China is on a critical mission -- to secure sources of energy from around the world to quench the country's seemingly unending thirst.
With millions of Chinese discarding their bicycles and climbing into cars, crude oil consumption, currently at 6.68 million barrels per day, is estimated to roughly double to 13 million per day within the next two decades.
Monday's announcement of the acquisition of PetroKazakhstan for 4 billion dollars by China is part of an ongoing strategy to tap in to new oil reserves -- primarily in Russia, the Middle East, North Africa and South America.
ILLUSTRATION: YU SHA
As Chinese newspapers celebrated the PetroKazakhstan "victory" by outbidding India, which is likewise struggling to search for energy resources, the government's resolve not to simply purchase from the world market but to instead secure its own resources was made very clear.
Currently importing 40 percent of its oil to run the world's fastest growing economy -- China's domestic oil production stopped being able to quench local demand in 1993 -- oil managers and workers are being sent around the world to hunt and gather new sources.
"But I cannot claim that we have an all-encompassing strategy here. It all depends on which oil companies we can entice with an offer," said Shan Weigou, an expert at the Research Institute of the China National Petroleum Corp (CNPC).
The successful takeover of Canadian-registered PetroKazakhstan in October by CNPC will be the largest purchase of a foreign oil firm by a Chinese conglomerate.
PetroKazakhstan controls 12 per cent of total oil production in Kazakhstan, from where China is currently constructing a pipeline for US$3 billion, with the first phase scheduled to become operational next year.
In Central Asia, where any US presence is increasingly being met with political resistance, China's acquisition is in line with its goal to limit dependence on oil reserves controlled by the United States.
And though the US is equally suspicious over China's expansion plans, observers say that China's total oil reserves abroad account for merely one-tenth of what a multinational conglomerate like BP Global currently controls.
However, that didn't stop political resistance in the U.S. to thwart the takeover of American Unocal corporation a month ago, even with an extremely favorable bid by state-owned Chinese petrochemical giant CNOOC.
China's advances are therefore mostly directed at countries or regions where the US wields comparatively little influence, which can come with another set of political problems.
China has cooperation agreements with Sudan, whose government is accused of massive human rights violations, and Iran, whose nuclear programme is under worldwide criticism.
In October last year, China and Iran entered a framework agreement for petroleum and gas deliveries valued at between US$70 and US$100 billion over the next few years.
It is also not a big surprise that Venezuela's oil minister Rafael Ramirez is visiting China this week. Faced with increasing tensions with Washington the Latin American country intends to reduce its dependence on petroleum deliveries to the United States.
Venezuela, the world's fifth largest oil exporter, only supplied China with 12,300 barrels per day last year, but wants to increase this to 300,000 barrels by 2012.
But China's most controversial moves might be closer to home. The world's most populous nation is contesting territorial claims by Vietnam, Taiwan and the Philippines to the potentially oil-rich Spratly islands in the South China Sea -- and in the East China Sea a territorial dispute with Japan may quickly escalate when Japan begins test drillings.
Recently, China launched another diplomatic offensive against Taiwan, improperly linking its “one China principle” with UN General Assembly Resolution 2758 to constrain Taiwan’s diplomatic space. After Taiwan’s presidential election on Jan. 13, China persuaded Nauru to sever diplomatic ties with Taiwan. Nauru cited Resolution 2758 in its declaration of the diplomatic break. Subsequently, during the WHO Executive Board meeting that month, Beijing rallied countries including Venezuela, Zimbabwe, Belarus, Egypt, Nicaragua, Sri Lanka, Laos, Russia, Syria and Pakistan to reiterate the “one China principle” in their statements, and assert that “Resolution 2758 has settled the status of Taiwan” to hinder Taiwan’s
Singaporean Prime Minister Lee Hsien Loong’s (李顯龍) decision to step down after 19 years and hand power to his deputy, Lawrence Wong (黃循財), on May 15 was expected — though, perhaps, not so soon. Most political analysts had been eyeing an end-of-year handover, to ensure more time for Wong to study and shadow the role, ahead of general elections that must be called by November next year. Wong — who is currently both deputy prime minister and minister of finance — would need a combination of fresh ideas, wisdom and experience as he writes the nation’s next chapter. The world that
The past few months have seen tremendous strides in India’s journey to develop a vibrant semiconductor and electronics ecosystem. The nation’s established prowess in information technology (IT) has earned it much-needed revenue and prestige across the globe. Now, through the convergence of engineering talent, supportive government policies, an expanding market and technologically adaptive entrepreneurship, India is striving to become part of global electronics and semiconductor supply chains. Indian Prime Minister Narendra Modi’s Vision of “Make in India” and “Design in India” has been the guiding force behind the government’s incentive schemes that span skilling, design, fabrication, assembly, testing and packaging, and
Can US dialogue and cooperation with the communist dictatorship in Beijing help avert a Taiwan Strait crisis? Or is US President Joe Biden playing into Chinese President Xi Jinping’s (習近平) hands? With America preoccupied with the wars in Europe and the Middle East, Biden is seeking better relations with Xi’s regime. The goal is to responsibly manage US-China competition and prevent unintended conflict, thereby hoping to create greater space for the two countries to work together in areas where their interests align. The existing wars have already stretched US military resources thin, and the last thing Biden wants is yet another war.