By Ingrid Pederson
Central Eurasia Standard
BusinessInsider.com
Central Eurasia Standard
BusinessInsider.com
It didn’t surprise me today to read that China was irked by Clinton’s recent comments that African nations should be wary of China, as their relationships were based on a need for natural resources bountiful in numerous countries:
“I will be talking about what that means, about a model of sustainable partnership that adds value rather than extracts it,” Clinton told a university audience in this West African capital. “That’s America’s commitment to Africa.”
This need for resources, particularly minerals and oil, could lead to extractive partnerships in which the African nations don’t benefit as much as they potentially could. Additionally, China has not shied away from doing business with nations that the US considers unsavory, the obvious example being Sudan throughout the Darfur crisis:
From Bloomberg:
China’s thirst for oil is causing bloodshed. So says New York-based nongovernmental organization Human Rights First, which on Mar. 13 released a report linking China’s rising imports of Sudanese oil with sales of Chinese small weapons to Khartoum, used to further the deadly conflict in the western region of Darfur.
China’s engagement with Africa supports a broader strategy for China in two main ways:
1. China often presents itself as the champion of developing countries. They grew quickly economically and have become a major player. Often, they present themselves as the juxtaposition to the developed, Western nations, an outsider who has power inside and is always looking out for other developing states. This is very good PR for the country, giving it strength and leadership in international organizations. It can also makes the US look as though they have no interest in the agendas of developing states, an advantage that China manipulates very effectively.
2. Expansion. China is looking to establish and economic, and in some cases, military, presence wherever they can. The String of Pearls refers to China’s extensive lines of communications between mainland China and South Sudan. China has increased economic ties to Venezuela recently. Africa is a place where the US is hogtied by ideals – the government doesn’t want to be seen doing business with dirty players, but it is at the expense of natural resources that are being snapped up by China. China already controls the majority of the world’s cobalt supply, an essential mineral for electronics found in Madagascar and the Congo. The more control they have over the resources available, the more leverage they have over the countries that need them – especially if they have near-monopoly over them.
So, while I am 100% sure that Clinton is very much invested in the human rights aspects of African nations dealing with China, her comments encouraging countries away from the monolithic country are very much about preserving US power. It’s all part of the game.
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There’s a tendency among U.S. scholars, policymakers and especially the military to look at China in a purely confrontational way. Not everyone thinks this way but the number of analysts looking at a future clash of the powers is staggeringly big. This may be true, especially if we look at Chinese aggression in the South China sea. Maybe the Pentagon itself, with its focus on the Air-Sea Battle doctrine, is right in making sure everything is in order in case that happens. And yet, looking at some data, a different future looks more likely.
Let’s look at the role of China in the Persian Gulf. Asking a U.S. analyst what he thinks about Beijing’s involvement in the region, the most common reply is something along the lines of “Iranian friends, against the U.S. and the West”. Quotes on growing Chinese imports of Iranian crude oil at discounted prices will follow, presented as possible proof that China will back Iran in most disputes. Talking about the possibility of China sending warships into the Persian Gulf itself–not so unsurprising in the future, given its “String of Pearls strategy”–the possibility of Chinese ships fighting alongside Iranian ones against the USN becomes a matter of worry (even if tech disparity would make it short-lived).
This may well be, but looking at Chinese interests in the Gulf we get a different picture on their long-term strategy.
Both OPEC monthly reports and other reports by other prominent analysis firms show that China imported a record 6.0 million barrels/day of crude oil in May 2012, or 585,000 barrels/day more than April 2012 (+10.8%). First reports from June quotas show that this amount is likely growing even more. On a year-on-year basis, China’s imports have grown by 18.2%.
OPEC data confirms that most of this growth is due to Middle East imports, but not only from Iran. Iraq, UAE, Yemen and Saudi Arabia have increased their export quotas to China (Saudi Arabia +13.7%, Iraq +64%, UAE +32%). China also imports from Kuwait and Oman. Saudi Arabia in particular sends about 2 times more oil than Iran to China.
What does this show? First of all it confirms that China’s thirst for oil is growing, as reported by most macroeconomic indicators, and that its production ratio will remain unable to keep up with its needs–bringing it to need more and more imports down the road.
Second, China relies more on non-Iranian than on Iranian oil. This doesn’t make Iranian crude imports irrelevant: their availability, lower price and lack of competitors due to international sanctions makes the Islamic Republic the perfect place to continue buying from. But Iranian crude oil production isn’t going to expand much more: most facilities are old and need enhanced extraction techniques that only foreign firms possess in order to boost production, while other countries, especially Iraq, are undergoing an extraction boom thanks to fresh investments and the use of modern tech. Iraqi production has already overtaken the Iranian one and it’s slated to grow more in the next few years, while Saudi Arabia, UAE and Oman will remain important players. Unless sanctions are lifted, in the long run Iran is going to remain important but not so vital as to warrant a clash with the GCC countries.
Third, China needs the oil to continue flowing. This may look the most obvious consideration, and it is, but it’s also the most vital one. China needs the oil and doesn’t want anything to stop it from reaching its mainland, where its industries, cities and economy in general badly need it. With most of its crude imports coming from the Persian Gulf, that means that China badly needs to avoid anything that can disrupt supply routes from there.
China doesn’t need a war in the Persian Gulf now against Iran because this will likely shut down a good part of its Iranian supplies and possibly disrupt flow through the Strait of Hormuz. This may also work in the West’s advantage, as Beijing is likely to heavily pressure Tehran not to try to block the straits, as it would hurt China more than it hurts the West. Threats of Beijing dropping its support in the UN Security Council may be enough to convince Iranian leaders that that would not be a wise choice–a full-scale U.S. response would become more likely, and more legitimized.
Why does it mean later? That China doesn’t need a war, or serious regional destabilization even in the future, and will work hard to avoid it, as it would threaten its own all-important energy security. With so many stakes in regional stability due to oil imports, Beijing could become the U.S. best friend in the area in order to make sure Iran doesn’t get too aggressive on its neighbors. Saber rattling will likely continue, but Beijing could easily become a valid substitute of the U.S. in maintaining regional peace. With stakes on both sides, it would probably enjoy better reliability (at least until it commits some major mishap). In addition the U.S., not having great interests there anymore, could pivot elsewhere more easily as this time it would be China to be the one remaining mired into one of the most complex areas in the world.
It may sound incredible, but the U.S. might stand to gain more from a careful cooperation with China in some key areas. Air-Sea Battle may make the Pentagon happy, but won’t necessarily make the Gulf, or other areas, more secure. Exploitation of China’s weaknesses will, instead. It just requires observing well where its interests stand, instead of just looking at part of it. Let’s remember it next time a Chinese ship moves: thinking about how best to sink it may not be the best choice; helping get it towards a common interest might be a better, and more fruitful, alternative.
By. Lorenzo Nannetti
Lorenzo Nannetti is a contributing analyst at Wikistrat’s Middle East and Energy Security desks. He is an analyst for ENI’s petrochemical division, Versalis S.p.A. and is Senior Analyst for the Italian think tank Il Caffè Geopolitico. He also writes on Middle East and energy security for several online journals including the Italian AGI Energia.
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