International Relations

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Volume 8, Number 8, August 2020 (Serial Number 83)

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International Relations and Diplomacy. 8(2020). Copyright ©2020 by David Publishing Company

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Editorial Board Members of International Relations and Diplomacy:

★Abdel-Hady (Qatar University, Qatar);
★Abosede Omowumi Bababtunde (National Open
University of Nigeria, Nigeria);
★Adriana Lukaszewicz (University of Warsaw, Poland);
★Ahmed Y. Zohny (Coppin State University, USA)
★Alessandro Vagnini (Sapienza University of Rome,
Rome);
★Ali Bilgiç (Bilkent University, Turkey);
★András Mérei (University of Pécs, Hungary);
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Poland);
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Zealand);
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Taranaki, New Zealand);
★Christian Henrich-Franke (Universität Siegen, Germany);
★Christos Kourtelis (King’s College London, UK);
★David J. Plazek (Johnson State College, USA);
★Dimitris Tsarouhas (Bilkent University, Turkey);
★Fatima Sadiqi (International Institute for Languages and
Cultures, Morocco);
★Ghadah AlMurshidi (Michigan State University, USA);
★Guseletov Boris (Just World Institute, Russia);
★Hanako Koyama (The University of Morioka, Japan);
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★John Opute (London South Bank University, UK);
★Léonie Maes (Vrije Universiteit Brussel, Belgium);
★Lomarsh Roopnarine (Jackson State University, USA);
★Marius-Costel ESI (Stefan Cel Mare University of
Suceava, Romania);
★Marek Rewizorski (Koszalin University of Technology,
Poland);
★Martha Mutisi (African Centre for the Constructive
Resolution of Disputes, South Africa);
★Menderes Koyuncu (Univercity of Yuzuncu Yil-Van,
Turkey);
★Myroslava Antonovych (University of Kyiv-Mohyla
Academy, Ukraine);
★Nazreen Shaik-Peremanov (University of Cambridge,
UK);
★Nermin Allam (University of Alberta, Edmonton,
Canada);
★Nadejda Komendantova (International Institute for
Applied Systems Analysis, Austria);
★Niklas Eklund (Umeå University, Sweden);
★Phua Chao Rong, Charles (Lee Kuan Yew School of
Public Policy, Singapore);
★Peter A. Mattsson (Swedish Defense College, Sweden);
★Peter Simon Sapaty (National Academy of Sciences of
Ukraine, Ukraine);
★Raymond LAU (The University of Queensland,
Australia);
★Raphael Cohen Almagor (The University of Hull, UK);
★Satoru Nagao (Gakushuin University, Japan);
★Sanjay Singh (Ram Manohar Lohiya National Law
University, India);
★Shkumbin Misini (Public University, Kosovo);
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★Stéphanie A. H. Bélanger (Royal Military College of
Canada, Canada);
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★Valentina Vardabasso (Pantheon-Sorbonne University,
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The Editors wish to express their warm thanks to the people who have generously contributed to the
process of the peer review of articles submitted to International Relations and Diplomacy.
 International Relations
and Diplomacy
Volume 8, Number 8, August 2020 (Serial Number 83)

Contents
Military

Transformation of Russian Military Enterprise in the Geopolitical During Putin Era 333
WU Fei

Foreign Policy

New Systemic Order and Foreign Policy Strategies of the Islamic Republic of
Iran in the Middle East 346
Hamid Sarmadi, Javid Karimi Nerbin, Edriss Hassanpour

China-Africa Economic Cooperation

Research on Sustainability of China’s Economic Cooperation With Africa 358

YANG Li, DONG Shaoxuan, QIAO Zaiqin

Migration

The Role of the European Union in Socio-economic Integration of Immigrants

Residing in Azerbaijan: Current Problems, Tendencies, and Perspectives 370
Nargiz Hajiyeva
International Relations and Diplomacy, August 2020, Vol. 8, No. 08, 333-345
doi: 10.17265/2328-2134/2020.08.001
D DAVID PUBLISHING

Transformation of Russian Military Enterprise in the

Geopolitical During Putin Era

WU Fei
Jinan University, Guangzhou, China
Charhar Institute, Beijing, China

The quotation, from Vladimir Putin’s annual address as president in 2006, neatly summaries the reason why Russia
had to press forward with long-overdue reforms of its armed forces. Two decades after the fall of the Soviet Union,
Russia was still left with an oversized military organization built for large-scale mobilization and the demands of
the Cold War, but highly ineffective for the type of conventional military conflicts that Russia was most likely to
become involved in. The rationale behind Russia’s reforms of the armed forces were thus clear long before the war
in Georgia, which has often been pointed to as the reason why the reforms were launched in October 2008.
President Vladimir Putin’s current period runs out in 2024, when he is due to step down, according to the
Constitution. Given the fact that the current political system has been carefully crafted for almost 20 years, it is
evident that there is uncertainty about its future. First, it no longer produces wealth for the population. For five
years in a row, the real disposable income has been decreasing. Second, the legitimacy of the system could be
questioned, since Putin’s popularity figures are going down, and the surge from 2014-2015 has been eradicated.
War as well (indeed, the Soviet Union helped fuel conflict and instability), the communist ideology and groups that
professed it lost their main backer with the fall of the Soviet Union. Some African states weakened as the result,
and coupled with an influx of arms on the global market, it was easy for disparate individuals and groups to carve
out areas of influence under the barrel of a gun. In the U.S., private military companies (PMCs) emerged as “a
function of decades of decisions underscored by both the strategic requirement for resources and neoliberal thinking.
The desired result to recue costs, gain efficiencies, and create economies of scale”.

Keywords: Vladimir Putin, PMC, defense military enterprise, Eurasians

I remember the conversation with the then chief of the General Staff very well.... In order to give an effective answer
to the terrorists we needed to gather a force numbering at least 65 000 men. But in all of the Ground Forces, there were
55,000 in battle-ready units, and these were scattered all over the country. An army of 1 million 400 thousand men, but
there was no one who could go to war. (Vladimir Putin’s Annual Address to Parliament in 2006)

Development of PMC Between Government and Commercial Market

Private military companies (PMCs) are not something new in the modern world full of local conflicts and
unstable regions. PMCs are usually considered as a commercial enterprise offering specialized services for the


This article support by National Social Science Fund Project: Research on the Construction of Institutional Discourse Right in
Global Governance—An empirical study based on Sino-Russian Media Communication (全球治理中制度性话语权的构建研究
—基于中俄传媒交流的实证研究 16AZD052).
WU Fei, Ph.D., professor, Jinan University, Guangzhou, China; senior fellow, Charhar Institute, Beijing, China.
334 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE

safeguarding or protection of any objects, as well as for demining, training, maintenance, elicitation, strategic
planning, logistics, and consulting. Private military companies are most often used where the task is beyond the
power of civilian security companies, but for whatever reasons, it is impossible or impractical to involve a
regular army.
The history of Russian PMCs dates back to the 1990s, when the first so-called “Russian volunteers” went
to fight in Yugoslavia. The Federal Specifications Board (FSB) Officer Igor Strelkov-Girkin was among them.
He is known for the capture of Slavyansk in the Donbass, Ukraine, in the spring of 2014, and is accused of
involvement in the downing of the Malaysian Boeing MH17 in the sky over the Donbass on July 17, 2014.
In the case of Yugoslavia, it is safe to say that the Russians could not go abroad with combat gear and
participate in hostilities without the authorization of the Russian leadership. According to some sources, in
1992-1995, on the territory of Bosnia, several hundred “Russian volunteers” were constantly operating, using
the tactics of reconnaissance and sabotage groups. The basis of the unit consisted of fighters of the St.
Petersburg security company under the name Rubicon. Without the participation of Russian special services
and the Russian government, their activities would be impossible.
Under the same scheme, the Kremlin sent mercenaries linked with the special services of the Russian
Federation under the guise of “volunteers inspired by the ideas of protecting Russia’s interests” to Transnistria
and Nagorno-Karabakh, and later to Georgia, the Crimea, the Donbass, and Syria.
It is worth noting that against the background of such illegal military activities, Russian military experts
repeatedly appeared in various absolutely legal PMCs. In particular, Russians are actively involved in
protecting vessels from Somali pirates. They also worked in western PMCs during the American campaign in
Iraq. But these were the foreign PMCs in which citizens of the Russian Federation participated as private
individuals.
Therefore, the need to regulate the activities of PMCs in Russia appeared, which would allow not only
legalize the participation of Russians in private military companies, but would also enable the Kremlin to create
PMCs legally to achieve its military and political goals outside of Russia.

The Military Threat to Russia and State Defense Industries Transformation

The most famous Russian PMC is the Wagner Group, owned by Yevgeny Prigozhin, an oligarch close to
the Kremlin (known as “Putin’s chef”). However, there are many other groups. In a February 2018 interview
with Lenta.ru, an individual working for a PMC said,
Why is this private military company (PMC) allowed to work? This is hard for me to understand. I can assume that
the whole thing is in the relationship of a particular person with a specific president. This practice has no world analogues.

His comment highlights the unique nature of Russian PMCs.

Scholars have divided private security companies (PSCs) into categories based on the types of functions
they perform—ranging from analysis, to provision of goods and services to military forces, to acting as
bodyguards. Private military companies, or private contractors—PMCs, are a different subset of PSCs and
provide a very specific service—“kill or train others to kill” in foreign settings. PMCs primarily hire military
veterans, “often those with a special-forces background”. Russian PMCs overlap across these categories when
it comes to their activities, and at times also engage in mercenary behavior. Not all individuals employed
appear to have the special forces background. Some, for example, join these organizations in exchange for
 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE 335

removal of their past criminal history. This is not the case with Western PMCs, where the system is more
streamlined and transparent, and where PMCs tend to disassociate themselves from mercenary behavior.
Related to the confusion of definitions is that the need for and use of PMCs arose differently in the West
than in Russia. Before the end of the Cold war, Western nations saw the state as the primary (though certainly
not exclusive) employer of military power. The end of the Cold War changed that. With the collapse of the
Soviet Union, multiple small-scale conflicts broke out worldwide, while the global market flooded with excess
military equipment and specialists. Small conflicts and weapons flow proliferated during the Cold War to
compete with the West in the realm of PMCs. Because the Kremlin could not challenge Western PMCs within
the existing rules of the game, according to Sukhankin (2019), it had to change “the principles of the game
itself”. Ambiguity and confusion are other unique features of Russian PMCs. PMCs are illegal under Russian
law, specifically the Russian Constitution. Chiefly, Article 13.5 prohibits “public associations” whose aims
include “setting up armed units”. Others had pointed out also that Article 71 of the Constitution deems matters
of defense, security, war and foreign policy to the state although this point may reflect an underlying fear that
such groups could overtake the state. After all, in Western countries that utilize PMCs do so in full accordance
of the law, and these laws give the state power to carry out matters of defense, security, and foreign policy.
Indeed, PMCs clearly have links to the Kremlin, but they are not always controlled by the Russian state.
This opacity provides the Russian state plausible deniability, another key unique feature of Russian PMCs.
However, it is not the only unique feature. Opacity fits the pattern of behavior of weak and corrupt authoritarian
states, rather than great powers. It is unclear how the illegality of PMCs contributes to plausible deniability for
the Kremlin. But the illegality does help the state to maintain power dynamics and ensure loyalty within the
rivalries of cronies around Putin. This point about plausible deniability and how the illegality of PMCs is useful
to Putin highlights broader theme with regard to Russia—as it does not fit Western notions of great power or
weak state behavior. Indeed, as historian Stephen Kotkin wrote, Russia has “almost always been a relatively
weak great power”. A strong state in the Western understanding of the term would not need to keep PMCs
illegal in order to maintain its grip on power by hanging a sword of Damocles over rivaling groups. In this
sense, the Kremlin’s behavior with regard to PMCs is more characteristic of a mafia group than a strong state.
In 2009, as part of major reforms of the Russian armed forces, several units were transferred from the
Glavnoe Razvedivatelnoe Upravlenie (GRU) to report directly to then-General Chief of Staff Nikolai Makarov.
The next year, Makarov suggested publicly the use of PMCs “for delicate missions abroad…to avoid the
humiliation of 2004”, likely referring to the conviction in Doha over Yandarbiyev’s murder. The onset of the
Arab Spring and fighting in Libya and Syria, “magnified the Russian military strategists’ focus on PMCs due to
the changing nature of warfare”. And in November 2012, Putin publicly supported the idea of using private
military companies. When reporting on Putin’s comment, RIA Novosti highlighted the point that countries that
use PMCs abroad are primarily the U.S., Great Britain, and France.
In early 2012, the general staff unveiled the Special Operations Forces Command (Командование сил
специальных операций, КССО in Russian), and in March 2013, Valeriy Gerasimov officially announced the
creation of Special Operations Forces (SOF, Силыспециальных операций [ССО]), as part of the Special
Operations Forces Command, which are separate from other branches of the Russian armed forces. The
prototype for the SOF appears to have been the units created in 2009-2010 mentioned earlier. Gerasimov (2017)
said as part of the announcement, “Having studied the practice of the formation, training and use of special
operations forces of the leading states of the world, the leadership of the Russian Ministry of Defense has also
336 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE

begun to create them”. Indeed, Moscow appears to have modelled the unit in part after elite, Western SOF.
However, Russia’s SOF hires exclusively on contract (per Russian definition of the term “contractor”), for
officer positions. SOF operations, carried out usually in secret, are “under the direct control of senior military
leaders or commanders-in-chief of the armed forces in theaters of war”. The SOF has other unique features.
According to Sukhankin (2019), they are “able to collaborate with local military formations”, and are able to
operate in smaller tactical groups, but without formal approval from the armed forces. The SOF is part of the
story when it comes to understanding the origins of Russian PMCs under Putin, even as the SOF is formally
part of the Russian armed forces. This model continued to expand and modify in the coming years.

Defense Military Enterprise Show Russian Soft Power

Russia developed its main security and foreign policy doctrines and strategies throughout the 1990s. It is
clear that the Russian threat assessment in the Military Doctrines has been consistent—with only a few
variations—since the first draft of the 1993 Military Doctrine (Izvestiia, 1993). In 1997, a concept of national
security and an updated foreign policy concept were published (National Security Concept, 1997; Foreign
Policy Concept, 1997). Although the Military Doctrine, in its initial year, took a more hard-liners approach to
Russian national security, focusing on external military threats to a greater extent than the other documents in
1997, by the year 2000, the anti-Western view had become persistent in the political debate.
Russian foreign policy has two overall long-standing objectives. The first is to be recognized as a great
power in world affairs, comparable to the United States. According to the current national security strategy
(2015), one of Russia’s long-term strategic interests is to consolidate its “status as a leading world power,
whose actions are aimed at maintaining strategic stability and mutually beneficial partnerships in a polycentric
world”. In a similar way, the Foreign Policy Concept (2016) talked about the country’s need to consolidate its
status as “a center of influence in today’s world”.
Historically, the Russian defense industry has played an important role in Russian society. It has been
argued that the Soviet Union did not have a military-industrial complex; rather it was one. By the 2000s,
however, it was becoming increasingly misleading to refer to a Russian military-industrial complex in terms of
a defense industry, armed forces and defense industry ministries operating as a single, integrated entity. Signs
of deep dysfunctionality were increasingly apparent, and by 2016, the long-standing rifts between the defense
leadership and the industry, as well as within the industry, were out in the open. The sector was no longer the
state’s primary focus; it had become dependent.
Since 2008, Russia’s political leaders have intensified their efforts to steer the development of the
country’s defense industry. In addition to continued efforts to concentrate the defense industry in state-owned
holding companies, a process begun in 2006-2007, the government has also sought to stimulate change from
outside.
The Ministry of Defense, with the backing of the president and prime minister, has been proactive in this
process, using a carrot and stick approach. As discussed in the previous chapter, the defense industry has been
sharply criticized for price rises, poor quality and unpunctual delivery as well as widespread corruption. The
Ministry of Defense has also, and for the first time, placed orders for large materiel systems with foreign
defense industries. Meanwhile, a substantial increase in domestic orders is being planned. Moreover,
companies’ profit margins on priority materiel are expected to increase. Domestic defense orders since 2007
have exceeded arms export contracts by 50 percent. With the 2020 State Armament Programmed, government
 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE 337

orders will become an even more important source of income for the Russian defense industry and thus a
potentially stronger defense policy instrument.
After a period of high military spending, Russia’s total military expenditure is now on a downward trend.
It has fallen from over five percent to 3.8-3.9 percent of GDP, which represents a decrease, but this is still a
high share compared to the other great powers, the US and China. This means that although Russia’s spending
in nominal terms is lower than that of its perceived potential adversaries, Russia continues to forsake a greater
share of its GDP to at least maintain the higher level of military capability it has achieved thanks to the military
reform, the GPV-2020, and prioritizing defense spending over other public spending during a period of falling
economic growth. A reason for ascribing lower priority to defense now is that the military reform and the
GPV-2020 have produced visible results. During recent years, Russia has been able to demonstrate its status as
a military great power at home and abroad growth. Low growth hampers improvements in the population’s
living standard, which challenges the president’s popularity rating, also another important priority. However, it
is not through market reform that the president wants to restore growth; it is rather with administrative methods
and by stipulating plan targets. A wide range of national projects has been created to accomplish ambitious
goals regarding the economy’s ranking internationally and the population’s health and living standard.
However, under present institutional arrangements, without economic reforms, it will be hard to raise growth
sufficiently to achieve these goals.
The Russian defense industrial complex consists of approximately 1,350 organizations. It employs about
two million people, although not all of them work on military production (Pravitelstvo Rossii, 2018). As a rule
and in comparison with Western defense companies, Russian defense companies and organizations are more
focused on defense production. A striking thing about the Russian defense industry is that there are very few
small- and medium- sized enterprises (SMEs).
At the annual evaluation meeting on 22 November 2011, the Russian minister of defense, Anatolii
Serdiukov, started by stating that the task of transforming the armed forces, giving them a “new look” (Novyi
Oblik), had been fulfilled. However, he also pointed to a number of tasks ahead. And, in spite of the many
problems and criticisms levelled against Serdiukov’s reforms, the achievements so far are worth taking note of.
Few believed that Serdiukov would be successful where earlier ministers of defense had failed, but three years
after the reforms were launched, the results are impressive. In little more than three years, Russia has managed
to downsize its bloated officer corps, to dismantle empty cadre units and to introduce a new command system
as well as a new branch of arms. Although there are significant tasks ahead, there is every reason to note the
scale and depth of the restructuring that has taken place inside Russia’s armed forces.
The most recent large-scale military exercises, practicing and refining new concepts of employment of the
Russian forces, serve as an illustration of the threat perceptions guiding the military transformation. They
follow the pattern noted some time ago of exercises in Russia practicing offensive action in the West and
defensive action in the East, and tally with the threat picture expressed during the Ladoga-2009 exercise by
chief of the main staff of the Ground Troops Lt-Gen Sergey Skokov in the West, Russia has to contend with
“innovative armies with non-contact forms and methods for using the latest forces and equipment”, in the south,
“irregular formations...[and] guerrilla warfare”, and in the east, “a multi-million troop army using traditional
approaches to the conducting of combat operations...with a great concentration of manpower and firing systems”.
Six months after this statement, Russia’s new Military Doctrine emerged, containing a carefully nuanced
treatment of North Atlantic Treaty Organization (NATO) and a studied silence on the subject of China.
338 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE

Contrary to much media reporting at the time, the new Doctrine signed into law by President Medvedev in
February 2010 does not describe NATO as a military threat to Russia. But specific NATO activities (in
particular, the development of military infrastructure closer to the borders of Russia, and use of force globally
“in violation of international law”) are noted as “military dangers” which could under certain circumstances
lead to an immediate threat. At the forefront of Russian thinking in this respect are the Baltic States—within
NATO but not subject to the restrictions of the unadapted Conventional Forces in Europe (CFE) Treaty—and
any potential new members for NATO that could be found around the Baltic rim.
In 2019, the Russian defense budget (in the federal budget what is classified as “national defense”) totaled
619.8 billion, corresponding to 2.9 percent of GDP. Data on the defense budget and defense expenditure as a
share of GDP are of interest, as they reflect how big a burden defense allocation are for the rest of the economy.
Changes in this share also give us an idea of whether the Ministry of Defense and the defense lobby have
grown stronger or weaker in the budget process, in which public expenditure is decided. Defense expenditure as
defined in the Russian defense budget lay, on average, at a level of 2.7 percent of GDP between 2009 and 2019.
As the line “Russia/Federal Budget”, the defense budget share of GDP is expected to increase over the next two
years and amount to 3.9 percent in 2017.
The main cause of the rise in military expenditure as a share of GDP is the ongoing military reform and
the fact that the state procurement of arms will increase. Arms procurement including research and
development (R & D), which accounted for around 20 percent of the defense budget in the early 2000s, was
allocated almost 40 percent of the defense budget in 2014. The plan is to increase this share to almost 60
percent of the defense budget in 2018.
 costs of the Border Troops and Interior Ministry Troops
 certain costs for the Ministry for Civil Defense, Emergencies and Elimination of Consequences of Natural
Disasters (MChS)
 certain costs for the security services
 subsidies for the closed cities
 military pensions.
There are different national definitions of military spending and Stockholm International Peace Research
Institute (SIPRI) recalculates the national expenditure to accord with the SIPRI definition, with the help of
country specialists. In the case of Russia, in principle, Cooper has based his estimates of total military
expenditure on Russian budget data. Historically, SIPRI’s estimates give defence shares of GDP that are about
1-1.5 percentage points above the official Russian figures, which means that estimated total military
expenditure in the 2000s lay at a level of 3.5 and 4.3 percent of GDP.
The composition of the Russian defense budget is not easily discerned, since its breakdown into separate
items of expenditure only becomes known when the budget is submitted to the Duma. However, many budget
items are classified in this version, and researchers try to estimate their size. The armed forces are the largest
item in the defense budget and amounted to nine percent of the federal budget in 2009 (2.3 percent of GDP). If
total military expenditure, as estimated from Russian budget data, is used as a basis, the armed forces account
for the bulk, or almost 50 percent of total military expenditure. A further 20 percent goes to the Interior
Ministry Troops and other troops outside the armed forces. Nuclear weapons, which are a major priority,
accounted for nine percent and pensions and social provision, such as housing, for six and seven percent,
respectively, in 2016.
 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE 339

The Ministry of Defense is in the process of reforming the state procurement system for weapons and
equipment, which has been both corrupt and ineffective. According to Russia’s chief military prosecutor,
Sergei Fridinskii, 20 percent of the defense budget disappears every year. Fake invoices, fraudulent dealings
and bribes are commonplace, and some observers believe the losses caused by practices may be twice as large.
Major delays caused by friction in the procurement process, disagreement over prices and the defence
industry’s limited ability to supply military equipment of the standard required by the Ministry of Defense are
more the rule than the exception. Then President Dmitrii Medvedev called attention to these problems and took
the defense industry to task for its failure to deliver in 2011. Minister of Defense Serdiukov has sought to calm
the industry’s fears following this criticism by assuring it that no closures or major purchases abroad are
planned. The Ministry of Defense, too, has been called to account for its failure to finalize orders in the first
quarter of 2011. In July 2011, the ministry was still having trouble finalizing contracts for that year.
The pressure on prices from the defense industry together with the constant disagreements on prices led to
that the Ministry of Defense established a special price department in 2011, in order to improve knowledge and
transparency in relation to the price of military equipment. According to Serdiukov (2011), disagreement over
prices is one of the prime causes of delays in defense industry contracts. In some cases, the defense industry has
had a guaranteed level of profit of up to 25 percent, and given soft budget constraints in the form of large
subsidies and favorable credits, the tendency has been to let all peripheral costs spill over in prices.
The large ineffective defense enterprises are still burdened by their own social service provisions (day-care
centers, hospitals, etc.) and other high external costs (such as extremely long development times and unfinished
projects). The Ministry has tried to force these enterprises to phase out their social commitments and let them
be taken over by local municipalities, but the municipalities are reluctant to shoulder these tasks. In October
2011, Serdiukov discussed the Ministry of Defense’s 491 pre-schools with Medvedev, who sternly requested a
list of the municipalities that were refusing to take them over, clearly intending to put pressure on the local
authorities concerned. For 2011, the Ministry is requiring the industry to reduce its average level of profit from
15 percent to five percent. Enterprises producing priority equipment, however, are to be allowed to raise their
margins to 25 percent. Priority equipment refers to 200 products, including nuclear weapons, intercontinental
ballistic missiles, cruise missiles, and other advanced arms that are in high demand. A further change is a plan
by the Ministry to boost pre-payments from 15-40 percent to 80 percent. This means that the enterprises will
have less financing problems during production, but also that subcontractors should be paid sooner.
Government arms procurement comes under the Official Secrets Act, and details of the annual value and
composition of procurements belong to the classified section of the federal budget. The lack of transparency
has led researchers to add together data from different sources and produce their own estimates. Thanks to a
statement by Viktor Zavarzin, head of the State Duma Defense Committee, data were made available in 2016
relating both to the 2010 defense budget and to the budget for 2014-2016.

The Geopolitical Race Between Russia and US Decides Their Influence on the World
Both the historical and geographical aspects of the concept of geopolitics were developed in 1899, when
the idea was originally proposed by the Swedish political scientist Rudolf Kjellen. It was the world view of
Western imperialists who aimed to expand the European geographical sphere of influence to the rest of the
world in order to seize more resources. It therefore indicates the hierarchical relationships in the European
centralized ontology. The concept was extended by the Nazis to mean a fight for more territory. Given this
340 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE

expansionist context, the term “geopolitics” was out of favour until the US Secretary of State, Henry Kissinger,
used it to define the global contest between the United States and the Soviet Union (O’Tuathail, 1998).
Geopolitics can be used as a theoretical research tool in the field of political rhetoric to make foreign
policy decisions. From this diplomatic viewpoint, the word of geopolitics analytically frames the policy-making
process in terms of national interests rather than ideology. During the Cold War period, Kissinger defined it as
an approach that focused on the requirements of equilibrium, emphasizing the “balance of power”. Secondly,
the meaning of geopolitics assumes that geographical factors influence most national interests; this is taken for
granted by policy-makers aiming to ensure global security and a military presence in various regions. Halford
Mackinder has defined it as the exploitation of armed forces by economic wants and geographical opportunities
to obtain political objectives (Gray & Sloan, 1999).
The dominant geopolitical view arose from the European-American experience and was then projected
onto the rest of the world and into the future theory and practice of world politics. To think about the
geopolitical framing of foreign policies is to recall the doctrines enunciated by various US presidents, from
Monroe in 1823 through Truman in 1947, and G. W. Bush in 2002. The Monroe Doctrine initially involved
three geopolitical imperatives relating to the US foreign policy: The Americas were closed to further European
colonization; the United States must avoid becoming involved in wars in Europe; and the US government
would regard efforts made by any European power to expand its empire into the Western hemisphere as a threat
to the United States itself. During the Johnson and Reagan presidencies, this doctrine was invoked to justify the
US military intervention in many parts of the Latin America. John Agnew has envisioned world politics by
regarding the modern geopolitical imagination in multiple ways, rather than as a simple reflection of competing
geopolitical and national interests and the “identities” of fetishized states (Agnew, 2003).
Ratzel’s study of the way in which human society is shaped by the natural environment has not only led to
the sub-field of political geography but has also fed into the study of strategic studies, both in its
Anglo-American and Nazi manifestations. The historical trend was from smaller peripheral to larger continental
states. Technological developments from the age of discovery had benefited both sea and land powers.
Maritime technology had allowed the states of Western Europe to circumnavigate the physical barriers that had
penned them in and turned the ocean from an obstacle to a highway. At the same time those at the Eastern
margins—Russia—had succeeded in conquering the pivot area of central Asia (Ashworth, 2011).
Eurasia is home to most of the world’s politically assertive and dynamic states. All of the historical pretenders to
global power originated in Eurasia. The world’s most populous aspirants to regional hegemony, China and India, are in
Eurasia, as are all the potential political or economic challengers to American primacy. Eurasia accounts for 75 percent of
the world’s population, 60 percent of its GNP, and 75 percent of its energy resources. Collectively, Eurasia’s potential
power overshadows even America’s. Eurasia is the world’s axial supercontinent. A power that dominated Eurasia would
exercise decisive influence over two of the world’s three most economically productive regions, Western Europe and East
Asia. A glance at the map also suggests that a country dominant in Eurasia would almost automatically control the Middle
East and Africa. With Eurasia now serving as the decisive geopolitical chessboard, it no longer suffices to fashion one
policy for Europe and another for Asia. What happens with the distribution of power on the Eurasian landmass will be of
decisive importance to America’s global primacy and historical legacy. (Brzezinski, 1997, p. 51)

Eurasianism and geopolitics have become theoretical and doctrinal manifestations of the geomentality of
Russia’s foreign and security policy establishment. Political thinking about the importance of geographical
space has strong intellectual and academic roots in Russia. The idea of Eurasianism emerged in 1920 and
re-emerged in the 1990s. The decision on NATO enlargement helped Eurasianist ideas to emerge as the
 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE 341

dominant doctrine in Russia’s foreign and security policy. The NATO enlargement issue united Russia’s
political class in their opposition to this policy. The 1999 NATO-Yugoslavia war convinced the majority of
Russians that Eurasians had always been right in their criticism of the West, NATO, and the Russian Liberals
(Tchantouridze, 2001). Afterwards, the Russian authority has begun to adopt defensive realism to formulate its
foreign and security policy. This direction has made the Russian president powerful, as several presidencies
have resisted Western geopolitical expansion through NATO enlargement and economic sanctions against
Russia. The distrust between the West and Russia have consolidated Eurasianism as a national identity and
broadened its development in the East under the strategy of “Pivoting to Asia”.
Realist and imperialist frames have dominated analyses of Russia’s foreign policy under the leadership of
Vladimir Putin. In one concept associated with defensive realism, Russia has been viewed as a status quo great
power state seeking to preserve its position in the international system by maintaining the balance of power
threatened by the US. From this standpoint, Russia’s decision to annex Crimea stemmed from its desire to
contain and balance the US. Prior Western activities, such as NATO’s enlargement, prompted Russia’s
pushback when the opportunity presented itself. In another argument informed by offensive realism, Russia has
been portrayed as a revisionist power harbouring aggressive intentions and pursuing the goal of
power-aggrandizement. According to the theory of offensive realism, Russia’s decision to invade Crimea was
rational and expected, as it allowed the Kremlin to acquire the requisite strategic control over a vital military
security asset (Omelicheva, 2016).
Robert Dannenberg, Frank J. Cilluffo, and Sharon L. Cardash (2014) had argued that the Crimea event
should be understood through a geopolitical analysis of Putin’s Russia. Russia moved to annex Crimea; the
speed and audacity of the action shook Eastern Europe and surprised the West. The West used economic
sanctions to counterattack, resisting the influence of geopolitical change after the collapse of the Union of
Soviet Socialist Republics (USSR). Putin views sanctions as an opportunity to rebuild areas of the Russian
economy that have suffered since the collapse of the Soviet Union and to reverse the increasing emphasis of the
Russian economy on exporting commodities and importing manufactured goods. Putin wishes to use sanctions
to change the world’s macroeconomic paradigm. He has begun his own “Pivot toward Asia”, finding an
increasingly sympathetic audience in China. The Ukraine is the first step in Putin’s campaign to reject the West
culturally, economically, and strategically, in favour of a genuine and meaningful pivot toward the East. To
make it all work, however, he needs China, Iran, and India—which is one reason why the Shanghai
Cooperation Organization (SCO) is more important than people give it credit for. In any case, Putin calculates
that one important element in Russia’s ability to withstand Ukraine-related sanctions is his personal relationship
with Chinese President Xi Jinping, along with a series of economic and energy agreements. Finally, Putin is
putting a lot of energy into building up the Eurasian Union as a regional counterpart to the EU and an
instrument for Moscow to use to exert influence over its neighbours.
In other words, Russia’s geopolitical strategy plays a key role in strengthening its power in the regions.
The Black Sea gives Russia navy ports for its Black Sea Fleet and the ability to construct pipelines to Europe;
these enhance Russia’s influence on Europe and the Middle East and strengthen Russia’s national security.
Russia relies on this energy supply to support its federal budget. Energy is considered to be the most important
strategic resource leveraging geopolitical influence. After the Crimean event, the Western block regarded
Russia’s actions as a form of aggression. For this reason, they launched a series of economic sanctions to
pressure Russia. Western economic sanctions have strengthened the liberal ideological and military block but
342 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE

hampered the construction of Russia-EU gas pipelines and collaboration in other areas, such as fighting
international terrorism. President Putin decided to boost his Asian strategy through a “Pivot to Asia” and has
therefore promoted Russian geopolitical influence in the Asian Pacific Region. This strategy is helping Russia
develop the economy of the Far East Region to integrate it better into North Eastern Asia, through which its
path extends to South Asia. Russia has promoted its role in the Korean Peninsula and intensified the
geopolitical wrestling among China, Japan, and the United States. Russia and China have used this new
situation to work more closely together to map peace-route plans in international conflict regions. This
approach could provide a similar arena for pursuing Russia-US relations.
The added external pressure on the Russian oil and gas industry stems from the increased EU and US
sanctions announced on 12 September 2014, which specifically target Russia’s energy, defence, and financial
industries. The oil and gas sector is affected by the limited access to financing and by limitations on technology
transfer for unconventional and offshore developments. While the sanctions have specifically focused on
exploration and production from offshore and unconventional resources in Russia, their effect has spread
through the entire oil and gas industry. In response to sanctions, the Russian government and industry operators
have intensified their focus on partnerships with Asia-based interests. When the South Stream gas pipeline to
Europe was cancelled, an immediate alternative for Russian gas was proposed by President Putin—a sub-sea
pipeline under the Black Sea to deliver gas to Turkey. In addition to replacing the South Stream project with
this Turkey-bound gas pipeline, Russia and China have signed a memorandum of understanding on 9
November to build another gas pipeline. The new pipeline, “Altai”, will connect Russia’s West Siberian fields
to the Xinjiang Uyghur Autonomous Region of China. The pipeline will run to the West of the Power of
Siberia (“Sila Sibiri”) pipeline announced in May 2014, which connects East Siberian fields to China’s Eastern
provinces (Global Data, 2014). The gas pipeline has guaranteed Russia-China relations and deepened the
comprehensive strategic partnership of coordination.

Conclusion for Further Discussion

Assuming that the security policy situation remains unchanged, the most important factors determining the
size of Russia’s military expenditure are GDP growth and how well the Ministry of Defense and the defense
lobby are able to negotiate in relation to other ministries and budget chapters in the federal budget process.
Many scholars and analysts believe that confrontation between the United States and Russia will continue
in the adversarial atmosphere created by the Ukraine crisis and Russiagate. Neither Russian nor U.S. experts
believe that Russia or the United States can afford to start a nuclear war, but both sides have to find ways to
reduce the escalating tension by agreeing on concrete issues for negotiation and cooperation. The West regards
the Ukraine crisis and Russiagate as examples of Russian aggressive geopolitical behaviour, ranging from
economy-driven aggression to cybersecurity-based information warfare. The West therefore feels that Russia is
challenging their national security; they need to counterattack against Russia’s geopolitical ambitions through
economic sanctions and military deterrence. This response is creating a new balance of power; it changed after
the end of the Cold War and the start of NATO enlargement. The dilemma is that Russia has been too strong to
compromise with the U.S. in its geopolitical games, for example in the Ukraine and Syria. What price will the
Trump administration pay to achieve normalization with Russia? Putin is very serious about overcoming
difficulties related to economic sanctions and low energy prices through a geostrategy involving Asia and the
Eurasian regions. The Russia-China strategic comprehensive partnership seems to have deepened in the face of
 TRANSFORMATION OF RUSSIAN MILITARY ENTERPRISE 343

US-Russian adversarial relations. This will give China a broader chessboard to implement its own geopolitical
strategy under the “One-Belt-One Road” economic plan. Russia and China have consolidated their Eurasian
strategies to counterattack the Western Liberal International order to meet their national interests and demands.
If the United States cannot normalize relations with Russia, North Korea, Iran, and other states will develop
nuclear weapons to guard against external threats in an unstable and uncertain world. US-Russia relations
therefore determine global security more than any other international relationship. U.S. and Russian experts on
both sides have suggested resuming the dialogue to limit nuclear weapons; the balance of nuclear deterrence
with the signing of periodic treaties to control the global security has created the present international order.
There is less space for Russia to concede. The next move on the chessboard depends on Trump’s ability to stop
the Russiagate investigation and cooperate with Russia.
From a foreign policy perspective, the Kremlin has concluded the PMC model is a useful tool. It will
continue to experiment with PMCs as part of its competition with the West—a struggle in which the Kremlin
will use any tool it has in its arsenal, without any concern for human rights, neither of its own citizens nor those
of other countries. This means wherever Russian PMCs appear, the West should pay attention, even when the
Kremlin denies any knowledge of these groups or downplays their importance.
The revolution of the PMC model shows soft power of Putin’s foreign policy in the Middle East and
Africa, where Putin has worked to build leverage and connections with all major actors, rather than openly
taking sides. PMCs are one tool of many in his arsenal.
The PMC model will evolve and expand insofar as the Kremlin sees it as successful in achieving foreign
policy objectives. For Moscow, this means its focus on weakening the West in a zero-sum effort to prop up its
own position. Analysts must study PMC groups in greater depth, examining their structure and operations,
looking beyond their plausible deniability as the only explanation for their use. In the end, as PMCs play a
larger role in the Kremlin’s foreign policy, the West needs better solutions for countering Russian them.

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International Relations and Diplomacy, August 2020, Vol. 8, No. 08, 346-357
doi: 10.17265/2328-2134/2020.08.002
D DAVID PUBLISHING

New Systemic Order and Foreign Policy Strategies of the

Islamic Republic of Iran in the Middle East

Hamid Sarmadi, Javid Karimi Nerbin, Edriss Hassanpour

Islamic Azad University, Bonab, Iran

The international system has characteristics that have a direct influence on the foreign policy of the countries.
Among these, the systemic cycle of power is one of the most conspicuous features of the global system and the
regions that affect this issue. In this vein, the systemic order resulting from the cycle of power in the strategic
policy-making circle of units can play a limiting role and influence the type of strategy and strategy. The
Islamic Republic of Iran is also one of the units of international order; hence, it is not exceptional. Therefore, the
purpose of this study is to examine the order of the Middle East and, accordingly, to determine the strategy of the
Islamic Republic of Iran in that region. Accordingly, it assumes that the regional order in the Middle East puts
defense strategies, especially deterrence and passive defense, at the forefront of the strategies of the Islamic
Republic of Iran in the Middle East. So, the present paper, while explaining the order of the international system
and the order of the Middle East region, designs the foreign policy strategies of the regions of the Islamic Republic
of Iran.

Keywords: international system, systemic order, foreign policy, strategy, Islamic Republic of Iran

Introduction
International and regional systems, due to their realistic nature, have a cycle of power, or in other words, a
cycle of power-oriented, in which there is a tendency to assimilate power, interests, and role. The units of the
international system use various tools to achieve their national goals and interests. In such a system, due to the
lack of a central government and the nature of anarchy, these units are self-sufficient and the realization of their
interests is based on individual abilities. Accordingly, due to the anarchic nature of the international system,
countries have faced various security threats from the very beginning, which are due to their strategic
environment. Among these, the most important feature and element affecting the strategic environment is the
ruling system of the global system and the regional system. The Middle East region as one of the most
important strategic environments of the Islamic Republic of Iran can also pose special threats and
vulnerabilities for this country.
By knowing the strategic environment accurately, special benefits can be created for the foreign policy of
the Islamic Republic of Iran. In this regard, Iran’s strategic environment has changed drastically over the past
several years, and this change in strategic environment has brought new opportunities and threats for

Hamid Sarmadi, Ph.D., political science, Invited Lecture, Department of Law and Politics (Bonab branch), Islamic Azad
University, Bonab, Iran.
Javid Karimi Nerbin, M.A I.R, Department of Law and Politics (Bonab branch), Islamic Azad University, Bonab, Iran.
Edriss Hassanpour, M.A I.R, Department of Law and Politics (Bonab branch), Islamic Azad University, Bonab, Iran.
 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES 347

policy-makers. The direct presence of US in the region makes the dimensions of this strategic change very
sensitively. Examining this change is the prelude to any attempt to formulate a defense strategy and policy for
the Islamic Republic of Iran. Therefore, the main question of this research will be the type of order governing
the international system and the order governing the Middle East region and consequently the type of strategic
environment resulting from the combination of these two types of order and the type of regional foreign policy
strategy of the Islamic Republic of Iran in the Middle East. How is it and then assumes that the chaotic
systemic order prevailing in the Middle East region has created various threats and restrictions for the Islamic
Republic of Iran (located in the Middle East) and passive deterrence and defense strategies in the priority of the
Islamic Republic of Iran’s strategies. Iran is located in the Middle East.

Background of the Research

In pursuit of finding an answer to these questions, several groups of literature in the field of international
relations and regional studies can be seen. In the first group, the literature that analyzes the conceptual and
theoretical foundations of the power cycle, which is currently found in the field of international relations, a
specific effect that is found in relation to understanding the strategy cycle can be referred to Ghasemi’s writings
(Ghasemi, 2005a). The second group is the theoretical field related to the literature that tries to analyze the
foreign policy of the Islamic Republic of Iran, including: Dehghani Firoozabadi (2010), in his book Foreign
Policy of the Islamic Republic of Iran, defined the dimensions and dimensions of Iran’s national goals and
interests and also, in the framework of discourse analysis, examined the foreign policy of different governments
ruling Iran; Ruhollah Ramezani (2004), in his book Analytical Framework for Foreign Policy of the Islamic
Republic of Iran, introduced a model of dynamic tripartite interaction, i.e., the combination of domestic, foreign
and international policy for foreign policy of countries, and examined Iran’s foreign policy; and Sheeran Hunter
(2010), in her book Iran’s Foreign Policy After the Collapse of the Soviet Union described the characteristics of
the international system and its challenges and opportunities for Iran, described and evaluated Iran’s relations
with the outside world. The third group of literature is related to strategy, including: The book Strategy and
Strategic Planning by Saeedeh Lotfian (2002), the book The Great Strategy by Collins (1991), the book
Theories and Problems by John Belis (1990), and the article “The geopolitical construction of the new
international system and the US military and security strategy” by Ghasemi (2005b). These sources have
examined some levels and types of strategy.
In this respect, it can be mentioned that there are several weaknesses in the existing literature, including:
 Descriptive nature of most of these sources, especially the existing literature in the field of foreign policy
of the Islamic Republic of Iran.
 Lack of attention to foreign regional strategies.
 Lack of attention to the interrelationship between the order of the regional system and the type of regional
strategy.
Therefore, considering these inefficiencies that exist in the existing literature, it is necessary to address the
regional system order and, consequently, the type of regional strategy of the Islamic Republic of Iran.
In line with the research hypothesis and inefficiencies in the literature of international relations, the current
study pursues two theoretical and practical goals. In the theoretical field, the study of the power cycle of the
global and regional system and drawing the ruling order in the Middle East and in the practical field, the
348 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES

purpose of this study is to provide appropriate strategies to ensure the national interests of the Islamic Republic
of Iran in the Middle East. Therefore, according to the main question, hypothesis, and objectives of the research,
first to the principles and foundations of cyclic theories and systemic order, in the second part, the link between
cyclic theories and strategy, in the third part, the systemic order governing the world system and the ruling
order of the Middle East regional system, and finally, the strategies of the regions of the Islamic Republic of
Iran in the Middle East region are discussed.

Principles and Foundations of Cyclical Theories and Systemic Order

Cyclic theories are among the theories that analyze international relations and systemic order by
generalizing and conceptualizing trends in the system. The above-mentioned analytical and logical apparatus
and its theoretical skeleton are formed on the axis that the world system is a system whose process, while
having the characteristics of axial power, is a cyclical process; this is indicative of the fact that power includes
the stages of life consisting of formation, growth, maturity and decline, and countries have a certain position
within the cycle due to the stages of growth, and according to the dynamics, the power of displacement.
Countries can be observed in it and this shift will play an essential role in the behavioral patterns of countries
and its type (Ghasemi, 2012). According to this issue, the most important principles of the theory can be drawn
as follows:
1. Anarchy is a good basis for analyzing the distribution of power and world order (Ghasemi, 2012).
Cyclic theories begin with the assumption that the international system lacks supreme authority. And so, the
system will face a security dilemma, which is the result of such a situation of self-help and the central power of
the system and its constituent units.
2. The tendency of the system to concentrate power and polarize it is real; we must pay attention to the
principle of a system that all free systems, including anarchic systems, tend to polarize; the orientation of the
power cycle is based on its accumulation in the countries that are at the top of the cycle.
3. The orientation of all great powers towards world politics is the same; due to the anarchy of the system
and the principle of power-oriented cycle, the behavioral orientation of all the forces governing the cycle is the
same, and all of them try to gain, maintain, and increase power.
4. Power is not a static phenomenon, but a transformative and dynamic thing. Power has its own life
process, starting from the stage of potential growth and continuing until decay and destruction.
5. In international politics, there is a strong link between power and role; countries seek role based on their
position in the power cycle, in other words, the role of countries in the international system is determined by
their position in the cycle.
6. In international politics, power, satisfaction, and role are intertwined, and the stability of the world
system is not possible without regard to coordination between these three aspects.
7. Power within the system has a cyclical feature that according to the stages of power growth—its
dynamics can also be observed (Ghasemi, 2012). The power cycle is different for different countries, but what
is important is that the power cycle belongs to the powerful countries in the system. This cycle is repeated
alternately and has a starting and ending point. Considering in which part of the cycle security, stability, and
instability occur, there are five orders (Ghasemi, 2012):
1. Hegemonic order (with intense concentration of power, conformity of other powers with hegemony and
closure);
 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES 349

2. Inhibitory order (weakening of hegemony, emergence of new hegemonic challengers and formation of
strategic competition with hegemony);
3. Concert order (consensus of the great powers);
4. Balancing and inverse order (multipolarity of power);
5. Unstructured order (conflict of great powers with each other).
It is available that each of these disciplines forms a different pattern of behavior. One of the existing
realities is that the power cycle at the global and regional levels will be interconnected. Basically, all systems
are composed of different subsystems. In the international arena, the global system itself has regional
subsystems, and therefore, both have specific patterns of order at the same time, which have a functional link
between them. Therefore, the intersection of such orders in the cycle of power is considered as the foundation
of regional order. The intersection can be shown in Figure 1:
Global order Regional order

Hegemonic order Hegemonic order

Controlling order Controlling order

Concert order
Concert order

Balancing order
Balancing order

Unstructured order
Unstructured order

Figure 1. The intersection of regional and global order (Source: Ghasemi, 2012, p. 117).

In this regard, the interaction between regional order and world order shows the pattern of order in the
region in the form of Table 1:
350 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES

Table 1
Interaction of Global and Regional Order and Regional System Order
Hegemonic Controlling Concert Balancing Unstructured
Global and regional Reduce world order
Cooperation for the The impact of global
strategic interventions and
Hegemonic benefit of regional instability on the Rare situation
stability—overall increase regional
power region is less
stability independence
The impact of global
Reduction of regional
Cooperation with the turmoil on the region
Global strategic Further entanglement power as a result of
global hegemon as an is higher than the
Controlling stability and reducing of regional order in reducing the rate of
intervener in the previous phase and
regional stability world order integration in the
region less than the next
region
phases
Global order is more
Weakened regional stable than regional
Increased instability
order so the regional stability. Chaos and instability Chaos and instability
Concert in globally and
cooperation will be The region is under in the region in the region
regionally
raised. the influence of
global hegemon
Analyzing the pattern
Instability and Global chaos affects Chaos and instability Chaos and instability
Balancing of global order on
scattered pattern more than before in the region in the region
regional order
Complete chaos, the
Region is under
global hegemon Chaos and war in the Chaos and instability Chaos and instability
Unstructured management and will
intrudes more than region in the region in the region
of the powerful order
ever

Andre Buffer is one of the strategists who study and analyze the concept of strategy. In his view, it is an
artistic strategy in which issues that arise from the collision of two opposing wills can be identified, and as a
result of full knowledge of these issues, a technique and method can be adopted to achieve maximum benefit.
Also, the general rule of strategy is to find a way to overcome the enemy and reach the ultimate goal. In
general, according to Buffer’s strategy patterns, different tools can be identified in the strategy, which are
(Ghasemi, 2005b):
 means of threat: such as assertive demands;
 tools related to indirect pressures;
 defense tools;
 abrasive tools;
 military tools and weapons (offensive): the use of force.
Strategy in the field of international politics manifests itself in various ways, the most important of which
are (Bilis, 1990):
 conventional strategy and nuclear strategy;
 direct and indirect strategy;
 defensive and offensive strategy;
 step-by-step and intensive strategy;
 anti-force and anti-city strategy.
Conventional and Core Strategy
The first formulation of strategy in contemporary international politics is based on the type of equipment
and tools used in it. In other words, the most important difference between these two types of strategies is the
 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES 351

type of military weapon used. Conventional strategy relies on the use of conventional military weapons, and
there will be a kind of uncertainty in military victory, because the unit does not have absolute destructive power.
On the other hand, the emergence of weapons of mass and absolute destructive power, including nuclear
weapons, led to a fundamental change in strategy and the emergence of its new form, nuclear strategy.
Direct Strategy and Indirect Strategy
In indirect strategy, the goal is to achieve domination and supremacy over the enemy, but this supremacy
is not achieved through the direct use of military force. Here, as in other strategies, the goal is to achieve broad
freedom of action so that the enemy can be suppressed, and this goal is achieved in two ways: external
maneuver and internal maneuver.
In foreign maneuvers, the goal is to gain more freedom of action and restrict the enemy’s freedom of
action. The focus here is on change in factors that are targeted outside the geographical area. It places more
emphasis on psychological operations and will use international tools, as well as the sensitivities of the enemy,
to question its possible actions and behavior in international relations. In internal maneuver, the goal is to
design a map for a specific geographical area in which the ultimate goal must be achieved. This map is drawn
based on the factors of material forces, psychological factors and time.
Offensive and Defensive Strategy (or Deterrent and Deterrent-Based)
Countries adopt different patterns of behavior in terms of strategy and the type of behaviors needed to
achieve their goals. Some try to directly change the enemy’s environment, but others just look inside their unit
and mostly want to neutralize the strategic offensive and defensive threats (Lotfian, 2002). Offensive strategy
means using the element of war and offensive policies to achieve the goal, and defense strategy, measures, and
ideas adopted to protect a country from foreign threats, and a variety of defense strategies include:
 strategic defense: protecting a country from the threat posed by strategic weapons;
 agent defense: using the armed forces against enemy attacks;
 passive defense: the use of civilian tools to counter external threats;
1. Inward-oriented defense: increase the coefficient of internal cohesion against the enemy;
2. External defense: creating vulnerability in the enemy, creating divisions in the enemy, psychological
operations against the enemy, change in the external environment of the enemy.
3. Defense-oriented defense: demonstrate defensive and offensive readiness to the enemy.
 urban defense: defense of civilian points;
 regional defense: the defense of the target area;
 point Defense: defend the target point.
Step-by-Step and Intensive Strategy
Strategy can be cumulative, condensed, and step-by-step, or gradual. In other words, in step-by-step
strategies, the final goal is divided into a set of goals and a kind of hierarchy is established between them. On
the other hand, some strategies are cumulative. In other words, the relevant units believe that they will be able
to change the environment and transform its various dimensions in order to achieve their strategic goal,
simultaneously and simultaneously (Wylie, 1967).
Anti-force Strategy and Anti-city Strategy
The basis of this classification is based on the existence and function of nuclear weapons. The goal here is
to create deterrence. Some strategists put targeting and bombing of civilians and enemy production centers on
352 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES

their agenda, and believe that if an unacceptable threat can be imposed on the enemy from this perspective, it
will strike a balance of terror. It creates power, and with the emergence of a stable balance of terror, nuclear
war does not actually occur. On the other hand, some strategists are skeptical of this strategy and believe that it
can only be achieved by disarming the enemy. In other words, strategies must be designed against the enemy’s
military forces and lead to their neutralization. Only then can the deterrent stability be considered (Collins,
1991). In this regard, countries as the constituent units of the international system have a cycle of power.
Different tools are considered in the strategy based on which phase of growth, maturity, and decline of power
they are in. System order, which plays a limiting role in strategy design, also stems from this cycle of power.
Systemic order also forms the strategic environment of the unit in question, which with its special
characteristics causes several strategic threats. And it is in the presence of strategic threats that the use of
different types of strategy finds meaning.
And these threats are formed, according to the enemy’s ability to take special actions, the enemy’s
intentions, and vulnerabilities (prominent enemy weaknesses) (Collins, 1991). Accordingly, the relationship
between power, order, and type of strategy is shown in Figure 2:

Strategic type
Power cycle

Global Regional
Strategic threats

Systematic regional order Strategic

environment
envirome

Figure 2. Interaction between power cycle, order, and type of strategy.

The cycle of power and the pattern of order in the world system. In general, in the world system,
based on the distribution of power and the measurement of relative power, in different periods, different great
powers played a fundamental role in the international system. According to the structure of the international
system, although at one time there was a distribution of power among European countries and with the world
wars this type of structure and distribution of power disappeared, but it must be said that countries, such as
Great Britain, France, and Germany are still considered an influential power in the international system. After
that, a bipolar system centered on the United States and the Soviet Union was formed, which even after the
collapse of the Soviet Union and the end of this type of structure, the Soviet Union was still considered one of
the most influential powers in the system. But the United States has taken the management of the system by
surprise. During this period, although the old powers, such as Great Britain, France, and Germany existed, other
new powers, such as Russia, the European Union, and Japan entered the cycle of world power, although their
 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES 353

influence, especially after America’s declining movement was different. In the new system, the three powers of
the United States, Japan, and China are the most important countries in the system, growing in both the
economic power cycle and the military power cycle, as shown in Figure 3.

Figure 3. The power cycle of China, the United States, and Japan from 2000 to 2030 (Source: Kissane, 2008, p. 33).

Based on Figure 3, it can be concluded that the United States has moved away from the hegemonic order
in this situation and has entered the next phase, namely the restraining order. In this phase, although the relative
power of the United States is more than the rest, but its level of power is less than the previous phase. That is
why it cannot take action against the units in a hegemonic manner with direct imposition. Thus, the policies and
control system he uses are defensive in nature and eliminate potential challengers through a unilateral deterrent
system.
The cycle of power and the pattern of order in the Middle East. The Middle East region has special
characteristics in terms of the power cycle. One of its most important features is the involvement of power or
non-indigenous powers in it. In the global power cycle, although there is a lot of competition between the
world’s top powers, the United States is still the most important world power, despite its relative power decline
and its entry into the restraining order phase. For this reason, it has a relatively active presence in vital areas,
especially in the Middle East, and is highly in control of the region against internal challenges and external
competing powers.
Considering the degree of orderly interference in the Middle East, relative instability in the global system
affects the regional system of the Middle East. Thus, given the situation of structural stability in the Middle
East, the regional order is in an unbalanced state towards an unstructured order, which is due to the strategic
instability of the region, which is strongly influenced by the system, puts the world.
The systemic order of the Middle East and the regional strategies of the Islamic Republic of Iran. As
a result of the interference of global and regional order, the strategic environment of the Islamic Republic of
354 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES

Iran in the Middle East is in a state of regional instability and turmoil. In the turbulent environment of the
Middle East, there are no cooperative relations within the region and include hostile relations patterns
(Iran-Zionist regime, Lebanon-Zionist regime, and Syria-Zionist regime), the pattern of cold relations between
the Arabs and the regime. Zionist, the model of competition between Iran, Saudi Arabia, the southern countries
of the Persian Gulf, Egypt, and Jordan, the model of relations between Iran, Syria, Lebanon, and Palestine, the
model of Arab cooperation in the Arab League, the Gulf Cooperation Council (GCC), and the Arab Maghreb
Union, the model of cooperation between Iran and Iraq, the model of US-Zionist alliance and strategic
cooperation between the US and the Arabs in the form of the Arab League, the Gulf Cooperation Council, and
the Arab Maghreb Union, the model of cooperation between Iran and Iraq, and finally, the model of US-Zionist
alliance and strategic cooperation between the United States and the Arabs, can be shown in Figure 4.

Arab Maghreb Union (1989)

Syria
Morocco Algeria Jordon Particle countries Saudi Arabia

Egypt, the second ally of USA

European Union USA

Figure 4. Pattern of relations in the Middle East (Source: Ghasemi, 2011, p. 42).

In this regard, by recognizing the strategic environment of the Islamic Republic of Iran, the threats facing
this country can be examined.
In fact, Iran’s strategic environment has revealed various threats against this country, which can be
categorized as follows:
 Strategic threats to the system, which itself consists of the following dimensions:
 Structural threats due to the hegemonic tendency of the US-led system as the most important strategic
enemy, which can be seen in the nuclear issue;
 Process threats to the system, including the process of economic globalization and cultural processes,
including the subject of the Western civilization in the form of Huntington's theory of the clash of civilizations.
Strategic regional threats include:
 Threats from interventionist regional powers, especially in the Middle East and the Persian Gulf;
 Threats arising from the role of the region by large and effective regional powers;
 Threats from some powers in the Middle East, including the Zionist regime in occupied Palestine.
National strategic threats include threats arising from demographic, ethnic, and religious structures and the
existence of similar structures in the periphery of a region that can sometimes be manipulated by other powers.
According to the threats, the most important and effective strategy of the Islamic Republic of Iran in the
turbulent region of the Middle East is the defense strategy, or more precisely, deterrence, and passive defense.
 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES 355

In this regard, the general policies in the field of passive defense in the Islamic Republic of Iran have been
announced by the supreme leader, emphasizing passive defense, which is a set of unarmed measures that
increase deterrence, reduce vulnerability, continue essential activities, and promote sustainability,
nationalization, and facilitation of crisis management in the face of enemy threats and military actions.
Observing the principles and criteria of passive defense, such as choosing a safe area, dispersing, or
aggregating as the case may be, desensitization, concealment, camouflage, deception of the enemy and securing
important population centers, especially in land management plans and future development plans;
Classify important centers, places, and facilities as vital, sensitive, and important and update it if necessary;
According to these general policies in the field of passive defense, Iran pursues the following goals:
1. Promoting effective deterrence and achieving lasting security in the development of the country against
threats;
2. Promoting knowledge and efficient and effective management system specific to crisis situations;
3. Reducing the set of vulnerabilities of the country and minimizing the impact of threats and increasing
the cost of the enemy;
4. Completing the country’s defense cycle and the positive interaction between active defense and passive
defense;
5. Achieving the structure and continuity of national, provincial, municipal, and institutional services and
crisis scene management and civil defense in crisis situations caused by war;
6. Raising the threshold of national tolerance against threats and increasing the survival and protection of
the country in conditions of threat and crisis (Yasi, 2010).

Conclusion
This study aims to investigate the systemic order of the Middle East and its impact on the type of strategy
of the Islamic Republic of Iran in the Middle East. According to the systemic order governing the world system
and the systemic order of the Middle East, the strategic environment governing the system of the Middle East
appears and by using this environment, the restrictions, and threats in the foreign policy of the Islamic Republic
of Iran. Creates, it affects the type of strategy. Therefore, considering that the strategic environment of the
Middle East has been the focus of research, first the power cycle, systemic order and the strategic environment
derived from them are examined.
In this regard, units at the level of regional system and global system have a power cycle consisting of
three phases of growth, maturity and decline, which is determined by the order of the regional system in
proportion to the power cycle in the global and regional system. Meanwhile, the Middle East region, which has
always been at the heart of world politics, and any change in this region has had a great impact on the relations
between the great powers, has an unstructured order that combines hegemonic order with a restraining order.
The ruling world system has been in turmoil in the Middle East system and makes the strategic environment of
the Islamic Republic of Iran insecure and brings various structural, process and national threats to it and
strengthens the model of the foreign policy strategy of the Islamic Republic of Iran in the Middle East in the
field of deterrence and passive defense. Slowly Figure 5 shows the relationship between the power cycle,
system order, and type of strategy:
356 NEW SYSTEMIC ORDER AND FOREIGN POLICY STRATEGIES

Power cycle

Global Regional

Strategic threats

Systematic regional order

strategy
Systematic threats of IRIB
Systematic regional order

Regional threats of IRIB

National threats of IRIB

Figure 5. Strategic model of the Islamic Republic of Iran in the Middle East.
Note. IRIB = Islamic Republic of Iran Broadcasting.

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International Relations and Diplomacy, August 2020, Vol. 8, No. 08, 358-369
doi: 10.17265/2328-2134/2020.08.003
D DAVID PUBLISHING

Research on Sustainability of China’s Economic Cooperation

With Africa

YANG Li
China Foreign Affairs University (CFAU), Beijing, China
DONG Shaoxuan
Beijing Qianhui Brand Consulting Co. Ltd., Beijing, China
QIAO Zaiqin
China Foreign Affairs University (CFAU), Beijing, China

Africa is one of the important polars in the current political and economic pattern of the world. This paper explores
the problems in China’s economic cooperation with Africa from the perspective of Chinese-funded enterprises in
Africa being pioneers and barometers in the cooperation, and researches sustainable development of China’s
economic cooperation with Africa focusing on connectivity and integrating African characteristic.

Keywords: China’s economic cooperation with Africa, connectivity, Chinese-funded enterprises in Africa

The Development Trend of China-Africa Economic Cooperation

Africa is an alive continent with 30.29 million square kilometers of land and only 27% of its arable land
has been utilized. With a population of about 1.3 billion, it is expected to reach 2.5 billion by 2050, and its
workforce will surpass that of China and India by 2034. In addition, Africa now has more than 200 million
young people aged 15 to 24. Africa’s youth population is expected to make up a quarter of the world’s youth
population by 2025 (Wang & Li, 2017). Factors, like rich labor force, accelerating urbanization rising levels of
spending power, and so on, enlighten growth prospects in Africa. Most African countries are eager to realize
industrialization and economic diversification, and are in urgent demand of foreign investment and technology
transfer, so they have close economic contacts with the world (Wang, 2015).
Five countries, namely France, the United Kingdom, the United States, China, and India, which have a
certain influence in the history of African development, are selected for trade comparison with Africa in this
paper. As shown in Figure 1:
(1) Before 2009, the trade data of the United States with Africa was always higher than that of China, but
the financial crisis in 2008 was the inflection point. Since then, the trade data of China has surpassed that of the
United States, and the gap is getting wider and wider.
(2) France and the United Kingdom were the early colonial countries. Africa was colonized mainly

YANG Li, Ph.D., professor, School of International Economics (SIE), China Foreign Affairs University (CFAU), Beijing,
China.
DONG Shaoxuan, master, teaching assistant, Beijing Qianhui Brand Consulting Co. Ltd., Beijing, China.
QIAO Zaiqin, master, teaching assistant, School of International Economics, China Foreign Affairs University (CFAU), Beijing,
China.
 CHINA’S ECONOMIC COOPERATION WITH AFRICA 359

between the United Kingdom and France from the 18th century to the middle of the 19th century. France got
involved in Africa earlier, Morocco and Algeria were the first African colonies, and France and the United
Kingdom had different policies on colonial occupation: the United Kingdom mainly occupied the densely
populated and economically developed coastal areas, while France paid attention to the size of its territory.
France occupied a slightly larger area of Africa than the United Kingdom. Therefore, France and the United
Kingdom have a certain basis for trade and investment in Africa.

250

200

150

100

50

Africa-China Africa-France
Africa-the United Kingdom Africa-India
Africa-the United States

Figure 1. Trade volume of France, the UK, the US, China and India with Africa (Source: UN Comtrade Database,
https://comtrade.un.org/data/).

France, like the United States, started with a closer cooperation with Africa in 1994 than China, India, or
even the United Kingdom, but the gains are limited and volatility is modest. The United Kingdom’s trade
volume with Africa has been lower than that of France and the United States for a long time, also with a limited
growth and modest volatility. China surpassed the United Kingdom on the trade volume with Africa in 2004,
and even lower than India after 2009. The growth rate of The UK’s economic exchanges with Africa has been
lower than that of the world economy.
(3) As an emerging market with a large population, India has attached great importance to cooperation
with Africa in recent years. Compared to the United States, the United Kingdom, France, India, and China both
have less trade with Africa before 1999. China-Africa trade volume surged in 1999, while India-Africa trade
volume in 2003. India’s trade with Africa surpassed that of the United Kingdom in 2009 and France in 2014.
The data of 2018 showed that the trade volume between India and Africa has increased even more than that of
France and the United Kingdom, showing great potential for cooperation.
(4) The trade volume between China and Africa has grown rapidly since the 2008 financial crisis. Differ
from other kinds of monotonous rising economic data, the trade data between China and Africa volatile,
reached the peak in 2014, and then decreased, and has been the partial linear shape since 2006, not flat, up and
down, not only because of the unstable political situation in current Africa, but also imperfect development
models in a way, which need to be improved.
360 CHINA’S ECONOMIC COOPERATION WITH AFRICA

1 400 000

1 200 000

1 000 000

800 000

600 000

400 000

200 000

Figure 2. Population growth in Africa (thousands) (Source: United Nations, Department of Economic and Social
Affairs, World Population Prospects 2019, https://population.un.org/wpp/Download/Standard/Population/).

9 000 000

8 000 000

7 000 000

6 000 000

5 000 000

4 000 000

3 000 000

2 000 000

1 000 000

0
1964

1982

2000

2018
1950
1952
1954
1956
1958
1960
1962

1966
1968
1970
1972
1974
1976
1978
1980

1984
1986
1988
1990
1992
1994
1996
1998

2002
2004
2006
2008
2010
2012
2014
2016

Figure 3. World population change (thousands) (Source: United Nations, Department of Economic and Social Affairs,
World Population Prospects 2019, https://population.un.org/wpp/Download/Standard/Population/).

As shown from Figures 2 and 3, the population change trend of Africa is the same as that of the world.
The population growth rate of Africa does not deviate from the track of world population development. The
growth of world population is mainly driven by Africa and some developing countries. Similarly, Africa is
facing or will face the difficulties encountered in the course of economic development of the developing
countries in the world. Population, food, and environment are huge problems to Africa at present. The rapid
growth of population leads to the severe shortage of food, accompanied by hunger and poverty in Africa. The
economic model is unitary, the industrial structure is unreasonable, the productivity level is low, the agriculture
and animal husbandry production is backward, therefore the overall economic development is backward; with
the population soaring, food supply shortage, people plunder nature in a single, primitive way, and the pressure
 CHINA’S ECONOMIC COOPERATION WITH AFRICA 361

on the land and environment from human is increasing, which leads to environmental pollution. There are also
problems, like urban diseases caused by regional over-concentration of population (China Economic Net,
2016).

1 600 000
1 400 000
1 200 000
1 000 000
800 000
600 000
400 000
200 000
0

Africa China

Figure 4. Population comparison between China and Africa (thousands) (Source: United Nations, Department of
Economic and Social Affairs, World Population Prospects 2019,
https://population.un.org/wpp/Download/Standard/Population/).

16000
14000
12000
10000
8000
6000
4000
2000
0
1962

1972
1960

1964
1966
1968
1970

1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
2014
2016
2018

Africa China

Figure 5. GDP comparison between China and Africa (current US$) (billion) (Source: World Bank Open Data,
https://data.worldbank.org/indicator/NY.GDP.MKTP.CD).

As shown from Figures 4 and 5, although the population of Africa has the same change trend with that of
the world, the population of China grows more slowly than that of Africa.1 The total population of China was
554.419 million, while the total population of Africa was 227.794 million, which was 41% of that of China in

1
Due to the incomplete data of some years in Africa, different years are used in different figures.
362 CHINA’S ECONOMIC COOPERATION WITH AFRICA

the early days of the founding of China in 1950. The population of Africa has been about 91% of that of China
by 2019, narrowing the gap by about 125 million. However, as the population of China and Africa approaches,
the GDP gap between China and Africa becomes wider and wider. Especially, China’s economy has been
developing rapidly, while the overall development of Africa has been slow except for some countries since
1994.
There is a special relationship between China and Africa, which is mutually beneficial and complementary.
Due to abundant labor and resources, Africa, like China in the past, is gradually becoming a global processing
plant and needs to learn from China in terms of technology and management means. The degree of acceptance
of Africa today is similar with that of China forty years ago.
China and Africa have a profound foundation for friendship. After The independence of Africa, China has
provided a great deal of friendly aid to Africa, which laid the foundation for accumulating friendship. Africa is
willing to learn from China’s successful experience and development model.
China’s economic cooperation with Africa based on mutual benefit and win-win results, China-Africa
joint efforts to promote policy coordination, unimpeded trade, building people-to-people bonds. Forming
China-Africa community of interests and China-Africa community with a shared future is the general trend
(Jiang, Ren, L. H. Zhang, Chen, & Z. K. Zhang, 2016). On the premise of fully considering the protection of
natural environment and the sustainable development of society in Africa, as well as the requirement and
influence on economic cooperation from different parts of Africa, the strategies are conducive to the sustainable
development of economic cooperation between China and Africa should be discussed.

The Leading Chinese-Funded Companies in China’s Economic Cooperation With Africa

The cooperation between China and Africa faces a huge difference in regions, geographical and natural
conditions, economic development and the requirement of economic cooperation, so the phenomenon, like
companies first, practice first, crossing the river by feeling the stones and lack of theoretical guidance, is
relatively common. Therefore, existing problems in the development of China-Africa cooperation over the
years, and the experience and lesson of risk prevention and control in China’s economic cooperation with
Africa should be summarized (Shen, 2017).
Chinese-funded enterprises in Africa are pioneers and barometers in China’s economic cooperation with
Africa. As China’s investment in Africa continues to grow, Chinese-funded enterprises have basically covered
45 countries and six regions in Africa, with diversified investment modes and targeted investment directions.
Africa is China’s second largest market for overseas contracted projects. The energy, electricity, and
transportation sectors account for an important proportion of the market. Chinese-funded enterprises in Africa
are mainly engaged in project contracting, mining, manufacturing, and processing and commodity trade, which
involve agriculture, infrastructure, processing and manufacturing, resource development, finance, trade and
logistics, and other fields.
Chinese-funded enterprises investing and developing in Africa can be classified into the following
categories: (1) enterprises developing African agriculture, such as those engaged in agriculture, forestry, animal
husbandry and fishery, grain storage and processing, etc.; (2) information and communication technology
enterprises participating in the construction, operation and service of information networks in African countries;
(3) engineering construction enterprises, mainly engaged in highway, railway, regional aviation, road, bridge,
port and power infrastructure construction; (4) energy enterprises represented by China General Nuclear Power
 CHINA’S ECONOMIC COOPERATION WITH AFRICA 363

Corporation are committed to exploring new energy markets in Africa; (5) manufacturing enterprises investing
and building factories in African countries; (6) enterprises carrying out investment cooperation in the field of
service trade; (7) enterprises that promote the development of African culture; (8) enterprises engaged in drug
research and development and cooperation in the field of medical and health in Africa; (9) enterprises related to
the development of tourism; (10) enterprises engaged in domestic and international logistics in African
countries; and (11) financial institutions that promote the development of local financial industries, support
corporate financing, etc.
China’s investment in Africa includes joint ventures, cross-border mergers and acquisitions, and
investment creation, among which investment creation is the main mode of China’s direct investment in Africa.
China’s investment in Africa tends to be resource-seeking foreign direct investment (Gao, 2016). Most of them
choose to establish labor-intensive and resource-intensive enterprises in Africa. Africa is rich in agricultural
and mineral resources, but backward in industry, unable to meet the huge market demand from not only Africa,
but also global market. Chinese-funded enterprises can make full use of the cheap labor force and abundant
natural resources in the investment of processing and smelting industries in Africa, which meet the needs of
local markets and create common economic benefits.
The summary of the development experience of Power Construction Corporation of China (Yan & Zhang,
2016), Sinotruk and other enterprises in Africa is conducive to the sustainable development of China’s
economic cooperation with Africa. Take Power Construction Corporation of China as an example, which is one
of the top 500 companies involved in the energy, electricity, infrastructure, water resources and environment
industries in world. Power Construction Corporation of China ranked 157th among the top 500 companies in
2020, higher than 161th in 2019. It has achieved eight consecutive ring from 390th in 2010to 157th in 2020.2 It
is also one of the top 250 international engineering contractors in world, whose business covers more than 102
countries. The enterprise is one of an active practitioner of Chinese-funded enterprises in Africa. Its member
enterprises have been developing in the eastern and southern African market for more than 30 years, covering
more than 26 countries in eastern and southern Africa, including Kenya, Ethiopia, Uganda, Tanzania, Zambia,
Zimbabwe, and South Africa. A large number of landmark projects have been completed, including the “China
Road” on the Nairobi-to-Sika highway in Kenya, the Zambian Kariba North Bank Power expansion project in
Zambia, etc. Even in the Coronavirus disease 2019 (COVID-19) epidemic in 2020, China and Africa still
signed up two important projects: the first phase oil refining project with an annual capacity of 5 million tons in
Ghana and the design and construction projects of Thika high speed bus rapid transit (BRT) corridor in Kenya.3
The BRT project, located in Nairobi, Kenya, included the design and construction of bus rapid transit lanes,
stations, and other affiliated facilities. The total line length of the project is about 27 kilometers, and the length
of the special lane is 20.18 kilometers. There are 13 groups of 25 intermediate terminals on the whole line,
including rebuilding 10 overpasses, building two bus stops and origin and terminal station and related
supporting facilities, which make positive contributions to benefit the wellbeing of the people. Power
Construction Corporation of China has become a model of “South-South cooperation” and made positive
contributions to the development in Africa and improvement of local people’s lives. Such as Sinohydro, a
subordinate enterprise of Power Construction Corporation of China, has undertaken many projects that have

2
Fortune, http://www.fortunechina.com/global500/585/2020, login on October 10, 2020.
3
Power Construction Corporation of China signed two No. 1 in African market,
https://www.360kuai.com/pc/9bec556d392aae250?cota=3&kuai_so=1&sign=360_57c3bbd1&refer_scene=so_1, 2020-7-18.
364 CHINA’S ECONOMIC COOPERATION WITH AFRICA

produced good economic and social benefits in Africa over the years. The subordinate enterprises of Power
Construction Corporation of China also actively fulfill the social responsibility, such as organizing activities
including donating capital for education, donating food against drought, protecting the ecological, etc., which
establish a good image of Chinese-funded enterprises and welcomed by local people in Kenya.

Problems in China’s Economic Cooperation and Construction With Africa

Analyze from the perspective of Chinese-funded enterprises in Africa:
(1) The system of China-Africa cooperation lacks completion. Although the existing international political,
economic, financial, trade, energy, cultural and other systems of China-Africa cooperation have not come easily,
they are still complex and incomplete, hindering China-Africa cooperation.
(2) The impact of political transformation. In some African countries, frequent political changes, such as
political parties or governments lead to the lack of stability and continuity of policies, on the other hand,
African countries are greatly affected by the complexity of the development and evolution of the international
structure.
(3) High security risks, such as terrorism, disease, and social security. The security situation in some
African countries is not optimistic, such as regional security problems caused by sovereign territorial disputes,
border issues, ethnic and religious conflicts, the presence of anti-government forces, threats posed by terrorism,
small-scale armed conflicts, etc.
(4) Unreasonable industrial structure. The unreasonable proportion of the structure of primary, secondary
and tertiary industries in African countries causes the problems existing in the African economic structure (Li,
2016), which also puzzled foreign investment including Chinese investment in African countries.
(5) The business environment needs to be improved. African countries hope to receive foreign investment,
but the laws and regulations for attracting and protecting foreign investment are not perfect, preferential
policies are not matching each other, government services are inadequate, tax systems are incomplete, and legal
environment is not standardized in some countries. Laws and regulations in some African countries need to be
improved in terms of foreign trade, investment, taxation, labor, customs, foreign exchange, insurance, and other
aspects, and there are also obstacles in law and policy implementation.
(6) Impact of external economic environment. The ongoing global economic downturn and the sharp drop
in international commodity prices have directly affected Africa’s energy and mineral exports and the
international community’s enthusiasm for investment in Africa, and seriously undermined the development
momentum of African countries.
(7) Development hits a bottleneck. Local resources are limited, infrastructure and supporting services are
insufficient, especially transportation, logistics, and electricity conditions are not mature, resources are scarce,
and gap in capital demand is large. On the other hand, raw materials, skilled technicians and industrial workers
are in short supply, and it is difficult to provide corresponding supporting equipment or services for the
production of enterprises.
(8) The local government is inefficient. Many African countries have low administrative efficiency, which
hinders the development of enterprises. Widespread corruption among government officials has made it
difficult for some Chinese-funded enterprises to advance projects in Africa.
(9) Serious trade deficit. The huge trade deficit between China and African countries affects the
sustainability of policy equity in the countries.
 CHINA’S ECONOMIC COOPERATION WITH AFRICA 365

(10) Weak anti-risk capability and strict foreign exchange control in financial institutions. Many African
countries have weak economies, immature financial systems and small foreign exchange reserves. Moreover,
some African countries impose strict foreign exchange control, and their financial institutions are less able to
withstand risks and their currencies are unstable. Some countries have high inflation, which is easy to generate
monetary credit and financial risks. Especially for those countries that rely heavily on resource exports to earn
foreign exchange, any slight change in the international economic situation may lead to drastic exchange rate
fluctuations.
For example, the Zambian currency depreciated from 7.5 kwacha to 14.5 kwacha per dollar in August
2015. Similarly, Angola, Nigeria, and Egypt have seen their exchange rates fall sharply over time. Some
Chinese-funded enterprises have had to leave the country because the currency has depreciated so much.
(11) It is difficult for enterprises to integrate into the local environment in Africa. There are great cultural
differences between China and Africa, which makes social integration more difficult. Some Chinese concepts
and customs are not accepted by Africans. For example, Chinese people are willing to work overtime, value
recreational activities, and some of their eating habits are unacceptable.
(12) High unemployment rates prevail in African countries. In particular, the youth unemployment rate is
twice that of adults. They are worried that Chinese enterprises will enter and grab jobs, or they have too high
expectations for Chinese enterprises to provide jobs.
(13) Problems in terms of use and management of labor workers. Relevant laws in some African countries
stipulate that the proportion of local employees employed by foreign investment enterprises or foreign
contracted enterprises shall not be less than a certain percentage. However, the skill level and quality of work of
local employees may not meet the requirements of Chinese enterprises, which may cause damage to the
operating benefit of Chinese-funded enterprises.
(14) Homogenized competition among Chinese-funded enterprises is fierce. Chinese-funded enterprises do
not cooperate with each other, causes the phenomenon of ignoring the long-term healthy development of
enterprises. In the early stage, the Chinese-funded construction industry established its market in Africa by low
price and reliable quality. However, when more Chinese-funded construction enterprises flocked to Africa, they
competed with each other by price war and homogenized competition, which was bound to affect the project
quality and long-term cooperation.
(15) Chinese-funded enterprises in Africa are strongly closed. For the sake of safety, Chinese-funded enterprises
are relatively closed. In this way, they seldom deal with the media, sometimes causing misunderstanding to the
outside world and causing disputes over the development mode of Chinese-funded enterprises in Africa.
Because of this, in many cases, whenever Chinese-funded enterprises are judged by the media to have done
something wrong, negative news reports will appear and they will be regarded as rule-breakers.

Strategies China Should Adopt to Build a China-Africa Community With a Shared Future
The sustainable development of China’s economic cooperation with Africa should be based on focusing
on connectivity and integrating African characteristics.
The Building of People-to-People Bonds
Mutual understanding and inclusiveness are the prerequisite for China-Africa economic cooperation and
the foundation for advancing China-Africa economic cooperation initiative. People-to-people bonds help
366 CHINA’S ECONOMIC COOPERATION WITH AFRICA

communicate academic circles and universities, accelerate the development of African tourism, give priority to
the development of agricultural parks, accelerate the development of the restaurant industry in Africa, and
popularize medical aid. In addition, activities, such as Power Construction Corporation of China’s money
donation for education and grain donation to fight drought cannot be ignored.
(1) Paying attention to the communication between academic circles and universities. To build closer
people-to-people bonds in China-Africa economic cooperation should not only focus on Africa’s educational
assistance and personnel training, but also promote communication between academic circles and universities
in China and Africa. At present, there are still limited academic exchanges between Chinese and African
academic circles, such as international conferences and visiting scholars. In addition, there are already some
Chinese students in Africa graduate and work in these countries, which plays a positive role in building closer
people-to-people bonds.
(2) Accelerating the development of tourism in Africa. Africa has many natural tourist attractions, such as
Kenya, South Africa, Egypt, Morocco, Namibia, and other countries, not only have famous tourist attractions,
but also safe and affordable. China should vigorously develop tourism to Africa. This will not only create
conditions for closer people-to-people bonds, but also help China and the rest of the world to better understand
Africa and benefit the African people. Support will be given as soon as possible to open pilot of direct flights
between some China local provinces and cities and Africa to promote China-Africa tourism cooperation. Start
from African countries with safe environment, and use the Ibrahim Index of African Governance (IIAG) to
select destination country, which rates African countries in four categories: personal safety, laws and
regulations, national security, and accountability system.
(3) Giving priority to developing agricultural parks. In a way, the economic depression of Africa is not
restricted by its natural environment. China should give priority to developing agricultural parks in Africa, so
that Chinese technology can contribute to Africa’s agricultural modernization development. At the same time,
China’s concept of interconnected development rather than help the poverty will be gradually recognized in
Africa.
(4) Accelerating the development of the restaurant industry in Africa. The role of promoting Chinese food
to the world is obvious to all, and the development of restaurant industry in Africa should be paid attention to
as soon as possible. For example, by learning from the China Railway 14th Bureau Group Cooperation, limited
promoting the localized employment of overseas chefs, which not only greatly reduces the employment cost for
Chinese-funded enterprises, but also enables local women to master a skill, and at the same time, it also widely
spreads Chinese food culture in the local area.
(5) Extending medical assistance. The level of medical care in Africa is generally low. Medical assistance
to African countries is the most practical and acceptable, and it is an important means of building
people-to-people bonds. The process also focuses on helping promote Africa’s health care industry, build
hospitals and train doctors. And it also helps improve the quality and quantity of drugs in Africa to cooperate
with Chinese-funded enterprises. Africa has a high proportion of young people, a high fertility rate, and
attention should be paid to improve the detection rate of birth defects and so on.
(6) Making full use of various effective resources. To explore the use of local overseas Chinese, Chinese
chamber of commerce, overseas students, information communication and experience presentation in local
well-developed Chinese enterprises, and the economic and commercial counselor’s office of each embassy
need to establish a business information integration platform for the investment information. The adoption of
 CHINA’S ECONOMIC COOPERATION WITH AFRICA 367

various effective resources and means, such as holding multinational table tennis competitions and get-together
parties, will help promote cultural and people-to-people exchanges and the healthy development of
Chinese-funded enterprises in Africa.
The Building of Policy Coordination
(1) Formulating top-level strategic planning. The state should be able to make far-sighted judgments on
the political situation, economic operation trend, investment environment and other deep-seated issues of
African countries, give macro guidance, achieve policy communication with domestic enterprises, and more
importantly with foreign countries. Increased communication between domestic authorities and African
governments will help to achieve more bilateral agreements more quickly on key issues relating to the
implementation of trade and investment and to clarify more operational details on the basis of the agreements
already signed.
(2) Playing the role of typical examples. For example, Addis Ababa-Djibouti Railway, the first modern
electrified railway in Africa, built with Chinese standards and equipment, was opened to traffic, and Kigamboni
Bridge, the largest cable-stayed cross-sea bridge in East Africa, was officially opened in Tanzania. These
important infrastructure facilities can promote the development of local economy and can be promoted as
typical examples.
(3) Collaborative development of Chinese-funded enterprises. According to the forecast from “Large
Projects and Infrastructure Spending 2025” by PricewaterhouseCoopers (Liu, 2016), from 2015 to 2025,
Africa’s road (including bridges and tunnels) is expected to spend 200 billion dollars with an average annual
growth rate of 8.2%, railways (including stations) are expected to spend 78 billion dollars with an average
annual growth rate of 8%, Ports are expected to spend 25 billion dollars with an average annual growth rate of
7.8%, and airports are expected to spend seven billion dollars with an average annual growth rate of 7.1%.
Countries with high project expenditures include Nigeria, South Africa, Mozambique, Ghana, Ethiopia, Kenya,
Tanzania, etc. Infrastructure construction is China’s strength. Chinese companies should strengthen cooperation
to compete for projects on the premise of ensuring the healthy economic development of Africa.
(4) Encourage provincial and municipal governments to take the lead. Provinces and cities of government
have a full understanding of the management, technology, innovation and talent advantages of the enterprises
under jurisdiction. They should comprehensive utilization of their respective advantages, support more enterprises
under the jurisdiction to develop in tandem with other countries or regions with complementary advantages, in
order to expand areas of cooperation, enhance cooperation level, and achieve long-term mutual benefit.
The Building of Unimpeded Trade and Financial Integration
(1) Cross-border e-commerce. Unimpeded trade can enhance the use of cross-border e-commerce,
especially the opening of China Railway Express to develop cross-border e-commerce with Africa. As an
important “Online Silk Road”, cross-border e-commerce has gradually extended its development model to
Africa: cross-border payment and cross-border delivery in cross-border e-commerce (Hu & Wang, 2016).
Chakrabarti & Ghosh, 2014), data protection related to shipping can be further optimized, such as exploring
ways to provide support for cross-border e-commerce in Africa, similar to trade facilitation agreements, using
the overland Silk Road and China Railway Express to drive development.
(2) Investment in Africa’s light industry market and retail market: Africa generally suffers from imperfect
supporting facilities, limited production capacity and relatively high production cost of light industry, so
368 CHINA’S ECONOMIC COOPERATION WITH AFRICA

China’s light industrial products just meet the needs of these countries and regions in the Africa. Africa’s retail
market is growing fast and has begun to build shopping malls. Retail could be boosted by opening e-commerce
businesses in Africa.
(3) Focus on green credit in financial integration: The essence of green credit is to include environmental
factors in financial accounting and decision-making and regulate credit supply by means of credit (Zhao, 2015).
China should increase its support for green credit in Africa’s financing, take actions to enhance Africa’s
capacity for green, low-carbon, and sustainable development, take into full account that Africa’s ecological
environment and long-term interests will not be sacrificed, and reduce the fears of the African people that
China’s investment in Africa will damage environment.

Conclusion
With population resources, urbanization rate and consumption level increasing in Africa, it has a good
prospect of economic growth. Deepening the sustainable development of China-Africa economic cooperation
can inject strong kinetic energy into the economic in China and Africa. With China strengthening its economic
and trade cooperation with Africa and enhancing its foreign assistance to Africa by the instruction from the Belt
and Road Initiative, China and Africa have become inseparable and indispensable economic and trade partners,
making positive contributions to the steady and healthy development of economic and trade in the country and
region.
Because there are many similarities in the development path of China and Africa, China and Africa have
mutually beneficial complementarities, and Chinese-funded enterprises in Africa have become an important
link for Africa to learn China's successful experience and development model. Some leading Chinese-funded
enterprises carry forward the spirit of exploration and win-win cooperation, and make full use of Africa's cheap
labor force and abundant natural resources in infrastructure, processing and smelting industries to meet the
needs of the local market and create common economic benefits. With the completion of a series of landmark
projects, it has established a good enterprise image for Chinese-funded enterprises in Africa, provided valuable
experience for "South-South cooperation", and made positive contributions to the development of Africa and
the improvement of the lives of local people.
At the same time, China’s economic cooperation with Africa still faces complex risks and challenges.
From the perspective of Chinese-funded enterprises in Africa, they are facing the problems like unstable
China-Africa cooperation system, African political system and social security; limited resources, lack of
infrastructure, lack of supporting services and other external constraints; weak ability of financial institutions to
resist risks, strict foreign exchange control, unreasonable industrial structure, imperfect business environment
and so on.
Therefore, in order to deepen the sustainable development of China-Africa economic cooperation and
build a China-Africa community with a shared future, we must combine the characteristics of Africa with the
emphasis on interconnection. To develop the building of people-to-people bonds from the perspective of
focusing on the exchanges between academia and universities, accelerating the development of Africa's tourism,
agricultural parks and catering industry, the popularization of medical and making full use of various effective
resources; To develop the building of policy coordination from the perspective of formulating top-level
strategies, playing the role of typical examples, strengthening the cooperative development of Chinese-funded
enterprises and encouraging governments at all levels to take the lead; To develop the building of unimpeded
 CHINA’S ECONOMIC COOPERATION WITH AFRICA 369

trade and financial integration from the perspective of using China Railway Express to develop cross-border
e-commerce with Africa, investing light industry and retail markets in Africa, and paying attention to green
credit.

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doi: 10.17265/2328-2134/2020.08.004
D DAVID PUBLISHING

The Role of the European Union in Socio-economic Integration

of Immigrants Residing in Azerbaijan: Current Problems,
Tendencies, and Perspectives

Nargiz Hajiyeva
Azerbaijan State University of Economics (UNEC), Baku, Azerbaijan

The chosen study mainly concerns on the migration issue, which has become a phenomenon in the European
Union’s political economy in the contemporary era, within the recent years, which identifies the role of migrants in
Azerbaijani labor market and other areas of economic integration involving the current trends, challenges, and
perspectives in the political or socio-economic fields. The long-brewing Civil War in Syria created a large-scale
trajectory of migrants, resulting in a massive influx of refugees from Turkey to Greece and then to Germany.
Recently, the issue of migration is now transforming into a phenomenon among the member states of the European
Union prompting them to take immediate action and make crucial decisions in the country’s political economy. As
a result, modern migration can play a pivotal role both for the EU and for Azerbaijan in the direction of flow of
people, capital and services, remittances, improving socio-economic well-being and the cheap labor force in the
international labor market. The key criterion of the study is to identify specific ways in which persons or migrants
who are involved in the migration process can be able to also contribute to the sustainable economic development
of the region by positively influencing IDPs on the local population, labor market activities, and overall political
and economic activity. The main idea behind the research is to investigate the economic integration of immigrants
in Azerbaijan through its original theoretical and empirical study of migration that plays an important role in the
EU’s political economy. The research aims to better regulate labor migration processes in Azerbaijan with the help
of the European Union and to optimize the impact on labor productivity in the country by providing economic
integration of migrants in the local labor market. The main focus of this study is to identify the role of the European
Union in the economic integration of immigrants in Azerbaijan, the legal migration and migration process, based on
the Joint Declaration on Resettlement Partnership launched between the EU and Azerbaijan.

Keywords: European Union, Azerbaijan, labor migration, immigrants, political economy, local labor market

Introduction
At present, Azerbaijan considers the establishment and strengthening of cooperation with the European
Union in both energy and socio-economic spheres as one of the priorities of its foreign policy. It should be
noted that since 1991, the EU has allocated about 333 million euros for Azerbaijan within the framework of

Nargiz Hajiyeva, Ph.D. candidate, independent researcher, international relations manager, lecturer on Sociology and Political
Science, International Cooperation Department, International School of Economics (ISE), Azerbaijan State University of
Economics (UNEC), Baku, Azerbaijan.
 SOCIO-ECONOMIC INTEGRATION OF IMMIGRANTS RESIDING IN AZERBAIJAN 371

various humanitarian and technical projects, as well as food and emergency support ones. In recent years, there
have been major shifts in the migration policy of Azerbaijan, confirming economic development and the
economic integration of migrants, among which the inclusion of migration legislation in the Unified Migration
Code of the country is particularly considered important. Recently, the number of short-term migrants to
Azerbaijan has been increasing, with 54,000 temporary residence permits issued in 2015 and 48,500 in 2016,
and the vast majority of whom are citizens of Turkey, Russia, and Georgia. However, to apply for the
permanent residence permit requires a temporary living permit in the country for at least two years. In 2016, at
least 15,100 people immigrated to Azerbaijan and more than 3,200 permanent residence permits were issued
for them (see Appendix 1).
Azerbaijan is currently taking appropriate measures and decisions based on the Joint Declaration on
Partnership with the European Union (MOBILAZE) to ensure transparent and efficient organization of
migration, in particular, labor migration. The project called MOBILAZE aims to support the implementation of
the Mobility Partnership Program between the European Union and Azerbaijan, with a special focus on
strengthening the country’s capacity to effectively develop and implement the government’s national migration
policy. The project is being implemented by the International Center for Migration Policy Development
(ICMPD) with nine executive partners from seven EU member states, namely Bulgaria, the Czech Republic,
Latvia, Lithuania, the Netherlands, Poland, and Slovakia. Azerbaijan started implementing this project on
January 15, 2016. The five-component project mainly encompasses the development of analytical skills to
formulate an informed migration policy, legal migration to Azerbaijan and other countries, document security,
asylum decision-making procedures, return, and reintegration (International Centre for Migration Policy
Development [ICMPD], 2016). The importance of this program transparently implemented by the EU to boost
up the integration of migrants in the socio-economic life of the country and the enforcement of economic
activities in the local labor market should have to be emphasized. Recently, migration policy and its direct
impact on economic life have been identified as a topical issue in the country.

Relevancy of the Study

The main objective of the research is the provision of the economic integration of migrants in the labor
market of Azerbaijan through the engagement of the EU. Therefore, the study content is to determine the role
of the European Union in the economic integration of immigrants in Azerbaijan, to achieve the proper
development of legal migration and labor migration. The study is characterized as a kind of new research topic
in recent years, based on the processes of economic integration and labor migration of foreign migrants in the
local labor market of Azerbaijan. The research provides new points for the organization of effective economic
integration of foreign migrants in the Azerbaijani labor market and the correct and transparent organization of
labor migration for the development of the country's economy and in-depth analysis of possible trends, current
problems, and prospects. The main object of the study is a project to support the development of migration
processes applied by the European Union to Azerbaijan. The study cited the MOBILAZE support project and
the International Center for Migration Development, funded by the State Migration Service and the European
Union. As a result of the Syrian Civil War and the refugee crisis that followed the Arab Spring of 2011, the EU’s
migration policy has been re-examined by many European and even local political researchers, interlocutors,
and economists. However, from the point of view of Azerbaijan, the chosen study has not been fully studied
before and in this respect, can be characterized as incomplete. In recent years, a sharp influx of migrants to
372 SOCIO-ECONOMIC INTEGRATION OF IMMIGRANTS RESIDING IN AZERBAIJAN

Azerbaijan has been observed both in terms of education and work, and at the same time, the government agencies
impose a number of obligations on educational institutions for the transparent organization of migration.

Discussion and Analysis

Nowadays, the European model can be successfully noted in the migration policy and the regulation of
migration issues. The main criterion of the mentioned model for the admission of immigrants is the recruitment
of qualified and educated foreign personnel to be successfully assimilated with locals in the region. From this
point of view, Azerbaijan should take appropriate steps and implement an action plan to attract qualified and
educated personnel to the labor market, which can play a crucial role in the development of the country’s
economy. At the same time, the opportunities for Azerbaijani migrants and members of the diaspora living
abroad to use their social, educational, and economic potential for existing economic purposes as much as
possible have to be taken into account.
In recent years, the “Strategic Roadmap for the National Economy and Key Sectors of the Economy”
provides for the implementation of the necessary work to further develop 11 key sectors related to the labor
market policy of the country. In this regard, the following eight key sectors as well as three other supporting
sectors have been identified in Figure 1.

Figure 1. Eight main and three other supporting sectors to be developed according to the “Strategic Roadmap for the
National Economy and Key Sectors of the Economy” of Azerbaijan (Source: Strategic Roadmap for the National
Economy and Key Sectors of the Economy, composed by author).

It should be noted that the labor quota for foreigners, introduced in 2010, is used, among other things, as a
tool to protect the local workforce. Article 61.2 of the Migration Code of the Republic of Azerbaijan stipulates
that one of the main conditions for foreign labor to engage in paid employment in the country is the availability
of vacancies that are not claimed by a citizen of the Republic of Azerbaijan with vocational training and
qualifications. This is mainly related to the introduction of labor market testing in the local labor market taking
into account the foreign labor force in Azerbaijan. In general, a party intending to employ a foreign national
must apply to the relevant state authorities in order to obtain a permit on behalf of foreign employee to legally
reside in the country.1

1
To get acquainted with the legislation and policy related to labor migration, you need to look at the ICMPD (2016).
 SOCIO-ECONOMIC INTEGRATION OF IMMIGRANTS RESIDING IN AZERBAIJAN 373

One of the main factors enticing immigrants to Azerbaijan is the country’s economic development, which
in recent years, has been characterized primarily by a significant increase in per capita gross domestic product
(GDP) and a reduction in poverty compared to previous years. In 2000, the growth rate of the national economy
was the highest in the world, and compared to all other countries in 2006, a record figure was achieved in this
area, constituting 34.5% (SSCA 2017; World Bank 2018). Moreover, due to the significant increase in the
number of births compared to the number of deaths in the country, the country's population is estimated at 10
million in 2020 and 11 million by 2050 (Wittgenstein 2014; UNDP 2015). Due to the development of labor
migration in the country, the volume of remittances from Azerbaijan increased in parallel with the volume of
remittances sent to this country, which, as a result, reached a record high of $2.1 billion in 2012. In the same
year, it was the expenditures that slightly exceeded the revenues, resulting in a negative balance. (It was set at
-83 million US dollars in 2012 and -23 million US dollars in 2015) (Central Bank, 2017) (see Appendixes 2
and 3).
One of the ways to ensure future economic development is to use the potential of labor migration correctly
and transparently. In this regard, the development of Azerbaijan’s non-oil sector and the private sector, the
attraction of foreign and local labor in the local market is of particular importance. At the same time,
opportunities for sustainable business support should be used to the full. On the other hand, investment in
education is considered one of the most promising strategies for increasing medium and long-term productivity
in the country. For the current period, Azerbaijan lags behind other middle-income countries in terms of
enrollment in higher education in the country (20%) (ICMPD, 2016).
It is an undeniable fact that the immigration of foreigners is mainly due to the desire to find a job in the
local labor market. Thus, relocations for education and asylum only cover a very small part of the immigration
process. In this regard, Azerbaijan is gradually becoming a country of labor immigration for short-term
migrants. Recent innovations and developments in the construction and oil sectors are attracting a growing
number of foreign workers to this country. Migration systems are mainly characterized by the development of
multifaceted historical, cultural, economic, and social ties of each nation state. In this regard, one of the main
priorities of the study is to accurately identify the role of migrants living in Azerbaijan in the labor market, the
emerging trends related to their economic integration and adaptation, and the proper development of relevant
opportunities. At present, the country is undertaking the clear-cut measures, such as the process of
diversification and transparency of the migration system, proper and effective management of labor migration,
and so on. Therefore, Azerbaijan, in turn, further strengthens cooperation with the EU member states including
Germany, France, the Netherlands and Sweden to regulate relocation in both directions and increases the level
of partnership. In addition, temporary or periodic migration processes in the country are inclined to intensify.
At the present time, determining the role of migrant workers in the local labor market of Azerbaijan and
scrutinizing their impact on local GDP, the proper organization of labor migration are assessed as key factors in
the development of the country’s economy. In this regard, the researcher identified the issue of migration,
which has become a phenomenon in the political economy of the European Union in modern times and its role
in the economic integration of migrants living in Azerbaijan in the labor market and other areas.
The recent influx of foreign immigrants or labor force into the country is forcing Azerbaijan to take the
necessary measures to properly regulate labor migration and, at the same time, to ensure their proper economic
integration into the local labor market. In the end, the researcher points out that the attraction of highly
374 SOCIO-ECONOMIC INTEGRATION OF IMMIGRANTS RESIDING IN AZERBAIJAN

qualified personnel or immigrants to the European political and economic system plays an important role in
increasing labor productivity and the GDP of the host country. At the same time, this empirical approach
considers it necessary to increase the socio-economic well-being of immigrants living in the country and ensure
their social regulation and entrepreneurial rights.

Problems
The one of limitations of the research is mainly related to the threat of illegal labor migration in the
country. In this regard, the state migration service (SMS) should have to undertake the necessary measures in
this sphere and conduct scientific and statistical research. The main problem in the current period is the
effective economic integration of foreign personnel in the country. Therefore, the opportunities for foreigners to
do business with local employees and participate in the oil and non-oil sector should be increased so that they
can apply their skills in the field of innovation to adapt to the local labor market and contribute to the country’s
economic development. In the context of the sustainable economic integration of immigrants in the local labor
market in the country, the provision of social benefits should also be applied to highly-qualified migrant
workers in Azerbaijan.
Pursuant to this, the involvement and support of returning migrants, especially in the non-oil sector
(tourism, hospitality, construction, logistics, education, etc.) and the stimulation of entrepreneurship among
foreign immigrants can be important in the development of labor productivity in the country. Another limitation
is the regulation of the migration balance in Azerbaijan. Thus, in 2016, at least 15,100 people immigrated to
Azerbaijan and at least 28,600 people emigrated from this country. Hence, it can be assumed that the negative
migration balance is at least 13,500 people.
Along with all these difficulties, taking into account the current economic situation, it is inevitable that
Azerbaijan will be facing difficulties in achieving one of the main goals of state policy, or more precisely, in
attracting highly qualified foreign labor force to the country. In this regard, the process of involving highly
qualified immigrants as a foreign labor force should be stimulated in order to meet the demand for skilled labor
of the country, especially in the non-oil sector of the economy.

Conclusion
As in the world practice, migration has already become a socio-economic reality in Azerbaijan. There are
still shortcomings in ensuring a transparent flow of immigrants to the country, and appropriate reforms are
being carried out in this direction, using Western experience to create a unified migration mechanism. Illegal
immigration still poses certain problems and urgent measures have been taken in this direction. Another
important issue facing Azerbaijan is the attraction of educated personnel from abroad to the oil and non-oil
sector. In this regard, state-important measures are being taken to attract highly qualified immigrants as foreign
labor to meet the country's demand for skilled labor, especially in the non-oil sector of the economy. Azerbaijan
should attract more foreign students to higher education institutions. Gaining a degree in Azerbaijan will also
make it easier for those who have the opportunity and support entrepreneurial ideas to enter the labor market.
Thus, appealing and supporting return migrants, in particular for positions in the non-oil sectors of the economy
(tourism, engineering, education, etc.) and encouraging entrepreneurship will help Azerbaijan boost up its
socio-economic development.
 SOCIO-ECONOMIC INTEGRATION OF IMMIGRANTS RESIDING IN AZERBAIJAN 375

References
International Centre for Migration Policy Development (ICMPD). (2016). Assessment report: Review of legal and labour
migration mechanisms in the Republic of Azerbaijan. Retrieved from
http://www.icmpd.org/fileadmin/user_upload/Com2_Assessment_report_FINAL_EN.pdf
State Statistical Committee of the Republic of Azerbaijan (SSCA). (2017). Reports on the flows of immigrants.
Central Bank. (2017). Expert Estimates, ICMD, MOBILAZE Support Project - Baseline Study on Migration in Azerbaijan.
United Nations Development Programme (UNDP). (2015). Human Development Report 2015, Work for Human Development.
Wittgenstein Centre for Demography and Global Human Capital. (2014). European Demographic Data Sheet 2014.
World Bank. (2018). Azerbaijan,World Bank Open Data.

Appendix 1

Table 1
Citizenship and Number of Immigrants Who Came to the Republic of Azerbaijan for Permanent Residence in Recent Years in 10
Countries of Origin
Country origin 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
b
Georgia 238 158 403 68 35 48 7 696 490 782 1.134
b
Russia 1.394 1.269 2.024 1.580 1.706 1.655 1.628 1.098 623 930 910
Turkey 7 8 267 38 4 3 4 398b 160 164 214
İran 4 7 32 6 5 - - 120b 106 144 145
Kazakhstan 94 92 196 157 177 183 229 130b 81 103 132
b
Ukraine 127 105 174 130 97 103 73 173 72 99 126
Turkmenistan 171 159 204 154 62 37 36 91b 48 50 124
b
Uzbekistan 111 77 96 70 53 58 62 93 68 95 116
Kyrgyzstan 12 10 11 18 4 13 33 42b 16 33 46
b
Pakistan - - 22 - - - - 45 22 30 19
Other 74 69 168 71 85 81 100 243b 173 219 267
b
CIS countries 1.956 1.749 2.781 2.155 2.166 2.111 2.134 1.668 926 1.336 1.493
b
Other 276 205 816 137 62 70 38 1.461 933 1.313 1.740
Total 2.232 1.954 3.597 2.292 2.228 2.181 2.172 3.129b 1.859 2.649 3.233
Notes. Source: State Migration Service (SMS) and the Ministry of Internal Affairs (MIA).
b
= after change; “-” = information not available; returned citizens of the Republic of Azerbaijan are not included. The number of
temporary residence permits issued in the country was not taken into account.

Appendix 2

Table 2
The Volume of Remittances Sent to and From the Country in 2008-2016 (in the Amount of One Million US Dollars) According to
the Central Bank of the Republic of Azerbaijan
2008 2009 2010 2011 2012 2013 2014 2015 2016
Volume of imports into the country 1.416 1.182 1.338 1.772 1.852 1.579 1.709 1.183 564
Annual shifts 18.8% -16.6% 13.2% 32.4% 4.6% -14.7% 8.2% -30.8% -52.3%
Volumes of exports from the country 399 522 840 1.138 1.892 1.579 1.523 943 490
Annual shifts 45.9% 30.9% 60.8% 35.5% 66.2% -16.6% -3.5% -38.1% -48.1%
Balance 1.017 659 498 633 -40 0 186 240 75
376 SOCIO-ECONOMIC INTEGRATION OF IMMIGRANTS RESIDING IN AZERBAIJAN

Appendix 3

Table 3
The Volume of Remittances Sent to and From the Country in 2008-2016 (in Millions of US Dollars) According to the World Bank
2008 2009 2010 2011 2012 2013 2014 2015 2016
Volume of imports into the country 1.518 1.255 1.410 1.893 1.990 1.733 1.846 1.270 643
Annual shifts 19.8% -17.4% 12.4% 34.2% 5.1% -12.9% 6.5% -31.2% -49.4%
Volumes of exports from the country 567 638 954 1.280 2.073 1.903 2.031 1.293 -
Annual shifts 40.2% 12.5% 49.4% 34.2% 62.0% -8.2% 6.8% -36.3% -
Balance 951 617 457 613 -83 -169 -185 -23 -
Note. Source: Central Bank 2017, Expert estimates, International Center for Migration Development, MOBILAZE support project
research calculations.