Archive for ‘oil’

Wednesday, August 5, 2009

Is AGOA Good Enough?

A Boer View of African DIY

A Boer Vision of African DIY, 1980s

On the AGOA Forum currently held in Nairobi, African Union deputy chairman Erastus Mwencha said that stringent quality and lengthy certification processes had prevented many African producers from exporting to the U.S. under what has been described as the most lucrative trade preference legislation ever passed by the American Congress. Mwencha pointed out where the U.S. could or should do more to make the AGOA a success. It is also pointed out that there isn’t sufficient diversity in the range of African exports, as energy-related products account for the lion’s share of African exports with nearly 96 per cent of the 56.3 billion US dollars.

Clothesource on the other hand believes that Kenyan complaints over AGOA disappointments miss the point, and cites Cambodia’s garment industry as an example. Even though the country never enjoyed duty-free access to the U.S. market, Cambodia’s share of US garment imports was about half Africa’s in 2004, even before the WTO Agreement on Textiles and Clothing (ATC), and all restrictions thereunder ended on January 1, 2005. “The AGOA nations have failed to attract the Asian investment that has created garment industries from Cambodia to El Salvador – and, what little they have attracted has often found a hostile local reception”, Clothesource writes.

But of eighteen garment makers in Kenya, only one is actually Kenyan-owned, the L.A. Times writes today. The vast majority of exporters in the nation’s export-processing zone Athi River Industrial Park south of Nairobi are foreign-owned, usually by investors from China, the Persian Gulf or Southeast Asia, but also some from the U.S.. AGOA is not realizing its potential, the L. A. Times quotes Joseph Kosure, acting chief of Kenya’s Export Processing Zones Authority, even though AGOA (African Growth and Opportunity Act) offers some 39 sub-Saharan African countries, including Kenya, duty-free access to the American market.

American sermons on good governance can be tedious, and are often hypocritical. But reliable rule of law is the best policy for domestic and foreign investment – and AGOA looks fair, at least from outside. The opportunities it offers to Kenya were actually convincing enough for Beijing to oppose the idea, and (unsuccessfully) trying to have the arrangement lifted by the U.S. government in 2006, according to the Kenyan Spectator. Kenya has more than 6,000 product lines to sell to the U.S. under AGOA, writes Xinhua.

Isn’t the onus now mainly on Africa to prove that it can make good use of a real opportunity?

Tuesday, August 4, 2009

Clinton attends AGOA Forum: Energy and Textiles

U.S. secretary of state Hilary Clinton arrives in Kenya today to attend the AGOA Forum (African Growth and Opportunity Act, signed into law by president Bill Clinton in May 2000 and renewed by Congress in 2004. Nigeria, South Africa,  Angola, the Democratic Republic of Congo, Liberia, and Cape Verde are also on her 11-day schedule. In Kenya, Clinton will address a forum of about 40 nations covered by the African Growth and Opportunity Act, a US law giving market access to sub-Saharan nations committed to democracy and free markets. One of the leading African products making it into the U.S. markets duty-free are textiles and apparel. But as is the case in African-Chinese trade as well, energy-related products account for the lion’s share of African exports with nearly 96 per cent of the 56.3 billion US dollars. Other goods are taking some 1.3 per cent of the export, notes the Kenya Broadcasting Corporation. During French president Nicolas Sarkozy‘s visits to the DR Congo and Niger in March, uranium mining was at the very fore.

Xinhua published a rather neutral report on the AGOA Forum yesterday, but the act clearly differs from China’s approach of a strict policy of non-interference in other nations’ affairs in that AGOA spells out criteria for African countries’ eligibility for access to the American market, such as

“… market-based economies; the rule of law and political pluralism; elimination of barriers to U.S. trade and investment; protection of intellectual property; efforts to combat corruption; policies to reduce poverty, increasing availability of health care and educational opportunities; protection of human rights and worker rights; and elimination of certain child labor practices.”

That said, China’s development support doesn’t come unconditionally either. China’s EXIM Bank‘s terms in trade with Angola state that the Angolan government would get Chinese loans on condition that 70 per cent of public tenders for the construction and civil engineering contracts be awarded to Chinese companies., writes Asia News.

The Namibian government is apparently in the process of reviewing similar provisions in its business relations with China.

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Related:
G20 London Summit – A Difference for Africa?, April 4, 2009
China in Africa, Hearts and Minds, Febr 13, 2009

Sunday, July 12, 2009

JR’s Weekender: Anger Management and Anger Manipulation

Thousands of Turks and Uighur expatriates took to the streets across Turkey after Friday prayers, protesting the violence in Xinjiang and burning Chinese flags, according to AFP. The times have changed – it is hard to imagine that any news could have sparked that much anger that quickly only fifteen years ago. But no matter if it is the West, the Middle East, China, or elsewhere, rightful indignation has become a way of life – it is latently simmering in the background, and erupts whenever a Pope says something “wrong”, when a Paralympics athlete is attacked in her wheelchair, when Danish authors depict prophet Mohamed, or when a former German chancellor defies a smoking ban.

No trivialization of Beijing’s policies meant. If protests lead to the right results, such as to a visa for Rebiya Kadeer, this should be welcomed. But it shouldn’t take statements like prime minister Erdoğan‘s to channel or manage Turkish public anger. Such statements hold just more seeds for more of the same anger, because what the prime minister said went beyond the cruel reality. What kind of vocabulary does he intend to use in case of a real genocide?

Chinese indignation, on the other hand, has been given a beautiful mouthpiece just recently. The “Global Times” has probably qualified for the silliest article of the month last week (granted, we are still counting the days). The article demonstrates another kind of anger management. Until three years ago, the Bush administration had managed very successfully to brand any American national who opposed police-state measures as a “traitor” – they left the defamation routine to their proxies, but it was part of the White House’s own work. No wonder that China is trying to ride the pig chased through the global village by George W. Bush. And no wonder that the Chinese government was much happier with the 43rd American president than many other global villagers.

Anyone who supported or still condones the Bush administration’s approach to the war on terrorism should at least sympathize with one of the Global Times‘ points:

Five years ago, when terrorist bombings hit Turkey in November 2003, China took its firm stand on the side of Turkish people and condemned the violent act. However, when the riots happened, inflicting casualities and property damage in Urumqi on July 5, Turkey stands by the side of the thugs, reavealing its shame to the whole world and repaying China with evilness.

But it takes Bush or Cheney logic to see eye to eye with such ideas. The war on terrorism served the agenda of those Mssrs and their cronies’ agenda. The Iraq war wasn’t about going after terrorists. And Beijing’s “war on terrorism in Xinjiang” is just a scam to deflect global attention from the failure its national minorities policy is. Let’s face it: there will more of the same disaster somewhat further south, once the Dalai Lama is no longer around. Unless Beijing stops blaming its own failure on Turkey and other “hostile forces abroad”, and starts looking at the roots of the problems at home, that is.

Tuesday, March 31, 2009

Sarkozy’s Africa Tour: Sans la Nommer

French president Nicolas Sarkozy returned to Paris on Friday, after calls on the DR Congo, the Congo Republic, and Niger during a two-day Africa tour. In the DRC, France’s state-controlled nuclear-energy company Areva signed a deal with the government in Kinshasa allowing the company to prospect for and to mine uranium. In Niger, the company signed another deal for uranium mining. Al Jazeera reports that Areva’s mining activities in Niger had been attacked by Tuaregs after thousands of Tuareg nomads had been displaced to make way for the mines. Apparently, French politicians are reacting to allegations that Areva would enforce poor safety and environmental standards, and to mounting allegations that the Niger government expelled nomadic Tuareg tribes. Sarkozy was, with Areva CEO Anne Lauvergeon, due to take part in a meeting of the local chapter of the Extractive Industries Transparency Initiative (EITI), an international attempt to set global standards for companies on publishing what they pay and for governments on disclosing what they receive, according to France-24.

The official Republicain Niger refers to Sarkozy’s visit as a review of cooperation within four hours – that’s apparently as much time as the French president has for the former colony. And the paper refers to his meeting with the EITI (after a lunch with president Tandja Mamadou) in a rather ambiguous way: [Sarkozy] will certainly restate his engagement to make transparency in Ali Baba’s Cave a reality, so that the citizens will know that the extractive industries [or mining industries] account to their countries.

[Which country, in the case of Areva‘s activities in Niger, would be the one to be reported to?]

Areva has committed an initial investment of 1.2 bn Euros at the Imouraren mining site, which is planned to produce 5,000 tons of uranium from 2012, according to La Tribune.
“The Nigeriens must know how much money is paid (…) where the money goes, how it is used. These are the methods of the twenty-first century”, Sarkozy reportedly said at the meeting with the Nigerien EITI committee. By the way, he invited the Nigeriens to do the same with other countries, because “transparency must apply for everyone, not just the former colonial powers”. Without mentioning it by name, he apparently aimed at China, Nigers second trade partner, where the country operates uranium mines and an oil field.

Related: For a “healthier relationship” with Africa, BBC, September 26, 2007

Friday, February 13, 2009

China in Africa, Hearts and Minds

Why all the noise about China in Africa now, when China has had good relations with Africa since the 1950s?

Pang Zhongying, Professor of International Studies, Nankai University

China’s chairman Hu Jintao is on another Africa trip from February 10th to 17th, with scheduled stops in Mali, Senegal, Tanzania and Mauritius. The Chinese embassy to the U.S. quotes China’s assistant foreign minister Zhai Jun as saying that energy cooperation is only part of Sino-African cooperation.

Senegal was one of the battlegrounds between China and Taiwan for diplomatic relations with African states (Beijing doen’t maintain formal ties with governments which recognize Taiwan). Senegal had switched diplomatic relations from China to Taiwan in the past, and back to China in 2005.

Lu Shaye, China’s ambassador in Senegal, on February 5th, made the same point as Zhai Jun about Beijing’s relations with African countries: “China doesn’t only come to Africa for the natural resources and markets. (…) Senegal isn’t rich in natural resources, although there is iron ore, but that isn’t mined by China, but by the Europeans, by Arcor Mittal. There is gold, but it isn’t mined by China, but by the Canadians. So, China isn’t coming to Africa only for natural resources and markets.”

But China is encountering some image problems, just as other outsiders in Africa may do. There are people who feel that they have got the short end of the stick in African-Chinese relations, and make no secret of their feelings.About fifty Senegalese in Guangzhou took the opportunity of Hu Jintao’s visit and tossed a turd into the punchbowl, complaining about unfair treatment in the wake of the Olympic Games. Ever since the Olympic Games, the Chinese authorities had refused to renew their visas, according to Ms Mbèye Ndiaye, speaking for the Senegalese living in Guangzhou, and talking with a local Senegalese radio station, RFM (apparently this one). They didn’t dare to leave their houses in Guangzhou any more, and the police didn’t hesitate to chase them just up to (or into) their flats. Ndiaye hoped that, during Hu Jintao’s visit, Senegal’s politicians would make sure that she and her compatriots could either live in peace in China, or that measures would be taken to re-patriate them to Senegal.

If caught, they faced prison for fifty days unless they paid 350,000 FCFA (Central African Francs), said Ndiaye.

Seneweb, the source reporting about Ndiaye’s interview or talk with RFM doesn’t describe the role of the Senegalese in Guangzhou – they might be business people, or overseas students. For sure, most of the comments underneath the article aren’t exactly China-friendly.

One however criticizes the original source of the article, nettali.net (which is harder to read than seneweb, because there are too many plug-ins required): “Bravo, Nettali. You encourage repressions against the Chinese in Dakar. (…..) Encourage hate and racism. Bravo / Shame on you.” And neither seneweb nor nettali seem to be too familiar with the issue itself: They spell Guangzhou “Ghaounwazou”, apparently blindly transcripting the RFM’s radio program. Comment No. 20 points that out. There is also an argument about how factual the complaints are.

One commenter (No. 27) sees problems at home – and in Europe:

“The problem is that the Senegalese government is niak diom (irresponsible). In places abroad like France, Italy, or China, Senegalese people have to go through a lot for getting a visa or employment, but when a foreigner comes to Senegal, he is allowed to do anything during a long, free stay or his sex trip. That’s the real shame! Arise, Senegalese people! You are ruled by servants of France!

Maybe the next Globalscan survey will be made in Africa. Hard to tell from here who Africa’s bigger devil – the one they’ve known for centuries, or the new one.

China’s investment in Africa now stands at $1.5 billion a year, there are at least 700 Chinese enterprises operating on the continent, and China’s trade with Africa is approaching $50 billion, according to [Peter] Lewis [director of African Studies at the Johns Hopkins University]. This has made China the second-largest trading partner with sub-Saharan Africa, eclipsing one of the continent’s former colonial powers, Britain, which formerly enjoyed the highest economic profile in Africa. (VoA News)

Western governments and corporations competing for influence in Africa might still hold an advantage over China – but only if they avoid a mistake frequently made by them in the past, and by the Chinese government now. In the long run, it won’t be the relations among governments and elites alone that will count. Africa in general may profit from Chinese engagement once China’s own political system becomes less corrupt – but that can take a while, if it is ever to happen. Meantime, other stakeholders should offer Africa better terms of trade than in the past – terms that don’t only favor Africa’s oligarchs. If that happens, international competition with China for African resources and markets (let’s face it, this is what counts most after all) may actually begin to serve African countries.

But that might require changing some habits on the ground:

“I can’t count the number of times I spoke with people in South Africa or Kenya or Mozambique, who explicitly made the comparison between Chinese traders – some of whom had actually been sleeping in the market – and Western expatriates…who are viewed very differently than small-scale Chinese traders.” [Joshua Kurlantzick, Carnegie Endowment for International Peace.]
Many Western expatriates in Africa live in relative luxury, and are resented by some Africans for their apparent efforts to isolate themselves from the communities amongst which they work. (VoA News)

Let’s learn from president Bush.

OK – cracks aside. Conservatism may be something appreciated in Africa indeed, and most Chinese people probably do have a rather conservative attitude. But the official statements made by China’s diplomats – that Chinese engagement in Africa isn’t just about markets – is underpinned by their volunteering concept. Mauritius for example is one of China’s traditional diplomatic relations, and it’s the first place in Africa where five Chinese nationals volunteered to teach Chinese in 2004.

And while the Senegalese may have bigger problems with getting visas in China than other foreigners (the problem isn’t quite unfamiliar for Westerners either), and while the economic crisis may have an impact on global trade for a while, China has reasons to stay in Africa.

Sunday, February 8, 2009

Will CCTV and Xinhua shape China’s Global Image?

BBC’s correspondent in China, James Reynolds, refers to CCTV’s planned Russian and Arabic language channels and to similar plans by Xinhua News Agency. And he asks if the efforts of China’s official media efforts have won any of his blog’s readers over so far.

Some of the commenters instantly criticised his post and in turn pointed out where they see the BBC as just another (Western) propaganda tool. They are critical of the BBC in a way CCTV and China Radio International would probably appreciate – but I don’t think that their defense mode in Beijing’s favor was created by CCTV – maybe unless they are mainland Chinese and grew up with CCP-controlled media.

A former White House task force media expert, David Chambers, was enthusiastic about the BBC’s Arabic TV channel launched last year. You can’t blame the BBC for his enthusiasm. But in the 1990s, the BBC chose the Orbit Communications Corporation as a partner for its first try to reach a large Arab television audience. If Wikipedia has it right, Orbit Communications was owned by a certain Prince Khaled, a cousin of King Fahd of Saudi Arabia. Again, to the defense of the BBC, it should be said that the BBC angered the House of Saud sufficiently to make the partnership explode – many of the staff switched to Al Jazeera television. A partnership with an oligarchy in power in a certain place doesn’t look clever. As long as it works, I’d constantly suspect as a viewer or listener that there is no real editorial independence. When it doesn’t work, they go off the air anyway. Maybe going it alone as the BBC does now is a smarter choice.

You can be pretty sure that BBC Arabic TV will be listened to. They may also be trusted more than local media, just as I’d still guess the BBC’s Mandarin service is more trusted – by those in China who listen to it – than China’s local stations. But when the BBC chose to launch their Arabic television service, they also decided to close ten other language radio services to balance their budget. Such choices reflect political priorities, don’t they?

The bottomline is that no non-commercial media service is here simply for the sake of making their audience more informed. Still, there are some among them which I think are doing a good job, and others which don’t. I’m listening to the BBC World Service more often than to any other station from home (Germany) or abroad.

Journalists who know their trade and work professionally will win me over. Stuff like the “VoA Editorials” puts me off. And the VoA is still subtle in its approach, compared to China Radio International or Xinhua. Even government-funded journalism might work with integrity.

But is that the rule?

When the Reagan administration upgraded the Voice of America in terms of staff and broadcasting sites during the 1980s (and introduced those “Editorials, reflecting the views of the United States government”), Carl Rowan, who had been head of the USIA earlier, warned that radio broadcasts couldn’t make up for wrong political decisions. (The picture wouldn’t be complete without saying that Rowan was critical of the Reagan administration’s policies anyway.)

But it should be food for thought that the BBC’s Arabic television followed British troops into the Arab world.

Sunday, December 21, 2008

Commodities: Cabbage and Fuel

Cabbage doesn’t find as many buyers this year as expected. The wholesale price in Zhifang Township, Ruzhou (汝州), Henan Province, was around 6 Fen per kilogram in early December, according to dahe.cn, and it was six Mao per kilogramm a year ago, according to that source. Last year, farmers could count on buyers from places as far away as Guangdong and Shenzhen. Expecting more of the same, they had grown larger quantities of cabbage.

If you can believe the story at dahe.cn, all it took to improve sales was publishing the situation, plus some online publicity by the local party and government websites to get phone calls from Inner Mongolia and Jilin Province, doubling sales and reducing the farmers’ losses.

Over-supply may not be the only reason for falling demand from the South. China increased retail and wholesale prices for fuel and electricity by as much as 18% on June 19, but $2.9bn in subsidies were still “set aside”.

But a scarce commodity is a scarce commodity. Truck drivers in Guangdong Province have used a good share of their fuel to search for the next fill, and similarly bizarre situations could be watched in many places in China.

Probably, neither the actual market prices nor subsidies for fuel have contributed to make China’s markets more mobile.

Maybe the international oil prices – now falling – will help.

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Footnote: apparently there was a media scandal in Ruzhou three years ago – reporters took bribes to keep silent about mining disasters in the place.

Tuesday, November 25, 2008

Turkey and Greece look East

India and Turkey are discussing the use of the Baku-Tblisi-Ceyhan (TPC) pipeline as a shortcut for Russian oil supplies to India, reports Today’s Zaman. The oil from Russia is currently shipped across the Black Sea and the Turkish Straits – the latter are bottlenecks because the limit on cargo allowed to pass through the Turkish Straits is set at 130,000 tons, while ships carrying 400,000 tons of cargo can use the Port of Ceyhan in southern Turkey, according to Turkey’s Energy and Natural Resources Minister Hilmi Güler.

A number of common projects were discussed with Indian authorities, prime minister Tayyip Erdoğan said during his official visit to India, singling out new oil transport projects as an opportunity to bring the two nations closer together. Energy minister Güler announced meetings with his Israeli and Indian counterparts in the coming days to discuss the Ceyhan-Red Sea oil project. It would lead from Ceyhan in Southern Turkey through Ashkelon in Israel’s Southern District to Eilat on its Red Sea coast.

This will help India to avoid oil transports through Iran and Pakistan, says Der Spiegel. From the Red Sea to India, the oil will have to be shipped.

The BTC Pipeline was inaugurated in 2006, and it is the only pipeline that transports oil from the Caspian Sea to the Western countries without running through Russian territory, according to Der Spiegel.

Also in the region, China’s chairman Hu Jintao who is on a three day visit of Greece, joined COSCO CEO Wei Jiafu today for the signing of a 4.35-billion-euro (5.5 billion-dollar) deal for the 35-year concession of terminals 2 and 3 at Piraeus, Greece’s busiest port, reports Seatrade Asia Online. The terminals had so far been run by the state, and dock workers’ unions opposed the Piraeus privatization plan, according to ABC News.

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