BOOK REVIEW : The West, the Gulf and China: An oil-fueled triangle

BOOK REVIEW
West, the Gulf and China in an oil-fueled triangle
China and the Persian Gulf,
edited by Bryce Wakefield and Susan Levenstein

Reviewed by Giorgio Cafiero

China's rise, according to many analysts, has been the world's most significant geopolitical and economic development of the 21st century. Central to China's rise has been the energy it needs to fuel economic growth. Importing more than 42% of its crude oil from the Persian Gulf, Beijing views that region as vital for this economic development. China's growing influence in the world's most oil-rich region is the subject of Bryce Wakefield's and Susan Levenstein's China and the Persian Gulf: Implications for the United States.

The contributors - edited by Wilson Center program associate

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Wakefield and program assistant Susan L. Levenstein - pay particular attention to China's relations with Saudi Arabia, Iran and Iraq. Since 2002, Saudi Arabia has been China's top supplier of crude oil, currently supplying more than one-fifth of its needs; China has replaced the United States as Saudi Arabia's top export partner.

The bilateral relationship between Beijing and Riyadh is valued economically and politically in both capitals. According to Erica Downs in her essay in the volume, US demand for oil is expected to decrease over the next 15 years, while China's is expected to reach 16.3 million barrels per day by 2030, constituting more than two-fifths of the global increase in demand for petroleum.

Therefore, Saudi Arabia is convinced that China is the most reliable partner for "security of demand". Moreover, in the aftermath of the terrorist attacks of September 11, 2001, complications in US-Saudi relations, in particular the West's criticism of Saudi Arabia's human-rights record, have made closer ties with China more appealing.

Sino-Iranian ties are delicate, largely because of Beijing's perception of Iran as "a tempting but tough place to do business", writes Downs. Iran is China's third-largest supplier of crude oil, and the Islamic Republic's oil and gas fields, which are open to foreign investment, do attract Chinese oil firms. However, Downs concludes that Western-imposed sanctions on Iran have pressured China to act cautiously when assessing the value of its ties to Iran as compared with Saudi Arabia. From Tehran's perspective, there is much incentive to lure China's oil companies into Iran to demonstrate the Western-imposed sanctions' ineffectiveness.

China, like the West, does not want to see Iran develop a nuclear weapon. Nonetheless, Beijing is suspicious of the real US and European interests in Iran and has therefore not cooperated with Western efforts to isolate Tehran.

China sees Iraq and its 115 billion barrels of proven oil reserves as a "land of opportunity", according to Downs. Iraq is planning a major expansion of its oil production, and its oil ministry has offered three of 11 major contracts to Chinese companies. Afshin Molavi labels China an "unlikely winner" of Washington's 2003 invasion of Iraq. A joint partnership between China National Petroleum Corp and British Petroleum over the enormous Rumaila oilfield has the potential to make Iraq China's new top supplier of crude oil within eight years, surpassing Saudi Arabia and Iran.

Jon Alterman believes that interdependency defines the triangular relationship of the United States, China and the Persian Gulf. The United States Pacific Command (PACOM) is the largest US command, and it focuses on China. However, US-China trade is the second-largest in the world, and China possesses leverage over America's economy, holding almost US$1 trillion in US debt.

US-Gulf relations are largely security-oriented, as Washington sells billions of dollars of arms to the region's governments each year and has established military bases in all Gulf Cooperation Council countries, save Saudi Arabia (the others being the United Arab Emirates, Oman, Quatar and Kuwait.

Last, Sino-Gulf relationships are defined primarily by Middle Eastern demand for Chinese construction and manufactured goods and China's thirst for the Gulf's non-renewable natural resources.

China and the Gulf states can't force the United States out of the Persian Gulf, nor can the United States and Gulf states remove China. At the same time, Washington and Beijing are not positioned to squeeze the Middle Eastern oil producers, as the global economy is far too reliant on Persian Gulf oil. Alterman concludes that the three actors share a mutual interest in maintaining stability in the Gulf and continuing the free flow of energy. Washington's "goal should not be to deny the triangle", he writes, "but instead to embrace it".

The contributors to China and the Persian Gulf concur that China is increasingly important to the Gulf states and vice versa. Moreover, Beijing has replaced the ideological foreign-policy pursuits of the Mao Zedong era with self-calculating, shrewd, and cautious strategies.

Although it does not seek to rival the United States as the region's dominant military power, China may take advantage of US dilemmas in the region to pursue its own agenda by evading US-imposed sanctions and directly dealing with energy-rich states that the United States seeks to isolate, such as Iran, to acquire valuable assets and play spoiler. In this inescapable triangle, China, the United States and the Persian Gulf are all in tension, but in the end they all need each other, too.

China and the Persian Gulf, Implications for the United States, ed Bryce Wakefield and Susan Levenstein, is published by the Wilson Center, Washington DC. Send an email to asia@wilsoncenter.org for a free copy or click here for a free PDF version.

Giorgio Cafiero is a contibutor to Foreign Policy in Focus

(Posted with permission from Foreign Policy in Focus)

Source: http://www.atimes.com/atimes/China/NH25Ad01.html

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