Who will we travel with in the carriage of the "Eastern Economic Block"
With the beginning of the year, the discussion revived about how the big players were going to eventually divide the "orange" - the world economy. The fact that we are witnessing the division of the world into new economic zones and / or clusters is undeniable, but as for the specifics of such a division, here the fantasy of experts, forecasters and various other “geostrategists” becomes truly limitless.
Often, such a division means what could be called the term from biology “secondary signs” - the sphere of currency calculations. But the question is not in the currency coverage, the coverage of the instrument of circulation, but in what mechanism the cost of your goods and services is established through. And not only and not so much the issues of the economy itself are on the agenda, we are already talking about the very principles of interaction. After all, the overt and unspoken foundations of trust in treaties from one side or another are gradually being destroyed.
So far, we have several, relatively speaking, frameworks on the basis of which it is possible to build such macrostructures - Eastern, Western and, oddly enough, Latin American. Where our Fatherland is directing and will continue to direct its efforts, there is no doubt - to the east. Such a turn in our country is often surrounded by very optimistic narratives and symbolic steps.
Here Afanasy Nikitin failed to build a corridor to India, but we will build it, here is the Eurasian economic zone, relying on which we will come to the East with a good and significant asset, promising, etc. Dear sinologist Andrey Devyatov generally says that we need to go into the future "together with China, on the shoulders of China and at the expense of China».
But you start to figure out what is this very “way to India”, and it turns out that this mega-project rests on the fact that there is no land route there, cargoes of 50 thousand tons per year go by rail. And it is not very clear, if goods from Russia are unloaded in the southern ports of Iran, then why should they be transshipped from there by land to India and Pakistan, if both countries have their own large trading ports on the coast to the south? It is also periodically proposed to dig a canal from the Caspian to the Indian Ocean, etc.
The fact that the activity in terms of turning to the south, that to the east has been shamelessly imitated for years, does not mean at all that such a turn has not happened now for real, just this time we were literally forced to drive there and from there. Through "I do not want, I will not." However, towards the end of the article, we will understand some of the reasons why the elites resisted going east. But since we already want or don’t want to, but we find ourselves in this very eastern cluster, it is desirable to understand at least in general what trade in this region looks like, what this very cluster is like. Suddenly, not quite what is dreamed of and drawn in projects.
From the point of view of “classical” political economy, an economic cluster can be called not only and not so much the group of countries or regions that are connected by “trade ties”, albeit arbitrarily long and strong, but those trade relations within which the total cost of goods and services. Probably, a textbook example from the current turbulent times is the EU economy, which has already been successfully buried and even buried in our media. But before we celebrate the EU commemoration, let's try to look at some indicators.
The GDP of the European Union today is $17,1 trillion, while foreign trade with non-EU countries is $5,1 trillion or 29%. This is a really high figure relative to the world average of 20-21%, it is similar to the situation in Japan (30%) and reflects a high dependence on foreign markets. But on the other hand, another 44% (7,1 trillion) falls on foreign trade turnover between the countries of the EU itself. It is clear that there are “donor” countries, like Germany, there are recipients, like Greece or Bulgaria, but in general, we see that the countries themselves “inside themselves” form only 26% of the total cost of goods and services, and another 44% through each other . In the rest of the world the proportion is usually 20% to 80%.
There are also reverse examples, of course. For example, the Arab oil countries of the Persian Gulf have a 70% trade-to-GDP ratio of $1,126 trillion to $1,65 trillion of GDP. But it is clear that at the same time they buy literally everything except oil and gas, and the internal trade turnover between them is not significant in principle. And they do not need a common currency - the cost is formed through international exchanges. The only interesting step here was taken by Saudi Arabia, reaching a 35% proportion by introducing all reserves into the assets of Saudi Aramco. But it's more of an accounting operation.
There are such interesting states as Pakistan and Bangladesh, where foreign trade is 10% and 12% of GDP - they live on the principle of "I grew it myself, I used it myself."
In general, returning to the EU, 44% of the internal trade turnover between the EU countries is evidence of the highest interconnectedness of the economies and the actual, and not imitation, formation of a single value space. Potentially, this is a very stable construction, and it is not for nothing that there were so many opponents of Brexit in the UK. However, London has its own geopolitical project. But the European Union is, in fact, a trade and industrial federation, which has no analogues in the modern world. Nevertheless, speaking of a certain single economic cluster, we must remember that a necessary condition for its creation is the presence, if not of a similar level of connectivity, then at least of general tendencies towards this - the trade turnover between the countries of the cluster should tend to exceed the trade turnover between the countries of the outside world.
For example, M. L. Khazin, for all the debatable theses about the “collapse” of the global liberal elites, although the collapse is more like a manual reformatting, always takes Japan out of the brackets of future Western projects. And why, exactly? Here is Japan's GDP of 5,3 trillion dollars. With a foreign trade turnover of 1,53 trillion. But the share of the USA, EU, Canada and Australia in it is less than 27%, the share of China and Southeast Asian countries is 50%, and the share of Latin America is about 20%.
That's the question, but Japan forms its value mainly within the framework of which "economic cluster" - western or eastern? Divide the world economy, what is called, for real, which side will Tokyo choose? After all, it’s not very successful to act here with a “rod of iron”, as they like in the USA, although they have practical experience and the methods are quite harsh. Another thing is that this is a costly undertaking. Is this a trend for Japan's eastern clustering? Undoubtedly, since fifteen years ago this ratio was reversed.
It can be said that for an investment fund it does not matter on what and where to make a profit. In general, in theory - yes, if you are not a fund that is directly or indirectly affiliated with the Fed. Had the United States implemented B. Obama's program in the form of transatlantic and transpacific partnerships in due time, everything would have been much simpler. But partnerships “did not take off”, and it is necessary to sanitize the monetary system.
Therefore, the capitalization of stock markets is periodically lowered, assets are written off, and the European Union has been chosen for the role of a “draft horse”, on which the burden will gradually flow more and more, up to the actual creation of a common currency area. The EU is strong and stable - it will survive, but Japan somehow does not want to experiment. She is in the Asian cluster, oriental, leaning. But whether Japan is happy about this is a question.
How dependent on foreign trade are the countries of the hypothetical "Eastern bloc"? Southeast Asia has a serious dependence - foreign trade turnover to GDP ratios from 35% to 45%, South Korea and Taiwan exceed 50%, and only the Philippines has an average world level of 21%. Against this background, India stands out with its "penny" 7%. And once again, we note that the turnover of the countries of Southeast Asia to GDP reaches 50%, and India, Pakistan and Bangladesh - 7%, 8%, 12%. Our Central Asia performs modestly with 16-20%, the Russian figure is 18%.
And on whom are countries dependent in foreign trade? We have fixed the trend of Japan, we will see the rest. The rest of the countries of Southeast Asia with the collective West trade somehow “not very much”: the total trade turnover is 19%, but the picture is diametrically opposite to each other – 55%. Actually, it is clear that behind the percentages there are quite serious absolute values - these are trillions of dollars.
But the same stubborn "renegades" India, Bangladesh and Pakistan do not want to join these trillions of total turnover in Southeast Asia. With all their cross-border problems, they form up to 14% of the turnover among themselves, over 35% are sent to the Western bloc and receive from it, less than 35% falls on Southeast Asia. And this is mainly import, there is practically no export from region to region.
The situation with neighbors in Central Asia is interesting, with the possible exception of Mongolia. Everything is obvious there - 90% of foreign trade in both directions is China. If we consider Central Asia, Russia and Iran as a single cluster, then the ratio of trade between countries and with the outside world is rather modest - 8% and 92%. If we single out Iran and Russia and leave only the countries of the former Soviet Union, then their internal trade is even lower - 6%, taking into account Russia's export-import, the connectedness rises to 22%.
At the same time, China and Southeast Asia (mainly South Korea) already account for over 33% of the foreign trade turnover. Iran, on the other hand, depends twice as much on trade with China and Southeast Asia - it forms 60% in this direction. This, by the way, is the answer to the question of how realistic the talk about a "common currency area" is. Even the fact that we have increased trading operations does not play a significant role here yet - we started from a very low base. Less than 4 billion dollars with a total external turnover of Iran of 100 billion. And behind all the talk about how to increase and deepen, Turkey is firmly entrenched in the region with 11%.
Hypothetically, nothing prevented us from competing for additional interest from our Central Asian neighbors, given the flow of money that goes to the region through labor migration. By and large, this money, if it had been sent in rubles, would have become a ready-made currency area of the ruble in itself. And that's not counting other familiar tools. In the end, even without producing the entire range of industrial goods, it would be possible to engage in resale within the framework of the turnover of the ruble mass. It is possible that this is generally the last tool for going to the East together, and not one by one. Another thing is that the elites do not want to.
China, absorbed in solving other problems, for a long time (until the last SCO summit) gave us the opportunity to conduct various experiments in the region, and we could bring the calculations up to 40-45%. But for some reason we didn't want to. Of course, now there is parallel import, but this is de facto sponsorship of neighbors.
As a result, while only Iran's direct trade with Russia is gradually growing, Russia's trade is also growing with Southeast Asia, European flows go to the east and are replaced from the east. And here it is necessary to say that such tendencies are characteristic, and for quite a long time, not only for us, and we will soon find ourselves in a rather remarkable company.
In our country, the eastern turn was caused by sanctions, but no one imposed sanctions on Japan and other Southeast Asian countries. But gradually their deliveries to the West and from the West also changed direction to the opposite. Maybe the West collectively "lost" the region? After all, we have been talking a lot about the fact that Europe, for example, is seriously dependent on Southeast Asia, they say, Southeast Asia is a “European factory”. Where did the supplies from this mighty factory go?
And now it's time to look at the trade balance of our neighbor China. Its foreign trade turnover to GDP is described by a quite reasonable value of 22%, while the turnover in the western direction has already exceeded $ 1,5 trillion. It seems that against the background of all China's foreign trade operations, this (38%) is almost a kind of balance with the East and South (35 %), but the balance looks different if we take into account that trade with Southeast Asia and the collective south is mainly imports. And in terms of exports, or 3,36 trillion dollars, this is 50%, and with an absolute surplus.
In fact, for the countries of Southeast Asia, China has become a kind of vacuum cleaner, which, having formed a common market in 20 years, has drawn the economies of the region into itself and assumed the functions of a trade representation in trade with European countries and the United States. Southeast Asian countries operate on a common market, from which China trades mainly with the Western world. Such, as it is fashionable to call today, "trends" are visible only in general statistics, and in terms of specific projects, they are lost against the background of the usual talk about the benefit of "growth in common trade." But every good, as we see, has a price.
This is to the question of how to use such a strategy of Beijing to enter the future "together with China, on the shoulders of China and at the expense of China". Together - yes, but otherwise everything is exactly the opposite.
It is obvious that India, Pakistan and Bangladesh are not in a hurry to move in this format of “division of labor”. At the same time, Pakistan, under the previous leadership, established ties with China, but no longer along the actual trade, but along the military-political line - it bought weapons, even gave the port of Gwadar for concession. But I was in no hurry to enter the project of "trade representation" then, and now, under the new leadership, even more so. Did these countries know something, did they guess, but the important thing is that it is not possible to consider them as part of a single cluster. The Indo-Pakistani region lives, as we see, for itself, and tries to tie up external operations for the "Western bloc".
With such indicators and understanding of the essence of the “vacuum cleaner theory”, the Indo-Pakistani region will not go to the eastern economic cluster. Not to mention such a factor as the integration of Indian and Western elites. The common currency will not take off there, even in the form of payment instruments - they will put it on record, they will not fully use it. Here, at the macro level, the issue of a corridor “to India” can also be considered. At one time, Afanasy Nikitin did not succeed in this event, but today we just have to accept that India needs a gas and oil pipe and several more nuclear power plant projects. It's more prosaic, but much more honest.
For twenty years, China, holding many countries around itself through the Silk Road projects, relying on Western investments, formed a trade surplus with the West, which was directed to buying up assets and resources in Southeast Asia. This is not yet an analogue of the European Union and will not be, but the internal turnover, which tends to reach 50% in the region, and in a number of countries has already exceeded this indicator, means that the value of national wealth has begun to form within the region and due to ties in the region, and the functions " clearing house” and the trade office were taken over by Beijing.
The Silk Road is originally not only and not so much the way of Chinese goods somewhere to the West. In the conditions of stagnation of world markets, when gains were drawn artificially before the pandemic, Silk Roads is a control over the logistics flows not only of Chinese goods, but in general of all in the region. If your direct turnover is not growing, take control of the logistics center, and the profit from current flows will automatically go into growth indicators.
Exactly because of the considered macro indicators, the Chinese, on the one hand, are not active in terms of direct conversion of settlements in yuan, keeping its share in the world measurement in the region of 1,5-1,6% (see where exports go), and on the other hand , develop and test the CIPS system and strengthen clearing banks in their "Chinese trading offshores" - that is, specifically in their regional cluster. Gradually, we will enter it together with our neighbors.
Strategically, this will lead to the fact that within its trade zone, China will trade with partners in yuan, and the main export, as a representative of the region, will be carried out with dollars, pounds and euros (or a possible new currency in the future) at its exchange rates. It is possible that after reunification with Taiwan, Beijing will undertake a direct expansion of the yuan, but so far the current strategy is effective. Approximately in this way, albeit in miniature, our EAEU, by the way, could look like.
Without a doubt, our elites, working around the world, understood the essence of the idea of \u6b\u8bthe Chinese vacuum cleaner. Who did not understand, he guessed. It was not in vain that they kicked, pushed this turn to the east with their feet, pushed it away with their hands. This can be understood, since by working in the zone of the future "transferable yuan", even in moderate scenarios, they will receive income with a significant discount (XNUMX-XNUMX% in fact last year), and they will also cease to be "partners" of the West for the most part, they will now have to this representation to delegate.
But they will be in the same not very friendly, but very disciplined company with the countries of Southeast Asia, with Iran, but without India and Pakistan, with the countries of Central Asia, but without the countries of the Persian Gulf, although in dialogue with the latter. Often, all this activity will be accompanied by political excesses, because, as we see in the example of China, Vietnam and Japan, this economic bloc does not and will not have a format similar to the full political integration of the Eurozone, and policy issues will be resolved through large platforms, following the example SCO.
We considered only three macro-indicators out of two dozen possible ones. And what will happen if we take at least three more, for example, direct investments - internal and external? So the elites themselves are the forgers of this situation, the problem is that the population will ultimately pay for all this. Moreover, we will have to gradually master the famous "Asian mode of production" and, it is possible that we will recall the practice of planned indicators.
Who prevented these same elites from looking two steps ahead and, realizing that a conflict with the West is inevitable, preparing the ground in the form of work in the Central Asian region? One by one, the vacuum cleaner will tighten, but to tighten the whole large EAEU, if it is saturated with its own commodity production, this task is much more difficult. But we did not want to develop mass production of goods, and then there will be fewer and fewer special opportunities. And this "trend" for years.
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