OpEdNews Op Eds 9/13/2013 at 22:21:47
China stitches up (SCO) Silk Road
By Pepe Escobar (about the author) Permalink
Headlined to H2 9/13/13
opednews.com
Source: Asia Times
While the whole world was terrified by the prospect of the Obama
administration bombing Syria, Chinese President Xi Jinping was busy
doing the Silk Road.
One has to love that famous Deng Xiaoping dictum; "Always maintain a
low profile." This being the second-largest economy in the world, "low
profile" always packs a mighty punch. Cue to September 7, in Astana,
Kazakhstan's capital, when Xi officially proposed no less than a New
Silk Road in co-production with Central Asia.
Xi's official "economic belt along the Silk Road" is a supremely
ambitious, Chinese-fueled trans-Eurasian integration mega-project, from
the Pacific to the Baltic Sea; a sort of mega free-trade zone. Xi's
rationale seems to be unimpeachable; the belt is the home of "close to 3
billion people and represents the biggest market in the world with
unparalleled potential."
Talk about a "wow" factor. But
does that mean that China is taking over all of the Central Asian
"stans"? It's not that simple.
A roomful of mirrors
On Xi's Silk Road trip, the final
destination was Bishkek, Kyrgyzstan's capital, for the 13th summit of
the Shanghai Cooperation Organization (SCO). And to cap it all off,
nothing less than a graphic reminder of the stakes involved in the New
Great Game in Eurasia; a joint meeting on the sidelines of the SCO,
featuring Xi, Russian President Vladimir Putin, and new Iranian
President Hassan Rouhani.
This is Rouhani's first foreign trip since he took office on August 4.
Not an epic like Xi's; only two days in Bishkek. In a preliminary
meeting face-to-face with Xi, Rouhani even started speaking "diplomatic
Chinese" -- as in the upcoming negotiations over the Iranian nuclear
dossier leading, hopefully, to a "win-win" situation. Xi emphatically
supported Iran's right to a peaceful nuclear program under the
Non-Proliferation Treaty, while Rouhani stressed the Iran-China
relationship "bears vital significance for Asia and the sensitive Middle
East issue."
And that leads to the common Iran-China-Russia front in relation to
Syria. Even before meeting with Putin, Rouhani had agreed with the
Russian four-part plan for Syria, which, as Asia Times Online had
reported, was brokered between Damascus, Tehran and Moscow (See Al-Qaeda's air force still on stand-by,
September 11, 2013). According to the plan, Damascus joins the
Organization for the Prohibition of Chemical Weapons (OPCW); discloses
the location of chemical stockpiles; allows OPCW inspectors access to
the sites; and then comes the long process of destroying the
stockpiles.
In the nuclear front, Tehran and Moscow remain open for business.
Russia will hand operation of Unit 1 of the Bushehr nuclear power plant
over to Iran in less than two weeks. And there will be more
"cooperation" ahead.
The importance of this triangulation cannot be overstated. Oh, to be a
fly on the wall in that Xi-Putin-Rouhani Kyrgyz room. Tehran, Moscow and
Beijing are more than ever united on bringing about a new multipolar
international order. They share the vision that a victory for the axis
of warmongers on Syria will be the prelude for a future war on Iran --
and further harassment of both Russia and China.
The God of the market, it's us
Meanwhile, monster
business -- and strategic -- opportunities beckon in the Eurasian
corridor. Xi's Silk Road Economic Belt, with trademark Chinese
pragmatism, is all about free trade, connectivity and currency
circulation (mostly, of course, in yuan). It's ready to go because there
are no more border problems between Russia and Central Asia. It ties up
perfectly with China's push to develop its Far West -- as in Xinjiang;
consider the extra strategic Central Asian support for the development
of China's Far West.
Here's an example. At a China-Eurasia Expo in Urumqi, Xinjiang's
capital, earlier this week, China Telecom and two Hong Kong telecom
companies signed seven deals with the governments and companies from
Kazakhstan, Tajikistan, Russia and Mongolia. Not many people know that
Urumqi boasts more than 230 Internet companies; nearly half are
connected with neighboring countries. Xinjiang is not only about Han
Chinese encroaching on Uyghurs; it's no less than the communications
base for the Eurasian corridor - a hub for broadband and cloud
computing.
Beijing is already massively investing in new roads and bridges along
the Eurasian Land Bridge -- another denomination of the New Silk Road.
As Asia Times Online has reported,
the New Silk Road is all about highways, railways, fiber optics and
pipelines -- with now the added Chinese push for logistics centers,
manufacturing hubs and, inevitably, new townships.
There are plenty of Pipelineistan gambits to implement, and a lot of
mineral resources to be exploited. And, crucially -- considering the
original Silk Road traversed Afghanistan -- there's also the prospect of
an Afghan revival as a privileged bridge between Central, East and
South Asia. Not to mention speeding up China's land access to both
Europe and the Middle East.
In China, no major decisions such as this are "spontaneous," but
there's a neat softening PR behind it. In Astana, Xi said, "my home,
Shaanxi province, is the start of the ancient Silk Road"; and he was
"moved" as he reviewed Silk Road history during the trip.
He indulged in sightseeing in Samarkand's fabulous Registan square,
flanked by Uzbek President Islam Karimov, and even waxed "poetic,"
telling Karimov, "this gives us a special feeling. We are far away in
distance, but we are also so near to each other in our soul. It is just
like time travel." Well, the Timurid empire has finally met its match.
It's not that China hadn't done it before; during the Western Han
dynasty (206 BC - AD 24), imperial envoy Zhang Qian was dispatched to
Central Asia twice to open up China to global trade.
"Poetic" or not, Xi was always on message. All along his Silk Road
trip, he left no doubts this is a foreign policy priority for China.
China has now established strategic partnerships with all five Central
Asian "stans."
The Pipelineistan angle
Kashagan is your usual
Pipelineistan nightmare. Significantly, on 9/11 this week, the North
Caspian Operating Co, which runs Kashagan -- one of the largest oil
fields discovered in the past 40 years, with 35 billion barrels in
reserves -- said the first oil was finally in sight.
Kashagan is in the northern Caspian Sea. I've been there.
Technically, oil extraction is immensely complex; that is certainly the
case here. Production should have started in 2005. No less than US$46
billion has been spent by a consortium featuring Italy's ENI, France's
Total, Royal Dutch/Shell, ExxonMobil and ConocoPhillips. Nasty bickering
has been the norm. A week ago, Astana finally signed an agreement for
China's CNPC to buy the former ConocoPhillips' 8.4% share.
With China stepping in, major hard cash will flow. Beijing is
determined to become a major player in the Kazakh energy market.
Ideally, Kashagan should be producing 370,000 barrels a day in 2014 and
1.6 million barrels by 2016.
China's strategy in Kazakhstan is basically about oil. But China also
badly needs a lot of natural gas. Russia's Gazprom is betting on
Beijing's non-stop thirst for gas to facilitate its shift from exporting
mainly to Europe. But competition is stiff. And Turkmenistan is a key
part of China's equation.
China is already planning expansions for the Central Asia-China
pipeline -- which it built and paid for. Exports should be up by 2015.
In his Silk Road trip, Xi naturally hit Turkmenistan, inaugurating no
less than one of the largest gas fields in the world, massive Galkynysh,
which began production only three months ago. Most of the gas will flow
through -- where else -- the pipeline to China. China is paying the
bill, $8 billion so far, and counting.
Turkmenistan's economy now virtually depends on natural gas exports to
China (at 60% of GDP). Beijing's ultimate strategy is to use its
Turkmenistan leverage to extract better gas deals from Gazprom.
Kyrgyzstan also features in China's Pipelineistan strategy. Beijing
will finance and operate the proposed Kyrgyzstan-China gas pipeline --
which will be a key part of the fourth Turkmenistan-China pipeline.
Beijing is also building a railroad linking it to with Kyrgyzstan and
Uzbekistan.
Observing all this frenzy, we have to come back to the ultimate adage
of the times; while the (Washington) dogs of war bark, the (Chinese)
caravan does deals.
Those three evils
The SCO is also involved in boosting
this major transportation route connecting East Asia, West Asia and
South Asia, and ultimately the Pacific to the Baltic Sea.
Yet Stalin's legacy lives -- as in the demented way he partitioned
Central Asia. China will need to shell out a fortune in transportation.
Chinese trains are always in trouble traveling on Soviet-era railways.
Airline service is dodgy. For instance, there's only one flight every
two days between Uzbekistan and Kyrgyzstan (I took it; always crowded,
the usual delays, stranded luggage ...)
The SCO was founded 12 years ago, when Uzbekistan joined the members of
the original Shanghai Five; China, Russia, Kazakhstan, Kyrgyzstan and
Tajikistan. Turkmenistan preferred its splendid isolation.
The original emphasis was on mutual security. But now the SCO
encompasses politics and economics as well. Yet the obsession remains on
what the Chinese define as "the three evil forces" of terrorism,
separatism and extremism. That's code for the Taliban and its offshoots,
the Islamic Movement of Uzbekistan (IMU) and the Uyghurs in Xinjiang.
The SCO also tries to fight drug trafficking and arms smuggling.
Again in classic Chinese style, the SCO is spun as fostering "mutual
trust, mutual benefit, equality, consultation, respect for diverse
civilizations and seeking common development," in an atmosphere of
"non-alliance, non-confrontation and not being directed against any
third party."
It may go a long way before becoming a sort of Eastern NATO. But it's
increasingly carving its territory as a direct counterpunch to NATO --
not to mention Washington's Central/South Asian chapter of the Global
War on Terror (GWOT) and the push for "color revolutions." The SCO is
actively discussing its regional options after Washington's withdrawal
from Afghanistan in 2014. China and Russia will be deeply involved. Same
for Iran -- for the moment a SCO observer.
Xi's Silk Road belt, in principle, is not detonating alarm bells in the
Kremlin. The Kremlin spin is that Russia and China's economies are
complementary -- as in China's "sizable financial resources" matching
Russia's "technologies, industrial skills and historical relations with
the region."
One wonders what the adults in assorted rooms in the Beltway think
about all this (assuming they know it's happening). Former US secretary
of state Hillary Clinton used to wax lyrical about an American-propped
New Silk Road. Well, after Xi's trip that sounds like yet another Barack
Obama campaign promise.
Pepe Escobar is the roving correspondent
for Asia Times. His regular column, "The Roving Eye," is widely read. He
is an analyst for the online news channel Real News, the roving
correspondent for Asia Times/Hong Kong, an analyst for RT and
TomDispatch, and a frequent contributor to websites and radio shows
ranging from the US to East Asia. He argues that the world has become
fragmented into "stans" -- we are now living an intestinal war, an
undeclared global civil war. He has published three books on
geopolitics, including the spectacularly-titled "Globalistan: How the
Globalised World Is Dissolving Into Liquid War".
His latest book is "Obama Does Globalistan."