Wednesday, June 16, 2004

China

I keep an eye open for developments in China, as I feel certain it is the next spot on the globe where the empire du jour shall reside. Okay, it's a lazy eye.

The United States would face an increasingly lethal Chinese army modernized by Washington's friends and allies if it had to defend Taiwan in a war with Beijing, said a U.S. study released on Tuesday.

Russia's arms exports to China are more sophisticated than ever, and Israel -- recipient of some of America's most advanced technology -- has an increasingly worrisome defense relationship with Beijing, the report said.

Moreover, if the European Union lifts its arms embargo on China as some members want, that could "dramatically enhance China's military capability," added the report by the U.S.-China Economic and Security Review Commission.

Echoing a recent Pentagon study, the commission said China's military capabilities "increasingly appear to be shaped to fit a Taiwan conflict scenario and to target U.S. air and naval forces that could become involved." China views Taiwan as a rebel province that must be reunited with the mainland, by force if necessary.

...As for Israel, Commission Vice Chairman Dick D'Amato told Reuters that while Washington had made "strenuous" efforts to restrain it from selling to China, "there's still not the level of cooperation and assurance that has relieved our concerns. We're very worried about this relationship."

Israel annually receives $3 billion in U.S. aid, including advanced technology. Criticism of Israel is sensitive in the United States, its leading ally.

The report said Israel in 2003 assured Washington it would not sell items to China that could harm U.S. security.

But the commission "understands that Israel has offered training facilities, including one for urban warfare, to train China's security forces for the Olympics."

In the past year, "reports indicate Israeli firms have discussed a range of projects with China, including export of sensor and observation systems, security fences, microwave and optics, training, metal detectors and packages for airport and vital facilities security," the commission said.

Israel also provided China with HARPY unmanned aerial vehicles, radar systems, optical and telecommunications equipment, drones and flight simulators.

...In 2000, under U.S. pressure, Israel suspended the sale to Beijing of four $250 million-a-copy advanced early warning Phalcon aircraft, similar to U.S. AWACS planes. The proposed deal alarmed the Pentagon and angered some members of Congress.
  Haaretz article

Of course, we are not permitted to complain about Israel, as that is anti-Semitic. In fact, Israel has used us as their stupid errand boy in many situations, and Sharon has openly bragged that Israel controls America.

Uzbek officials have indicated they wish to focus Sino-Uzbek talks on security and economic cooperation. On the eve of Hu's visit, Uzbek Foreign Ministry spokesman Ilkhom Zakirov said it is "very important for [Uzbekistan] to continue our cooperation with China in the economic sphere and very important to have deep cooperation in the antiterrorism struggle."

...Uzbek officials have indicated they wish to focus Sino-Uzbek talks on security and economic cooperation. On the eve of Hu's visit, Uzbek Foreign Ministry spokesman Ilkhom Zakirov said it is "very important for [Uzbekistan] to continue our cooperation with China in the economic sphere and very important to have deep cooperation in the antiterrorism struggle."

...Reports say China's state oil company CPNC will sign cooperation deals with Uzbekistan's state oil company Uzbekneftegaz, but that they will be modest in comparison to contracts with Kazakhstan, Turkmenistan, or Russia.

Vatanka said it makes sense for China to negotiate oil and gas deals with its immediate neighbors, while keeping old suppliers. "If you can buy your gas from the Middle East, or if you can get a pipeline from Russia and Kazakhstan, why would [the Chinese] put too much emphasis on Uzbekistan?" he asked.
  Radio Free Europe article

Perhaps because the U.S. has a military base there and has increased its aid to that country in recent years?

(Thanks to TJ at POAC for the heads up on those two articles.)

“China’s leaders appear to have concluded that the net effect of the US-led campaign (against terrorism) has been the further encirclement of China,” specifically by placing US military forces in Uzbekistan and other Central Asian nations, and strengthening relations with Pakistan and India, the report said.

The Chinese also believe, partly from its assessment of the Bush administration’s declared war on terrorism, that the United States is increasingly likely to intervene in a conflict over Taiwan or other Chinese interests, according to the Pentagon analysis.
  Daily Times article

China and the U.S. are increasingly becoming top competitors for a finite resource that is the lifeblood of both countries.

US cable network CNN is reporting that surging Chinese demand is underpinning a recent spike in the price of oil, according to figures from the International Energy Agency (IEA) which show that the "China factor" has more bearing on oil prices than any "risk factor" coming from global tensions.

...An energy exporter until just a few years ago, China is now the world's fastest growing major importer of oil. In the first three months of 2004, when China's economy grew at a breakneck pace of 9.7%, demand for oil in China grew almost 1 million barrels a day.

...Saudi Oil Minister Ali al-Naimi is proposing an increase of 2 million barrels per day. In Xie's view, world oil prices could become captive to Chinese demand fluctuations, in the same way that metal prices are now driven by China's investment cycle. Based on long-term trends, Xie says China's oil consumption could double from 7 million barrels a day now to 14 million a day by 2014. But he says China cannot afford this, and so must become more energy-efficient or find substitutes for oil.
  VHeadline article

Or more oil. At least in the short run.

And there's always the Venezuelan factor.

March 9, 2004 - President Chavez Frias: To Asia, to Europe. The Chinese petroleum industry has asked for an increase in their quota with Venezuela. We can’t, because we make up part of the OPEC quota. We sell 1,500,000 barrels of oil per day to the United States. It wouldn’t cost us much to sell it elsewhere. Brazil imports oil. They have to buy it from the Middle East. Why? Because for many years, the strategy of the Venezuelan petroleum industry has been tied only to U. S. interests. Contract obligations break in times of conflict.

Everything is here in this one small interview segment; the supposed “threat” to cut off the Venezuelan oil supply to the US, and China’s involvement in the issue.

There are three points to be made here:

1. Chavez does not want to stop selling oil to the US (for obvious economic reasons), and will only do so if he has to, i. e. in the event of a US-backed invasion, not an unreasonable position for any sovereign government to take.

2. Chavez openly reveals that China has asked for more oil, and the Venezuelan government has refused because of its obligations to maintain OPEC quotas. If Chavez has a secret agreement with China, why would he draw attention to it by bringing up the subject of China himself?

3. Contract obligations break in times of conflict. Therefore, if the supply of Venezuelan oil does get cut off to the US, it is no longer the business of the US who it sells oil to.
  VHeadline article

And it's got to be a source of comfort to Venezuela to know that there is a ready customer in case of problems with its current main client.

It definitely should concern U.S. officials that Israel is selling military power to China.

....but hey, do what you want....you will anyway.