Parts of this article were adapted from the authors’ “China and Central Asia: A Significant New Energy Nexus” in The European Financial Review, April 30, 2013, accessible here.
Over the past decade China has aggressively developed its energy cooperation with Central Asia, which has an abundance of oil and natural gas deposits, and relative political stability. Through its energy relationship with Central Asia, China not only diversifies its access to new energy sources but also gains greater flexibility in playing regional geopolitics that advances its broader national interests.
In a speech last September at Nazarbayev University in Astana, Kazakhstan, China’s President Xi Jinping coined a new strategic vision for his country’s relations with Central Asia, calling for the creation of a Silk Road Economic Belt. Coming at the culmination of a sweep through Central Asia during which he signed deals worth $56bn and touched down in four out of five capitals, the declaration may be something that has now received a new moniker from President Xi, but the economic and geopolitical reality that it characterizes is one that has been underway for some time.
President Xi’s declaration of the Silk Road Economic Belt needs to be understood within a wider context, particularly in his October 2013 speech at a work conference on diplomacy in which he set out his first formal statement on foreign policy. There he highlighted the priority he wanted his administration to place on border diplomacy: “We must strive to make our neighbours more friendly in politics, economically more closely tied to us, and we must have deeper security cooperation and closer people-to-people ties.” Continue reading →
Turkmenistan’s southeastern desert, not far from the border with Afghanistan, is a forbidding place. Its bleak, dusty vistas are punctuated by the ruins of ancient caravansaries: once rest stops on the old Silk Road. But, the silence of that long lost East-West artery is now regularly broken by the rumble of Chinese truck convoys. These are not ordinary tractor-trailers, either: they move slowly carrying massive loads of natural gas extraction equipment, and according to Turkmen officials, the shepherds’ bridges and village roads have had to be reinforced from the impact of their weight. The equipment is headed to one of the top five natural gas fields in the world; Formerly known as South Yolotan-Osman, in 2011 the field was renamed “Galkynysh” or “revival” in Turkmen. The name is apt because this gargantuan reserve of natural gas is the prize motivating CNPC, China’s largest oil company, to revive the old Silk Road — only this time by pipeline. Continue reading →
In the last two years, China has emerged as the most consequential outside actor in Central Asia. As we have described in other writings, China’s ascension to this role has been largely inadvertent . It has more to do with the region’s contemporary circumstances and China’s overall economic momentum than a concerted effort emanating from the Zhongnanhai. The implications for United States and NATO policy are nevertheless profound. Not only have the geopolitics of Eurasia shifted in ways little understood in Washington and Brussels, but the socio-political and physical undergirding of the post-Soviet space from Aktobe to Kandahar is being transformed.
Official Chinese policy in Central Asia is quiet and cautious, focused on developing the region as an economic partner with its western province Xinjiang whilst also looking beyond at what China characterizes as the “Eurasian Land Bridge…connecting east Asia and west Europe” (Xinhua, September 4, 2012). Chinese state-owned enterprises (SOEs) are active throughout the region on major infrastructure projects, but it is not clear how much they are being directed as part of some grand strategy as opposed to focusing on obvious profitable opportunities. The Shanghai Cooperation Organization (SCO), the main multilateral vehicle for Chinese regional efforts and reassuring engagement is a powerfully symbolic, but institutionally empty actor. Many smaller Chinese actors—ranging from shuttle traders to small-time entrepreneurs to schoolteachers and students posted to Confucius Institutes throughout the region—are the gradual vanguard of possible long-term Chinese investment and influence. Continue reading →
China is on its way to becoming the most consequential actor in Central Asia. This isn’t a critical or a negative statement, but rather a reflection of a reality on the ground.
The heavy investments in Central Asian infrastructure and natural resources, the push to develop the Xinjiang Uyghur Autonomous Region, and China’s focus on developing the Shanghai Cooperation Organization into an economic player are slowly reorienting Central Asia toward China. None of this means that China is aiming to become a regional hegemon, but unless it is willing to write off considerable regional investment, it is going to find itself needing to engage in regional affairs in a more focused manner.
And these actions are likely to be interpreted regionally as hegemonic. A potentially very prosperous corner of the world, Central Asia, is in an early stage of development that could easily be pushed by instability in a wrong direction. China needs to prepare herself to step in and help resolve matters.
Facing a heavy domestic agenda and growing foreign policy tensions in the seas to the east, it is unlikely that Afghanistan is going to be a major priority for incoming Chinese leader Xi Jinping.
Unfortunately, this does not mean the problems are going away. The contrasting fates of China’s large extractive projects in Afghanistan highlight a number of growing issues for the new administration in Beijing as the 2014 deadline for American withdrawal imposed by President Obama looms ever closer.
Up in the north, CNPC has started to extract oil from the ground in its project in the Amu Darya basin, while southeast of Kabul at Mes Aynak, the giant copper mine run by Metallurgical Corporation of China (MCC) and Jiangxi Copper has been put on hold while the Chinese firms reassess their ambitious plans for a project described by President Karzai as ‘one of the most important economic projects in Afghan history’.
The prospect of reaching European markets once excited oilmen in the energy-rich Caspian countries of Azerbaijan, Kazakhstan and Turkmenistan. Now, the famed Baku-Tbilisi-Ceyhan oil pipeline has been built and the State Oil Company of Azerbaijan Republic (SOCAR) is on the cusp of realising a natural gas line through Turkey that will finally get the long-stalled Nabucco project going. On the eastern side of the Caspian, Kazakhstan and Turkmenistan’s major energy partner is China. As the uneasy grouping of European governments, EU negotiators and Western companies dithered, China worked to create the world’s fastest-built natural gas pipeline, linking Turkmenistan’s vast southeastern gas fields with Kazakhstan and Uzbekistan’s formidable reserves to help slake the second-largest economy’s seemingly unquenchable thirst for resources. This has caused a split down the middle of the sea. For the moment, most resources on the western side go West, and most resources on the eastern side go East. Continue reading →
On a recent visit to China, Turkmenistan President Gurbanguly Berdymukhamedov smiled broadly as he was awarded the title of Emeritus Professor at Peking University. Yet his satisfaction was probably less the academic distinction than a lucrative energy export deal he had signed earlier that day — 65 billion cubic meters of natural gas, roughly half of China’s 2010 gas consumption, would eventually flow from Turkmenistan’s massive fields to China’s seemingly insatiable consumers.
This end-of-year agreement prompted some observers to proclaim that gas-rich Turkmenistan had achieved a coup against regional political powerhouse Russia: For years, Moscow has been negotiating a gas export deal with Beijing, but what would it do now that China was receiving so much supply from Turkmenistan? Yet that analysis is backwards: Rather than a Turkmen power play, the natural gas deal was a geopolitical chess move by Beijing, whose fundamental interest in the region is both raw resources, and raw power. While the West is focused on constraining China’s actions in the Asia-Pacific, Beijing is capitalizing on vast space for influence to its west in Central Asia.