalin Energy Investment Ltd with the following foreign shareholders: Shell Sakhalin Holdings B.V. (27.5% minus 1 share), Mitsui Sakhalin Holdings B.V. (12.5%) and Diamond Gas Sakhalin (10%). Reserves of the developed fields are about 182.4 million tons of oil and 633.6 billion m3 of gas. There are 10 seaports on Sakhalin. Sakhalin Region ranks first in Russia in marine biological resources. Sakhalin Region also includes Kuril Islands which ensure access to Pacific Ocean. However, an obtaining of control over both the Kuril Islands and Sakhalin Island would be accompanied by serious difficulties because landing operations require a lot of time for preparations and bringing large forces into play. So, even if Sakhalin could be captured by China during a winter, Kuril Islands could be occupied only by omission of other countries which have geopolitical interests in the North Pacific Ocean.

          Crude oil, natural gas, coal and chrome are of great commercial importance in the region. 

          Magadan Region is an out-of-the-way place (over 1000 miles to the northeast from the state border of China). There are no railroads here, and roads extend for hundreds of miles to Magadan from Yakutia. The only gateways to Magadan are the seaport and the international airport capable to receive any type of ships and airplanes, respectively. It’s impossible to redeploy troops by land and very difficult to begin a big landing there. However, control over the region would be necessary to China. There are largest reserves of Russian gold (gold output in 2009 amounted to 13 tons). The region ranks first in Russia in silver output (there were extracted 656 tons in 2008). 

          So, Magadan Region has only gold and silver as economic minerals.

          Kamchatka and Chukotka are accessible only by airlift or sea. The Chinese expansion is hardly probable there. So it is no point in estimation of sources of raw materials and geopolitical location of these regions. 

          China obviously became more active in the Arctic. In Accordance with the report of the Stockholm International Peace Research Institute entitled «China and the High North prepare for an ice-free Arctic» one can consider that the Arctic becomes the another region where China formulates its own strategic demands. There is no doubt that China’s Arctic interests are in shortened trade routes to European and North American markets, and possible access to untapped natural resources to fuel China’s economy. Leadership of the PRC supposes that there could be much to gain if the shipping route from Shanghai to Hamburg is shortened by 6400 km during the summer each year. Also this will make it possible to avoid high insurance costs on the traditional route through the Strait of Malacca and Suez Canal having raised ten times as much due to piracy. The Chinese negatively apprehend attempts of the Government of Russia to prove Russian rights to a part of the Arctic shelf in accordance with the UN Convention on the Law of the Sea. There were not ignored decisions of Russian authorities to resume regular flights of long-haul aircraft bombers over the Arctic and place Russian tricolour at the bottom of the Arctic Ocean (August, 2007). In view of consequences of the probable Chinese expansion, China could reach the shore of the Laptev Sea (the seaport of Tiksi is one of the most principal ports for accessing the Arctic Ocean). In this case China would access the Arctic and apply for membership in the Arctic Council.

          The diagram shows probable (not balance) reserves of chrome of Eastern Siberia and the Far East, and probable (not proven) reserves of titanium in China. 

          As follows from the diagram, Eastern Siberia and the Far East (even without Kamchatka and Chukotka) could practically redouble sources of raw materials of China. The PRC will immediately rank first in world’s annual output of diamonds (700 million carats), gold (350 tons) and silver (3800 tons) and quarter its needs for uranium by taking 5th place worldwide in uranium output (3150 tons). Also this will make it possible to reduce dependence on import of crude oil, natural gas, wood, titanium, platinum, chrome, zirconium and aluminium to China and fully satisfy its potable water requirements (more than 12 million Chinese experience shortage of potable water). There is needless to say about taking of high-developed industry, hydroelectric facilities and agricultural land. Area of arable land in these regions is about 9.8 million acres, which is close to area of arable land in Japan, while China itself has total area of arable land up to 304 million acres. 

          But, may be, China never made plans to capture foreign territories? May be, the PRC gives no reason for concern?  

          The official newspaper of the People’s Liberation Army, Jiefangjun Bao (PLA Daily), published the following on April 13, 1987:  «… [Border] defines the living space of the state and the country and relates to inflow and outflow of all-embracing national power», «reflects the power of the state in whole and serves interests of its existence, economy, security and scientific activity». 

          Another quotation from the same newspaper (April 3, 1988): «Effective control exercised for a long time over a strategic area outside geographic borders [of China], leads to transfer of these borders as a result». 

          Thereupon, there remains only one thing to point out: the official media of the PLA may put into words only official viewpoint of the military and political leadership of the PRC. 

          By the way, the structure of the PLA is built in accordance with the implicit Conception of Strategic Borders and Living Space, developed to substantiate a legality of conduct of offensive hostilities. This Concept is based on the viewpoint that the Chinese population growth and insufficiency of natural resources in the country «causes natural needs of the living space expansion in order to ensure further economic development» and «broadening of the natural area of existence» of the state. Territorial boundaries only mark a scope where the state is able «to protect its interests effectively» by using a real force. «Strategic frontiers of the living space» should move after the growth of «the complex power of the state». This Concept proposes a shift of hostilities from the frontier Chinese provinces to zones of «the strategic borders» or even beyond them, and problems of «ensuring of legitimate rights and interests of China in the Asia-Pacific Region» may become causes of armed conflicts.

          China does not keep conceal its preparations from international community. In September 2006, the PLA conducted 10-day military exercises of the Shenyang and the Beijing Military Regions (the two most powerful Military Regions of the PLA which are bordered by the Russian Far East and Eastern Siberia, respectively). During these exercises military units of the Shenyang MR made a 620-mile rush into the territory of the Beijing MR, where they gave sham battle to its units. Redeployment of the units was carried out both under their own steam and by train. The objectives of the exercises were training of large units maneuvering skills at a great distance away from location of their bases and improving of logistics control. The war game code named Stride-2009 conducted in August, 2009, became the logical continuation of these exercises. This was the largest-ever tactical exercise of the PLA with a total strength of about 50,000 heavily-armored troops from the Military Regions of Shenyang, Lanzhou, Jinan and Guangzhou. During the first stage of these massive exercises, methods of the large units’ long-range redeployment were worked out. Four Divisions of the PLA moved 1.3 thousand miles to the target area by railway and motorized maneuvers in order to test their long distance mobility. After that troops began to practice coordination of their activities under a complex electromagnetic environment. During the maneuvers the Chinese tested the functional readiness of their state-of-the-art military technology, including the Beidou Satellite Navigation and Positioning System. Dozens of military helicopters with paratroopers on board trained to conduct massive air-assault operations and coordinate their activities with ground forces.

          The main thing is that these were not ordinary tactical exercises to maintain everyday combat readiness and not training for an air-amphibious landing operation to capture Taiwan, but strategic maneuvers covering a vast continental territory, where the landscape is the exact copy of the Eastern Siberian and the Far Eastern one. In addition, groups of armies of the Nanjing MR were not participated at these exercises, inspite of the fact that exactly this MR is oriented to Taiwan. 

          February 26, 2010 was adopted a law on defense mobilization in China. It is intended to legitimize actions of the Chinese Government during wartime and disasters on establishing of the control over facilities with foreign capital in industry, energy and banking sector. It confers emergency powers to the Government of China on mobilization of all resources of the state «in case of a war, a threat to the cause of reunion, the national sovereignty, the territorial integrity and security of the PRC». In accordance with the law, the State Council of the PRC in such circumstances has right to intensify control over finances, transportation, trade, communications, media activity (including the Internet), sources of potable water and food. There was described a mechanism of local authorities’ actions in case of war, according to which they are obliged to take prompt action on placing of injured people to hospitals and secure protection of public and state property. 

Major preconditions for a military scenario

          The forecast of a probable military scenario is based on the following preconditions:

          1) Complete disruption of the armed services control system (at least within the bounds of the Siberian and the Far Eastern Military Districts of the Armed Forces of Russia);

          2) Catastrophic degradation and drop of fighting efficiency of all kinds of Russian troops;  

          3) Confidence of the Chinese in disuse of nuclear weapons by the Russians.

          One can be fully confident in a very low probability of realization of a military scenario against the Russian Federation in the absence of at least one of the above-listed preconditions. The whole scenario is based on the absence of strong efficient resistance on the part of the Armed Forces of the Russian Federation, which would be possible only in case of disorganization of the state system and disintegration of the country. Note should be taken that the current Review does not analyze socio-economic and political trends which are likely to lead to so unfortunate results. 

          Now let’s estimate strength, weapons and equipment of the PLA and the Russian Army. 

Overall strength and fighting efficiency of the armies

          Strength of the PLA is about 2.3 million people (including the PLA Ground Force totaling 1.6 million people). The reserve of the PLA is the 12-million-man People’s Volunteer Corps (male citizens in the age of 18 till 35, liable for call-up). General mobilization reserve of China is over 190 million people. For comparison: the Russian Army in 2009 consisted of 1.068 million personnel in active service (the Ground Force totaled 0.3 million people), and general mobilization reserve was of 10 million people.  

          As already noted above, the PLA regularly conducts massive military exercises to maintain combat readiness of its units. The Soviet Union also maintained the Soviet Army in the combat-ready status. Border armed disputes with China in 1969 proved the ability of the 250-thousand-man Far Eastern military alignment of the Soviet Army to go into the state of operational readiness almost instantly. But 30 years later, in 1999 the Russian Army has demonstrated its inability to assemble combat-ready troops 60 thousand in number to fight in the Second Chechen War. Even in August 2008 a lot of experts were not particularly enthusiastic about execution of regrouping of the 58th Army (70 thousand strong) in order to combat with Georgian forces in South Ossetia. 

          Until the beginning of 1990ths China was a backward country in defense technology, whose army exploited the Soviet basic patterns of defense technology of 1950ths. Inspite of the rupture between the USSR and the PRC in 1961 the Chinese continued to illegally copy the Soviet patterns of weapons and equipment which they got across the Third World countries. Chinese efforts to invent something of their own invariably led to ridiculous or deplorable results. Only after the collapse of the USSR the Government of the Russian Federation irresponsibly launched a massive supply of the Soviet defense technology of the latest pattern to the PRC, which laid down the foundations of technical re-equipment of the PLA. Russia became the main source of advanced military technologies to China. 

Ground Forces

          The PLA Ground Force (PLAGF) disposes of 7.4 thousand tanks, but more than 65% of them are copies of obsolete Soviet models (Т-54, T-55, etc) to a considerable degree. This is extremely significant, that, for example, a Type 99 tank (also known as ZTZ-99) of a third generation of Chinese main battle tanks corresponds to modernized Soviet model T-72 of 1970ths, and the PLAGF is armed with only about 500 tanks of this type. For the purposes of replacement of the basic mass of the Chinese tank park (copies of archaic Т-54), China produces Type-96, which is much more simple and cheap than Type-99 and evidently falls short of the modern requirements. Generally, an approach when mass production of superficially modernized, but obsolescent military weapons and equipment is continued along with production of only a few modern-looking patterns is typical for the Chinese industry. 

          It is necessary to pay attention to a large number of Chinese-design armored combat vehicles (2 thousand IFV and 5.5 thousand APC), which are adopted by the PLAGF. This improves mobility and security of infantry. Of course, quality and field-performance data of the Chinese armored vehicles do not enable them to compete with the Soviet analogues. For comparison: the Russian Ground Forces dispose of 6 thousand IFV and 6.4 thousand APC. 

          The PLA is armed with 25 thousand artillery pieces. All their cutting-edge technologies (no more than few hundred pieces) were copied from the Soviet analogues of 1980ths. Self-propelled howitzer Type-89 is a copy of the 2S1 «Gvozdika» (Carnation); self-propelled howitzer PLZ-05 is a copy of the 2S19 «Msta-S»; self-propelled mortar PLL-05 is copy of «Nona-SVK» (Anemone); Multiple Rocket Launcher PHL-03 is a copy of BM-30 «Smerch» (Tornado). China also got a license from Russia for production of the Krasnopol Anti-tank Missile System, Anti-tank Guided Weapon «Kastet» (Brass Knuckles), ATGM «Refleks-M» (AT-11 Sniper) и man-portable rocket launcher «Shmel» (Bumblebee). Most of the rest artillery is on a level with the Soviet standards of fifty years’ prescription. The most of it are towed artillery pieces, which are highly vulnerable to retaliatory artillery blow. For comparison: the Russian Army in particular disposes of 2.9 thousand SPH «Gvozdika», 1.6 thousand SPH «Akatsiya» (Acacia), 600 SPH «Nona-S», 550 SPH «Msta-S», 300 SPH «Giatsint-S» (Hyacinth), 800 «Pion» (Peony), 2.5 thousand MRL «Grad» (Hail), 500 MRL «Uragan» (Hurricane), 106 MRL «Smerch», and also over 7.5 thousand toweled artillery pieces.   

          It is necessary to mark out technical assistance of Russia to China to get modern long range surface-to-air missile systems. In 1993-2008 Russia supplied China with 20 artillery battalions of the S-300 series of SAM systems (each artillery battalion has 4 launchers). Now China produces S-300PMU-1 (NATO reporting name: SA-20 Gargoyle) under the name HQ-10 and S-300PMU-2 «Favorite» under the name HQ-15 (or HQ-18). Russia helped China to construct short-range SAM systems in addition to the purchased 27 SAM systems «Tor» (Sa-15 Gauntlet), and also to develop radars. China became the main importer of Russian air-to-air and air-to-surface missiles. There also was organized an assembly of tactical guided anti-radiation missiles X-31P (AS-17 Krypton) in the PRC. So, the riddle of developing of the Chinese sea-based and land-based cruise missiles becomes clear now. Nevertheless, the anti-aircraft defense of the PRC beyond the operational range of the S-300 battalions remains defective. For comparison: the Russian Army disposes of 102 artillery battalions of S-300 и 2 artillery battalions of S-400 «Triumph» (one of them is deployed in the Russian Far East). 

          By the way, Maritime Territory, the Southern Yakutia, Khabarovsk and Amur Regions, Jewish Autonomous Region, Transbaikalia and Buryatia are within reach of the ballistic missiles the Donfeng-11 и the Donfeng-15. 800 such missiles are deployed in the southern provinces of China and targeted at Taiwan for a present. 

Air Forces

          Bulk deliveries (178 fighters until 2005) of Russian fighters the Su-27 (Flanker) и the Su-30 (Flanker-C) enabled the PLA Air Force (PLAAF) to make a qualitative leap from the 2nd generation of a military aircraft into the 4th one. Launching the production of the Su-27 under the name J-11 provided an unprecedented stimulus to development of the aviation industry of China. A purchase of Russian advanced reaction-propulsion air engines enabled the PRC to bring to mass production 2 types of really competitive Chinese fighters the J-10 and the JF-17. However, desperate attempts of China to free itself from the dependence on deliveries of Russian air engines dash against inability of the Chinese air industry at least to copy Russian models (as usual), and it compels the Chinese to expose their lack of talent to shame and sign contracts of delivery of Russian air engines AL-31F for the J-10 one after another. Thereupon, transfer of Soviet skills and technologies and issuing licenses to China is another irresponsible decision of the Government of the Russian Federation. Russian design bureaus helped China to develop both advanced military technologies and even fully integrated armament systems. As a result the PLAAF currently consists of approximately 2 thousand combat aircrafts and 130 helicopters. Of course, only the Su-27 / J-11, the Su-30 and the J-10 are the competitive fighters there. For comparison: Russian Air Force has about 2.8 thousand aircraft and 700 helicopters. Average flight time of Chinese pilots at modern fighters is about 200 hours per year, and Russian pilots are forced to confine themselves to 40 hours. 

          Such ball game means that in case of resistance of the Russian Army to the PLA, the PLAAF will not be able to win air superiority (either general or at certain sectors).

Navies

          The PLA Navy (PLAV) is armed with 2 SSBN Type 092 Daqingyu (U.S. DoD designation Xia-class) with 12 SLBM and 3 SSN Type 091 (Han-class) with 6 cruise missiles, 1 conventional ballistic-missile submarine, 48 conventional attack submarines, 26 destroyers, 51 frigates, 132 missile boats, 20 torpedo boats, 160 gun boats, 75 submarine chasers, 31 mine warfare vessels, 49 auxiliary/support vessels, about 500 amphibious warfare vessels. Of course, the most of combat-ready models is Soviet-designed. China made an order and Russia produced for the PLAB 12 diesel-electric submarines Project 877 Paltus (Kilo) and Project 636 Varshavyanka (Improved Kilo), 4 Sovremenny class destroyers (Project 956 Sarych). Thus, the PLAN has received competitive submarines and surface vessels with good acoustics, radar systems, torpedoes and supersonic anti-ship cruise missiles «Moskit» (SS-N-22 Sunburn). Russia also supplied China with the naval variants of S-300F «Rif» (SA-N-6) and the 9K37 «Shtil-1» (SA-N-12 Grizzly), which were mounted on the Type 051C (Luzhou class) and the Type 052B (Luyang I class) destroyers, also developed with help of Russia. China even purchased the unfinished Soviet aircraft carrier «Varyag» and made it operational. For comparison: The Russian Pacific Fleet in 2009 consisted of the following modern submarines and surface vessels: 3 Delta III class, 2 Oscar class, 2 Akula class and 7 Kilo class submarines; 1 Slava class cruiser, 4 Udaloy class and 1 Sovremenny class destroyers, 6 Grisha class anti-submarine corvettes, 7 Tarantul class missile corvettes, 3 Nanuchka class small missile ships.

          The conclusion: the PLAN wouldn’t be the ghost of a chance in case of resistance of the Russian Pacific Fleet.

          Among other things, it’s necessary to note that the military-technical cooperation between China and Russia lessens last time. There are 2 possible explanations: 1) Russian defense establishment became so degraded that it is not able now to offer adequate services to the PRC; 2) The PRC considers the possibility of military actions against Russia in the foreseeable future, so the Chinese want to narrow down the military-technical dependence on the probable enemy. In view of the fact that the Russian defense establishment is more alive than dead, the second explanation is more likely.

          Let’s consider formations and units of border military regions (districts) of China and Russia (in 2007).

          Mechanized infantry units of the PLA are equipped only by trucks, not by IFV or APC

          Russian Armed Forces undergo reformation and reduction. The main idea behind these reforms is the transformation from a mass mobilization army to a small force of contract soldiers. One of the main directions of these reforms is the transition from four-level control system «Military District» - «Army» - «Division» - «Regiment» to three-level system: «Military District» - «Operational Command» - «Brigade». For example, the Ground Forces should have 40 Motorized Infantry Brigades of constant-ready status. Each of them will be organized on the basis of disbanded general divisions. In many independent military experts’ opinion, such reform would be reasonable only if the Army will be oriented to neutralization local armed conflicts solely, and waging small wars like the war against Georgia in August, 2008. Obviously, the Russian Army follows the example of the U.S. Army brigade structure. But the Defense Ministry of Russia has ignored the fundamental difference between Russia and the USA, which consists in the fact that nobody gave the U.S. Army a task to protect the North-American territory and state borders of the United States, because Canada or Mexico do not threaten the USA with an intrusion. Brigades in general are able to solve theatre-of-war problems, but in a strategic defensive battle they can only quickly counterattack. It’s impossible to put up in a united echelon front with such units.  So, there is a trend which can lead to a situation that the Russian Army will be incapable to oppose something to the classical Soviet-structured PLA.  

          The current situation means, that in fact there is no sense to subdivide in our Review the formations of the Siberian and the Far Eastern Military Districts of Russia into 4 armies which are under a real threat of disbandment. Therefore, the table below shows only large units of the Russian eastern military districts. It is necessary to note that even these large units undergo constant reductions. 

          Now we are returning to the previously emphasized preconditions of the probable Chinese military operation against Russia. If the Russian Army will disappear as centralized and organized structure, all its armament and equipment together with the military infrastructure which now look so impressive on paper will become spoils of war, in addition to the sources of raw materials.  

          Let’s estimate the probable theater.

          The Soviet Union built echeloned defense consisted of fortified areas in the border regions of Eastern Siberia and the Far East. Tens of miles of engineering structures, reinforced concrete pillboxes, barbwire fences and minefields were able to withstand first assault of the PLA throughout a day. During this time large units of the Far Eastern or the Siberian Military Districts should have time to move in the area of a breakthrough. However in our time the Government found it possible after negotiations with the PRC to withdraw troops 60 miles away from the border and suspend all fortified areas, and also to transfer to China Tarabarov Island and to divide between Russia and China Bolshoy Ussuriysky Island at the confluence of the Ussuri and Amur rivers in 2008. This made location of Khabarovsk vulnerable from the south-west, because the state border, in fact, moved up to the city. 

          The primary strategic directions of the offensive would be the following: the Western (Chita Region, Buryatia and Irkutsk Region); the Northern (Amur Region, Yakutia, Jewish Autonomous Region and Khabarovsk Region) and the Eastern (the Maritime Territory). 

          It is logical to expect an intrusion in winter, because the Chinese may force a crossing over Amur and Baikal on the ice. The ice also makes impossible any activity of detached brigades of border guard ships and patrol boats of the disbanded Amur River Flotilla.  The Northern Sea Route also freezes in winter, which interrupts supplies of the eastern regions of Russia by sea transport. Of course, in case if such supplies still will be carried out.

          First of all, Chinese subversive groups (may be, even from among the Chinese migrants) would blast the Trans-Siberian Railroad in several sectors to the west of Taishet and, probably, of Krasnoyarsk. In fact, this would cut off Eastern Siberia and the Far East from the rest of Russia. Any violation of «vested rights and interests of the Chinese living abroad» may become casus belli. Actually, the leadership of China will formally be obliged to bring troops into Russia, because Article 50 of the Constitution of the PRC runs as follows: «The PRC protects vested rights and interests of the Chinese living abroad, vested rights and interests of the Chinese who have returned to their homeland, and family members both those and others, who live in China». It is no coincidence that after the collapse of the Soviet Union stable national associations of the Chinese have started to appear in the eastern Russian regions. It is amazing how Chinatowns had not yet appeared in the Siberian and the Far Eastern cities.  

          65th, 27th and 38th Army Groups of the Beijing MR (reinforced by 21st и 47th Army Groups of Lanzhou MR) shall move ahead of time from places of their distribution forward to Hailar District and cross the state border near Zabaikalsk urban-type settlement (just opposite the Chinese border town Manzhouli) immediately after blasting of the Trans-Siberian Railroad. Chinese troops shall move to the west by railway and on their own. They practiced it repeatedly during military exercises in 2006-2009. The Chinese will capture Krasnokamensk and uranium-mining facilities of Priargunskoe Chemical and Mining Production Association straight away. Leaving here one mechanized infantry brigade and one artillery air defense brigade to cover this strategically important enterprise, the Western military alignment of the PLA will move further in the direction of Chita — Ulan-Ude — Irkutsk - Taishet. The distance from the state border of China to Chita is about 250 miles. During military exercises (although, in summer conditions), the Chinese troops showed the speed over 620 miles a week (88 miles per day). So, they will burst into the city of Chita on the 3rd day of the operation, into Ulan-Ude – on the 6th day, into Irkutsk – in exactly a week’s time after the beginning of the operation (in case of crossing Baikal on the ice). Leaving here one mechanized infantry brigade and one rocket-artillery air defense brigade to cover the Angarsk industrial zone, and sending similar formation to capture the Angarsk coordinated hydroelectric system, the Chinese troops will come up to Taishet in two weeks after the beginning of the operation. In fact, after two weeks of the offensive, the whole Eastern Siberia will find itself under the control of the PRC without any resistance!

          It is logical to send to the north 16th and 40th Group Armies of the Shenyang MR (reinforced by 13th Group Army of the Chengdu MR).  They will force a crossing over Amur near Blagoveshchensk and Khabarovsk (in this case these cities shall be captured on the first day of the operation), and also in the vicinity of Dzhalinda (Russia) and move towards Skovorodino – Tynda – Neryungri, in order to block the Trans-Siberian Railroad and the Baikal Amur Mainline and cut off the Far Eastern Military District and the Russian Pacific Fleet from the rest of Russia. 

          At the same time 39th Group Army of the Shenyang MR will move from Mudanjiang towards Vladivostok and may occupy it on the 2nd day already after the beginning of the operation. 

          The PLAN surface vessels and submarines will come nearer to the Russian Pacific Fleet bases in the Maritime Territory and Khabarovsk Region (Vladivostok, Fokino, Bolshoi Kamen and Sovetskaya Gavan). There the PLAN will either be shattered (in case of organized resistance of the Russian Pacific Fleet), or will simply capture inactive surface vessels and submarines. 

          Russia will have no possibility to protect Yakutia, Sakhalin and Magadan Region. Kamchatka and Chukotka due to their geographical description will be able to stand until spring, and it is unlikely that no country will get ahead China and carry out landing of troops there. During winter China may still have time to take control over Sakhalin and, probably, to carry out airborne landing in Magadan Region; and what is more, by this moment the PLA will already have carried out all its primary objectives. So, it will take the PLA a month to carry out the operation. 

          Using of nuclear missiles is not considered in this Review in principle because Russia or China will have nothing to gain from radioactive contamination of Eastern Siberia and the Far East. In addition, one of the preconditions of the considered military scenario is inability of Russian authorities because of disorganization of the state system to use every possible means, including the Strategic Nuclear Forces, to protect the territory of Russia. 

          However, there exists another viewpoint that China apparently is preparing to subject Eastern Siberia and the Russian Far East to its fundamental influence, but this influence will be based not on the enormous influx of Chinese settlers or the military intervention but on the not foreseen before sinicization of Russians. One day a serious crisis will arise, and in the face of the weakening political and military influence of Moscow, these Russians possibly will prefer to make the choice in favor of Beijing and not of their own unskillful government. In such a hypothetical situation, Eastern Siberia and the Far East possibly will become provinces of China. The Chinese are working in this direction already, offering Russian specialists favorable conditions to acquire residences, to study the Chinese language, and to work normally. Many Russian inhabitants, cut off from Moscow, are already adapting themselves to these programs. Beijing’s approach which also involves the construction of highways and other infrastructure up to the Russian border and into Central Asia, something the Russian government has not done on its side of the line. And as a result, the Chinese are simply exploiting Moscow’s failures in this and other areas. However, many farsighted people in Russia are not at all happy with this option. The quiet expansion of China is not less dangerous than the overt one, and results will be the same.  

Conclusions

          1. Further developments in the current direction should lead Russia to a geopolitical disaster. Deepening of the financial crisis will lead to a downfall of all macroeconomic indicators. Social-economic crisis will arouse social tensions. Any attempt to tighten the screws on the society without revision of the current political system will provoke an uncontrollable wage of indignation, which may become fierce. At some point degradation will inevitably concern security, defense and law enforcement agencies, which would mean a dramatic crime wave and downfall of the current regime throe force of circumstances and under political pressure of oppositional organizations grown by leaps and bounds. After that the probability of recurring armed conflicts between clans of power-hungry politicians and collapse of the country will become high. 

          2. The weakening of Russia will make it possible for China to occupy the area of 2.5 million square miles with full-blown industry and agriculture, get access to the Arctic, redouble its natural resources, get rid of dependence on raw materials import, solve demographic problem and become the second superpower on Earth spread over Eastern Eurasia (6.17 million square miles) and predominated over other countries of Eastern Hemisphere. Sharply rising power of the Greater China can turn heads of leaders of the PRC who are already reveled in the progress of their country. Chinese national interests may even begin to spread all over the world and clash with the national interests of the USA. 

          Do the current Russian authorities recognize the seriousness of the situation? One can assume that the Government of Russia lets things go hang, but the international community will not be happy at all with this option.

          Our task is to bring this point of view to the widest possible range of people who care about what happens in Russia.

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