Old lands, new power: China & Russia

Courtesy of Plenty magazine: Winter 2007. Story and photography Neville Giles

One of the ironies of the world’s fast-changing financial scene is that huge economic muscle is now being shown by two lands linked by communism – China and Russia. So how do they compare as places to visit?

Global investment bank Goldman Sachs released a landmark research paper in 2003 on the rapidly developing countries of Brazil, Russia, India and China. It tipped these four nations (which it called the BRIC countries) as future massive economic engines. That two of them are, or were, communist shows how the world is changing. With this in mind, I set out to visit Russia and China to see their signs of progress for myself.

They are fascinating places to visit as both function under false pretences. Russia, rich in oil, gas and minerals, is a ‘democracy’ in name only, operating under the presidency of former KGB colonel Vladimir Putin while attempting to develop a market economy. China steadfastly maintains a single party ‘communist’ regime but this masks the most open trading economy in the world.

Goldman Sachs predicts that, within the next 30 years, China will overtake the United States as the largest economy in the world. It won’t be the first time. The largest Asian nation was also mighty in the Middle Ages, before the 1500s ushered in Europe’s flowering of trade, thought and philosophy. Now China is set to take back the title of world’s largest economy, along with all the power and influence that comes with being number one.

Visit China and you see it growing before your eyes. The scale of construction is simply awe inspiring. Shanghai is a teeming forest of hundreds of cranes busily building tower after tower after tower of high-rise apartments. View the city from the sky and you can see entire blocks being levelled for the next phase of the grand plan. Everything is on a grand scale, with China set to build the world’s tallest building, biggest dam, and fastest train.

While still backward in some respects, it is racing ahead in others. Modern Nanjing Road in shanghai reveals clean, gleaming and spacious shopping centres equal to any in the world. The shops are filled with all the trappings of 21st century consumerism and the majority of the merchandise is made in China. It has become the whole world’s factory. Ninety per cent of all toys, for instance, are now made there.

However, China also faces gargantuan problems. It is soon to overtake America as the world’s biggest emitter of greenhouse gases and, as a non-signatory to the Kyoto Protocol, feels no compulsion to limit them. Power shortages are common as energy supply struggles to meet the ravenous demand generated by economic growth. Headaches over water pollution, air pollution, deforestation and soil erosion are other issues the government is only just starting to acknowledge.

Social tensions – particularly between the rural hinterland and the coastal cities – are increasing as income inequality grows. Furthermore, all Chinese face uncertain property rights, and the conspicuous lack of political representation will make it harder for these social tensions to be dealt with peaceably. It will be fascinating to watch how China handles these issues over the next 10 to 20 years. But you also sense they will somehow work it out. The energy and drive to succeed is evident in everyone from the Premier Wen Jiabao right down to the budding street entrepreneurs who chased me down the street offering me all manner of “CD, DVD, Puma, Rolex?”

After seeing China up close, I was also looking forward to seeing the birthplace of communism. Russia was famously described by Winston Churchill as “a riddle, wrapped in a mystery, inside an enigma”. It is emerging from the shadow of communism but seemingly with less drive and direction than China. There really are two Russias – the modern face of an emerging market democracy and the legacy of the communist past. Often, you can visit both by simply crossing the road.

Russia’s brash new side is easier to spot. According to local legend, the Moscow Mercedes dealership sells every single top-of-the-line model staff can lay their hands on. There is some fabulous wealth on wheels on display as many people have made huge money from the auctioning of state assets. Stretches of Russia’s most expensive retail real estate are lined with stores displaying the finest from Gucci, Louis Vuitton and Yves St Laurent. Nestled alongside are top-class dining establishments offering cuisine from around the world.

The economic rebound will probably not be based on tourism because getting around Russia is very tough for non-Russians. Nothing is open when it says it will be. Famous exhibits close without notice or explanation. Landmark buildings throughout Russia can be a great disappointment. Despite their fantastic cultural heritage and history, Russians seem to have spent the 72 years of communist rule deliberately neglecting those assets. Palaces that must once have entertained Europe’s grandest nobles stand untended behind locked gates. We wandered down deserted streets two minutes’ walk from St Petersburg square. Other monuments built to demonstrate the strength of soviet might are now covered in graffiti and surrounded by litter.

But every now and then, you see what makes Russia special. My favourite memory is of a few magical minutes in an underground walkway, when we came across a string sextet playing Tchaikovsky, Beethoven and Mozart. As the timeless classics echoed off the marble walls we stood, mouths agape, at the sight of world-class musicians playing for a few extra roubles. We also noticed street sellers enjoying quiet games of chess when business was a bit slow and everyone on the trains seemed to be reading a novel. It is an intellectual society.

For those with artistic interests, Russia is a joy. One lasting achievement of the Bolsheviks is the Hermitage museum. After confiscating the top private art collections in the country, they turned the Winter Palace into a massive, 1000-room art gallery and opened it to the public. It is now the pre-eminent collection of art in the world. One room contains no less than 27 Rembrandts, roughly half of those known to exist in the world. Russia is also famous for its ballet companies, and its churches are rich tapestries of history and art. Even the Moscow metro stations carry fantastic mosaics depicting famous scenes from Russian history.

Yet my lingering memory of Russia is one of sadness. The abject poverty of the working class contrasts starkly with the fleets of Mercedes. Old, bedraggled women try to eke out an existence selling pots, scarves and dresses at subway exits. Street kiosks selling nothing but beer and cigarettes cater to the rampant alcoholism that dulls the pain of Russia’s poor. Its rotting infrastructure creaks under the strain of servicing modern city life. It’s also quite a lawless and violent place. The deputy governor of the Russian Reserve bank was gunned down as he left a football match the week after we left.

Russia, a once-great nation, looks actually to be in terminal decline despite some stunning legacies of its artistic heritage. China, by contrast, has determined to become a great nation once again and you can feel the energy and excitement there. Many tourists go to China to walk the Great Wall, its fabulous monument to past construction efforts. Most leave talking about the Great China that is being built today.

Reprinted by permission. Copyright 2007 Plenty magazine Winter 2007 published for Hanover Group. Subscribe to Plenty today.

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