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Finance and Management
Reference:

Prospects for the Development of the Great Tumangan Initiative (GTI) in the New Geopolitical Reality

Stepanov Nikita Sergeevich

ORCID: 0000-0002-5136-8580

PhD in Economics

Senior Scientific Associate, Institute of Economics of the Russian Academy of Sciences

117218, Russia, g. Moscow, ul. Nakhimovskii Prospekt, 32, kab. 720

stepanov720@inecon.ru
Other publications by this author
 

 

DOI:

10.25136/2409-7802.2022.4.39018

EDN:

LXCOBU

Received:

24-10-2022


Published:

30-12-2022


Abstract: The subject of the study is the process of East Asian regionalism, considered in the context of the development of the Great Tumangan Initiative. The proposed goal is to characterize, analyze and evaluate the impact of the new geopolitical reality on the prospects for integration processes in Northeast Asia. The main research methods used in the study are a literature review on the topic and a descriptive method. As a result of the work, the following can be distinguished: analysis of geopolitical factors affecting the integration processes in Northeast Asia; the features of the development of the Great Tumangan Initiative are determined and the main problems limiting the effectiveness of this initiative are identified. The scientific novelty lies in the substantiation of the priority directions for the development of the untapped potential of the Great Tumangan Initiative: improvement of institutional support; the need to cooperate simultaneously at four levels: regional, local, multilateral and bilateral. It is concluded that the achievement of regional connectivity is the main priority in the development of regional cooperation and economic integration in Northeast Asia.


Keywords:

China, Republic of Korea, Mongolia, Japan, East Asia, regional economic integration, Great Tumangan Initiative, GTI, integration processes, institutional support

This article is automatically translated. You can find original text of the article here.

IntroductionThe processes of international economic integration are, in addition to globalization, one of the main directions of the modern world economy.

They occur in almost all geographical areas, and their motives are complex and diverse. Generally speaking, integrating countries should see opportunities to benefit from closer relations with other countries, otherwise they will not want to participate in such initiatives. Regional integration processes should also fit into the strategy implemented by a particular country. It should be emphasized that not all countries are interested in developing the institutional dimension of regional cooperation and are guided by the benefits arising from the spontaneous intensification of trade and capital ties [10].

The processes of regional economic integration can be viewed in two aspects: as a manifestation of initiative at the institutional level and as a spontaneous, upward deepening of economic ties between countries. In the first case, it is the so-called de jure regional integration, otherwise called regionalism, whereas in the latter it is de facto regional integration, called regionalization. This approach is identical to the division of regional economic integration processes into the so-called institutional and instrumental component (de jure) and the real component (de facto). The real component (de facto integration) is created by the strengthening of economic interdependence on a regional scale as a result of the tightening of trade and financial ties, not necessarily conditioned by institutional arrangements. On the other hand, the manifestation of the institutional and instrumental component, which this study is aimed at, is the increase in the number of regional economic agreements [7].

There are many regional integration groups operating on the territory of East Asia, all of them have great potential, but, in our opinion, the least used is the Expanded Tumangan Initiative (hereinafter RTI). Therefore, the purpose of the study is to study the prospects for the development of RTI, taking into account modern changes in the geopolitical arena.

Problem statementRTI is a space for international cooperation, tourism and transport interaction.

The potential of the initiative is connected with the fact that within a radius of 200 km with the center in Hunchun there are more than ten ports of Russia, North Korea and other countries. It is not only the only channel of China's direct access to the Sea of Japan, but also the closest point from China to the east coast of South Korea, the west coast of Japan, North America and Northern Europe. Despite the ample opportunities, they are not fully used by the countries of the RTI [4].

Over the past 20 years, all interested parties have made great efforts to develop regional cooperation on the Tumangan (Tumannaya) River, but in general, most of the development plans expected by all parties have not come true. In recent years, many studies have been conducted in the academic community on the reasons why RTI has not achieved a fundamental breakthrough, mainly in terms of the complexity of the international environment and differences in the policies of the countries of the region. It is believed that the countries of Northeast Asia are characterized by huge ideological differences in political, economic systems, cultural traditions, etc., as well as complex and diverse regional conflicts, which can be called serious fundamental limitations. The purpose of this article is not to repeat the existing conclusions of the study, but to analyze the prospects existing in the RTI in terms of target positioning, cooperation mechanism, regional scale and institutional support [5].

Literary reviewTaking into account the reasons why the vision of regional cooperation within the framework of the RTI and various cooperation plans have not been implemented, we must first think about whether the relevant vision and plans are realistic and whether there are effective measures to implement them.

Since the United Nations Development Programme (UNDP) decided to include the development of the Tumangan River region in its fifth (1992-1996) priority support project, the relevant parties have repeatedly issued reports on the goals and action plans of the Tumangan River region [1]. Since then, some research institutions and specialists have consistently drawn up a series of special plans for the development of the Tumangan River area [2, 4, 5]. However, over time it turned out that these ambitious reports and plans are simply impossible to implement. According to some scientists, the main plans and most of the planned studies of RTI development projects are not based on regional plans that have been prepared and implemented in different countries, nor have the actual local needs been fully taken into account, trade potential, institutional barriers and financial opportunities have not received unanimous support from all participating countries [2, 5].

In November 1995, China, Russia, North Korea, South Korea and Mongolia officially signed three framework documents on the development and cooperation of the Tumangan River region at the United Nations headquarters in New York, namely the "Agreement on the Establishment of the Tumangan River Basin". In the following years, a number of declarations and plans of cooperation were consistently issued, but these declarations and plans of cooperation are obviously of a principled nature, and there are still no specific agreements on cooperation in various fields.

The main vision of joint development includes two aspects [8-9]:

1) creating a growth pole for RTI; 2) turning the entire RTI space into an attractive region for investment.

Moreover, the strategic action plan also puts forward common strategic goals for the countries participating in the RTI, and describes in principle strategic goals and strategic measures for cooperation in priority areas such as transport, tourism, energy, investment and the environment.

Analysis of resultsCurrently, the targets have not been achieved because they have problems such as vague content and poor feasibility [4, 12, 13, 15]:

Firstly, many cooperation projects are listed, but mostly the specific meaning or advantages of each project, partners, budgetary mechanisms, mandatory requirements, etc. are not mentioned, so it basically does not meet specific requirements.

Secondly, the schedule of each cooperation plan was not stipulated in principle, a standard system of evaluation and monitoring of the implementation of relevant projects was not established, limited by the lack of statistical data, it is difficult for anyone to evaluate cooperation projects and make reliable estimates.

Thirdly, many grandiose goals of cooperation include the aforementioned long-term goals, such as "growing the pole of growth" and "turning the entire Large Region into an attractive region for investment." That is, the number of goals for large-scale construction of cooperation projects is large, but there is no consideration of whether the existing RTI cooperation mechanism can ensure the implementation of various cooperation goals and how to provide human, financial and material guarantees for these projects.

Fourth, the real needs of the various stakeholders are not fully reflected, since, in general, the participating countries have not shown a strong willingness to consistently implement the plans.

The essence of sub-regional cooperation lies in cross-border functional economic cooperation carried out by neighboring countries in the border territories. This means that local authorities and enterprises in the respective border areas of different countries benefit most from cooperation and are often a key force in promoting sub-regional cooperation. However, in the process of regional cooperation within the framework of the RTI, local governments and local enterprises did not even participate fully in the discussion and coordination of cooperation plans, and it is even more difficult to talk about how to effectively support sub-regional cooperation for development [12].

Main resultsIt should be noted that today it is important for Russia to develop cooperation in the Asian direction.

By 2021, it was clear that the Russian economy was in crisis, exports and imports were declining annually (Table 1).

Table 1 Indicators of foreign economic activity, billion dollars.USA [11, 14]

2017

2018

2019

2020

The amount

Percent

The amount

Percent

The amount

Percent

The amount

Percent

Export

359,8

25,1

451,8

25,6

426,3

-5,6

338,2

-20,7

Import

228,9

24,7

240,8

502

248

3

233,7

-5,7

Volume

588,7

24,9

692,6

17,7

674,3

-2,6

571,9

-15,2

Balance

130,9

25,9

210,9

61,1

178,4

-15,4

104,5

-41,4

As we can see, the indicators of foreign economic activity have been declining since 2018, while it is expected that due to the new geopolitical reality, the volumes of imports and exports in 2022 will be even smaller. The analysis of the country structure of foreign economic activity showed that in 2020, the EU and the USA were among the ten main partner countries of Russia, while new sanctions limit possible economic cooperation with these states, it is necessary to look for new sources of possible development (Fig.1).

Figure 1 - Country structure of foreign economic activity, % [11, 14]

We agree that the RTI region has an extremely important strategic position in the sub-regional cooperation of Northeast Asia and has the opportunity to develop into an important hub between Eurasia and the Asia-Pacific region. The most fundamental way to fully exploit the potential benefits of this area is to strengthen cooperation in the construction of transport infrastructure and coordination of cross-border transport systems between China, Russia and North Korea, rather than general cooperation in the field of economic development.

To implement these directions, the following problems need to be solved:

Firstly, there is no institutionalized framework for cooperation covering the entire region. Compared to the EU, NAFTA and ASEAN, the Northeast Asia regional cooperation has not formed an effective regional cooperation mechanism covering all six countries.

Secondly, the weak multilateral mechanisms in the region are insufficiently motivated.

Thirdly, bilateral cooperation is active, but uneven. Although cooperation in Northeast Asia at the regional and small multilateral levels is unsatisfactory, bilateral cooperation is very active. Sino-Japanese, Sino-Korean, Korean-Japanese, Chinese-Russian, Russian-Japanese, Russian-Korean and other bilateral trade and economic relations are active, especially Sino-Korean and Sino-Japanese.

Fourth, there is competition or even substitution between the mechanism of interregional cooperation and the mechanism of intraregional cooperation. The signing of the Comprehensive Regional Economic Partnership (CEP) Agreement with ASEAN as a center and the participation of China, Japan and South Korea has a complex impact on regional economic cooperation in Northeast Asia. It may have the effect of competition and substitution of a free trade agreement between China, Japan and South Korea. In addition, Japan plays a leading role in the Comprehensive and Progressive Trans-Pacific Partnership Agreement (CPTPP), and China and South Korea have expressed interest in joining. The combination of VREP, CPTPP, USA, Japan, Australia and India (QUAD) allows Japan to become a "hub" of the regional cooperation mechanism. Given the "centrifugal nature" of Japan in relation to Northeast Asia, the impact of these mechanisms on regional cooperation of the RTI is extremely difficult in the context of the escalating game between China and the United States.

ConclusionSumming up the research, it can be concluded that the future development of regional cooperation within the framework of the RTI requires the countries of the region to form a basic consensus and a high degree of readiness for cooperation to jointly promote the development of regional economic integration and the creation of institutional mechanisms for interaction.

The promotion of regional cooperation in Northeast Asia should be carried out at four levels: regional, local, multilateral and bilateral. Currently, it seems that all parties can consider the possibility of promoting the RTI initiative so that it turns into an institutional agreement covering all countries in the region. The necessity of transforming the RTI into an effective, results-oriented mechanism of economic cooperation, as well as the constant expansion of the circle of partners, is substantiated.

All parties also need to further strengthen the momentum of the existing mechanism of small multilateral cooperation, for example, to eliminate the interference of other, primarily geopolitical, factors and to realize a pre-set goal - achieving regional connectivity, from infrastructure to personnel exchange, is a top priority in the development of regional cooperation and economic integration in Northeast Asia.

References
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Peer Review

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The list of publisher reviewers can be found here.

The material submitted for review is devoted to the consideration of the prospects for the development of the Expanded Tumangan Initiative in the context of a new geopolitical reality. The research methodology is based on the study and generalization of literary sources on the topic of the work, the analysis of statistical data. The author of the article rightly associates the relevance of the work with the fact that the processes of international economic integration are one of the main directions of the modern world economy, and the Expanded Tumangan Initiative in East Asia has great potential. The scientific novelty of the reviewed study, according to the reviewer, lies in the presentation of the prospects for the development of the Expanded Tumangan Initiative, taking into account modern changes in the geopolitical arena. The following sections are structurally highlighted in the article: Introduction, Problem statement, Literary review, Analysis of results, Main results, Conclusion, Bibliography. The text of the article notes that within a radius of 200 km centered in Hunchun there are more than ten ports of Russia, North Korea and other countries this is not only the only channel for China's direct access to the Sea of Japan, but also the closest point from China to the east coast of South Korea, the west coast of Japan, North America and Northern Europe. According to the authors, the strategic action plan sets out common strategic goals for cooperating countries in priority areas such as transport, tourism, energy, investment and the environment. Based on the fact that today it is important for Russia to develop cooperation in the Asian direction, since exports and imports decreased annually in the period 2017-2020. Summing up the research, the authors conclude that the future development of regional cooperation within the framework of the Expanded Tumangan Initiative requires the formation of a basic consensus and a high degree of readiness for cooperation to jointly promote the development of regional economic integration and the creation of institutional mechanisms for interaction. The bibliographic list includes 15 sources publications of domestic and foreign authors of the article, normative materials and Internet resources. The text contains targeted references to literary sources confirming the existence of an appeal to opponents. As a remark, it can be noted that the text first presents the section "Analysis of results", and then the "Main results" are presented it is required either to change the sequence of presentation of these sections, or to adjust their names to give a logical coherence to the scientific publication. The reviewed material corresponds to the direction of the journal "Finance and Management", has been prepared on an urgent topic, reflects the results of a study on the prospects for the development of the Expanded Tumangan Initiative in a new geopolitical reality. The presented material contains generalizations on the topic under consideration, may arouse the interest of readers, and therefore it is recommended for publication after some revision in accordance with the comment made.