China Gains from American Strategic Distraction

Secretary of State Hillary Clinton in testimony to a House subcommittee warned that the United States risks losing influence to China because it is too slow to deliver aid to needy nations. Kudos to the Secretary for noticing the costs of America's strategic distraction. The geo-political winner of Bush's misbegotten adventures has been Beijing. While Bush preoccupied himself in search of weapons of mass destruction that he knew didn't exist, China was been free to fill vacuums from Myanmar to Argentina and across the whole of Africa. In her testimony today, the Secretary cited a recent example where China swooped into Jamaica.

"They (Jamaica) have just signed a memorandum of understanding with China...and now they have got a government-to-government relationship with China," Clinton said.
"We have to be sure we have in place the safeguards so that the money goes where we intend it to go," Clinton told the subcommitee on foreign operations of the House Appropriations Committee.

She also urged Congress to move quickly to deliver aid for Mexico's drug wars.

"It's just too slow, and when I was in Mexico, that's what I heard from both the president and the foreign secretary," Clinton said, referring to talks with Felipe Calderon and Patricia Espinosa last month in Mexico City.

She said the United States, for example, has been slow to release the money needed for Blackhawk helicopters to fight the drug cartels.

"Let's try to get to the bottom of this because you all do your work, you get it appropriated, I go around talking about what we need to do and it's kind of hollow, and we're losing ground," Clinton said.

"And we're seeing particularly China come in right behind us, because countries get tired of talking to our bureaucracy and decide they're going to cut a deal with someone else."

Furthermore the Republican mismanagement of the economy over the past 30 years has weaken our national security to such a point that China now fills a role that US and the West has historically filled. And yet incredulously the Republicans would have us believe that they are the party of national security. Jamaica approached China because the United States is preoccupied with its own financial problems, our legacy from the cut taxes and still spend GOP.

Here are some of China's recent geo-political moves.

China and Angola
From Xinhua Net (April 2009):

Visiting President of China Development Bank (CDB) Chen Yuan and Angolan President Jose Eduardo dos Santos here on Thursday discussed the possibility of the CDB offering over one billion U.S. dollars for Angola's agricultural development project.

   After the meeting with the Angolan president, Chen Yuan said his discussion with President Dos Santos is aimed at strengthening bilateral cooperation in agriculture and financing sectors between China and Angola.

   "We are ready to grant a credit line of over one billion U.S. dollars, but we think that this amount is not enough and may be increased to respond to the concrete needs of Angola in the domains of agriculture, grain production and agriculture products processing," Chen said.

   The Chinese banking official also said that other Chinese financing of social and economic projects in Angola may be granted this year, stressing that he has confidence in the Angolan government and believes that the perspectives of cooperation are "very good".

   According to Chen, the global financial crisis should be used by developing countries like Angola and China as an opportunity to increase and strengthen their cooperation.

In 2006, China became Angola's largest trading partner. China advanced a $5 billion USD loan which Angola, an oil rich country, is to repay in oil.

China and Argentina
From Financial Times (March 2009):

China, which is pushing to end the dominance of the dollar as a worldwide reserve, has agreed a Rmb70bn ($10.24bn, £7.18bn, €7.76bn) currency swap with Argentina that will allow it to receive renminbi instead of dollars for its exports to the Latin American country.

Xinhua, the official Chinese news agency, said the deal was signed on Sunday by Zhou Xiaochuan, governor of the People's Bank of China, and Martín Redrado, Argentine central bank president, in Medellín, Colombia, where they are attending a meeting of the Inter-American Development Bank.

An Argentine official confirmed a deal had been discussed and said the fine print was being worked out and negotiations were "very advanced".

Beijing has signed Rmb650bn ($95bn, €72bn, £67bn) of deals since December with Malaysia, South Korea, Hong Kong, Belarus, Indonesia and, now, Argentina in an attempt to unblock trade financing that has been severely curtailed by the crisis.

Argentina mostly imports industrial components and electrical goods from China, plus a smaller amount of consumer goods including clothing, shoes and toys. However, Ernesto Fernandez Taboada, executive director of the Argentine-Chinese Chamber of Production, Industry and Trade, said Argentine imports from China had fallen about 15 per cent in the past three months because of the slowing of the domestic economy.

That Chinese officials recently told Argentine officials that Argentina should let its "inefficient" industries collapse and instead import from China is somehow lost on Argentine officials that China is just another hegemon out to remake the world for the benefit of China.

China and Brazil
From National Public Radio (March 2009):

Raw materials like soy and iron ore form the basis of Brazil's skyrocketing exports to China, which doubled in just three years.

Welber Barral, Brazil's secretary of international trade in the Ministry of Development, Industry and Trade, says China has become "a very important partner to Brazil. In fact, China became the second partner to Brazil after the United States."

Barral also notes that as their commercial ties intensified, 6 percent of all Brazilian exports went to China last year, while 10 percent of all imports came from China. But Barral says Brazil's new trade deficit with China may actually be beneficial for many Brazilians.

"Because we have this sense that it reduces inflation and gives more opportunity for the poor population of Brazil that [now] has cheaper goods," he says. "On the other hand, as a principle, we don't have to reduce the 10 percent imports from China; we have to increase our exports to 12 percent."

China's ambassador to Brazil, Chen Duqing, says the Chinese and Brazilian economies are "mutually complementary" and insists that with China as a partner, Brazil will reduce its dependence on the U.S. market.

At the same time, Duqing acknowledges that he has had to address apprehensions among some business circles in Brazil that a lopsided commercial relationship may be developing.

China and Equatorial Guinea
From The China Institute at the University of Alberta (February 2006)

A subsidiary of leading Chinese oil and gas producer China National Offshore Oil Company Ltd. (CNOOC) has signed a production-sharing contract for an offshore block in Equatorial Guinea.

The five-year contract was signed on Friday by Equatorial Guinea's mines ministry, national oil firm GEPetrol and CNOOC Africa Ltd., Xinhua news agency said Saturday, citing CNOOC sources.

It covers a block of about 2,287 square kilometres (915 square miles) off the south coast of Equatorial Guinea with the waters ranging from 30 to 1,500 metres (99 to 4,950 feet) in depth.

The agreement follows a strategic partnership between the two countries announced by President Teodoro Obiang Nguema during a visit to Beijing in October.

Equatorial Guinea is the third biggest producer of crude oil in sub-Sahara Africa. US companies have hitherto developed its oil resources.

CNOOC vice president Zhu Mingcai cited the deal as another sign of progress in the energy firm's expansion of overseas operations, Xinhua said.

Formerly a Spanish colony, Equatorial Guinea might be the most repressive place in Africa. It boasts the distinction of being the only country that I have ever been to that does not sell newspapers. It isn't a country as much as a family run concentration camp. Teodoro Obiang Nguema Mbasogo makes Robert Mugabe look like a saint. And China is now his main benefactor.

China and Gabon
From Xinhua Net (November 2008):

China and Gabon signed a pact on economic and technological cooperation here Friday in an effort to push for more and better cooperation in large-scale projects.

The agreement was signed after visiting Chinese top legislator Wu Bangguo held talks with Gabonese President El Hadj Omar Bongo Ondimba in the presidential palace here.

Wu said that economic cooperation served as the foundation for bilateral ties and that both sides were paying more and more attention to this. Both sides should try to take advantage of the complementarity of their economies by turning it into huge economic achievement, Wu said.

He said that cooperation in large-scale projects in mineral production, power production and gymnasium construction should be further strengthened by hastening the pace of their initial phases, expressing the hope that these projects will become new bonds between the two economies.

Bongo said that relations with China had been a high priority on Gabon's foreign relations' agenda and that more progress should be made on the agreed large-scale projects.

Bongo said the two countries should cooperate in a wider and deeper scale, pushing for further progress in bilateral ties.

Gabon is Wu's second leg of his five-African nations tour. He finished his two-day visit to Algeria Thursday. He will visit Ethiopia, Madagascar and Seychelles.

Previously in 2006, Gabon granted China sole rights to exploit huge untapped iron ore reserves and build costly rail links needed to reach them. China is also invested in OPEC member Gabon's oil industry.

China and the Sudan
From Washington Post (December 2004):

China's transformation from an insular, agrarian society into a key force in the global economy has spawned a voracious appetite for raw materials, sending its companies to distant points of the globe in pursuit -- sometimes to lands shunned by the rest of the world as rogue states. China's relationship with Sudan has become particularly deep, demonstrating that China's commercial relations are intensifying human rights concerns outside its borders while beginning to clash with U.S. policies and interests.

Sudan is China's largest overseas oil project. China is Sudan's largest supplier of arms, according to a former Sudan government minister. Chinese-made tanks, fighter planes, bombers, helicopters, machine guns and rocket-propelled grenades have intensified Sudan's two-decade-old north-south civil war. A cease-fire is in effect and a peace agreement is expected to be signed by year-end. But the fighting in Sudan's Darfur region rages on, as government-backed Arab militias push African tribes off their land.

China and Venezuela
From Wall Street Journal (April 2009):

China, Venezuela and France's Total SA are in advanced negotiations on a multibillion-dollar deal to produce oil in Venezuela for use in China, people close to the negotiations said Tuesday.

The talks are another example of China's increasingly active role to secure global sources of oil and follow Royal Dutch Shell PLC's confirmation Tuesday that it is discussing a joint bid with Chinese oil companies for an Iraqi oil-field contract.

Senior officials from state-owned Petróleos de Venezuela SA, China National Petroleum Corp. and Total are to meet in Caracas in May to discuss a 20-year pact to send 200,000 barrels a day of Venezuelan oil to China, possibly starting in 2013, with volumes rising after that.

The people close to the talks said the plan involves CNPC-Total bidding for one of the Carabobo oil blocks in the Orinoco basin that Venezuela has offered to foreign investors. Awards of those bids are expected in late July or August.

Under the plan, heavy Venezuelan crude will first be processed at a so-called upgrader unit in Venezuela, to be built by Total, then shipped to China to be made into gasoline and diesel for the domestic market.

Tags: china, Geo-Politics, Secretary of State Hillary Clinton, US Foreign Policy (all tags)

Comments

6 Comments

Bush's foreign policy was such a disaster. At

least with respect the drug cartels, US needs to take positive steps to prevent the large scale arms smuggling across the southern border. We had good at blaming the drug cartels for drug smuggling but not very good at reduction of the demand that is fueling the drug war...Unfortunately Bush policy had been to berate countries like Mexico for the drug cartels without owning up to our own responsibility....

by louisprandtl 2009-04-23 11:50PM | 0 recs
Crossposted from the other diary...for correction.

Sorry for the sleep induced errors..:)

The point was that Bush's narrow vision for Latin American was limited to drug war, Chavez and Communist Cuba...as you illustrated well in your diary, this had been a boon for China...

by louisprandtl 2009-04-24 12:01AM | 0 recs
Percentage of foeign aid low compared to other

nations..

The US gives less per capita compared to the size of our economy than many other nations, and its much more likely to have political strings attached.

We should focus our aid where it would do the most good, and not try to solve all the problems in the world.

BTW, China is also pulling back on their foreign aid, especially in Africa. Their economy is in a shambles, just like ours.

The neocon approach seems to be to spend lots of money on ther friends, and gnore everything else. There needs to be much more transparency in the appropriations process. I do think we need to help stop the drug wars in Mexico, whch are driven by poverty and the incredible profits that are created by the illegality of drugs.

Similar imbalances exist because of the captivity of Americans - their not being able to buy prescription drugs overseas.

For example, one months worth of a cancer drug that costs $500 elsewhere might cost $10,000 here.

That also needs to change.

by architek 2009-04-24 04:58AM | 0 recs
Zero sum game- not

When one country gains, its not always a loss for other nations.

That kind of thinking is what doomed CheneyBushCorp to their stupid irrelevance.

Its depressing to see Obama supporters here falling into the same mindset.

Many countries, like Japan and Korea, Germany, etc, can and should pay for their own defense.

1500 US bases overseas is a bit excessive in the current economy.

by architek 2009-04-24 05:03AM | 0 recs
The Russian Trap

As I was reading Charles I was thinking along similar lines in terms of armed forces. Russia tried to keep up with the U.S. in a arms race only to have it erode the very economy that an arms race depends upon.

Now the U.S. is engaged in an arms race this time with itself or at least an image of itself that is increasingly at odds with reality. We, like the Russians, are damaging the very economy that an arms race depends upon by over-reaching our capabilities and needs. Or something like that.

by Jeff Wegerson 2009-04-24 05:55AM | 0 recs
Blackhawk Helicopters for a drug war?

You commented a bit ago that Latin America was, knock on wood, past the coup historical phase. Well when you need Blackhawk helicopters to fight an enemy then that enemy is in effect attempting a coup. Or perhaps just a partial coup, that of taking control of the drug war apparatus of the state.

by Jeff Wegerson 2009-04-24 05:58AM | 0 recs

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