Chinese Prime Minister Li Keqiang looks at a map of the port of Piraeus,
where Chinese shipping giant Cosco controls two of the three container
terminals, on Friday June 20, 2014.
From DefenseOne bySteve Levine
China’s
outsized latticework of global infrastructure is said to be rooted in a
fierce competitiveness learned from 19th-century America.
In the 18th and 19th centuries, the sun famously never
set on the British empire.
A commanding navy enforced its will, yet all
would have been lost if it were not for ports, roads, and railroads.
The infrastructure that the British built everywhere they went embedded
and enabled their power like bones and veins in a body.
Great nations have done this since Rome
paved 55,000 miles (89,000 km) of roads
and aqueducts in
Europe.
In the 19th and 20th centuries, Russia and the United States
established their own imprint, skewering and taming nearby territories
with projects like the Trans-Siberian and the
Trans-Continental railways.
Now it’s the turn of the Chinese.
Much has been made of Beijing’s
“resource grab” in Africa and elsewhere, its construction of militarized
artificial islands in the South China Sea and, most recently, its
new strategy to project naval power broadly in the open seas.
Yet these profiles of an allegedly grasping and treacherous China
tend to consider its ambitions in disconnected pieces.
What these pieces
add up to is a whole latticework of infrastructure materializing around
the world. Combined with the ambitious activities of Chinese companies,
they are quickly growing into history’s most extensive
global commercial empire.
China views almost no place as uncontested.
Chinese-financed and
-built dams, roads, railroads, natural gas pipelines, ports, and
airports are either in place or will be from Samoa to Rio de Janeiro,
St. Petersburg to Jakarta, Mombasa to Vanuatu, and from the Arctic to
Antarctica.
Many are built in service of current and prospective mines,
oilfields, and other businesses back to China, and at times to
markets abroad.
But while this grand picture suggests a deliberate plan devised in
Beijing, it also reflects an unbridled commercial frenzy.
Chinese
companies are venturing out and doing deals lacking any particular
order.
Mostly, they’re interested in finding growth abroad that is
proving difficult to manage at home.
This, too, is typical for a
fast-growing power.
“This is very much in line with what we would expect from other great
powers whose military posture follows its economic and diplomatic
footprint,” Lyle Morris, a China specialist with Rand, told Quartz.
Below are snapshots of components that are either already in place or on the way.
The story starts with a reimagined Silk Road …
In
September 2013, newly
anointed Chinese leader Xi Jinping visited Kazakhstan’s capital,
Astana. He was in town to seal the Chinese purchase of a
$5 billion stake in
Kashagan, one of the world’s largest oilfields.
On that trip, he
unveiled a plan ultimately dubbed “One Belt, One Road”—a land-and-sea
version of the fabled East-West Silk Road trading route.
The idea is audacious in scope.
On land, Beijing has in mind a high-speed rail network (map 2).
It
will start in Kunming, the capital of Yunnan province, and connect with
Laos and on into Cambodia, Malaysia, Myanmar, Singapore, Thailand
and Vietnam.
Another overland network of roads, rail and energy pipelines will
begin in Xi’an in central China and head west as far as Belgium (see
dotted brown line above).
As we’ve written previously, Beijing has
already initiated an
8,011-mile cargo rail route between
the Chinese city of Yiwu and Madrid, Spain.
Finally, another
1,125-mile-long bullet train will start in Kashgar and punch south
through Pakistan to the Arabian Sea port of Gwadur.
The thinking behind
this rail-driven plan isn’t new–as we have written previously, Beijing
has been piecing it together for awhile.
At sea, a companion
21st-century Maritime Silk Road (see
dotted blue line in map 1) would connect the South China Sea, and the
Indian and South Pacific oceans.
China would begin to protect its own
sea lanes as well. On May 26 it
disclosed a strategy for expanding its navy into a fleet that not only hugs its own shores, but can wander the open ocean.
China does not need to build all of these thousands of miles of
railroads and other facilities. Much of the infrastructure already
exists; where it does, the trick is to link it all together.
Everywhere, new public works will be required.
And to make its vision
materialize, Beijing must be careful to be seen as generously sharing
the big engineering and construction projects.
Up to now, such contracts
have been treated as rare, big
profit opportunities for
state-owned Chinese industrial units.
These include the China Railway
Group, whose already-inflated share prices have often gone up each
time another piece of the overseas empire has fallen into place.
If
local infrastructure companies are excluded from the largesse, there
will be push-back on almost every continent.
In any case, not all this will necessarily happen.
In a recent note
to clients, China observer Jonathan Fenby of the research firm Trusted
Sources suggested that it may all be too ambitious.
China has had a
history of announcing and then shelving projects, such as a
$3.7 billion railway canceled by
Mexico in February amid allegations of local nepotism.
Meanwhile, Japan
has begun to challenge Chinese plans.
It has launched rival bids for
billion-dollar high-speed rail and other projects in Indonesia, Thailand
and elsewhere, with
relatively low-interest loans and sometimes better technology (paywall).
But Beijing seems to recognize its own limits.
Rather, the world may help to build at least some of the infrastructure through
another Chinese creation—the
Asian Infrastructure Investment Bank, with its 57 founding members,
modeled loosely on the World Bank.
Projects backed by the bank are meant
to be good for the country where they are built.
But given China’s
outsize influence in the institution, they are certain to include some
that fit into its grand scheme of global infrastructure.
…extends into South America…
China’s South American railway project, which cuts through the Amazon rainforest.
(Global Forest Watch)
Xi has
pledged $250 billion in investment in South America over the next 10 years.
The centerpiece is a $10 billion,
3,300-mile, high-speed railroad (dotted
red line above) that would start in Acu, near Rio de Janeiro, crossing
the Amazon rainforest and the Andes Mountains, and terminate on the
Peruvian coast.
(
NPR’s Tom Ashbrook conducted an
excellent hour-long program on the railroad.)
On top of that, there’s an
advanced proposal by Chinese billionaire Wang Jing to build a 170-mile-long, $50 billion canal through Nicaragua.
In January, China
agreed with the African Union to
help build railroads (map 4), roads, and airports to link all 54
African countries.
These plans are already under way, including a $13
billion, 875-mile-long coastal railroad
in Nigeria; a $3.8 billion,
500-mile-long railroad connecting the Kenyan cities of Nairobi and Mombasa; a $4 billion,
460-mile railway linking the Ethiopian cities of Addis Ababa and Djibouti; and a $5.6 billion, 850-mile network of rail
lines in Chad.
Then there are China’s maritime ambitions.
These
envision modern ports in
the Tanzanian capital, Dar es Salaam; the Mozambican capital, Maputo;
Libreville, Gabon; the Ghanaian city of Tema; and the Senegalese
capital, Dakar.
All these land and marine projects align with existing Chinese
natural-resource investments on the continent.
For example, the China
National Petroleum Corporation (
CNPC) has large oil projects in Chad
and Mozambique, and Chinese manufacturers are fast setting up
Ethiopian factories that rely on cheap local labor.
The new Chinese empire is enveloping its neighbors …
In addition to its planned high-speed rail network into Malaysia and
Singapore (map 2) and Laos (map 5) into southeast Asia (see map 5 for
Laotian portion), China
plans a canal across the Isthmus of Kra in
Thailand, a
deep-water container
port and industrial park in Kuantan,
Malaysia, and a
$511-million expansion of Male airport in the
Maldives.
… and nations further afield in the Pacific
Chinese investments in the South Seas, by dollar amount (Lowy Institute)
China wants to dominate not only the South and East China seas, but far into the Pacific (map 6).
According to the Lowly Institute, transportation comprises by far the largest portion of $2.5 billion in Chinese assistance and
commercial credit to South Sea nations.
Among the projects are:
Fiji: A $158 million hydroelectric plant and several
sports complexes, including the 4,000-seat Vodafone stadium in Suva.
Samoa: A $100 million hospital in Apia, a
$40 million terminal and upgraded runway at Faleolo Airport, and a
$140 million wharf at Vaiusu.
Tonga: A
$12 million government building to be called St. George Palace, and two small
Chinese turboprop aircraft for domestic routes aboard Real Tonga airlines.
The aircraft deal has been controversial because neither of the planes
are certified for use in the West.
Vanuatu: Two more turboprops, this time for Air
Vanuatu, and $60 million to build a Port Vila campus of the University
of the South Pacific and a Parliament House (both loans have
been forgiven).
Pakistan is pivotal to China’s Silk Road …
Why has China lavished
$42 billion in infrastructure projects on
Pakistan?
The two have always been allies.
But China has a particular
goal: It wants to contain Uighur separatists who have been fomenting
violence in the western province of Xinjiang.
Some of these
separatists have sanctuaries in Pakistan and Afghanistan, and Beijing
has
pushed hard for both countries to hand over Uighurs living there.
But sending goods through Pakistan (map 7) also helps China avoid the
Malacca Strait (map 8). Much of Beijing’s oil and other natural
resources passes through this narrow, 500-mile-long stretch of sea
between Malaysia and Indonesia.
China worries that, if its relations
with Washington become truly hostile, the
US could theoretically blockade the strait and starve the country of its lifeblood resources.
That is in large part why
Beijing is financing a
deep Arabian Sea port at Gwadur, and the 1,125-mile-long super-highway,
high-speed railway and oil-pipeline route to the Chinese city
of Kashgar.
… as is Central Asia …
Central Asia has been an almost exclusively Russian playground for
almost two centuries. It still is when it comes to pure muscle.
But
in matters of cash, China is fast moving in.
The relationship revolves around oil and natural gas.
Turkmenistansupplies more than half of China’s imported gas.
It gets there through
three, 1,150-mile-long pipelines; a fourth pipeline is
soon to begin construction.
China is the only foreign nation that Turkmenistan allows to drill for
gas onshore, in particular from Galkynysh, the second-largest gasfield
in the world. China’s $5 billion share of the Kashagan oilfield in
Kazakhstan is one of its largest oil stakes anywhere.
Xi also has signed $15 billion in gas and uranium deals in
Uzbekistan.
… and Russia
Two years ago, Russia announced
a pivot towards China.
The centerpiece of the shift is
two natural-gas pipelines (the
larger of the two is the dotted red line in map 9) through which a
fifth of China’s gas imports would flow.
The deal had some snags, but
they reportedly have been worked out, and construction is to begin soon.
In addition, China is to build a $242 billion, 4,300-mile
high-speed railway from Beijing to Moscow, a two-day trip compared with the current six-day Trans-Mongolian Express.
China is speeding up how fast goods get to Europe …
The Maritime Silk Road (the solid blue line in map 10) will enter Europe through a $260 million Chinese-funded
upgrade of the Greek port of
Piraeus.
From there, rail service will continue into the Balkans. Ships
from China will also make port in Lisbon, Portugal, and Duisburg,
Germany.
To take the network into the heart of Europe, Beijing has
agreed to finance a 250-mile
bullet train, costing up to $3 billion, from Belgrade to Budapest.
Separately, China’s new
8,011-mile cargo railroad from Yiwu to Madrid is
taking away business from far more time-consuming truck shipping.
… and has piled into US real estate
For now, the Chinese web of infrastructure does not extend to the
US.
Instead, what has been built elsewhere is serving as a jumping-off point to the gigantic
US market.
High-speed trains are only now starting to be planned in the
US,
and Chinese firms are front-runners to win contracts, including a $1
billion contest for the San Francisco-to-Los Angeles route, expected to
be
worth $68 billion.
China’s
CNR Corp. is already providing 284 passenger cars worth $566 million to the Boston subway system.
Another big splash: the United States is China’s favored destination
for real estate investment (see chart above).
This has included
commercial jewels such as New York’s Waldorf Astoria ($1.95 billion to
Angbang Insurance) and the Chase Manhattan Plaza ($725 million to
Fosun).
But the bigger sums have been spent in all-cash deals by wealthy
Chinese
for residential properties (pdf, page 12).
Last but not least, China has polar ambitions
Though the closest Chinese territory gets to the Arctic Circle is a
thousand miles away, China nonetheless calls itself a “near-Arctic
state.”
Chinese oil company Cnooc has a majority share in Iceland’s
Dreki oil and natural gas field, and Beijing established the Arctic
Yellow River Station, a permanent research facility on Norway’s
Spitsbergen Island.
In Antarctica, China has
four research stations,
structures that allow nations to stake a claim to the continent. Plans
for a fifth station at a place called Inexpressible Island are under
way.
It is positioning itself to move for the continent’s resources when
a 1959 treaty guaranteeing its wilderness status
expires in 2048.
Some of the infrastructure China is creating around the world will
align with Western economic interests. But to the extent that it does,
that will be inadvertent.
Some of the most modern transportation
infrastructure going up not only in China, but around the developing
world, is deliberately linked to China.
It is meant to make the global
economy a friendly place for Chinese commerce.
That does not make China’s ambitions necessarily menacing or
pernicious.
But it does make them China-centric.
It’s worth remembering
that this way of doing economic development is not a Chinese invention.
As Michael Pillsbury, author of “
The Hundred Year Marathon,”
tells Quartz, China’s ambitions are rooted in “a fierce sense of
competitiveness which they claim they learned from the America of
the 1800s.”
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