Axis of ChiRan

August 10, 2009 10:47 AM

Multi - polarity in Eurasia. Pepe Escobar on Iran, China and the New Silk Road 1 & 2
Iran and China just signed a $3 bn. deal for China to help develop Iran's refinery capacity in Abadan and the Gulf. ( previous )
posted by adamvasco (16 comments total)

Is $3 bn a big deal in the oil business?

China chugs through about 8 million barrels of oil a day, so we're talking about an investment that equates in raw oil terms of 6 days.
posted by Static Vagabond at 11:55 AM on August 10

Is $3 bn a big deal in the oil business?

Not in terms of raw product output, no. But in terms of investment in infrastructure, yes.
posted by Burhanistan at 12:49 PM on August 10

Gah, I am so tired of this kind of reporting -- always looking for the conspiracy, and missing out on larger details because of it. The rag Asia Times is full of it. I previously gave faint praise to Pepe saying he was the sanest writer for them. Which is true, considering they regularly publish North Koreans apologists.

Iran has been courting China's oil investments lately, but that's not terribly new. The new deal really isn't that big in comparison to their previous deals, nor to China other contemporary deals. China just completed an even larger deal with Kazakhstan. Kazakhstan is an even more interesting story because (a) it already has large investments from the west, and (b) it offers easier access to Central Asia at this point (until the other countries stabilize).

China's oil deals have been huge lately, and Iran is just a tiny bit of that. Google shows this nicely done, up to date summary. Here's a map of China's most recent deals, according to which company is buying or investing.

Instead, Pepe goes for the Iran-China link, using tons of coined words, and in generally being a ignorant version of Niall Ferguson for the left. His reason for doing this appears to be solely to bag on the Bush Administration (who's strength continues even today, apparently) and trump up the link between the riots.

And his coverage of those Xinijiang riots is bland and not terribly knowledgeable as well. Claiming that there wasn't enough coverage in the West (huh?), or at least not compared to Iran's (which was different in that it was attempting to displace the government), he got other facts wrong. First, there has actually been a DECREASE in the percentage Han population in Xinjiang over the past few decades. The move-west policy was over with in the 70s. Second, he completely ignores that most of the victims in the riots were Han injured by Uyghurs. It was not as nice as clean as he clearly wants it to be.

He's just some dude who's not terribly knowledgeable (or at least doesn't display it) trying to find the next geo-political conspiracy. And it's sad, because there are some very interesting things going on there. The next Great Game. Iran desperately seeking partners. China's indifferent expansion. But instead of giving a great report on any one of those (and he obviously has the ability to relate things in an awesome way), he muddles through all of them to produce whatever it was he was saying above.

So, this is a long way of saying: adamvasco, please don't just link to Pepe again. There are a ton of links on the subjects he writes about that are more interesting than what he puts together.
posted by FuManchu at 1:32 PM on August 10 [5 favorites has favorites]

China chugs through about 8 million barrels of oil a day, so we're talking about an investment that equates in raw oil terms of 6 days.

capital is eternal, subject to depreciation of course. If the quid-pro-quo was the output of this new infrastructure goes to China for the next 50 years, then it was win-win.

Now, I don't know how much plant $3B buys you, but it's on the order of 100,000 bbl day output. So 1% of its usage is nothing to sneeze at.
posted by @troy at 2:39 PM on August 10

There are a ton of links on the subjects he writes about that are more interesting than what he puts together.

More than willing to believe you. If you could post some, or name good names, I would be most grateful. These are interesting fields....
posted by IndigoJones at 5:04 PM on August 10

First, there has actually been a DECREASE in the percentage Han population in Xinjiang over the past few decades

not counting the Han migrants the Chinese gov't doesn't count, yes.

move-west policy was over with in the 70s

but the mixed-economy enterprise system was just starting. Wikipedia: The region's capital, Ürümqi, is a heavily industrialised city of over 2.3 million people, approximately 75% of whom are Han, 12.8% are Uyghur, and 10% are of other ethnic groups.[22]

ignores that most of the victims in the riots were Han injured by Uyghurs

I don't think the events of last month were so clear. Ignoring the general problem of relying on Xinhua or even western ground-level press reports, I believe the the fact that the entire civil infrastructure of the city is run by Han will result in sever under-reporting of Uyghur injured/killed.

Now, the only knowledge I have of Xinjiang is what I saw on NHK's Silk Road series on DVD that I watched last year, but I do know that where the present-day Chinese gov't is concerned great care has to be taken about believing anything it says.
posted by @troy at 6:38 PM on August 10

First, there has actually been a DECREASE in the percentage Han population in Xinjiang over the past few decades. The move-west policy was over with in the 70s.
Interested in your source for this statement, FuManchu. I'm presuming you're claiming the end of major population transfers under the bingtuan for an end to a move-west policy in the 70s, but seems a bit bold to claim that the Go West (西部大开发) scheme hasn't at least in part encouraged Han in-migration - a view you can see, for example, in this 2007 opinion-piece/article at the UNHCR's website:

Official statistics show a steady increase in annual GDP growth rates for Xinjiang since 2000, passing 10 percent in 2004 and 2005. The region's potential also attracted a flood of migrants, mostly from China's poorer provinces such as Sichuan and Henan.

For Xinjiang-bound immigrants from the country's packed interior, Korla and similar cities are attractive for their abundance of resources and relatively small population. But the newcomers, mostly members of China's predominant Han ethnicity, are not filling a vacuum. Some analysts suggest that rather than building a more inclusive Xinjiang, the steady import of Han culture, commerce, and architecture is pushing Uighurs further towards the margins of Chinese society.

That read as a bit tendentious, if fitting the general impression I've been given over the years, so had a look round for more and found this chapter on the demography of Xinjiang in a 2004 collection of academic studies about the province. The prof writing the chapter seems to have a good grasp of the various issues with the data. He notes the large floating population in the 80s when migrants could come to Xinjiang from elsewhere in China without having to shift their registration (hence not appearing in the figures), and seems to agree that the Go West policy involved state facilitation of migration (p 247). Unfortunately, bit of his handing of the 2000 census figures aren't readable in the Google books preview (and only raw data was available when he wrote) but he notes the relatively high population growth rate in Xinjiang, which even if the proportion of Uighur is up slightly, given the disproportionate birth rate and the greater likelihood of in-migrants not bringing their families (he notes again p 258 that there's an unregistered floating population, 10 to 15 percent in certain cities), seems to support the picture of continued inward migration by Han people, albeit (as he concludes) not of the same nature as the policy-driven transfers of the 50s and 60s.
Agree that the Asia Times publishes all sorts of dodgy nonsense, but as it's eclectic it does have the occasional decent piece - trick is to check out each author, I think.
posted by Abiezer at 7:55 PM on August 10

Yikes, didn't mean to stir up so many issues with those Xinjiang comments. My point was simply that there's a lot of nuance to that situation. And I think the minorities have genuine grievances that aren't being addressed. But Pepe brought none of that in his riot commentary. And he tried to simplify again it in order to work it into his oil-deal commentary linked here.

Excellent English blogs that cover Xinjiang and Central Asia would include New Dominion and Registan, respectively. These guys get it, in my opinion. Registan is especially excellent for the type of over-arching synthesis that I think Pepe fails at. It is necessarily more boring and mundane because of that. They have just posted an article about Kyrgyzstan detainaing some Uyghurs yesterday, almost certainly under Chinese pressure. Global Voices translates a lot of the Chinese opinion, both good and ugly, on current events. Anti-CNN also puts some of their stuff into English. Comparing Western and Chinese media, you can't beat ESWN, which had good coverage of the riots (1, 2, 3).

For China's oil investments, I had thought those two links above (summary and map) were great. Hopefully the Economic Observer will keep the map updated. Otherwise, you can just look at business wires to see the large number of oil deals China's been after.

Okay, like I said, I didn't want to get into the population claims as much, but I figure I have to at least back up my throwaway ridiculous claim. Sun Bin has a pretty good summary here. I can't remember where I originally read the info, maybe anti-cnn, but he's got more than I remember there. Now, those figures are pretty fungible, but are close enough to the truth to show the massive influx of Han is neither new nor relatively large. There certainly has been an influx of Han into the region over the past few years. But Urumuqi hasn't changed all that much from what I've understood. I've only spent a few months there in total, but the largest influx and subsequent friction I've heard of occurs in areas being developed for oil; there aren't many people in those areas to begin with. And the developers don't hire locals. But that's also true here in Shanghai for real estate developers, and many other infrastructure projects as well. The root of the problem lies deeper than an influx of outsiders.
posted by FuManchu at 9:10 PM on August 10 [1 favorite has favorites]

My point was simply that there's a lot of nuance to that situation.
Wouldn't argue with that. I've really enjoyed reading New Dominion myself (never been further north-west than Gansu myself, so I certainly have no special knowledge). Thanks for the Sun Bin link - for some reason he's not part of my regular reading. Further to the bit there about the comparison of Xinjiang to Palestine, something similar just cropped up in an article by Mark O'Neill on the history of Xinjiang:

In the 2000 census, Han accounted for 41 percent of the region's population against 45.2 percent for the Uighurs. If the current rate of migration continues, the Han will become the majority within 20 years or sooner

A research paper published by the Bingtuan in August 2003 said that study of the Uighur language was useless.

"Our long-term aim is to Sinicise the local population. We must first destroy the Uighur language. We must encourage large-scale migration." The report stated. It advocated the Israeli example and establishment of large Bingtuan settlements in the five areas of Xinjiang where the Uighurs account for more than 50 percent of the population, including Hetian and Kashgar, where support for the ETR is strongest. "The Bingtuan method is to choose places where no-one is living, to avoid giving Uighurs the idea that we are stealing their land. Introducing water will improve the local economy and living standards of Uighurs and block the growth of terrorism."

During the 1950s and 1960s, Han migration was compulsory or nearly compulsory. Soldiers stationed in Xinjiang were ordered to settle there, families with the 'wrong class background' were ordered to send a member there and political prisoners were sent there to work. Since the 1990s, the migration has been driven by economic incentives. Xinjiang's nominal gross domestic product in 2008 was 420 billion yuan, against 220 billion in 2004, thanks in part to large government investments in industry and infrastructure and incentives to new settlers. China's dramatic economic growth has driven up prices of the farm, oil and mineral products which are the mainstay of the economy. Its oil, gas and petrochemical sectors are booming.

I actually worked with Mr O'Neill briefly in 90s (I was merely a glorified tea-boy for Reuters) and take him to be a very credible journalist, so although he doesn't give a source for the quoted report I trust it exists.
Agree with your wider points about China's sourcing of oil, hence not arguing with those!
posted by Abiezer at 9:28 PM on August 10

Thanks for the link, Abiezer. I'm not surprised the Bingtuan would write something so tonedeaf. They're years behind even the central party when it comes to PR.

Do you happen to recall articles from a few years back summarizing the role of the Bingtuan in Xinjiang? Maybe it was even New Dominion. I remember it succinctly outlining the historical place of it, along with its parallel power structures, alongside the nominally self-governing party. I can't seem to find them, and want to read up on it again.
posted by FuManchu at 10:07 PM on August 10

Afraid I don't but would also be interested if you do dig them up. As I said, I've no particular special knowledge about Xinjiang or its contemporary history bar what you pick up from a more general interest in China (and in my case social development) - does highlight the competing interest groups in what is often seen outside as a monolith though, which speaks to your point about a need for nuance.
posted by Abiezer at 10:29 PM on August 10

FuManchu: You have a scroll button or you can FIAMO.
I think the emphasis here is Iran not China as you have made it.
As Juan Cole points out China now imports 25% of Iran's oil output.
The Western nations are busy trying to isolate Iran which is surrounded by nuclear powers.
Neither Iran nor China are particularily fussy about human rights, therefore this particular hurdle does not come into play in their negotiations.
Love him or hate him Escobar's admittedly in your face presentations and slightly over the top writing definitely gives a different viewpoint from that normally posted in traditional media.
The other thing I find interesting from Juan Cole's comments, is that in helping Iran to build a refinery China could be in violition of the sanctions imposed on Iran.
Here is detailed info re Iran's present production and refining.
posted by adamvasco at 12:44 AM on August 11

I think the emphasis here is Iran not China as you have made it.
    You're partially right on that. But Escobar brought it up. I'm familiar with China, and the little I know conflicts with his presentation. And if he's wrong about half of a conspiracy, he's probably wrong about more.

As Juan Cole points out China now imports 25% of Iran's oil output.
    So what? Japan imports about the same (from the EIA link). And India imports almost as much. It's a factor of size and proximity.

The Western nations are busy trying to isolate Iran which is surrounded by nuclear powers.
    Yes, we agree on that. Iran is desperate for partners. China's not necessarily that partner, though. Compared to their other investments, they have not invested a lot in Iran. China is also less dependent on its oil imports than Iran's other partners (Japan, India). I was implying the deeper implications of this by saying in my first comment that "there are more interesting topics: ... Iran desperately seeking partners. China's indifferent expansion." Pepe seemed completely ignorant about the actual scope of China's other investments.

Neither Iran nor China are particularily fussy about human rights, therefore this particular hurdle does not come into play in their negotiations.
    Yes, you and he are absolutely right on this.

Love him or hate him Escobar's admittedly in your face presentations and slightly over the top writing definitely gives a different viewpoint from that normally posted in traditional media.
    You can say the same about Ann Coulter.

The other thing I find interesting from Juan Cole's comments, is that in helping Iran to build a refinery China could be in violition of the sanctions imposed on Iran.
    Well Cole's not too bright then. US sanctions only apply to US businesses and citizens. South Korea has invested in North Korean 'businesses'. France and Russia regularly invest in countries we have sanctions against.

Here is detailed info re Iran's present production and refining.
    That would have been nice in the original post. Escobar should probably read up on it as well. I only saw it when I was on Google trying to confirm my suspicion that Escobar was over-analyzing a tiny $3b plate of beans while ignoring the more than $75b China's invested abroad in the past six months alone. The story would be "Iran Desperately Looking for Partners" and not "Totalitarian States Regional Oil Pact Hurf Durf".



Look -- like I said, I think there are interesting topics here. But Pepe is not a great voice for them. There's a lot of other current commentary to choose from, and there's gnashing of teeth about the much larger previous deal (ironically also from Asia Times).

I don't know what to make of Escobar's commentary, as far as it's implications, either. This sort of ties in with my conspiracy-story complaint, in that they typically leave a lot for the reader to conclude on his own. The FP link is clear on the "can the US impose sanctions" question. Escobar only leaves me thinking that further deals may happen between these two countries, dunh dunh dunnhhh. I don't think people should always ignore him, only that he's not a strong enough voice on his own, and he doesn't provide decent context to the story he's pushing.

Sorry if I may have derailed this thread early with the Xinjiang comments.
posted by FuManchu at 3:18 AM on August 11

Detailed response FuManchu. Thank you. Probably my post was a bit thin. Escobar maybe tries to present too much information / comment / ideas at a time; rather than being more specific and in depth as possibly a place like metafilter deserves. However he does present some ideas from outside the tradition western box albeit badly. This viewpoint is largely missing in mainstream media which talks incessantly about what the US and sometimes Europe wants without so often considering that there are other players in the game; China being by far the largest. Bilateral China/Iran trade being over $27 million in 2008 a 35% growth on the previous year.
So there is definitely something noticeable going on here. From the same link above: In June this year President Hu Jintao stated that "Tehran and Beijing should help each other to manage global developments in favor of their nations otherwise the same people who are the factors of current international problems will again rule the world." .
China is hugely complex, but China needs Oil + Gas. Iran needs a trading partner and investor. China will also undoubtably help Iran modernise infrastucture as shown from your brookings link.
posted by adamvasco at 4:29 AM on August 11

(Thank you, Mr Manchu. Much obliged.)
posted by IndigoJones at 6:16 AM on August 11

This viewpoint is largely missing in mainstream media which talks incessantly about what the US and sometimes Europe wants without so often considering that there are other players in the game; China being by far the largest.

Yea, I agree that's absolutely true for most mainstream media. Foreign Affairs usually adds a good selection of non-US academics, but I think that you're right in that its a desert.

In one respect I do think what Escobar is doing is good: trying to summarize events for laymen. In another, I think he's no different than mainstream media: he gets facts wrong, wears his opinions on his sleeve, and will shoehorn everything into the story he already has in his head. These issues he touches on are clearly important issues to a lot of people, and I didn't hear from one of them in his report. I doubt he actually spoke to anyone in the oil industry about the deals. It's lazy, and B-grade writing even for bloggers at this point.

Good reporting on these issues is done, but of course it's going to be by "establishment" people: Oil businessmen and foreign policy experts. Good business news (so not CNBC) usually isn't tainted by allegiances. The articles are dry and don't often summarize the industry events in each article. Many research houses do put out regular "what's happening in X" summary reports (where X is an industry or country or political party), that are terribly interesting to read, but aren't made available to the public. Sadly, I think the market for that kind of reporting is limited to the people who are willing to pay thousands for it, and a tiny population that just can't afford it.
posted by FuManchu at 7:51 AM on August 14