HU JINTAO'S UPBEAT VISIT TO RUSSIA: EXTENDING

C O N F I D E N T I A L SECTION 01 OF 02 BEIJING 002130

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FOR EAP/CM, EUR/RUS, SCA

E.O. 12958: DECL: 03/30/2017
TAGS: PREL ENRG RS CH ZK KN
SUBJECT: HU JINTAO'S UPBEAT VISIT TO RUSSIA: EXTENDING
LEADERS' POLITICAL CONSENSUS TO GRASS-ROOTS LEVEL?

REF: A. BEIJING 1679

B. MOSCOW 1291

Classified By: Mark Tesone, Acting Political External Unit Chief.
Reasons 1.4 (b/d).

Summary
--------------


1. (C) Chinese scholars say President Hu Jintao's March 26-28
visit to Russia solidified the China-Russia political
strategic partnership and helped expand that partnership to
economic and cultural fields. Given the Hu-Putin consensus
on most bilateral and international political issues,
including the DPRK, Iran and the SCO, the trip focused on
improving economic and trade ties, resulting in US$4.3
billion in contracts and a huge trade fair. Presidents Hu
and Putin agreed to expand energy shipments to China and, for
now, Beijing is content to accept ambiguity over an oil
pipeline and gas prices, scholars said. Party media
celebrated the trip for opening the China Year in Russia and
because it will be the last state visit between the two
leaders. But judging from the low enthusiasm about the visit
in commercial media and some skeptical web postings, much
remains to be done to convince the Chinese public there is a
solid basis for expanding future ties. END SUMMARY.

Extending Elite Consensus To Grass-Roots?
--------------


2. (C) President Hu Jintao's March 26-28 visit to Russia
aimed to establish a basis in economic, cultural and
people-to-people exchange that will allow the China-Russia
strategic partnership to expand in future years, according to
scholars Wang Lijiu and Jiang Li of the Russian Institute at
China's Ministry of State Security-affiliated China Institute
of Contemporary International Relations (CICIR). Almost "no
political difficulties exist between the two countries," Wang
said, noting that Presidents Hu and Putin share a common
outlook on most bilateral issues. As a result, President Hu
emphasized that the relationship should reach a new level of
"regular mutual trust" and "mutual economic benefit."
Cultural events under the banner of the China Year in Russia
will try to extend that leadership consensus down to the
grass-roots, where xenophobic attitudes persist in both
countries, Wang told poloffs. The Duma's recent law banning
independent Chinese traders from the Russian Far East is an
example of that xenophobia, he said.

No View Toward Putin's Successor
--------------


3. (C) Hu met with Putin, Premier Fradkov and Duma Chair
Gryzlov before traveling to Tatarstan, according to Russian
Embassy political officer Denis Agafonov. With the opening
of the Year of China in Russia and a vast trade fair,
Agafanov said the atmosphere was one of celebration because
this will be the last state visit between the two leaders,
who nonetheless will meet several times in multilateral fora
before Russian elections in 2008. Some scholars had
predicted the visit would aim to let Hu meet likely
post-Putin leaders of Russia, but CICIR's Wang said this was
unlikely, noting that Russia's succession process is not far
enough along for Hu to predict who the next Russian leaders
might be.

Economic, Trade and Technology Benefits
--------------


4. (C) The US$4.3 billion in contracts signed during the
visit provides the most concrete result from the trip,
CICIR's Jiang said, noting that a huge trade fair brought
together many large Chinese and Russian companies for the
first time. China looks forward to acquiring some further
technology as part of the agreement to launch a space probe
to Mars, Wang said, adding that the countries also agreed to
cooperate on a "super jetliner," although additional work
remained before that project could be announced.

International Topics: DPRK, Iran, SCO
--------------


5. (C) China and Russia see "eye to eye" on most
international issues, the Russian Embassy's Agafanov noted,
such as the desire for a "more multi-polar world with greater
balance." Resolution of the border dispute means they face
no negative bilateral political issues, he added. Wang said
the leaders agreed to continue to use their "special axis"

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within the UN to cooperate on the DPRK and Iranian nuclear
issues. The leaders also discussed the Shanghai Cooperation
Organization (SCO),the possibility of SCO expansion and the
planned SCO military exercises to be held this summer in
Russia, Agafanov said.


6. (C) Jiang noted that the 2007 SCO military exercise will
help to improve mutual trust between the Chinese and Russian
militaries and enhance their ability to deal with
non-traditional security threats. The scholars acknowledged
that China and Russia have both proposed expanding their
contributions to the SCO exercises recently, a process Jiang
called a "my missiles are bigger than yours" cycle of
one-upsmanship. Wang doubted that Presidents Hu and Putin
discussed the military exercise in any level of detail. The
exact scale of the exercise has yet to be decided, he said,
but noted that past media reports suggesting Armenia or
Belarus would participate in the exercises were erroneous.

Energy: It's Not Just About Pipelines
--------------


7. (C) Media reports suggesting tension during the visit over
an oil pipeline from Russia to China are exaggerated, the
Russian Embassy's Agafanov said, noting that Putin previously
agreed that a Russian pipeline to Siberia will export oil to
Northeast China at Daqing. CICIR's Wang said the pipeline to
Daqing would be built, but differences remain over the volume
of oil to be pumped to China's branch of the pipeline versus
a second branch from Siberia to the Pacific coast.
Establishment of a Russian natural gas pipeline to China
(from either Siberia or Sakhalin) has also been delayed by
questions of policy and price, Wang said. China believes
Russia is torn between building the necessary infrastructure
to export oil and gas to Asia and increasing its control over
energy transport in the eastern part of the Former Soviet
Union, he said. Jiang added that squabbling within the
Russian government and between Russian companies will make
energy shipments via pipeline from Russia unreliable in the
near-term future. As a result, China will focus for now on
increasing oil shipments by rail, as authorized by an
agreement signed during Hu's visit, she said.


8. (C) Agafonov noted that bilateral energy cooperation
includes significant electricity exported from Russia and
cooperation on atomic energy, including a large
Russian-supported venture in Gansu Province. The two
countries also engage in joint exploration for energy
resources and cooperate in coal mining, he added.

Media Reports Celebratory, But Netizens Cautious
-------------- ---


9. (C) The tone of media coverage of President Hu's trip to
Russia has been overwhelmingly positive. Party organs such
as the People's Daily have kept the trip on the front page
throughout the week, complete with banner headlines and large
color photos lauding the Year of China in Russia. Articles
have stressed productive bilateral cooperation, particularly
in the areas of economics, security and technology.
High-circulation commercial dailies such as the progressive
Beijing News have covered the story with less fanfare,
generally relegating articles to inside pages, although the
announcement of cooperation on a Mars probe earned pride of
place on the paper's cover.


10. (C) The Propaganda Department has not handed down any
specific coverage guidelines about the trip, said Wang Feng
(protect),an editor at the influential bi-weekly Caijing
Magazine. Caijing has no plans to run coverage of the visit,
Wang said, adding that in media circles, the summit has not
struck chords because "it has generated nothing much new."
At the same time, he asserted that many average Chinese
currently view their northern neighbor with skepticism
because of recent incidents widely covered in Chinese media
in which Chinese citizens have been murdered or harassed in
Russia. In fact, while Internet chat room activity about
Hu's trip has been relatively quiet, skepticism about the
feelings of Russians toward China has been a common theme in
online forums. As one participant in the generally
nationalistic "Mighty Nation" chat room asked rhetorically,
"Is it safe to travel to Russia during the Year of China in
Russia?"
RANDT