China's Interest in Africa

Some interesting points taken from a recent article regarding China's interest in Gaddafi, by Pepe Escobar of Aljazeera.

It is important to remember that Africa is absolutely crucial for China's energy strategy, as their top oil suppliers are Saudi Arabia, Iran, Angola, Russia, Oman and Sudan. Saudi Arabia is China's top oil supplier (1.1 million barrels a day; the Middle East as a whole exports a total of 2.9 million); that limits Beijing's leverage to really influence the Arab world.

~China has 50 large-scale projects in Libya, but still invests less than in Angola and Zambia. From a Libyan point of view, China is a major Gaddafi financial partner – the third-largest buyer of Libyan oil behind Italy and France, with the added bonus of following its world-famous "non-interventionism" policy.

~China's top African oil suppliers are Angola, Sudan and Nigeria – all ahead of Libya, and 80 per cent of Libya's oil reserves, of roughly 44 billion barrels, are in the Sirte basin – spread out between Tripolitania and Cyrenaica, a great deal of it under on and off rebel control.

~Some 70 per cent of Libya's GDP is connected to oil. Beijing would hate to contemplate a balkanisation of Libya along Korea's lines – an impoverished, oil-less, Gaddafi-ruled west/North Korea opposed to an affluent, oil-rich, Western-aligned Cyrenaica/South Korea.

Now with a Libyan stalemate as the most possible scenario, Beijing is factoring its influence in the price of oil. Oil consumption in China is about 4 per cent of GDP. Each $10 increase in the price of a barrel dangerously increases that proportion by 0.4 per cent.China has to worry about Iran, its number two supplier (of oil and also natural gas), under severe sanctions that have shrunk its energy production.

Whichever the latitude, Beijing finds the Pentagon's mighty machine interfering with most of its key sources of energy; half of China's oil imports in 2011 came from MENA. The threat is graphic, as Beijing sees it.Africa, in the periphery of Eurasia, is a key battlefield of the New Great Game – as the global geo-economy is rearranged, and the competition between the US and China for energy resources is emphasized.