By Sanjeev Miglani KABUL – Sun Jun 3, 2012 3:38am EDT
(Reuters) – China and Afghanistan will sign an agreement in the coming days that strategically deepens their ties, Afghan officials say, the strongest signal yet that Beijing wants a role beyond economic partnership as Western forces prepare to leave the country.
China has kept a low political profile through much of the decade-long international effort to stabilize Afghanistan, choosing instead to pursue an economic agenda, including locking in future supply from Afghanistan’s untapped mineral resources.
As the U.S.-led coalition winds up military engagement and hands over security to local forces, Beijing, along with regional powers, is gradually stepping up involvement in an area that remains at risk from being overrun by Islamist insurgents.
Chinese President Hu Jintao and his Afghan counterpart Hamid Karzai will hold talks on the sidelines of the Shanghai Cooperation Organisation summit in Beijing this week, where they will seal a wide-ranging pact governing their ties, including security cooperation.
Afghanistan has signed a series of strategic partnership agreements including with the United States, India and Britain among others in recent months, described by one Afghan official as taking out “insurance cover” for the period after the end of 2014 when foreign troops leave.
“The president of Afghanistan will be meeting the president of China in Beijing and what will happen is the elevation of our existing, solid relationship to a new level, to a strategic level,” Janan Musazai, a spokesman for the Afghan foreign ministry, told Reuters.
“It would certainly cover a broad spectrum which includes cooperation in the security sector, a very significant involvement in the economic sector, and the cultural field.”
He declined to give details about security cooperation, but Andrew Small, an expert on China at the European Marshall Fund who has tracked its ties with South Asia, said the training of security forces was one possibility.
China has signaled it will not contribute to a multilateral fund to sustain the Afghan national security forces – estimated to cost $4.1 billion per year after 2014 – but it could directly train Afghan soldiers, Small said.
“They’re concerned that there is going to be a security vacuum and they’re concerned about how the neighbors will behave,” he said.
Beijing has been running a small program with Afghan law enforcement officials, focused on counter-narcotics and involving visits to China’s restive Xinjiang province, whose western tip touches the Afghan border.
Training of Afghan forces is expected to be modest, and nowhere near the scale of the Western effort to bring them up to speed, or even India’s role in which small groups of officers are trained at military institutions in India.
China wants to play a more active role, but it will weigh the sensitivities of neighboring nations in a troubled corner of the world, said Zhang Li, a professor of South Asian studies at Sichuan University who has been studying the future of Sino-Afghan ties.
“I don’t think that the U.S. withdrawal also means a Chinese withdrawal, but especially in security affairs in Afghanistan, China will remain low-key and cautious,” he said. “China wants to play more of a role there, but each option in doing that will be assessed carefully before any steps are taken.”
JOSTLING FOR INFLUENCE
Afghanistan’s immediate neighbors Iran and Pakistan, but also nearby India and Russia, have all jostled for influence in the country at the crossroads of Central and South Asia, and many expect the competition to heat up after 2014.
India has poured aid into Afghanistan and like China has invested in its mineral sector, committing billions of dollars to develop iron ore deposits, as well as build a steel plant and other infrastructure.
Pakistan, which is accused of having close ties with the Taliban, has repeatedly complained about India’s expanding role in Afghanistan, seeing Indian moves as a plot to encircle it.
“India-Pakistan proxy fighting is one of the main worries,” said Small.
In February, China hosted a trilateral dialogue involving officials from Pakistan and Afghanistan to discuss efforts to seek reconciliation with the Taliban.
It was first time Beijing involved itself directly and openly in efforts to stabilize Afghanistan.
Afghan foreign ministry spokesman Musazai said Kabul supported any effort to bring peace in the country. “China has close ties with Afghanistan. It also has very close ties with Pakistan and if it can help advance the vision of peace and stability in Afghanistan we welcome it.”
(Additional reporting by Chris Buckley in BEIJING; Editing by Daniel Magnowski)
- The TAPI Scam – Why Is India Boldly Taking Responsibility for the Pipeline That Will Never Be Built? (therearenosunglasses.wordpress.com)
The commentary in China’s Liberation Army Daily falls short of a formal government statement, but marks the harshest high-level warning yet from Beijing about tensions with the Philippines over disputed seas where both countries have recently sent ships to assert their claims.
This week American and Filipino troops launched a fortnight of annual naval drills amid the stand-off between Beijing and Manila, who have accused each other of encroaching on sovereign seas near the Scarborough Shoal, west of a former U.S. navy base at Subic Bay.
The joint exercises are held in different seas around the Philippines; the leg that takes place in the South China Sea area starts on Monday.
“Anyone with clear eyes saw long ago that behind these drills is reflected a mentality that will lead the South China Sea issue down a fork in the road towards military confrontation and resolution through armed force,” said the commentary in the Chinese paper, which is the chief mouthpiece of the People’s Liberation Army.
“Through this kind of meddling and intervention, the United States will only stir up the entire South China Sea situation towards increasing chaos, and this will inevitably have a massive impact on regional peace and stability.”
Up to now, China has chided the Philippines over the dispute about the uninhabited shoal known in the Philippines as the Panatag Shoal and which China calls Huangyan, about 124 nautical miles off the main Philippine island of Luzon.
China has territorial disputes with the Philippines, Vietnam, Brunei, Malaysia and Taiwan in the South China Sea, which could be rich in oil and gas and is spanned by busy shipping lanes.
Beijing has sought to resolve the disputes one-on-one but there is worry among its neighbors over what some see as growing Chinese assertiveness in staking claims over the seas and various islands, reefs and shoals.
In past patches of regional tension over disputed seas, hawkish Chinese military voices have also emerged, only to be later reined in by the government, and the same could be true this time.
Since late 2010, China has sought to cool tensions with the United States over regional disputes, trade and currency policies, human rights and other contentious issues. Especially with the ruling Chinese Party preoccupied with a leadership succession late in 2012, Beijing has stressed its hopes for steady relations throughout this year.
Nonetheless, experts have said that China remains wary of U.S. military intentions across the Asia-Pacific, especially in the wake of the Obama administration’s vows to “pivot” to the region, reinvigorating diplomatic and security ties with allies.
The Liberation Army Daily commentary echoed that wariness.
“The U.S. strategy of returning to the Asia-Pacific carries the implication of a shift in military focus, and there is no better strategic opening than China’s sovereignty disputes with the Philippines and other countries in the South China Sea,” said the newspaper.
“The United States’ intention of trying to draw more countries into stirring up the situation in the South China Sea is being brandished to the full,” it said.
(Editing by Sanjeev Miglani)
- China top military paper warns of armed confrontation over seas (thehimalayantimes.com)
- South China Sea Standoff Ratchets Up A Notch (chinabystander.wordpress.com)
- China accused of escalating South China Sea standoff (ctv.ca)
- Philippines says new China ship aggravates sea row (staradvertiser.com)
- Russian ships arriving in China for naval war game (worldnews.msnbc.msn.com)
- US and Philippines begin South China Sea drills (1oneday.wordpress.com)
- It’s Getting Ugly Between China And The Philippines In The South China Sea (businessinsider.com)
TOKYO (AP) — Tokyo‘s outspoken governor says the city has decided to buy a group of disputed islands in the East China Sea to bolster Japanese claims to the territory, a move that could elevate tensions with China.
Gov. Shintaro Ishihara said the city is close to reaching an agreement with the private Japanese owner of three of the four islands in the group known as Senkaku in Japanese and Diaoyu in Chinese.
“Tokyo has decided to buy the Senkaku islands. Tokyo will protect the Senkakus,” Ishihara said in a speech Monday at the Heritage Foundation, a conservative think tank in Washington. “The Japanese are acquiring the islands to protect our own territory. Would anyone have a problem with that?”
Ishihara, a strong nationalist, said the idea is to block China from taking the islands from Japanese control, as the central government is reluctant to upset China.
He did not indicate how much the city would pay, but said the deal would be finalized while he is visiting the United States.
In Beijing, Liu Weimin, a spokesman for China’s Ministry of Foreign Affairs, reacted harshly to Ishihara’s comment and reiterated China’s claim over the islands.
“Any unilateral measure taken by Japan is illegal and invalid, and will not change the fact that those islands belong to China,” he said in a statement.
Tokyo city official Tatsuo Fujii said details of the deal could not be released immediately and further discussions would be held with Okinawa prefecture, which has jurisdiction over the islands, and other related authorities.
The government currently pays rent to the owners of the four islands in the Senkaku group so they won’t be sold to any questionable buyer. It pays 24.5 million yen ($304,000) a year to the owner of the three islands, which are unused. The fourth island is used by the U.S. military for drills.
Chief Cabinet Secretary Osamu Fujimura reiterated on Tuesday that Japan has sovereignty over the Senkaku islands and said the central government might purchase them.
Japan and China also have disputes over undersea gas deposits in the East China Sea and Japan’s wartime history.
Ishihara previously helped to erect a lighthouse on one of the Senkaku islands, which a group of nationalists later replaced with a larger one recorded on navigation charts.
Ishihara’s comments about the disputed islands are also seen as politically motivated to discredit Prime Minister Yoshihiko Noda‘s government, which is struggling to gain public support.
- UPDATE2: Tokyo gov’t in talks with owners to buy Senkaku Islands: Ishihara (english.kyodonews.jp)
- UPDATE4: Tokyo gov’t in talks with owners to buy Senkaku Islands: Ishihara (english.kyodonews.jp)
- UPDATE3: Tokyo gov’t in talks with owners to buy Senkaku Islands: Ishihara (english.kyodonews.jp)
- Tokyo governor says city will buy disputed islands (newsinfo.inquirer.net)
- UPDATE1: Japan protests China’s possible East China Sea gas drilling (english.kyodonews.jp)
- Japan names 39 unihabited islands to cement economic zone (english.kyodonews.jp)
If you can take your eyes off the primary election coverage, watch Geithner. The US is engaged in a love trapezoid. The four corners are Beijing, Tehran, Tokyo, and Washington. Treasury Secretary Geithner is the Obama Administration’s front person. Track the news for the names of the other agents.
This is a very serious time. The pieces are linked. Some bullets as you watch the news flow.
1. The US faces the pressure of follow-through on Iran sanctions. Iran is an exporter of oil to Asia. Japan is dependent on imported oil. China is not self-sufficient. One part of this trapezoidal geometry is about oil.
2. Iran is feeling the heat from sanctions. The US wants to tighten them. It cannot do so without help from Asian “friends.”
3. China and Japan are each buyers of US Treasury securities. They each help finance the American fiscal deficit and the ongoing current-account deficits. They each want to diversify their reserves. They are not sellers, but they are reluctant additional buyers. This is truer for China than for Japan, but it is true in both cases.
4. China is glacially proceeding toward world reserve-currency status. It gradually allows its currency to strengthen against the dollar. It follows a policy that is fully rational for the Beijing oligarchs. It shrugs off political threats from Washington politicians (Schumer, Graham) who love to bash China while talking to their American constituents. China understands our political processes and our weaknesses. However, China also understands “realpolitik” and uses it. They learned US use of realpolitik from Nixon and Kissinger. Expect them to smile publicly but put some very intense private heat on Geithner.
5. Japan faces enormous economic pressure and sees the yen strength as now threatening. In order to weaken the yen, it must acquire other currency holdings in large quantity. (See the Cumberland website, www.cumber.com, for G4 central bank charts, and flip to those on the Bank of Japan. You will be able to observe how Japan expanded its balance sheet several years ago and subsequently contracted it. We expect them to expand it in 2012 as they seek to arrest yen strength.)
6. Japan is negotiating with China so that it may acquire reserve debt instruments denominated in Chinese currency. Beijing likes this because it is a step toward achieving world reserve-currency status. Geithner now worries, because the trend points toward a gradual and long-term weakening of the US position, as the world’s second (China) and third (Japan) largest economies maneuver their global positions.
7. Our Asian friends know that the US election cycle creates maximum vulnerability for the United States. That also makes circumstances more dangerous and raises risk profiles. Europe is of no help to us, given its internal crises.
We recall that a three-legged stool is a stable form. A four-legged stool is less stable. A four-legged stool with a trapezoidal top is least stable. Especially when one of the legs is Iran.
Watch Geithner in Asia and the news flow. Read between the lines, since the public statements will all be scripted and self-serving. Risk is high. Also, stay overweight energy. We are.
Read more: BI
- Forget The Election News: Keep Your Eye On Tim Geithner And The Love Trapezoid (businessinsider.com)
- The Chinese Yuan May Become A World Currency (mb50.wordpress.com)
- Tim Geithner Glitch In The Matrix Special: Will America Become Greece In Two Years – “No Risk Of That” (zerohedge.com)
- U.S. politics clash with reality over China currency (promoteliberty.wordpress.com)
- Wen calls for focus on common interests (upi.com)
BEIJING | Sun Feb 5, 2012 9:07pm EST
(Reuters) – China’s top newspaper on Monday defended Beijing’s rejection of a U.N. resolution pressing Syria‘s President Bashar al-Assad to abandon power, saying Western campaigns in Libya, Afghanistan and Iraq showed the error of forced regime change.
The commentary in the People’s Daily, the top newspaper of China’s ruling Communist Party, was Beijing’s clearest defence of its decision to join Moscow at the weekend in vetoing a draft United Nations resolution that would have backed an Arab plan urging Assad to quit after months of bloodshed.
The commentary suggested that Chinese distrust of Western intervention lay behind the veto, which was described by U.S. Secretary of State Hillary Clinton as a “travesty.”
“The situation in Syria continues to deteriorate and numbers of civilian casualties keep rising. Vetoing the draft Security Council resolution does not mean we are giving free rein to letting this heart-rending state of affairs continue,” said the commentary in the paper, which echoes government thinking.
China, not its Western critics, was acting “responsibly” for the sake of the Syrian people, it said. The author used the pen name “Zhong Sheng,” which can mean “voice of China” and is often used to give Beijing’s position on foreign policy.
“Currently, the situation in Syria is extremely complex. Simplistically supporting one side and suppressing the other might seem a helpful way of turning things around, but in fact it would be sowing fresh seeds of disaster,” said the paper.
China’s siding with Russia over Syria could add to irritants with the United States. Vice President Xi Jinping is due to visit there next week, burnishing his credentials as the Communist Party’s likely next top leader.
Beijing and Washington have also sparred over Iran, which faces tightened Western sanctions over its nuclear ambitions.
The commentary also laid bare broader Chinese concerns about Western-backed intervention in the Arab world and beyond.
China is one of the five permanent U.N. Security Council members that hold the power to veto resolutions.
In March, China abstained from a Council vote that authorised Western military intervention in Libya. That resolution became the basis for a NATO air campaign that led to the overthrow of Muammar Gaddafi, despite misgivings from Beijing and Moscow about the expanded campaign, which they said went beyond the resolution.
“Libya offers a negative case study. NATO abused the Security Council resolution about establishing a no-fly zone, and directly provided firepower assistance to one side in the Libyan war,” said the People’s Daily Commentary.
It also cited Iraq and Afghanistan in its case against the Syria resolution.
“The calamities of Iraq and Afghanistan should be ample to wipe clear the world’s eyes. Forceful prevention of a humanitarian disaster sounds filled with a sense of justice and responsibility,” said the paper.
“But are not the unstoppable attacks and explosions over a decade after regime change a humanitarian disaster?” it said.
(Reporting by Chris Buckley; Editing by Paul Tait)
- VIDEO: West angry at UN Syria vote veto (bbc.co.uk)
- Syria: UN veto gives Assad ‘licence to kill’ – opposition – BBC News (bbc.co.uk)
- Russia, China Block U.N. Resolution To Curb Syrian Violence (outsidethebeltway.com)
- Russia and China Veto Western Aggression Against Syria at the UN (02varvara.wordpress.com)
- Syria: Russia and China’s resolution veto shames UN, says William Hague – Telegraph.co.uk (telegraph.co.uk)
- Russia, China veto UN Security Council resolution on Syria (rt.com)
- AJC Dismayed by Russia and China Veto of UN Security Council Resolution on Syria (prnewswire.com)
Odfjell SE has made an agreement to enter into a joint venture via its subsidiary Odfjell Terminals Asia Pte Ltd (Singapore), with Tianjin Economic-Technology Development Area (TEDA) via its subsidiary Nangang Port Company to develop a terminal and marine facilities for bulk liquid chemicals, petroleum products and gases in the Nangang Industrial Zone (Tianjin) in China.
The initial phase of the joint venture will consist of three deep sea berths and have a total storage capacity of about 150,000 cubic meters.
The joint venture company will be named Odfjell Terminals Nangang (Tianjin), whereby Odfjell will hold 49% ownership and hold the operational management. The initial total investment is estimated to be about USD 160 million. The first phase will start operations during the second quarter of 2014. The Nangang Industrial Zone is located about 120 km from Beijing and will become the major petrochemical complex in the Western Bohai Bay area
- South Korea: Naming Ceremony for Odfjell Drilling’s New UDW Drillship (mb50.wordpress.com)
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BY JOHN LOURENZE POQUIZ
Energy Undersecretary Jose Layug said that the DOE is looking at mechanism where the government would ration fuel consumption in the event supplies become tight.
“We are reviewing our contingency plan. Part of that is cutting down consumption,” Layug told Malaya Business Insight.
“We would have a mechanism where people would be given allocations on the oil they consume. It’s a form of rationing,” he added.
Layug said that the Philippines sources only less than 1 percent of its requirements from Iran.
He said, however, local fuel supply would be threatened if the Strait of Hormuz, which is adjacent to Iran, would be blocked.
The strait is the only passage for ships carrying petroleum from major oil-exporting countries on the Arabian peninsula.
Layug said that because of the supply threats, world oil prices have been going up in past weeks, influencing local pump prices.
“In terms of Iran, (we source a) very small (amount). Less than 1 percent. But more importantly, ever since Iran test-fired its missiles (last week), the international market has gone up,” he said.
“In fact, for the past few weeks, the major reason for the price hikes is Iran. Prices in the international market have gone up,” he added.
Last week, oil firms raised the prices of their unleaded and premium gasoline products by P0.90 per liter. The price of regular gasoline went up P0.60 per liter, while diesel rose P0.30 per liter.
The sanctions approved by President Barack Obama on New Year’s Eve have highlighted the importance of Iranian oil supplies to East Asia’s energy-hungry economies. They have led to a clash of interests between Washington and key commercial and strategic partners over efforts to stop Iran’s nuclear program.
China, the biggest buyer of Iran’s oil, has publicly rejected US sanctions aimed at Tehran’s energy industry, while American allies Japan and South Korea are scrambling to find a compromise to keep critical supplies flowing.
Beijing is buying less Iranian crude this month, but analysts say China is unlikely to support an oil embargo. Instead, they say, the smaller purchases might be a tactic aimed at obtaining lower prices as the West squeezes Tehran.
A South Korean foreign ministry spokesman said this week Seoul is in talks with Washington aimed at “minimizing the negative impacts” of sanctions. South Korea imports 97 percent of its oil and depends on Iran for up to 10 percent of its supplies.
China’s foreign ministry rejected the sanctions this week and called for negotiations, leaving unclear whether Beijing might defy Washington, straining relations between the world’s biggest and second-biggest economies.
“Sanctioning is not the correct approach to easing tensions,” said a ministry spokesman, Hong Lei. “China opposes the placing of one’s domestic law above international law and imposing unilateral sanctions on other countries.”
- Iran plans more war games in strait as sanctions bite (mb50.wordpress.com)
- Geithner to pressure China and Japan to back economic sanctions against Iran (mb50.wordpress.com)
- Asian Economies Look to Keep Iranian Oil Flowing (foxnews.com)