Central Asia

China’s Strategy in Afghanistan

May 22, 2013

By Alexandros Petersen

First published by The Atlantic on May 21, 2013

For a relatively small drilling operation, China National Petroleum Corporation’s (CNPC) project in Afghanistan’s Sar-e-Pul province has a large footprint. Several layers of fences and containers serving as blast walls surround the extraction site, which includes dormitories, an office complex and various security structures. Throughout the day, trucks ferry in equipment and more containers. On the outside, the faces are all Afghan, but CNPC’s logo and bright red Chinese slogans are impossible to miss.

This remote outpost, not far from Afghanistan’s northern border with Turkmenistan, may symbolize the country’s future after the planned U.S. withdrawal of combat troops next year. As Washington prepares its exit following 13 years in the country, signs that Beijing has steadily stepped up its official and corporate presence across Afghanistan have begun to arise. In September, then Politburo member Zhou Yongkang met with President Hamid Karzai, while lower level diplomats have discussed greater engagement with the Afghan government. China even plans to re-open a branch of the Confucius Institute, an organization devoted to teaching Chinese culture and language, in Kabul. Read more »

Russia’s Energy Bully Takes a Fall

May 9, 2013

By Alexandros Petersen

First published by Foreign Policy on May 6, 2013

After years as Eurasia’s energy bully, Russia’s state-controlled natural gas monopoly, Gazprom, is getting a taste of its own medicine. Even as Gazprom seeks to build the tallest skyscraper in Europe as its new headquarters in St. Petersburg, pressure from Russia’s neighbors led to a 15 percent decline in the company’s profits last year, eating into the state budget. Moscow’s single-minded focus on gas exports in an effort to become, in the words of President Vladimir Putin, an “energy superpower” has crippled its ability to adapt to profound changes in the global energy landscape — from the shale gas revolution in North America to the dynamism of new market players such as Azerbaijan. Having spent the last decade making enemies in Central Europe and Central Asia, Gazprom and Russian decision-makers are now reaping what they have sown. Read more »

Afghanistan has what China wants

April 19, 2013

By Alexandros Petersen

First published by Foreign Policy’s AfPak Channel on April 18, 2013

As we near the date of withdrawal for U.S. combat forces in Afghanistan, the debate about the country’s largest neighbor has shifted.  No longer are American analysts worried about Chinese investments free-riding on U.S. and NATO stability efforts.  Now, the hope is that China’s massive state-owned enterprises (SOEs) will pour more funds into Afghanistan in the hope that foreign direct investment will shore up a centralized government and provide opportunities for all to make money instead of war.  But, Chinese companies face many of the same uncertainties that U.S. forces and contractors have contended with for a decade.

Much has been written about the controversies and delays at the site of China’s largest investment in the country: the gargantuan copper mine at Mes Aynak.  Both company officials and local observers indicate that the SOE leading the project, China Metallurgical Group Corporation, is biding its time, waiting to assess the post-withdrawal security situation.

What could be far more significant in the long run, however, are Chinese plans for oil and gas investment in the north of the country.  These have the potential to link Afghanistan into China’s growing pipeline network in Central Asia, providing the infrastructure-led regional integrationthat U.S. officials have been touting for years.  Nearby Turkmenistan and Kazakhstan have grown wealthy and centralized partly due to Chinese energy investment.  Could the same be true for Afghanistan in the future? Read more »

Inadvertent Empire

April 16, 2013

Alexandros Petersen is interviewed by The Gadfly on April 16, 2013

The Gadfly: You have referred to China’s growing influence in Central Asia as an “Inadvertent Empire.”  Could you explain what you mean?

Alexandros Petersen: It’s an inadvertent empire in the sense that China is already the most consequential actor in the region and will soon be the dominant actor in a number of different areas.  It already is the dominant actor in the economic sphere and definitely so in the energy sector, which is actually quite a significant accomplishment given Russia’s traditional role in that area.  China has also become the go to place for loans and investments.  One of the key needs in Central Asia is investment in infrastructure, and that requires funds.  Russia doesn’t have the money; the United States doesn’t have the money in some cases and simply doesn’t care in others; the European Union is not comfortable giving money because of the nature of some of the regimes in the region, so China is really the only option to provide funding as well as institutional capacity building.  So, it’s an empire in the sense that China is the player to watch and will be the dominate player in the future, but it’s inadvertent, in the sense that China doesn’t really have a strategy for the region.  China doesn’t want an empire.  As Seeley would say, it has an empire “in a fit of absence of mind.” Read more »

China’s Leadership Opportunity in Afghanistan

April 9, 2013

By Raffaello Pantucci

First published by the Carnegie Endowment for International Peace and The Diplomat on April 2, 2013

The 2014 deadline for the withdrawal of troops from Afghanistan is fast approaching. China has just over a year before Afghanistan fades from the West’s radar and Western attention toward the country shrinks substantially. However, it is not clear that Beijing has properly considered what it is going to do once NATO forces leave and pass the responsibility for Afghan stability and security to local forces.

And more crucially, it is not clear that China has thought about what it can do with the significant economic leverage it wields in the region. Afghanistan offers China the opportunity to show the world it is a responsible global leader that is not wholly reliant on others to assure its regional interests.

Traditionally, Chinese thinkers have considered Afghanistan the “graveyard of empires.” They chuckle at the ill-advised American-led NATO effort and point to British and Soviet experiences fighting wars in Afghanistan. Read more »

Chinese Refinery in Kyrgyzstan to Reduce Russian Leverage

April 3, 2013

On April 2, 2013 Alexandros Petersen conducted an interview with Chris Rickleton, a Bishkek-based analyst and Instructor at the American University of Central Asia.

You have conducted in-depth research into Chinese plans for a refinery at Kara Balta in Kyrgyzstan.  What exactly are these plans and on what sort of timetable are they to be carried out?

The refinery is already behind schedule, but is expected to be built by July of this year, and operating at full capacity by September. Local media reported some tough talk (http://www.vesti.kg/index.php?option=com_k2&view=item&id=17680:kitayskiy-npz-investiroval-v-ekonomiku-kyirgyizstana-poryadka-3-mlrd-somov&Itemid=79) in January between Chu Chan, the director of Zhongda, the Chinese state-owned firm that will run the refinery, and Kyrgyz Prime Minister Jantoro Saptybaldiyev. Saptybaldiyev was clearly very keen to see the refinery working as soon as possible and asked Chu why the facility still hadn’t been built. Chu referred to “misunderstandings” having led to the wrong equipment being delivered to the site. Chu also wanted the “sanitary zone”, which governs the distance residential homes can be from the refinery, reduced from 500 metres to 300 metres, which would have helped the company out in some of its compensation battles with local residents. When Saptybaldiyev rebuffed this offer, Chu reminded him that the company have already paid something like $4,000,000 in taxes and that they will have invested $250 million into the project by the time it is up and running.

Read more »

A Hungry China Sets Its Sights on Central Asia

March 8, 2013

By Alexandros Petersen

First published by The Atlantic on March 5, 2013

In the gravelly, uncertain road coursing through Kyrgyzstan’s picturesque Alay Valley, it does not take long to stumble across the Chinese road workers’ camp. Though just a dusty collection of prefab dormitories, the camps nevertheless proudly display the company’s name, logo and various slogans in large red Chinese characters. A Kyrgyz security guard is fast asleep on his cot, and the camp is deserted except for a young engineer from Sichuan. He explains that they work six months out of the year, when snow doesn’t block the passes. Next year, the road will be finished. He says his friends that work on Chinese-built roads in Africa get a better deal.

Further down the road, amid bulldozers and trucks full of dirt, are the road workers. They’re slowly reshaping the mountains, molding them into smooth inclines and regulation grades. Then there are the trucks; hundreds of them, crowding at the Chinese/Kyrgyz border, all engaged in the increasingly active trade between the two countries. One of the truckers, a member of China’s Muslim Uighur minority, is eager to chat. The roof of the world is his workplace. It takes three days to drive a 30 ton load from Kashgar, in China’s Xinjiang province, through Kyrgyzstan to Uzbekistan. He and his colleagues bring 100 such loads across every week. Read more »

…or Central Asia’s China Problem

March 1, 2013

By Alexandros Petersen

The International Crisis Group’s (ICG) latest report, “China’s Central Asia Problem” is a sweeping and masterful work in many ways.  As we traveled through and conducted research in eastern China, Xinjiang, post-Soviet Central Asia and Afghanistan, Raffaello and I came across ICG researchers and bounced our ideas off of ICG’s seasoned Eurasia hand Paul Quinn-Judge.  The report kindly quotes a couple of our articles that appeared here on chinaincentralasia.com.

But, does the ICG report get it right?  Yes and no.  The overall point that China is on the brink of becoming the pre-eminent external power in the region, not just in the economic sphere, is correct.  We have argued that China is already the most consequential actor in Central Asia, as well as the most forward-looking external power.  In the context of a U.S., and more broadly Western, exit from the region, the engagement of multifarious Chinese actors – from diplomats to state-owned enterprises (SOEs) to shuttle traders to manual laborers and Chinese language teachers – combines to create a momentum that has no clear counterweight.   Read more »

Horse To Water

March 1, 2013

By Raffaello Pantucci

First published by The Caravan on March 1, 2013

ON A FLIGHT FROM BEIJING TO TASHKENT, the capital of Uzbekistan, Sue Anne Tay, the photographer with whom I visited Tashkent in May last year, ran into a group of businessmen from China’s Xinjiang region. They were on a government-sponsored trip to the “Uzbekistan Tashkent China Xinjiang Business and Trade Fair” in Tashkent, to help build relations between Xinjiang and the neighbouring countries as part of an economic strategy laid out by Chinese Premier Wen Jiabao. As he put it, China wants to “make Xinjiang a gateway for mutually beneficial cooperation between China and other Eurasian countries”.

Unfortunately for this group of businessmen, they had to take a circuitous route to get through this gate. Because of a lack of direct flights from Urumqi to Tashkent at the time, they had been forced to re-route rather inconveniently through Beijing—a five-hour flight south-east followed by a six-hour flight west. In retrospect, the businessmen’s long trip was emblematic of difficulties they later faced in Tashkent. Read more »

Turkey: Abandoning the EU for the SCO?

February 15, 2013

By Raffaello Pantucci and Alexandros Petersen

First published by The Diplomat on February 15, 2013.

The European Union is in a rut. Its once-vaunted economy and “ever closer” integration is facing the tough challenges of a dogged recession and anti-EU sentiment in some of its most powerful member states. It is therefore perhaps not surprising that some EU aspirants appear lukewarm about their prospects and continued desire to join the club. For Turkey, probably the most unfairly spurned EU aspirant, it makes a lot of sense to at least explore alternatives.

After all, Turkey’s economy is booming – leaping from $614.6 billion in 2009 to $775 billion in 2011 (in current U.S. dollars) according to World Bank figures. Reflecting the country’s position at the global cross-roads, Istanbul’s Ataturk Airport international traffic more than doubled between the years 2006 and 2011. Last year alone its passenger volume increased by 20%, making it Europe’s 6th busiest airport. The country’s regional and global profile has grown since it first evinced a desire to join the EU. European leaders should only be surprised that Turkey has maintained its interest in the EU for so long. Read more »