Chinese Clout in Africa Grows With Moves In South Sudan

Article Summary
As Sudan and South Sudan inch toward war, China welcomed the South Sudanese president. This cozy relationship is yet another reason for the US to fear China’s expanding role in Africa, which is marked by its oil and gas partnership with Sudan, writes Khalil Hussein. 

The United States' growing concern over China’s economic growth in the past decade has been reinforced by several credible economic reports. The International Monetary Fund expects the size of the Chinese economy to surpass that of the US in 2012 in terms of purchasing power parity. Many international research institutions have asserted that the Chinese economy has been the world leader since 2010, and the US fears that China's economic superiority will eventually threaten its leadership position. Washington has acknowledged that it is working to prevent any potential competitors from emerging as an influential global power, which it can do by denying them the ability to overtake strategic, resource-rich regions.

The US, the largest importer and consumer of crude oil in the world, sees China as a significant challenger in the African continent. In the last decade, under President Hu Jintao, China was able to forge a strong alliance with certain African countries — particularly with Sudan. China is the largest importer of Sudanese oil and the main arms supplier to the Sudanese government.

The US oil involvement in Sudan goes back to the signing of the Addis Ababa Agreement in 1972, during the tenure of former Sudanese president Gaafar Nimeiry. The agreement halted the war temporarily between northern and southern Sudan, opening the door for oil investments. In 1974, the US oil company Chevron was granted a license to undertake oil exploration in the country. It invested $1 billion in the drilling of 52 wells, including 34 ready for production. In 1981, Chevron discovered the Heglig oil field, which Khartoum and Juba are currently fighting over. Heglig’s oil reserves are estimated at around 236 million barrels. Without presenting logical explanations, Chevron stopped its operations in Sudan in 1984 after twenty years of exploration. The reason may be related to Washington’s preference for the more regular flow of Gulf oil, and a notion that it might reconsider exploiting Sudanese oil after 2020. Washington did not expect to see a strategic partnership evolve between Khartoum and Beijing, which disrupted its plans. Sudan became a strategic partner with Beijing as part of an ambitious Chinese agenda to invest in the African continent. Clearly, Washington did not turn a blind eye or forget Chevron’s discoveries, which helps explain its position toward Khartoum in past years.

The African continent has large oil reserves, and their rate of discovery was the fastest in the world over the past five years according to reports issued by the US- based Corporate Council on Africa. West Africa provides roughly 15% of today’s US oil imports, and this number is expected to rise to 25% in 2015. Additionally, the high quality and shorter geographic distance of West African oil from the US makes it an attractive product.

There are certainly other hotbeds of US-Chinese competition. In Iraq, for example, China won three out of the 11 contracts to develop oil fields, while the US has won only two. This increases the probability of indirect conflict between the two nations. It seems that Sudan and South Sudan are so far the most prominent arenas for this hidden conflict.

There are obvious competitive motives that are concealed under the guise of humanitarian work, such as the Chinese presence at the oil wells in South Sudan. For the Chinese, it is a quite different scenario from the one in Libya — one of China’s largest oil providers — where China was forced to withdraw tens of thousands of experts and engineers from Libyan territory. They were replaced by the economic powers which had announced that they wanted to take a front seat in the reconstruction of Libya. The Chinese role in South Sudan is like that of those countries working on the reconstruction of Libya (which China lost out on). Washington cannot disregard that Chinese companies have won the majority of infrastructure contracts, including the building of dams and bridges in northern Sudan, and it is now undertaking the same role with regard to oil exploration contracts in South Sudan.

Beijing's adoption of a winning strategy is based on acquiring strategic points rather than the dealing fatal blows to the US. This eases the image of US-Chinese competition, and prevents it from escalating into direct violence. The strategy has thus far proven to be effective, especially since the collapse of the Soviet Union and after the US assumed unilateral leadership of the world through knockouts under the pretext of preemptive or preventative wars.

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