Apec's sleeping bear wakes up

President Vladimir Putin holds the future of Apec in his hands. Photo / AP

Next weekend Apec leaders, including Prime Minister John Key, gather in Russia's far eastern city of Vladivostok. Herald political correspondent John Armstrong, who will be covering the summit, assesses what might come of Moscow's chairing of Apec.

The lobby of what was then Auckland's Carlton Hotel was awash with rumour and abuzz with speculation. So much so that little notice was taken of the trim, slightly balding but otherwise unremarkable figure passing through the throng of politicians, diplomats, security personnel and journalists on his way to an appointment in one of the hotel's ground floor function rooms.

Outside the hotel, it was an unseasonably warm September afternoon. Inside the hotel, however, the heat was on in a very different fashion.

The diplomatic blow-torch was being applied to the Indonesian delegation by other nations attending the 1999 Apec summit. The conference's formal agenda had become very secondary as delegates engaged in frenzied diplomacy to persuade a reluctant Jakarta not to block an international peacekeeping force from entering East Timor. Its intent was to halt the carnage precipitated by the sudden withdrawal of the Indonesian military after a near quarter-century of occupation.

Little surprise that as this regional crisis played out, only passing attention was paid to the man paying a courtesy call on the summit's host, New Zealand Prime Minister Jenny Shipley.

Former KGB officer and Communist Party apparatchik Vladimir Vladimirovich Putin had been Russia's Prime Minister for barely a month. He was an unknown quantity. He was thought unlikely to last long in the job.

Putin was very much a peripheral figure at that year's Apec. Russia had only joined the 21-strong bloc of "economies" the previous year. A former Portuguese colony on the equator was far outside Russia's north Asian sphere of influence and its fate correspondingly of little consequence to Moscow.

What is surprising is that despite retaining the old Soviet Union's claim to superpower status, Russia has by and large remained a bit player on the Apec stage.

This year, however, Russia is hosting the annual Apec circus for the first time, the venue being the far eastern port city of Vladivostok, best known as the station at the end of the line for the Trans Siberian Express.

Russia is stressing that one of its priorities for the summit is to find ways of spurring economic growth in its stagnating far eastern region.

Billions of roubles have been spent on infrastructure projects - including the building of one of the world's longest suspension bridges - to show off Russia to the world and, more importantly, ensure there is nothing to embarrass Putin, now in his third term as President and an increasingly unpopular one.

There are several reasons why Russia's engagement with Apec has been somewhat perfunctory.

The main one is that Moscow - seven time-zones away from Vladivostok - looks to the west. As Putin declared in a major foreign policy address back in February, Russia sees itself as "an inalienable and organic part of Greater Europe and European civilisation".

Putin devoted only 13 of the discourse's 112 paragraphs to the growing role of the Asia-Pacific region. And most of those were consumed with assessing Russia's relationship with China.

There are suggestions that Russia views Apec as more useful in dealing with things like security against terrorism rather than the grouping's primary focus on freeing up trade and investment. That should change now Russia has finally been admitted to the World Trade Organisation after an 18-year struggle.

This will force Russia to conform with WTO rules, thereby making other countries more willing to negotiate free trade deals with Moscow.

It has taken a while to dawn on the Russians that economic growth and increased trade opportunities over the next decade will be found in Asia, not Europe.

The problem is that Russia has done little to "integrate" its far eastern economy with some very fast-growing or wealthy ones on its back doorstep, namely China, Japan and South Korea.

Apec's hosts have a large say over the summit's formal agenda. However, Russia's other priorities for its chairmanship (dealing with threats to food security such as climate change, improving transport and logistics systems and co-operating in the interests of modernisation to boost innovation) while important, are hardly headline-grabbing.

The leaders' discussions at Apec will inevitably focus on the lingering recessionary aftertaste of the global financial crisis and what to do about it.

But the summit's economic work may be overshadowed by various meetings on the sidelines to cool down arguments over the ownership of some strategic offshore islands near Taiwan, which has had China sparring with Japan, while the latter is still arguing with Russia about who should have sovereignty over a separate set of islands far to the north.

A clash of dates with America's Democratic Party Convention means Barack Obama is a no-show. That makes it even more unlikely Putin will get too much grief from elsewhere in Apec over Russia's backing of the Assad regime in Syria.

Obama's absence is unfortunate. At previous Apecs, Asian leaders have taken the lead from America. Whether Apec moves forward or just treads water is now very much in Putin's hands.