Financial Times: China seeks big stake in Nigerian oil

[touchring]

Re: Financial Times: China seeks big stake in Nigerian oil

Your conclusion is illogical.

China has absolutely no possible hope of securing the Persian Gulf via some land route...the world has long ago moved beyond the days of Ghengis Khan and Marco Polo.

Yes, and gasoline is a 20th century technology.

Do you think China will spend one trillion dollars on building a blue navy fleet that can replace the USA to patrol the Middle East for 10 years, or would China spend the money on electric cars and metro mass transport instead?

The movie Back to the Future was filmed in 1984, 25 years ago, isn't it about time that the world start using electric automobiles?

[bill]

Re: Financial Times: China seeks big stake in Nigerian oil

Your conclusion is illogical.

China has absolutely no possible hope of securing the Persian Gulf via some land route...the world has long ago moved beyond the days of Ghengis Khan and Marco Polo.

You are thinking in one dimension in a 4-dimensional world. Expand your imagination and consider what it really means to be a global economic power. For example, explain to us exactly how China protects its critical geopolitical and trade interests with a land force in this situation...700 miles off the coast of Somalia...:p

Chinese ship hijacked in Indian Ocean

October 19, 2009 -- Updated 1459 GMT (2259 HKT)

(CNN) -- A Chinese ship with 146 people aboard was hijacked Monday in the Indian Ocean, the European Union Naval Force said.

The bulk carrier De Xin Hai was hijacked around noon about 550 nautical miles northeast of the Seychelles and 700 nautical miles off Somalia's eastern coast, the EU Naval Force said in a statement.

The EU force found the ship not long afterward. Two pirates could be seen on deck, but as many as 20 could be on board, a task force spokesman said.

The 146 people on board included 25 Chinese crew members, said John Harbour, a commander with the British Royal Navy who serves with the EU Naval Force.

The naval force was monitoring the ship's movements Monday afternoon.

The ship was dragging two skiffs behind it, much like the kind of skiffs that pirates have been known to use to hijack ships in the waters off Somalia.

Do you think the EU is going to rescue a Chinese ship with Chinese crew? Do you think the pirates are going to stop venturing further and further offshore? Do you think the Chinese are going to stand by and not respond? In due course the Chinese Navy is going to displace the US Navy in the Persian Gulf. Count on it.

A Hot zone for sure.

http://www.icc-ccs.org/index.php?opt...map&Itemid=219

http://www.icc-ccs.org/index.php?opt...news&Itemid=51

Adding this pipeline brings more tension to the region.
http://en.wikipedia.org/wiki/Sino-Burma_pipelines

http://www.isn.ethz.ch/isn/Current-A...g=en&id=108738

http://www.marketoracle.co.uk/index....icle&sid=14327

[GRG55]

Re: Financial Times: China seeks big stake in Nigerian oil

Yes, and gasoline is a 20th century technology...

Hydrocarbon sourced liquid transport fuels technology seems destined to survive through a good portion of the 21st century, no matter how much some may wish otherwise.

Having said that, there is no limit to human ingenuity [imo] and there's lots of experimenting going on that will doubtless make a big dent in the levels of consumption of hydrocarbon sourced fuels:

One of the coolest sights in the Sydney Harbour (aside from the Opera House, the Harbour Bridge and the Pirate Ship) is the fully solar-powered ferry known as The Solar Sailor. This rather unique boat, designed by Robert Dane, uses both solar power and wind to reduce its emissions by half compared to standard ferries. What better way to travel?

The super green ferry uses a rather innovative flexible wing sail covered in solar panels, a design inspired by the evolution of insects. The steel and plastic structure is thus able to use solar and wind power to move, weather permitting. The wings move automatically, tracking the sun for optimal solar collection and the wind for optimal sail power. In extreme wind situations, they fold down against boat. When there is not enough sun or wind, the boat is powered by regular fuel and even biodiesel.

And...although not exactly hydrocarbon-free, nevertheless an interesting experiment [and an experiment is all it is at this point, in part because the dirty little secret about GTL is the enormous amount of the process inlet energy that is consumed in the conversion process]:

Airline flies first passenger flight on natural gas

Tue Oct 13, 2009 6:27am EDT

LONDON (Reuters) - The world's first commercial passenger flight powered by a fuel made from natural gas completed late on Monday a six-hour journey from London to Qatar, one of the biggest producers of natural gas.

"Today's flight opens the door to an alternative to oil-based aviation fuel," Malcolm Brinded, Royal Dutch Shell's executive director upstream international, said in a statement late on Monday.

"We are now well on the way to launching GTL on a world scale for the first time," Brinded said.

Shell developed and produced the 50-50 blend of synthetic Gas to Liquids (GTL) kerosene and conventional oil-based kerosene fuel used in Qatar Airways' Airbus A340-800 aircraft powered by a Rolls-Royce Trent 556 engine.

"This is a major breakthrough which brings us closer to a world where fuels made from feedstocks such as wood-chip waste and other biomass is available for commercial aviation," Rainer Ohler, a spokesman for Airbus, said.

"Airbus predicts that in 2030, up to 30 percent of jet fuel will be alternative."

The fuel burned with lower sulphur dioxide and particulate emissions, which should help improve local air quality at busy airports.

Qatar will become the world's leading producer of GTL kerosene when it is put into commercial production from 2012. It is already the world's top exporter of liquefied natural gas (LNG).

Qatar Petroleum and Shell are building the Pearl GTL plant, which has an annual capacity of around one million tons -- enough to carry 250 passengers around the world 4,000 times when used in a 50 percent blend to make GTL jet fuel.

"Commercial aviation is one of the exciting new markets that this opens up, helping us maximize the value from our natural resources," said Qatari Deputy Prime Minister and Minister of Energy and Industry Abdulla bin Hamad Al-Attiyah.

Do you think China will spend one trillion dollars on building a blue navy fleet that can replace the USA to patrol the Middle East for 10 years...

Yes.

...or would China spend the money on electric cars and metro mass transport instead?

The movie Back to the Future was filmed in 1984, 25 years ago, isn't it about time that the world start using electric automobiles?

I hope you don't make your investment decisions based on what you think the markets should do versus what they are actually doing. ;)

[skyson]

Re: Financial Times: China seeks big stake in Nigerian oil

Your conclusion is illogical.

China has absolutely no possible hope of securing the Persian Gulf via some land route...the world has long ago moved beyond the days of Ghengis Khan and Marco Polo.

You are thinking in one dimension in a 4-dimensional world. Expand your imagination and consider what it really means to be a global economic power. For example, explain to us exactly how China protects its critical geopolitical and trade interests with a land force in this situation...700 miles off the coast of Somalia...:p

Chinese ship hijacked in Indian Ocean

October 19, 2009 -- Updated 1459 GMT (2259 HKT)

(CNN) -- A Chinese ship with 146 people aboard was hijacked Monday in the Indian Ocean, the European Union Naval Force said.

The bulk carrier De Xin Hai was hijacked around noon about 550 nautical miles northeast of the Seychelles and 700 nautical miles off Somalia's eastern coast, the EU Naval Force said in a statement.

The EU force found the ship not long afterward. Two pirates could be seen on deck, but as many as 20 could be on board, a task force spokesman said.

The 146 people on board included 25 Chinese crew members, said John Harbour, a commander with the British Royal Navy who serves with the EU Naval Force.

The naval force was monitoring the ship's movements Monday afternoon.

The ship was dragging two skiffs behind it, much like the kind of skiffs that pirates have been known to use to hijack ships in the waters off Somalia.

Do you think the EU is going to rescue a Chinese ship with Chinese crew? Do you think the pirates are going to stop venturing further and further offshore? Do you think the Chinese are going to stand by and not respond? In due course the Chinese Navy is going to displace the US Navy in the Persian Gulf. Count on it.

While talking about multidimensional stuff is fun, lets get back to the boring one dimensional limit of "resource" first. Since when has China become the "mighty dragon" that could replace the superpower military of USA in short order? Before the 2008 financial crisis, nobody even talking about the "no name" third world military of PLA at all. It was this crisis that exposed the vulnerabilities of the west and pushed the Chinese to the spot light. But how ready is China?

No doubt, China has made tremendous progress in its economic power and national development, but while we like to talk about the "immense" two trillion-dollar reserve(is that just one year deficit of the US?:eek, we have to realize the majority of its population is still under poverty, the so-call middle class is only 20-30% of the populace. How can the China leadership justify to waste hundreds of billion dollars to develop and maintain a blue sea navy comparable to the US military? This will not happen in the foreseeable future(50 years?).

Why do you say there is no hope of China securing the gulf oil resource via land route? In fact, that is exactly what the Shanghai Cooperation Organization is set up for, with Iran and Pakistan as observing members. Please look at the map, from North-West China, the distance to the middle east oil fields is only 2000-3000 kilometers away on land route, contrast with the tens of thousands KM distance from the China ports via the sea route, across Southern China Sea, Straight of Malacca, and Indian Ocean, vulnerable to the attacks from US Navy and Indian Navy?

China is building a port at the southern tip of Pakistan(oil from Saudi Arabia, etc.), and there is talks of developing a pipeline via Pakistan to transport oil from Iran. These are facts, and they demonstrate the immediate strategy of China securing oil resources via the land route, through its North-western passage, the "silk route".

The reason is simple: it is much more cost effective. Not only it is the shortest in distance, also China could rely on its tradition of a strong army to protect this blood line. A air carrier battle group costs tens of billion of dollars to develop and maintain annually. How many motorized army divisions that could build and maintain? Put in place some sort of "profit sharing" scheme with nations along the route, backed with a 100 tank divisions(:eek, I see this as the most efficient and reliable way of securing the oil resource for China.

Your example of pirates hijacking Chinese ship is exactly the counter point for a blue sea navy protection. A 200 meter 7000 tons battle ship equipped with missiles fights a few 20 meter fast boats with a few pirates using AK-47s? How about use the F22 to stop robbery in NYC? The NATO, Indian, Chinese navies are not there to fight pirates. It is another never ending geo-political power struggle in that region.

I got a very simple solution for the pirate problem: every merchant ship should have a few crews who are former military men, and give them anti-aircraft machine guns, rifles, and hand grenades. In fact, that was what the Chinese did in the 60s, 70s, and early 80s. In those good old days, no pirates dared to approach any merchant ships bearing the "red flag", if they did not want to risk being shot into pieces by those powerful machine guns. The cost? $50,000 annually for absolute protection - no insurance required. Too bad, the Chinese abandoned that tactic in favor of the "globalization way of international trade" in late 80s.

Blue sea navy is only required if you want to deploy and project your military to different continents, and I don't know how many times I have to repeat, China does not have this ambition, from her history, her culture, and national psyche. In the "Art of War" by Sun Tzu, the best strategy is "Therefore one hundred victories in one hundred battles is not the most skillful. Seizing the enemy without fighting is the most skillful." Top strategists in Chinese history always consider war as harmful acts and should only use as the last resort and as defense. In pursuing her interests, China would prefer to develop a mutually beneficial and equal relationships with other nations, historically, and at present like what they are doing in Africa, Central Asia, Middle East, etc. It is good business and good business does not need big guns.

I believe this is the distinct difference in thinking between the Chinese culture and the Anglo-Saxon cultures. Bill Gates does not carry a gun on his business trips; the mob boss does, because he is looking for the "unwarrant proits", a free lunch. From the history of the British Empire, the present US Empire, their governments and ruling classes are always looking for free lunches, so they feel the need to develop and maintain a vast military network, and in the end, overstretch themselves into oblivion.

OK, I am writing a research proposal, to indentify the "free lunch" genes in the Anglo-Saxon blood line(err, no offense intended)...

[GRG55]

Re: Financial Times: China seeks big stake in Nigerian oil

While talking about multidimensional stuff is fun, lets get back to the boring one dimensional limit of "resource" first. Since when has China become the "mighty dragon" that could replace the superpower military of USA in short order? Before the 2008 financial crisis, nobody even talking about the "no name" third world military of PLA at all. It was this crisis that exposed the vulnerabilities of the west and pushed the Chinese to the spot light. But how ready is China?

No doubt, China has made tremendous progress in its economic power and national development, but while we like to talk about the "immense" two trillion-dollar reserve(is that just one year deficit of the US?:eek, we have to realize the majority of its population is still under poverty, the so-call middle class is only 20-30% of the populace. How can the China leadership justify to waste hundreds of billion dollars to develop and maintain a blue sea navy comparable to the US military? This will not happen in the foreseeable future(50 years?).

Why do you say there is no hope of China securing the gulf oil resource via land route? In fact, that is exactly what the Shanghai Cooperation Organization is set up for, with Iran and Pakistan as observing members. Please look at the map, from North-West China, the distance to the middle east oil fields is only 2000-3000 kilometers away on land route, contrast with the tens of thousands KM distance from the China ports via the sea route, across Southern China Sea, Straight of Malacca, and Indian Ocean, vulnerable to the attacks from US Navy and Indian Navy?

China is building a port at the southern tip of Pakistan(oil from Saudi Arabia, etc.), and there is talks of developing a pipeline via Pakistan to transport oil from Iran. These are facts, and they demonstrate the immediate strategy of China securing oil resources via the land route, through its North-western passage, the "silk route".

The reason is simple: it is much more cost effective. Not only it is the shortest in distance, also China could rely on its tradition of a strong army to protect this blood line. A air carrier battle group costs tens of billion of dollars to develop and maintain annually. How many motorized army divisions that could build and maintain? Put in place some sort of "profit sharing" scheme with nations along the route, backed with a 100 tank divisions(:eek, I see this as the most efficient and reliable way of securing the oil resource for China.

Your example of pirates hijacking Chinese ship is exactly the counter point for a blue sea navy protection. A 200 meter 7000 tons battle ship equipped with missiles fights a few 20 meter fast boats with a few pirates using AK-47s? How about use the F22 to stop robbery in NYC? The NATO, Indian, Chinese navies are not there to fight pirates. It is another never ending geo-political power struggle in that region.

I got a very simple solution for the pirate problem: every merchant ship should have a few crews who are former military men, and give them anti-aircraft machine guns, rifles, and hand grenades. In fact, that was what the Chinese did in the 60s, 70s, and early 80s. In those good old days, no pirates dared to approach any merchant ships bearing the "red flag", if they did not want to risk being shot into pieces by those powerful machine guns. The cost? $50,000 annually for absolute protection - no insurance required. Too bad, the Chinese abandoned that tactic in favor of the "globalization way of international trade" in late 80s.

Blue sea navy is only required if you want to deploy and project your military to different continents, and I don't know how many times I have to repeat, China does not have this ambition, from her history, her culture, and national psyche. In the "Art of War" by Sun Tzu, the best strategy is "Therefore one hundred victories in one hundred battles is not the most skillful. Seizing the enemy without fighting is the most skillful." Top strategists in Chinese history always consider war as harmful acts and should only use as the last resort and as defense. In pursuing her interests, China would prefer to develop a mutually beneficial and equal relationships with other nations, historically, and at present like what they are doing in Africa, Central Asia, Middle East, etc. It is good business and good business does not need big guns.

I believe this is the distinct difference in thinking between the Chinese culture and the Anglo-Saxon cultures. Bill Gates does not carry a gun on his business trips; the mob boss does, because he is looking for the "unwarrant proits", a free lunch. From the history of the British Empire, the present US Empire, their governments and ruling classes are always looking for free lunches, so they feel the need to develop and maintain a vast military network, and in the end, overstretch themselves into oblivion.

OK, I am writing a research proposal, to indentify the "free lunch" genes in the Anglo-Saxon blood line(err, no offense intended)...

I'm on "the road" so this will be brief:

1. "in due course" [my words] is not the same as "in short order" [your words];
2. China has been on the radar screen for some time, and this specific topic has been raised here prior to "the 2008 financial crisis": http://itulip.com/forums/showthread....ling#post17491
3. Just like upgrading the internet data bandwidth connection to your home, or using high speed trains, it's actually "the last mile" that is the most difficult to connect, and costs the most. Same thing applies trying to secure Persian Gulf oil supply using overland routes.
4. I am not trying to suggest that China is, or intends, to act in a unilaterally aggressive military fashion outside of its own borders...far from it. I am suggesting that China's growing geopolitical and economic interests will force her to develop a more capable navy, for no other reason than to defend those same interests. As for the GCC, the link above to the older post of mine lays out the short version case for why the Arab Ruling Families here already see considerable "mutual benefits" to developing their relationship with China [who conveniently looks the other way on all things political] while distancing themselves from an increasingly less beneficial relationship with the USA [which preaches to them about democracy and human rights]...all in due course, of course . [Note: I am making no judgement here about what is "right" or "wrong", simply observing]
5. I am neither Anglo, nor Saxon. ;) ...so no offense taken.

[skyson]

Re: Financial Times: China seeks big stake in Nigerian oil

I'm on "the road" so this will be brief:

1. "in due course" [my words] is not the same as "in short order" [your words];
2. China has been on the radar screen for some time, and this specific topic has been raised here prior to "the 2008 financial crisis": http://itulip.com/forums/showthread....ling#post17491
3. Just like upgrading the internet data bandwidth connection to your home, or using high speed trains, it's actually "the last mile" that is the most difficult to connect, and costs the most. Same thing applies trying to secure Persian Gulf oil supply using overland routes.
4. I am not trying to suggest that China is, or intends, to act in a unilaterally aggressive military fashion outside of its own borders...far from it. I am suggesting that China's growing geopolitical and economic interests will force her to develop a more capable navy, for no other reason than to defend those same interests. As for the GCC, the link above to the older post of mine lays out the short version case for why the Arab Ruling Families here already see considerable "mutual benefits" to developing their relationship with China [who conveniently looks the other way on all things political] while distancing themselves from an increasingly less beneficial relationship with the USA [which preaches to them about democracy and human rights]...all in due course, of course . [Note: I am making no judgement here about what is "right" or "wrong", simply observing]
5. I am neither Anglo, nor Saxon. ;) ...so no offense taken.

Thanks for clarification. When you were suggesting the replacement of US Navy by the Chinese, I was immediately thinking:"OMG, another 'Chinese Threat' propaganda".

Appreciate your knowledgeable input regarding matters in ME and oil industry.

[bill]

Re: Financial Times: China seeks big stake in Nigerian oil

Thought you may find this Lee Kuan Yew interview interesting regarding china policy.

http://www.charlierose.com/

http://www.charlierose.com/download/transcript/10681

10-23-09
CHARLIE ROSE: Make sure that China feels accept at the top table?

LEE KUAN YEW: Yes. There are places waiting for you when you make
it, but you have to play by the rules of the game. And the key really is
whether the next generation -- this generation understands it. They know
that they have no chance competing against the west, America especially, in
technology and especially military technologies. There’s absolutely no
chance. Let me build an aircraft carrier to protect shipping lines while
they carry oil and other materials.

This is the first time where the Chinese are growing but dependent on
the world for resources.

CHARLIE ROSE: But they’ve gone around the world signing up contracts
in Iran and Africa and...

LEE KUAN YEW: Absolutely. But before that it’s all within the
Chinese empire. They don’t have to worry about the rest of the world.
This time they have to worry with the rest of the world because without the
resources, the oil, the nickel, whatever, their growth will stop.

CHARLIE ROSE: Will they be able to create the domestic demand that’s
necessary as they find exports reduced?

LEE KUAN YEW: Slowly. But in the meantime they’re keeping the
economy by an enormous expenditure on infrastructure in the west -- high-
speed roads, high-speed railways, airports, telephone lines, bringing water
from the south up to the north where it’s arid and dry, huge, enormous,
mammoth projects. That keeps it going.
.
.
.
CHARLIE ROSE: Coming out of the global economic crisis, even though
the United States is the dominant country, it is forced to look to build
and to engage and build coalitions on a whole range of big issues, and
there is never now a guarantee of unanimous support.

It’s hard to put together, for example, sanctions against Iran.

LEE KUAN YEW: Iran is a special case. Iran has oil and gas. The
Chinese desperately need oil and gas. Russia’s playing a game with Iran.
Russia doesn’t need oil and gas, but Russia wants to cut the U.S. down to
size and remind the U.S. you need me to run the world.

With the Chinese they are doing their calculations. I think in
exchange they must know if they buck the word -- once the Russians say, all
right, we agree, I would bet 50/50 the Chinese will also say...

CHARLIE ROSE: So if the Russians say we’ll engage in sanctions, the
Chinese will follow.

LEE KUAN YEW: They would not want to be the odd-man out and be held
responsible.

CHARLIE ROSE: What if the United States finds another partner or
another supplier of energy for Iran?

(LAUGHTER)

LEE KUAN YEW: No, in place of Iran?

CHARLIE ROSE: Yes.

LEE KUAN YEW: Where will you find...

CHARLIE ROSE: Well, in the Middle East. In Saudi Arabia and -- not
possible?

LEE KUAN YEW: No, not possible.

CHARLIE ROSE: But I had a Chinese diplomat say to me that they would
welcome that, that if in fact they did not have a necessity of needing
Iranian oil, they would go along with sanctions, because they don think...

LEE KUAN YEW: They need Iranian oil, they need Arabian oil, they need
Nigerian oil, they need Angolan oil...

CHARLIE ROSE: They need all the oil they can find anywhere.

LEE KUAN YEW: Yes, of course.

CHARLIE ROSE: To fuel the economic growth at 8 percent.

LEE KUAN YEW: Absolutely.
.
.
.
.
CHARLIE ROSE: But I just read today an announcement by your sovereign
wealth fund in Singapore of over $1.3 billion in new investments, none
coming to the United States, going to China, to India, to Brazil, and I’ve
forgotten where else.

LEE KUAN YEW: That’s just $1.3 billion out of $300 billion.

CHARLIE ROSE: But none to the United States, mostly going to all
the...

LEE KUAN YEW: Yes, but the United States at the moment is in somewhat
of an unstable state. Is the dollar going to decline? Yes, it is cheap,
but supposing you buy and the deficits grow and Ben Bernanke is unable,
your federal chairman, is unable to draw enough liquidity out of the market
and you have hyperinflation. Wow. You go down and you lost money.
.
.
.
CHARLIE ROSE: That brings me to President Obama. What are your
observations about him?

LEE KUAN YEW: He’s a very great and eloquent man who is very
persuasive and is very able and has appointed very able people into his key
positions. And what impressed me most is his appointing people of
different minds.

For instance, on his economic team, there is Summers Paul Volcker, and
they’re both very strong minded people.

CHARLIE ROSE: Larry Summer has much more influence than Paul Volcker.

LEE KUAN YEW: Yes, but whatever it is, he has to make the final
judgment.

CHARLIE ROSE: So he wants to listen to smart people who have
different views. That’s one thing you admire.

What would you want to ask him? What would you want to know about
him?

LEE KUAN YEW: Two things. First, that the 21st century will be a
contest for supremacy in the Pacific because that’s where the growth will
be. That’s where the bulk of the economic strength of the globe will come
from.

If you do not hold your ground in the Pacific you cannot be a world
leader. A world leader must hold his ground in the Pacific. That’s number
one.

Number two, to hold ground in the Pacific, you must not let your
fiscal deficits and dollar come to grief. If it comes to grief in the
short term and there’s a run on the dollar for whatever reason, because of
deficits are too big and the world -- the financial community and the
bankers and all the hedge funds and everybody come to a conclusion that
you’re not going tackle these deficits and they begin to move their assets
out, that’s real trouble.

CHARLIE ROSE: And there is a risk of that perception today?

LEE KUAN YEW: Absolutely, yes.

And Ben Bernanke knows that. And he has to somehow or the other clean
up and soak up the liquidity. But if he does it too soon you get into
another recession. But you cannot dig up enormous deficits that allows all
the -- and do nothing about it, where people say this is hopeless.

CHARLIE ROSE: There’s always a Federal Reserve to make more money.
You can’t do that.

LEE KUAN YEW: You just print more money.

CHARLIE ROSE: They will print more money, exactly. There’s the
difference.

So the deficits -- the looming deficit of the United States is what
worries you me most because it will strike at the heart of the U.S. global
leadership.

LEE KUAN YEW: Absolutely, absolutely. I mean, that’s what happened
right. That’s why we’re in this recession, global recession.

[skyson]

Re: Financial Times: China seeks big stake in Nigerian oil

Thought you may find this Lee Kuan Yew interview interesting regarding china policy.

http://www.charlierose.com/

http://www.charlierose.com/download/transcript/10681

here is the video:

[touchring]

Re: Financial Times: China seeks big stake in Nigerian oil

Lee Kuan Yew made it clear that the Chinese are not going to spend money, so China will remain the producer, while Americans and the rest of the world will have to consume. More jobs, including hi-tech jobs are going to be lost to China. Soon, in 15 years (no need to wait half a century), the Chinese will be building their own jumbo jets and high end equipment.

Are Americans going to sit and watch their industries dismantled completely?

It is like telling the 19th century British to continue sending silver to China while China imports nothing from Britain. And we all know what happened eventually.

This merchant vs consumer stakeholder concepts sounds good, but is not sustainable over long periods of time. One can't just consume without making real stuff. The credit crisis and rising unemployment in the US revealed it all. If currencies aren't allowed to adjust to balance trade, you will have to use non-currency methods to balance the trade.

[skyson]

Re: Financial Times: China seeks big stake in Nigerian oil

Lee Kuan Yew made it clear that the Chinese are not going to spend money, so China will remain the producer, while Americans and the rest of the world will have to consume. More jobs, including hi-tech jobs are going to be lost to China. Soon, in 15 years (no need to wait half a century), the Chinese will be building their own jumbo jets and high end equipment.

Are Americans going to sit and watch their industries dismantled completely?

It is like telling the 19th century British to continue sending silver to China while China imports nothing from Britain. And we all know what happened eventually.

This merchant vs consumer stakeholder concepts sounds good, but is not sustainable over long periods of time. One can't just consume without making real stuff. The credit crisis and rising unemployment in the US revealed it all. If currencies aren't allowed to adjust to balance trade, you will have to use non-currency methods to balance the trade.

Indeed, China is well aware of the danger of war, and that explains her recent military show off - an intimidating posturing to the US military strategists.

The fast build-up of the Chinese military power after 1996 is singularly targeting the US: the Dongfeng 41 ICBM and nuclear strategic submarines(target the US mainland), Dongfeng 21C and "sun burn" anti-ship missiles(target air carrier groups), land base anti-satellite missile(targets the US command and communication systems), and the ambitious space programs. All these developments demonstrate that China have the capability to successfully attack/destroy the command, communication, and supply line of the US military, and the nuclear weapon systems serve as the intimidation of mutually assured destruction. In a war of defense, I believe China has the ability to defeat the US/NATO military because their command, communication, and supply lines are vulnerable when lauching an offense without a close range military base(Japan will refuse to be involved). The Chinese minister of defence General Leung publicly stated in a speech at a military college last year:"We have the capability, determination, and confidence to defend our motherland". He was not just venting out hot air.

While the US military is vastly more powerful, the PLA no doubt has developed key defense weaponary systems that could neutralized the US advantages.

You might want to look into the PLA strategic thinking:

Unrestricted Warfare
http://cryptome.org/cuw.htm

[touchring]

Re: Financial Times: China seeks big stake in Nigerian oil

Indeed, China is well aware of the danger of war, and that explains her recent military show off - an intimidating posturing to the US military strategists.

I think this is an over reaction. The imbalances can be solved without bringing out the arms. If you over over import, you put out policies that curb imports. It is as simple as that.

[GRG55]

Re: Financial Times: China seeks big stake in Nigerian oil

Your conclusion is illogical.

China has absolutely no possible hope of securing the Persian Gulf via some land route...the world has long ago moved beyond the days of Ghengis Khan and Marco Polo.

You are thinking in one dimension in a 4-dimensional world. Expand your imagination and consider what it really means to be a global economic power. For example, explain to us exactly how China protects its critical geopolitical and trade interests with a land force in this situation...700 miles off the coast of Somalia...:p

Chinese ship hijacked in Indian Ocean

October 19, 2009 -- Updated 1459 GMT (2259 HKT)

(CNN) -- A Chinese ship with 146 people aboard was hijacked Monday in the Indian Ocean, the European Union Naval Force said.

The bulk carrier De Xin Hai was hijacked around noon about 550 nautical miles northeast of the Seychelles and 700 nautical miles off Somalia's eastern coast, the EU Naval Force said in a statement.

The EU force found the ship not long afterward. Two pirates could be seen on deck, but as many as 20 could be on board, a task force spokesman said.

The 146 people on board included 25 Chinese crew members, said John Harbour, a commander with the British Royal Navy who serves with the EU Naval Force.

The naval force was monitoring the ship's movements Monday afternoon.

The ship was dragging two skiffs behind it, much like the kind of skiffs that pirates have been known to use to hijack ships in the waters off Somalia.

Do you think the EU is going to rescue a Chinese ship with Chinese crew? Do you think the pirates are going to stop venturing further and further offshore? Do you think the Chinese are going to stand by and not respond? In due course the Chinese Navy is going to displace the US Navy in the Persian Gulf. Count on it.

Yes, and gasoline is a 20th century technology.

Do you think China will spend one trillion dollars on building a blue navy fleet that can replace the USA to patrol the Middle East for 10 years, or would China spend the money on electric cars and metro mass transport instead?...

No comment...

China mulling naval base in Gulf of Aden

Source: Global Times
[02:59 December 31 2009]

A top Chinese naval official has proposed setting up a permanent base to support ships on an anti-piracy mission in the Gulf of Aden, raising the idea that China could build foreign bases elsewhere.

In an interview posted on the defense ministry's website, Yin Zhuo – an admiral and senior researcher at the navy's Equipment Research Center – said such a base would bolster China's long-term participation in the operation.

"We are saying to fulfill our international commitments, we need to strengthen our supply capacity."...

...As the world's largest importer of crude oil, China is reportedly interested in establishing naval bases in Bangladesh, Cambodia, Myanmar, Pakistan, Thailand and the South China Sea to protect its sea transportation lines.


Supply base necessary to support ships' overseas operation: official

Source: Global Times
[15:34 January 01 2010

Providing supply to China's naval ships operating overseas is a proper demand, a Chinese defense ministry official who refused to be named told the Global Times Thursday, responding to the previous proposal of setting up permanent base to support ships on an anti-piracy mission in the Gulf of Aden.

Yin Zhuo, an admiral and senior researcher at the navy's Equipment Research Center believed that building such a supply base will support China's long-term participation in the operation. The idea was followed by Western media's speculation that China will build the first foreign military base...

...The official didn’t comment on the so called "military base".

Okay...one comment...

Nobody builds aircraft carriers to protect the homeland. You build aircraft carriers so you can project power. Period.

China must build aircraft carrier 'soon' military says

By Peter Foster in Beijing
Published: 5:20AM GMT 06 Mar 2009

Speaking on the fringes of the National People's Congress, China's rubber stamp parliament, the official added that China now had the technology to build an indigenous carrier and should use it.

"Building aircraft carriers is a symbol of an important nation. It is very necessary," said Admiral Hu Yanlin in an article published in the government-sanctioned China Daily newspaper bearing the headline "Build aircraft carriers soon"...

...However remarks last December by a spokesman for China's National Defence Ministry that aircraft carriers were "a reflection of a nation's comprehensive power" and were needed to meet the demands of a modern navy were seen as an indication that China would build a carrier soon.

The Chinese government is highly sensitive to claims that its increased military spending will have a potentially destabilizing effect in the Asia-Pacific region...

[GRG55]

Re: Financial Times: China seeks big stake in Nigerian oil

Absolute levels of consumption are not the primary driver. Change always happens at the margin. The US needs to reduce its dependence on imported oil, but it does not need to reduce it to anywhere near Chinese levels before the Gulf becomes much less important to it geopolitically. China's situation is the exact opposite...

You also need to consider what is it that the Sunni minority Arab ruling families want/need...and who will provide it to them in the future. On the one hand they have, in recent years, been force-fed a diet of "democracy talk" from the USA**, while they watch China continue an active non-interference policy within ASEAN, even in the egregious case of the bloody Myanmar protests two years ago this month.

The Gulf Arabs already know that their long standing dependence on the USA is becoming a liability. Where do you think they will turn?

And if you think this is farfetched, just imagine how equally farfetched it might have sounded if 100 years ago somebody would have predicted that the mighty Royal Navy would give way in the Persian Gulf to the upstart Americans before the 20th century was half over.

China will not take over this role easily, but over time the benefits to China and the Gulf Arab rulers seem likely to overcome China's reluctance to behave like a dragon, instead of a panda, outside its own borders.

[** In the aftermath of the Gulf War II, with its constantly changing justification, one tee-shirt slogan that did the rounds in the Gulf region was "Be nice to us Americans, or we'll bring democracy to your country too" ]

Hmmm. I thought this was an interesting item in the Asia Times given the long ago discussion on this thread:

World learns to manage without the US

The giant sucking sound you here, I said on August 15 on CNBC'sThe Kudlow Report, is the implosion of America's influence in the Middle East. Vladimir Putin's August 17 offer of Russian military assistance to the Egyptian army after US President Barack Obama cancelled joint exercises with the Egyptians denotes a post-Cold-War low point in America's standing. Along with Russia, Saudi Arabia and China are collaborating to contain the damage left by American blundering. They have being doing this quietly for more than a year.

The pipe-dream has popped of Egyptian democracy led by a Muslim Brotherhood weaned from its wicked past, but official Washington has not woken up. Egypt was on the verge of starvation when military pushed out Mohammed Morsi. Most of the Egyptian poor had been living on nothing but state-subsidized bread for months, and even bread supplies were at risk. The military brought in US$12 billion of aid from the Gulf States, enough to avert a humanitarian catastrophe. That's the reality. It's the one thing that Russia, Saudi Arabia and Israel agree about.

America's whimsical attitude towards Egypt is not a blunder but rather a catastrophic institutional failure. President Obama has surrounded himself with a camarilla, with Susan Rice as National Security Advisor, flanked by Valerie Jarrett, the Iranian-born public housing millionaire. Compared to Obama's team, Zbigniew Brzezinski was an intellectual colossus at Jimmy Carter's NSC. These are amateurs, and it is anyone's guess what they will do from one day to the next...

... Neither party has an institutional capacity for intelligent deliberation about American interests. Among the veterans of the Reagan and Bush administrations, there are many who understand clearly what is afoot in the world, but the Republican Party is incapable of acting on their advice. That is why the institutional failure is so profound. Republican legislators live in terror of a primary challenge from isolationists like Senator Rand Paul (R-KY), and will defer to the Quixotesque McCain.

Other regional and world powers will do their best to contain the mess.

Russia and Saudi Arabia might be the unlikeliest of partners, but they have a profound common interest in containing jihadist radicalism in general and the Muslim Brotherhood in particular. Both countries backed Egypt's military unequivocally. Russia Today reported August 7 that "Saudi Arabia has reportedly offered to buy arms worth up to $15 billion from Russia, and provided a raft of economic and political concessions to the Kremlin - all in a bid to weaken Moscow's endorsement of Syrian President Bashar Assad."

No such thing will happen, to be sure. But the Russians and Saudis probably will collaborate to prune the Syrian opposition of fanatics who threaten the Saudi regime as well as Russian security interests in the Caucasus. Chechnyan fighters - along with jihadists from around the world - are active in Syria, which has become a petrie dish for Islamic radicalism on par with Afghanistan during the 1970s.

The Saudis, meanwhile, have installed Chinese missiles aimed at Iran. There are unverifiable reports that Saudi Arabia already has deployed nuclear weapons sourced from Pakistan. The veracity of the reports is of small relevance; if the Saudis do not have such weapons now, they will acquire them if and when Iran succeeds in building nuclear weapons. What seems clear is that Riyadh is relying not on Washington but on Beijing for the capacity to deliver nuclear weapons. China has a profound interest in Saudi security. It is the largest importer of Saudi oil. America might wean itself of dependence on imported oil some time during the next decade, but China will need the Persian Gulf for the indefinite future...

[coolhand]

Re: Financial Times: China seeks big stake in Nigerian oil

Hmmm. I thought this was an interesting item in the Asia Times given the long ago discussion on this thread:

World learns to manage without the US

The giant sucking sound you here, I said on August 15 on CNBC'sThe Kudlow Report, is the implosion of America's influence in the Middle East. Vladimir Putin's August 17 offer of Russian military assistance to the Egyptian army after US President Barack Obama cancelled joint exercises with the Egyptians denotes a post-Cold-War low point in America's standing. Along with Russia, Saudi Arabia and China are collaborating to contain the damage left by American blundering. They have being doing this quietly for more than a year.

What seems clear is that Riyadh is relying not on Washington but on Beijing for the capacity to deliver nuclear weapons. China has a profound interest in Saudi security. It is the largest importer of Saudi oil. America might wean itself of dependence on imported oil some time during the next decade, but China will need the Persian Gulf for the indefinite future...

So explain to me the rationale why Americans think that even as the Fed prints $85B per month in order to finance the US gov't deficit, why it seems logical that China will continue to use US dollars to pay for oil from Saudi Arabia (& Russia & Iran), thereby financing China's own military encirclement & funding military adventurism like we see the US moving towards in Syria today...

I guess a possible explanation is that China, Russia & Saudi Arabia are stupid, but I generally don't like investing on a theme that people I know to be smart being stupid.

And so the next question from this question is obvious: What happens to the US economy WHEN the US petrodollar system collapses? It is much closer than people think if you look at the signs...