18.05.2005
Chinese Migration in Russia
№2 2005 April/June

This article is based on two opinion polls – the largest ever
conducted amongst Russia’s Chinese community – of Chinese
immigrants in Russia. The first of these polls, was taken in
1998-1999 among 757 Chinese in Moscow, Khabarovsk, Vladivostok and
Ussuriisk. The second poll was conducted in 2002 among 525 Chinese
in Moscow, Irkutsk, Khabarovsk and Blagoveshchensk.

In both polls, those interviewed were chosen at random. The
polls were taken in marketplaces and at Chinese dormitories for
students and workers, and the respondents were given questionnaires
in both Chinese and Russian. No intermediaries were allowed to
interfere – neither foremen, nor tutors or other people engaged in
the organization of the life and work of the Chinese. I and my
fellow researchers determined the approximate number of respondents
in each city. In 2002, it was decided that Chinese students of
Russian colleges and secondary schools would comprise one-third of
those polled in each of the above cities. Research conducted in
1998-2001 had showed that Chinese students are likely to fill
employment positions needed by Russia as they are familiar with the
Russian language, culture and customs and wish to become Russian
citizens.

The data collected from the polls provides a general picture of
Chinese migration to Russia that includes social and economic
significance. It also shows certain distinctions between Chinese
migration to Russia from that to other countries, as well as
changes in the migrants’ overall composition since 1998-1999.

MIGRATION ON THE RISE

Statistics gathered by Russia’s Federal Border Guard Service
reveal that about 80 percent of Chinese migrants enter Russia
through checkpoints of the Far Eastern Border District; of this
number, approximately 50 percent arrive from checkpoints in the
Maritime Territory. In 1998-2001, the ratio of Chinese migrants
entering Russia was approximately the same as the number exiting:
450,000 to 490,000 Chinese entered and exited Russia per year. In
2002, the situation drastically changed: the number of Chinese who
entered the country increased by almost 55 percent compared to the
annual average figure for the previous four years, while the number
of Chinese who left Russia increased by 52 percent. In 1998-2001, a
total of 35,900 Chinese opted to stay in Russia, while in 2002
alone this figure stood at 27,200, that is, 200 percent more than
the average annual figure for the previous four years. In 2003, the
situation did not change much: 23,300 Chinese migrants stayed in
Russia. In all, 86,400 Chinese stayed in Russia over six years.

The number of private visits to Russia by Chinese citizens has
increased dramatically as well (in contrast to business and
tourists, Chinese leaving their country for permanent residence in
Russia, transit passengers, as well as trips made by service
personnel). Over a period of 6 years, the number of private trips
to Russia has increased by almost 14 times! Interestingly, before
2002, the number of private Chinese tourists leaving Russia
exceeded that of private Chinese tourists entering this country.
This rare situation can be explained by the large number of Chinese
tourists who had illegally remained in Russia in previous years.
Furthermore, there has been an increase in the number of private
firms set up by Chinese and Russians to assist travelers with visa
formalities. One can only conjecture about the influence this new
development may have on the total situation.

These statistics suggest several conclusions. First, the bulk of
Chinese migrants enter Russia legally, that is, they have documents
with official permission to cross the border. The question is: Did
they obtain their documents legally? (The Russia-Kazakhstan border,
which is longer than the Russian-Chinese border, illustrates the
size of the problem – the Federal Border Guard Service remains
unable to effectively control it.) Second, Russia has been unable
to completely block channels of visa-free tourism used by Chinese
citizens. Third, the scale of legal Chinese migration to Russia has
increased since the beginning of 2004, yet it is not big enough to
cause panic, let alone speak of a Chinese demographic
expansion.

Over this period, the number of Russians entering China has far
exceeded the number of Chinese arriving to Russia. But unlike the
Chinese, the Russians always return home. Russian visitors to China
can be divided into two groups: people hired by Chinese merchants
in Russia to deliver goods from China, and people leaving for China
to buy goods for commercial or private purposes. Some experts
believe the first group is the larger one. At the same time, there
have already appeared several small colonies of Russians in
China.

China’s state strategy of a global foreign-economic offensive
under the motto “Go outward” is aimed, among other things, to
increase Chinese immigration to other countries. But the Chinese
did not want to go to Russia in search of a better life. This
situation began to change fast in recent years. During the first
round of Russian-Chinese negotiations on Russia’s accession to the
World Trade Organization, the Chinese delegation demanded that
Russia remove barriers to Chinese merchants coming to Russia and
give them equal rights with Russian entrepreneurs. Later, China
withdrew this demand, and the country began to attract Russian
citizens. In 2002-2003, fifty Chinese cities introduced easy
procedures for issuing foreign travel passports. Furthermore, over
200 firms have been set up in the country to help the Chinese find
a job abroad. This measure has contributed to the growth of
migration from China.

A comparison of the results of the aforementioned opinion polls
shows that the nature of Chinese migration to Russia has in many
respects changed in the last five years.

First, the frequency of Chinese migrants’ trips to Russia has
sharply increased. Prior to our survey of 2002, specialists
believed that Russia’s Far East was largely a scene of ‘pendulum
migration.’ In 1998-1999, many Chinese preferred to avoid answering
the question how often they visited Russia. By 2002, the Chinese no
longer evaded this question. Now, considering all the information
gathered, we can definitely say that Chinese migration to Russia is
not a spontaneous migration of people to a new place of residence,
and not some search for a promised land. There has emerged a
specific form of the movement of manpower that serves the flow of
goods. Now the Chinese authorities have begun to stimulate
cross-border movement of people and goods. Migrants have become a
component part of China’s commercial and production structures. At
first glance, their cross-border movements resemble a pendulum
migration. But actually they reflect a specific mechanism of the
cross-border delivery of goods, which makes it possible to minimize
financial expenses (the payment of duties and taxes) or bypass
official procedures restricting flows of goods.

Second, the average duration that the Chinese remain in Russia
has increased. More and more Chinese migrants are permanently
settling in Russia.
Third, the structure and composition of Chinese migrants have
changed. The number of migrants who have lived in Russia’s Far East
for more than four years has markedly decreased. This development
has symbolic importance. In-depth interviews show that the Chinese
who have lived in Russia for more than four to five years
experience great difficulties upon returning home, and, therefore,
must once again find new ways to leave for Russia.

As a result, a permanent Chinese community is gradually forming
in Russia. In Russia’s Far East, this process is slow and limited
in scope. According to data from 2002, in Khabarovsk, the number of
Chinese migrants who have lived in Russia for over four years was
half the 1999 figure; in Vladivostok, it was 20 percent less
compared with 1999. At the same time, however, the number of
migrants in these cities who have lived in Russia less than one
year has markedly increased.
Fourth, speaking about the duration of the stay of Chinese migrants
in Russia, it is possible to single out two basically different
groups: some migrants act as delivery men and deliver goods to
regular salesmen, or work as temporary workers at Chinese retail
outlets; the other group of migrants settle in Russia, despite the
lack of legality of their status.

What are the plans of Chinese migrants in the future? To what
measure do they connect their future with China and with Russia?
The research done in 1998-1999 showed that only 7.8 percent of
those polled planned to permanently settle in Russia, while another
four percent wanted to move to other countries. The 2002 poll
revealed a higher percentage of Chinese migrants wishing to settle
in Russia – more than 35 percent, whereas over 14 percent planned
to leave for other countries via Russia. Less than half of the
respondents said they would return home. This change in Chinese
migrants’ sentiments was caused not so much by the living standards
in Russia as by the aggravation of the social and economic
situation in China.

Fifth, the analysis of Chinese migrants’ plans for the future
shows that among those wishing to leave for another country, more
than a half are migrants who have lived in Russia less than a year.
Among migrants wishing to return to China, an absolute majority is
again made of those who have lived in Russia less than a year.
Apparently, the first year in Russia is a critical period, after
which migrants radically change their plans for the future.

The Chinese migrants cannot break ties with their homeland
because they are an organic part of China’s commercial and
industrial structures. Otherwise, they would be left without a
livelihood, especially since the Russian Federation passed a law in
2002 that makes it more difficult to obtain Russian citizenship. It
is important for the Chinese to keep their Chinese citizenship –
even after living in Russia for many years – in order to have their
rights and dignity protected.

As a private person with certain plans for the future, a Chinese
migrant is not inclined to subordinate his entire life exclusively
to the interests of business – especially to one that he does not
even own. As more and more cargo firms become involved in the
‘people’s trade’ (as border trade is officially described in
China), thus driving out family businesses, the latter group must
change their plans. The fact that over 30 percent of Chinese
migrants hope to settle in Russia, and more than half of those
polled said they were not going to return home, is of fundamental
importance.

The last few years have produced another basically new
phenomenon: every seventh respondent openly expressed their desire
to leave for a third country. Until recently, such candidness was
rather uncommon. It is difficult to say what precisely caused such
a serious change in the Chinese migrants’ sentiments over just a
few years: the aggravation of the social and economic situation in
China (especially the growth of unemployment), or the Chinese
government’s measures to implement the “Go outward” strategy and
push emigration.

Sixth, Chinese social scientists have long noticed that, owing
to many circumstances, above all, economic self-reliance, Chinese
women have begun to demonstrate an unprecedented level of
independence from men. The difference between Chinese men and women
in terms of their duration in Russia, as revealed by the poll, is
not large enough to suggest final conclusions. Yet, this factor
deserves attention, considering the noticeably growing prevalence
of men in the Chinese population.
The history of Chinese migration shows that during the first few
years of migration to various countries, unmarried men made up an
absolute majority of the new arrivals. Later, they were followed by
women. A balance between the sexes was gradually established, and
full-scale diasporas were formed. In Russia, the situation with its
migrants is somewhat different. Until recently, very many Chinese
came to Russia with their families. The year 2002, however, saw a
sharp increase in the number of unmarried migrants.

An opinion poll, of course, is not an all-embracing census; it
is difficult to say to what extent the data obtained in polls
actually reflects the reality. In all of the Russian cities where
the polls were conducted, a significant process was revealed:
unmarried migrants have begun to prevail over those who are
married, while the number of married women participating in
business has decreased. These changes also testify to a decline of
family business in the ‘people’s trade.’

People in the most active, employable age bracket make up an
absolute majority of Chinese migrants to Russia, with more than
half aged 21 to 30. In some cities, there are very many people of a
more mature age. The year 2002 saw a marked increase in the number
of migrants below the age of 25 (it is possible, however, that our
data on this group of migrants overstates their actual percentage
due to the rate of students).

Almost everywhere in Russia an increase in the number of
migrants who have left their families in China occurred; this
scenario could be explained by the terms of employment established
by the Chinese side. Their significant increase is, no doubt, a
result of changes that have taken place in the working and living
conditions for an overwhelming majority of Chinese migrants in
Russia. The mode of life of the majority of those polled has
revealed an amazing coincidence in many aspects. For example, in
Khabarovsk and Vladivostok the number of married migrants living in
Russia together with their children has decreased by half. In this
sense, the situation is not improving. During the previous study,
almost none of the respondents said he was planning to bring his
wife and children to Russia; many complained about the poor
attitude of Russians toward their children and expressed fear for
their own safety. All those fears were still alive in 2002.
Furthermore, there were many complaints in particular about the
police.

ECONOMIC IMPLICATIONS

The former representative of the Russian president in the
Siberian Federal District, Leonid Drachevsky, stated there are not
more than 75,000 Chinese migrants out of a population of 21 million
in his region, and that the greatest danger is posed by their
economic effect on the region. He is absolutely right. The main
problem (at least, for the present) lies not in the number of
Chinese migrants, but in the economic damage that Chinese
communities inflict on Russia.

The ex-premier of the State Council of China, Zhu Rongji,
estimated the volume of people’s trade in 2001 at U.S. $10 billion.
The volume of official trade in the same year amounted to U.S.
$10.7 billion. The positive balance in the official trade stands at
3 to 5 billion dollars in Russia’s favor. However, the volume of
the people’s trade is determined by China’s net income brought by
the sale in Russia of Chinese goods – purchased from producers with
money earned by selling them in our country. So, actually, the
favorable balance in trade belongs to China.

At the 2nd Russian-Chinese Banking Forum (2003), a Chinese
participant described the most common pattern of Chinese firms’
activities in Russia. A company registers itself simultaneously in
two countries. One of its subsidiaries is registered in Russia by a
Russian citizen who has no financial signature authority as such;
this subsidiary engages in wholesale and retail trade. The other
company is registered in China by a Chinese citizen and it engages
in wholesale operations. Goods are supplied in small shipments from
a storehouse in China to Russia. The revenues from the sales are
sent back to China. This form of trade accounts for 40-60 percent
of Chinese exports to Russia.

The 2002 poll has shed some light on how the trade operations of
Chinese migrants are financed. In Russia, there have emerged
underground Chinese banks which finance various kinds of illegal
operations, and intermediary firms which transfer money to China.
Formally, some of these are exchange offices, but in reality they
transfer money via banks of third countries, serve Visa,
Master-Card and other bank cards, give financial advice, as well as
engage in other operations.
Interestingly, neither China’s Elos Bank, which is officially
registered in Russia as a branch of the Bank of China and has a
very small authorized capital, nor the numerous illegal financial
firms, engage in credit operations. Meanwhile, money transfers to
Beijing’s Yabaolu – a well-known center of wholesale trading
companies and cargo firms serving Russian ‘shuttle traders’ and
China’s ‘people’s trade’ in Russia – can be made even in cash!

The general pattern of illegal banks’ actions is as follows:
they accumulate revenues of trade companies, allocated for turnover
development, and via intermediary firms (mostly Russian ones) store
up, purchase and send to China scarce goods (timber, nonferrous
metals, pine nuts, and many others). In China, these goods are
sold, and the revenues are divided in respective shares among all
those who participated in the transaction at different stages. In
other words, there is a smoothly operating mechanism of “black”
schemes for looting Russia. Chinese firms closely cooperate with
Russia’s shady organizations. For example, about 1.5 million cubic
meters of wood is cut down illegally in the Maritime Territory
every year. Russia is not the only country to suffer. According to
a February 27, 2002 report of the Reuters news agency, the World
Wildlife Fund expressed its concern over the future of Russian
forests in the Far East. The Fund said these forests may disappear
in five years because of the illegal deforestation.

The aforesaid confirms the conclusion that Chinese migration is
a link in China’s trade and industrial system, oriented in recent
years toward the ‘cross-border economy.’ Russia is already included
in China’s division of labor through the business activities of
Chinese migrants. China has already assigned a place for Russia in
this process – a supplier of resources and a market for products
found unfit for sale on other markets.

The participants in the polls expressed interesting
considerations about their business plans in Russia. Most of them
said their plans depended on the market situation and the success
of their business. As in 1998-1999, Chinese migrants prefer to
extend their business operations in Russia rather than China. In
the late 1990s, 28.5 percent of those polled wanted to start or
extend their business in China, whereas 35.3 percent gave
preference to doing business in Russia. Interestingly, even in
1998-1999, that is, right after the financial default in Russia,
amidst uncertainty and social deprivation, only about 10 percent of
Chinese businesspeople planned to reduce their business in Russia,
while a mere six percent intended to shut down their operations. In
2002, the latter figure decreased to one percent. In 1998-1999,
13.3 percent of those polled planned to remain as hired workers,
compared to about 10 percent in 2002.

Thus, if the market situation permits, a majority of the
respondents plan to extend their business operations in Russia.
These sentiments will determine the state of Chinese migration into
Russia, and most importantly in the Far East. Much will depend on
the immigration policy of the Russian authorities, which are now
inclined to continue with its prohibitive nature.

However, the shortage of manpower will force Russia to revise
its immigration policy. Russia will have to resort to international
experience in this complex issue and look for creative solutions.
Moscow’s future immigration policy must stimulate the Chinese to
come to Russia for employment.

Yet, this is not enough: Russia needs an immigration policy that
would take into account the specific features of its different
regions. The difference between Russia’s European part, Siberia and
its Far East is immense. For example, many Russians in the Far East
now have to engage in an individual cross-border ‘shuttle trade’ –
not because of Chinese immigration but because of the poor state of
the regional economy, which, in turn, was caused not by a manpower
shortage but by the lack of clearly formulated goals for developing
local industries.

The widespread belief that immigrants are taking jobs from
native workers does not correspond to reality, as follows, for
example, from reports coming from the Maritime Territory, a region
where migration flows are particularly high. An analysis of the
situation there shows that areas where economic growth has begun
require additional manpower, and immigrants filling job vacancies
only contribute to the economic revival and thus to increased
employment among the local population.
The aforesaid suggests the main conclusion: a strategy for
developing Eastern Siberia and the Far East must be aimed at
increasing the competitive ability of Russian industries in order
to counter the growing inflow of goods from China.

Chinese communities in Russia have been actively extending the
sphere of their business. Their activity inflicts damage on
Russia’s economic security and checks the development of a
civilized market economy. Also, it strengthens Russia’s position as
a raw-material appendage of China. This turns Russia, primarily,
into a market for Chinese goods, thus preventing economic growth,
especially in the Far East, and contributes to increasing Chinese
migration to Russia and, via Russia, to other countries.

POSSIBLE STRATEGIES

The manpower shortage threatening the Russian economy, together
with the continuing social crisis, has caused some Russian experts
to advocate the broad use of Chinese workers, which would call for
introducing a liberal immigration regime in Russia. On the other
hand, many others warn against en masse Chinese immigration to
Russia.

Over the last decade, the Russian authorities have been seeking
to build an effective administrative mechanism to control
migration; these efforts have still not proven successful. An
analysis of the situation suggests several considerations about a
future state migration policy.

1. Russia has never had a consistent demographic policy. Now the
country is reaping the fruits of its past policy when the citizen
was not the central focus of society and the state. The entire
organization of Russian life – transportation, shops, housing,
public health, etc. – is not intended either for the population’s
expanded reproduction, or even for the maintenance of health.
Russia must adopt a sensible demographic policy, as well as a
comprehensive demographic and socio-economic strategy.

2. The Russian authorities must work out a comprehensive,
long-term strategy for developing Eastern Siberia and the Far East,
which would be basically different from all the previous programs.
To this end, Russia must:
– take into account possible changes in the political, social and
economic situation in China. In that country there are acute
conflicts in all areas of domestic life. Under The 21st Century
Challenges to China program, an opinion poll was conducted among
China’s 100 major scholars. In their opinion, the following six
social issues will be “extremely important” until the year 2010:
unemployment (66 percent of those polled); relations between
different sections of the population (64 percent); corruption (62
percent); ecology and resources (56 percent); overpopulation (54
percent); and “stagnation in the reform of the socio-political
system” (52 percent).

Let’s examine in more detail the first problem since this is
directly related to migration. At the end of 2002, China’s
population exceeded 1,284 million people. Out of this total, almost
933 million Chinese live in rural areas; of them, 150 to 200
million are considered to be redundant manpower. About 90 million
of these individuals manage to find work in the cities, but another
60 to 110 million fail to find employment. This poverty-stricken
mass of people is steadily increasing. In the 1980s, a one-percent
growth in the GDP was accompanied by the creation of 2.4 million
jobs; in the 1990s this figure decreased to 700,000-1.1 million.
This number represents an inflammable source of social discontent,
as well as a giant migration potential in China. Russia is
interested that China’s development is safe for the neighboring
countries; should open conflicts arise there, Russia may find
itself in distress.

Beijing plans to quadruple its GDP by 2020. According to Chinese
expert estimates, China will have exhausted a large part of its
natural resources by 2010. By 2020, it may even have difficulty
meeting its demand for coal. China needs natural resources from the
entire planet, including those of Russia;

– make plans for developing Eastern Siberia and the Far East,
bearing in mind that it is unable to compete with China. According
to figures of the United Nations, average per capita production
costs in China are 48 times less than in the U.S., 30 times less
than in Japan, 20 times less than in Taiwan, and 14 times less than
in South Korea; they are also lower than in Mexico, Turkey, the
Philippines, India and Indonesia. Therefore, companies from various
countries have in the last few years moved the production of many
goods to China. Thus, Russia will have to completely change the
mentality of its business community, which has been trying to
persuade China to buy Russian goods for many years now. Russian
businesspeople should learn from international experience and
understand that China will buy only those goods which it badly
needs – and only for a limited period of time. Several industries
in Eastern Siberia and the Far East manufacture products that
cannot stand up to competition with Chinese goods. It is inevitable
that these production facilities will be closed. Russia would only
gain if it uses Chinese industries for legal supplies of required
products to its market, and if the “shuttle (people’s) trade” is
gradually curtailed;

– exempt investors from taxes (completely or partially) for
financing the economy of Eastern Siberia and the Far East. It would
be expedient to study the experience of postwar West Germany in
liquidating a housing crisis, as well as the U.S. experience in
exploiting the natural resources of Alaska;

– try to understand what Russia’s real, rather than illusory,
comparative advantages are and on this basis build economic, social
and immigration policies.

3. Moscow must admit that Chinese migration will not solve the
manpower shortage problem in the country. First of all, the Chinese
leadership will not allow that, since it is using migration for
implementing its global foreign-economic strategy. The manpower
shortage problem can be solved through a wide use of tenders and
orders that would provide for the temporary use of Chinese manpower
in Russia.

It would also be expedient to follow in the footsteps of some
European countries and attract Chinese specialists and highly
skilled workers to Russia on a selective basis. The Chinese
government is already conducting such a policy toward Russian
specialists. Therefore, Russia should differentiate its visa
practices, borrowing from international experience.

Simultaneously, Russia must work out a program for developing
its industries on the basis of new and high technologies and
venture capital. Maximum economy of resources and manpower must be
the main development priority.

There are manpower resources in Eastern Siberia and the Far
East. However, people cannot find a worthy use for their talents,
while many must help accommodate the flow of Chinese goods. The
Russian authorities, therefore, must create prospects of permanent
employment which will lead to a worthy existence for the local
population and halt its moral degradation and lumpenization.

4. Of increasing importance are efforts to combat xenophobia and
various kinds of nationalistic movements.

5. There is a possibility that students will make up the bulk of
Chinese migrants to Russia. The high cost and low quality of a
Chinese education prompt many Chinese to send their children abroad
for schooling. The number of Chinese students in other countries
has been steadily increasing each year. In 2003, however, only one
in every 12 Chinese who left to study abroad chose Russia.

Russia could attract more young Chinese to its educational
institutions by launching a large-scale publicity campaign in
China. The success of such a program would help Russia solve, at
least, two major problems: first, it would increase revenues of
Russia’s educational institutions and help them to carry out a
modernization program; second, initiate a program to train Chinese
students of secondary and higher educational establishments with a
good knowledge of the Russian language, as well as specialists who
could work in Russia. All those wishing to stay in Russia must be
given the corresponding rights, including the possibility of
receiving Russian citizenship. This goal requires serious changes
in Russian legislation, as well as in Russia’s Foreign Ministry’s
operation.

To evaluate the possible efficiency of the above measures, an
opinion poll was conducted among Chinese students in Moscow,
Irkutsk, Khabarovsk and Vladivostok. The poll shows that these
measures deserve attention and state support, yet their
implementation requires painstaking preliminary work. Presently,
there are unemployed Chinese graduates in Moscow from Russia’s
higher educational establishments. They have been living in Russia
for up to five years and show a desire to live and work here. They
are looking for jobs in Chinese communities because they have
failed to find work in Russian organizations. The time has come to
make political decisions to drastically change this state of
affairs, and to translate these decisions into reality.