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What goes around comes around for Russia

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Russia invades an eastern European republic, sends its navy to Latin America for military exercises in America’s backyard, and threatens to cut off energy supplies to western Europe. This reads like a chapter out of Cold War history.

Yet 2008 has marked the re-emergence of Russia after a two-decade hiatus. Flush with cash from oil and gas revenue and a hefty grudge against perceived Western insults to its great power status, Russia has launched the opening salvo in a more muscular foreign policy.

While the United States and Europe hoped that Russia would become more integrated into the world system, talk of NATO expansion, support for nascent eastern European democracies, and plans for basing missiles in Poland have heightened Russia’s sense of alienation and its perception that it must not bend to the will of Western powers.

For Japan, Russia’s new power projection potentially complicates the territorial dispute over Japan’s northern islands and future peace treaty talks, making any Russian flexibility less likely. Discussions at the Group of Eight summit between Russian President Dmitry Medvedev and Prime Minister Yasuo Fukuda may have provided some optimism, but domestic political uncertainty in Japan and Russia’s new aggressive posture suggest a long, slow process if future negotiations do occur.

Any aggressive Russian move in Asia would certainly mark a serious shift in its foreign policy. Although the Caucasus has far more historical significance to Russia than territorial disputes with Japan, recent military maneuvers in the region, as Japan’s recent Defense White Paper points out, are cause for growing concern.

Long-term export opportunities for Japanese manufacturers remain an incentive for maintaining good Japan-Russia relations. Mitsubishi Motors Corp.’s car sales in Russia surged 70 percent this spring, overtaking America as the company’s most lucrative foreign market. Potential Russian energy supplies may help diversify Japan’s energy imports away from the volatile Middle East. Still, the business climate is changing as the Russian government continues to push the interests of its government-backed companies, most notably Gazprom, in its energy deals.

Possible Russian military exercises with Venezuela, while mostly symbolic, suggest a far broader goal of regaining international recognition beyond its traditional spheres of influence. Its “allies,” however, are few and weak compared to decades past.

The West has a few potentially effective options in countering any further Russian forays into territorial adventurism. The flight of Western capital and a strong show of military support should raise the stakes high enough in the short term to discourage new Russian incursions. Russia’s access to the international economic system could be limited and its G8 membership suspended if it chose more aggressive action (most notably in Ukraine).

Russian passports for the citizens of South Ossetia and Abkhazia won’t bring U.N. membership, trade, investment or international recognition. Sitting undeveloped on the edge of Russia like far-flung Soviet republics of the past, they will be reminded of the lost benefits of not integrating with the West. By contrast, U.S. support to Georgia to the tune of $1 billion (approximately 10 percent of the country’s 2007 GDP) will bring new development and jobs.

The threat of energy-supply disruptions is probably Russia’s strongest leverage. It underscores that Europe must develop a broad energy policy that diversifies supply and reduces demand as a matter of national security. Russia’s coercive energy policy should put Japan on guard, especially with regard to possible codevelopment in Siberia.

Ultimately a more productive relationship with Russia needs to be re-established. An appropriate incentive, after the defensive rhetorical dust has settled, would be to have serious negotiations on a new European security arrangement, codeveloped by the U.S., Europe and Russia as equal partners. The road to that end has just become longer and more tortuous.

For now, a rich emboldened Russia thinks it no longer needs the West and can act against neighboring countries with minimal consequences. But commodity prices are already falling and Russia will eventually need more foreign investment and the rule of law to reach the desired economic heights and the subsequent respect that engenders in the industrialized world. For the West and Japan, this ambitious climb must be followed closely.

Brian Klein, now based in Tokyo, is an international affairs fellow of the Council on Foreign Relations.