China’s Growing Interest in Central Asia

stratforChinese President Xi Jinping’s tour of four Central Asian countries in early  September highlighted a trend followed closely by Stratfor: China’s  struggle to reduce its exposure to security risks and supply disruptions in the  South and East China seas by exploring new overland sources of and transport  routes for goods, energy and other natural resources.

Over the past fifteen years, the Chinese economy’s extraordinary growth has  turned it into the world’s largest importer of key industrial inputs like coal,  iron ore, copper, nickel and aluminum, as well as the second-largest importer of  crude oil after the U.S. Today, more than 85 percent of Chinese trade moves  by sea, and more than 80 percent of its energy imports are seaborne. This leaves  China perilously dependent on the safety and security of sea lanes, which serve  as highways not only for getting Chinese-manufactured goods out to consumers in  the U.S., Europe and elsewhere, but also and increasingly for bringing in the  raw materials that China can no longer wholly supply for itself.

The Chinese government’s growing anxiety over the security implications of  this double-sided dependency has taken many forms. Aggressive naval  modernization, the speedy expansion of Chinese energy and resource acquisitions  overseas, and the general push to raise China’s diplomatic profile abroad are  some of the Communist Party’s most visible efforts to cope with the geopolitical  implications of the country’s globe-spanning economic needs. But in recent years  another, somewhat less overt, strategy for mitigating the impact of overseas  supply disruptions has begun to take shape — in the form of rapidly expanding  investments into energy projects in Central Asia and transport ties linking the  Chinese interior through South and Central Asia on to Europe and the Indian  Ocean Basin.

The keystone for this process is the Xinjiang Autonomous Region in far  northwest China. Xinjiang contains China’s entire 3,700 kilometer-long border  with Central Asia, making it the only viable direct land bridge between the Han  Chinese core provinces and the rest of southern Eurasia. It also contains the  Karakoram Pass, China’s only overland route to Pakistan — and, in turn, to the  Chinese-operated Port of Gwadar. These facts of geography help explain  Xinjiang’s historical legacy as home to the fabled Silk Road trading routes, as  well as the strong ethnic, cultural and religious ties that continue to bind  Xinjiang’s Uighur ethnic majority to the Turkic communities of Central Asia and  beyond. Today, China’s leaders are actively reviving these legacies, as  seen in Xi Jinping’s recent call for a new “Silk Road Economic Zone” spanning  Xinjiang and its Central Asian neighbors.

Energy is the beating heart of China’s interests in Central Asia, and by  extension in Xinjiang. In 2012, China imported 21.3 billion cubic meters of  natural gas from Turkmenistan — more than half its total natural gas imports  that year — and by 2020 that number could jump to almost 65 billion cubic  meters. Likewise, Chinese imports of oil from Kazakhstan are set to grow  dramatically in the coming years, potentially reaching 1.5 million barrels per  day, as output from the Kashagan oil project rises. China is also working on oil  and metals projects in Afghanistan, has agreed to import up to 10 billion cubic  meters of natural gas from Uzbekistan, and is all the while rapidly transforming  Xinjiang itself into a key resource base for newly industrializing provinces in  the Chinese interior.

However, China’s ambitions in Central Asia face many constraints. Distance  and terrain pose enormous cost and logistical challenges to large-scale  trans-Eurasian transport, while a perennially unsteady security situation in  virtually every part of the Central Asia region — including Xinjiang — will  threaten Beijing’s dream of reducing its exposure to energy and resource supply  disruptions. Nonetheless, as long as China’s energy needs continue to grow, the  Party will be forced to explore such avenues in order to ensure energy, economic  and political security, for both the country and the regime.

China’s Growing Interest in Central Asia is republished with permission of Stratfor.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s