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On the border How the Russian region most intertwined with China is coping economically amid the coronavirus outbreak

Source: Meduza

Primorsky Krai, a region located in the Far East of Russia, borders North Korea and China. It has close ties with China through trade and tourism. Chinese workers come to Vladivostok, the capital of Primorsky Krai, to set up small businesses. Many of the goods sold in the region are imported from China. But life in this region has changed drastically since the outbreak of the novel coronavirus. The border is on lockdown, flights have been cancelled, and travel restrictions with China are in place. Meduza’s Andrey Pertsev visited Vladivostok to see Russia’s Far East is coping in the context of severed ties, however temporary, with neighboring China.

“Come in, get your haircut!”

“You’d really have to have your head in the sand to say that the situation in the region hasn’t changed since the coronavirus epidemic began,” says Konstantin Shestakov, the deputy prime minister of Primorsky Krai. Ties to China are so close here that even people passing through Vladivostok as tourists or visitors can easily spot the transformations. Shops are closed, the doors of cafés are locked, business is suffering.

One of the most popular activities among Vladivostok residents is to hang out at Chifanki, or Chinese cafés. Most of these cafés are located at the Sportivnyi Market, known by locals as “Sportivka,” which is near the city center. They can be found both alongside the open-air booths and throughout the indoor shopping mall, sometimes lined up in a row. Competition for clients is fierce. Usually, someone stands outside each café and flags down passersby, advertising their food: “Come eat here! Our dishes are delicious!” In Vladivostok, many of the Chinese business owners have chosen simple Russian names for themselves: One can even find a café called “Sasha and Lena” right next door to another one called “Valera and Lena.”

The people outside who promote the cafés sometimes offer small gifts to clients, like a pack of juice. Lunchtime is always very busy, and many Chinese workers who work in nearby shops come here for their lunch breaks. When we visited, the cafés seemed empty. Many Chinese shopkeepers had gone to China to celebrate Chinese New Year on January 25, leaving signs outside their shops explaining when they would be back. Judging by these signs, many were looking to return sometime in mid-February.

But then the coronavirus outbreak began. By late January, Russia had closed its Far East border with China and imposed travel restrictions. Flights have been limited. Shopkeepers and café owners do not know when their colleagues could be back, but the most optimistic estimate seems to be late March.

Local news outlets have reported on the closure of Chinese cafés, but in fact, most of the cafés located on Sportivka were open when we visited. The people who work there were not eager to chat with us, but some of them told us that there are many Chinese citizens who are still in Russia and who are continuing to work: “Where would they go? Everyone is right there, working. Of course, the dishes on the menu have gotten a bit more expensive, but not by a lot,” said Valery, a fishmonger.

Some of the barber shops and hair salons around the city are also closed. Like the Chifanki owners, other Chinese entrepreneurs have opted for Russian names, and the salons sport signs saying “Roma” or “Pasha.” The barbershops that are still in business also have people standing outside, enthusiastically inviting people walking by to come in and get a haircut.

Indeed, they retain their clientele. The barbershops are full of people. The only difference between now and the time before the coronavirus is that the salon workers wear face masks. “I’m almost not even scared. After all, the border is closed. Our Chinese people, the ones who are in town right now, haven’t gone anywhere, so they couldn’t have contracted the virus. And here [in this Chinese barber shop], everything is high quality and cheap,” says Ekaterina from Vladivostok, who encountered us just after leaving a salon and seemed very happy with her new haircut. A few of the workers told us that they wear face masks to build trust with clients and to show they are keeping health concerns in mind: “After all, we work closely with people,” they said.

A little help from Korean bloggers

“The pigeons on the central square have definitely noticed the absence of Chinese people. Chinese tourists constantly fed them, they liked them for some reason. Now it looks like the birds have even lost weight,” says Viktoria, who words for a private tourist company.

In the building where Viktoria works, two of three floors are taken up by a grocery store and souvenir shops. Sellers argue that the border lockdown has had hardly any effect on their businesses. That is because they cater specifically to Korean tourists.

We walked into one of the souvenir shops. Visitors from Korea were crowding around the shelves, trying to choose from a broad selection of small vodka bottles and various souvenirs with portraits of Vladimir Putin. “Chinese tourism is mass tourism, they move about in groups, they follow their tour guide. The business owners who work with those tour guides have probably felt the effect of the border lockdown. We haven’t,” says Viktoria. She argues that Vladivostok in fact got very lucky with the timing of the coronavirus outbreak, since many people in China try to spend this time of year with their families at home. “It would have been very different in the summer. If you come to Vladivostok [in the summer] you could have trouble figuring out you’re in Russia, we get so many Asian tourists,” she told us with a smile.

Jewelers in the center of town have taken a hit. Gold jewelry is popular among tourists from China. Perfume and cosmetics shops are also having trouble. Like the jewelers, they are concentrated in the Tsentralnyi Supermarket, which is located in the center of town on the main square, in close proximity to the major tourist attractions. “It’s not nice, of course, but it’s true that we don’t have many tourists right now. In the summer it would have all been different, but right now, we don’t feel a huge blow. We really hope everything will return to normal, especially in the summer,” said Maria Zaitseva, who works at the jewelry shop called Biryusa. Her shop was empty.

The cosmetics shops have begun to depend on tourists visiting from Korea. “They are very heavily oriented towards bloggers. One blogger posted something on her blog about carrot-based cream, and now everyone wants it. I even came with my family to have a look at the cosmetics shop, to see what that kind of interest looks like. At the cash register, they told me, ‘if you see a crowd of young Korean women, that’s where it is,’” said deputy prime minister Konstantin Shestakov. An employee of Il de Bote, a chain store, told us anonymously that their sales have fallen drastically because their shop is more attractive for tourists from China, while Korean tourists seek out locally made unique brands.

A quirky local attraction in Vladivostok, the Museum of the Sea Cucumber, also suffered from the coronavirus outbreak. It is closed for regular visitors, and tour groups can come by only after submitting a special application. The museum workers told us that they usually cater to foreigners, and before the outbreak, about one thousand people would pass through the museum every day. The museum is located in the same building as a supermarket called 7-twelve, which also caters to Chinese tourists and is also closed.

Konstantin Shestakov says that the timing of the travel ban is indeed lucky: “In August, every day, around five thousand tourists come from China, but in February, that number would have been just hundreds,” he explains. He also adds that the blow has been softened by an increasing number of Korean tourists, who began taking more interest in Vladivostok in 2019. Now, the city’s numbers of Korean tourists are equivalent to its numbers of Chinese tourists in the period before the coronavirus outbreak.

“We get two to three people coming from Korea together, usually young people who want to visit the closest European city and have a nice holiday: the sea, selfies, crab, shopping, theater, bars with live music. Korean social media are full of photos from Vladivostok. We’ve tried to emphasize Korean shows and Korean bloggers here,” Shestakov says.

The tomato problem

The border lockdown and the quarantine in China have hit virtually every resident of Russia’s Far East in another way: Prices for fruits and vegetables have soared. Cucumbers, tomatoes, lettuce, Mandarin oranges, and apples are mostly delivered from China. The border closure in early February affected food delivery, and sometimes, residents would come to do their shopping and find empty shelves in the grocery store where the vegetables used to be.

The border is now open for food delivery again, and fruits and vegetables have filled up the shops. But they are not cheap, sometimes reaching 300 rubles ($4.70) per kilogram. “Before, prices started at 150 rubles ($2.35) depending on the shop. Now you get the same thing for twice as much. What happened?” a disgruntled shopper at the large supermarket Remi asked us. She said that she does not have any interest in buying vegetables from China at this price, and the issue is not coronavirus. She explained that many locals prefer Russian tomatoes and cucumbers to vegetables imported from China because they are better quality. But not everyone can afford Russian greenhouse vegetables, which start from 400 to 450 rubles ($6.25-$7) per kilogram. Tomatoes from Azerbaijan, which are flown in, cost around 600 rubles ($9.36).

At a high-end supermarket called Yuppie, a young man reaches for a bag of lettuce, but is taken aback by the price, which has reached 500 rubles ($7.80). “I don’t often look at prices, but this is way too much,” he says as he turns away from the shelf without his lettuce. Because of the price hike for lettuce in particular, the Vladivostok zoo had to crowdfund part of its animal feed by posting on social media and asking locals to bring lettuce for the animals.

“We can see that prices are going up, what can I say,” says Shestakov. He argues that this could provide a window of opportunity for the region to find new suppliers from Kazakhstan or Belarus and to develop its own greenhouses. But exports from the region, according to official statistics, have also fallen. For example, China used to buy live crab from Primorsky Krai, but now, demand has fallen. Public events are cancelled because of the quarantine, and people are not leaving their houses to eat out, so crab is not as necessary.

All but frozen

Construction is also facing problems. Two construction sites in Vladivostok, for two Hyatt hotels, have hardly been moving along over the past several years. In 2019, the local government sold the two construction sites to the company Burguduz Park, which belongs to Oleg Deripaska (a billionaire who is rumored to have secretive financial ties with Vladimir Putin). The new company wanted to hire Chinese workers to finish the inside of the hotels and planned to ask for permission to bring 500 migrant workers to Russia (companies must obtain authorization if they want to hire foreign nationals), but the border lockdown has halted these plans. “You won’t get these quotas [authorization for foreign nationals to work] until we figure out the situation with the coronavirus,” said Yury Trutnev, the presidential envoy to the Far Eastern District of Russia.

The Hyatt construction sites are practically frozen. “I talked to some representatives for Burguduz, and they are actively looking for new labor markets in order to stick to the schedule they set for themselves – they want the hotels completed by the time the Eastern Economic Forum rolls around,” says Konstantin Shestakov, referring to an annual international forum that encourages foreign investment in the Russian Far East. Vladimir Putin always attends.

The coronavirus has caused problems for other major building projects in the region, too. Since 2009, the factory Zvezda (Star), which belongs to the United Shipbuilding Corporation, has been working on a new shipyard that will serve as the site for oil tanker production. The China Communications Constructions Company, a Chinese business, has been working on part of the shipyard — namely, a dry dock set to be the largest in Russia. Several thousand Chinese workers are involved in the project. Some of them have gone back to China for the holidays and can’t come back because of the border lockdown. A source in the regional government told us that they have not yet heard anything from the United Shipbuilding Corporation about this issue. “Chinese workers travel there in waves, so there are still some people left in any case,” said the official.

A business owner working in construction in the region told us that a couple of years ago. the border lockdown would have caused far more serious problems: “Before, Chinese workers were involved at each stage of construction, but the economy there [in China] is growing, so they’re coming less often to work for the money we can offer them. For us, it’s also become more profitable to hire workers from Central Asia, who fly here via Novosibirsk. The Hyatt project went for Chinese workers because the Chinese people have been doing everything to high standards for a long time now, and they needed quality.”

“We’re used to epidemics and catastrophes”

Local business owners are worried about when the quarantine could end and whether it will last a while. The tourist season usually starts in March, and if the quarantine and lockdown continues, then businesses will face serious losses. But the local government is optimistic: “I have a feeling that by the end of March everyone will forget about this entire thing, everything will go back to normal. Of course, we’ll be left with an aftertaste; we’ll have to shake things up and restore them,” Shestakov predicts.

Even so, the local administration has taken measures to show they are ready to fight the coronavirus: Three isolation centers for Chinese citizens have been set up, and hospitals have stocked up on so-called “anti-plague kits.” Far East Federal University dorms were reorganized to create a quarantine space for Chinese students who are due back in March. Russian students have reacted with outrage, since many students were forced to relocate on short notice. There has not been a single coronavirus case in the region so far.

You see more people wearing face masks on the streets of Moscow than on the streets of Vladivostok. “We are used to epidemics and catastrophes. Something is always happening in the Far East,” says Veronika, the tourist company worker, and laughs.