• China Ascendant in Iraq

    July 20, 2011

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    Posted in: Embassy/State, Iran, Iraq, Other Ideas

    Further evidence that we failed in Iraq: Iraq has asked China to set up a fund to help with the reconstruction of the war-battered country, an Iraqi government official said on Monday during a visit to Beijing by Iraqi Prime Minister al Maliki.

    For those keeping score in blood and treasure at home, the US spent $63 billion on reconstruction efforts since the 2003 invasion, plus billions more in Iraqi money, all to little avail. Ordinary people have seen little improvement in their lives while contracting firms grew rich. The US went on to build the World’s Largest Embassy © in Baghdad, I wrote a whole book about the failure of reconstruction, etc., etc., etc.

    But let’s talk about a winner today instead! China has done well for itself in Iraq. The country eased into a cozy relationship with Iraq by writing off 80 percent of its Saddam Hussein-era debt.

    In 2008, the state-owned China National Petroleum Corporation (CNPC) successfully renegotiated a contract originally signed by the previous regime to develop the Ahdab oilfield, becoming the first country to sign an oil service contract in Iraq under the new U.S.-backed regime.
    CNPC completed construction of the first phase of the oilfield in June this year, and it is also developing Iraq’s Halfaya oilfield. CNPC also has a 37 percent stake in a service contract to develop the Rumaila oilfield, which pumps out almost half of Iraq’s total oil output.

    Iraqi government spokesman Ali al Dabbagh hinted also that the country might buy weapons from China, necessitating the need for PLA trainers to visit Iraq.

    Indeed, Iraq and China on July 19 signed a Memo of Understanding (MOU) for economic and technical cooperation and another MOU for the training of the Iraqi cadres in China, according to a statement on Monday by Prime Minister, Nouri al-Maliki’s office, now on a visit to China, leading a high-level delegation. These will be followed by the signing of an MOU for cooperation in the field of electric power

    The US, in its odd desperation to have things succeed somehow, anyhow, in Iraq, has even been helping the Chinese exploit Iraqi oil outside Basra. To ensure their safety, most of the foreign oil companies have their offices located within the confines of the US military base at Basra, along with the US PRT, the British Consulate and the Russian and Chinese oil exploration firms, which must make for some interesting cafeteria small talk.

    “US policy at this time is that the USG in Iraq should assist in facilitating the mobilization of these companies without regard to the nationality of the companies,” said Kenneth Thomas, head of the energy section of the Basra PRT, though he added “But we are not going to assist an Iranian company.”

    Chinese investment deals are worth noting. Outside of oil, one of the biggest is Shanghai Electric moving ahead with a $1 billion power-generating plant to boost Iraq’s electricity capacity by 1,320 megawatts. The planned steam power plant in the town of Zubaidiya near the city of Kut, southeast of Baghdad, is seen as one of the biggest power projects in the country, where intermittent electricity is one of the public’s top complaints.

    Of course, billions of dollars and eight years after the US invasion, Iraq’s national grid still only supplies a few hours of power each day.

    On a smaller scale, Chinese goods are readily found in Iraq’s markets and stores. A PRT project to make clothing, fully subsidized by the US Government, went belly up because Chinese imports underpriced our crappy knit goods by 30 percent. Another project, this time the Army’s plan to hand out free food, ended up being flooded with cheap Chinese gift bags, complete with intellectually pirated Disney characters on the outsides. Of course, no US base was complete with its so-called “Hajii Shop,” a sort of local bodega whose main item was illegal DVDs, shipped on via a reverse Silk Road journey from Guangzhou. Even some of Iraq’s prostitutes came from China: every Chinese restaurant was rumored to include some special off-menu services being available.

    China remains popular enough in the region. In the latest Zogby poll, when presented with several countries (e.g. Turkey, Iran, France, China, the US etc.) and asked to evaluate whether or not each of them play a constructive role “in promoting peace and stability in the Arab World” eight in ten Arabs give a negative assessment to the US role — rating it significantly lower than France, Turkey, China, and, in four of six Arab countries, even lower than Iran.

    So, quick recap:

    Since 2003 the US has lost 4474 soldiers and a couple of trillion dollars. Iran has risen politically such that there is talk of Iraq being nothing more than an Iranian vassal, and economic relations between the two countries are sweet as a summer peach. Trade with China is purring along the old Silk Road. Then China grabs a bunch of the oil at no cost to itself in military expenses, human lives or loss of prestige in the Middle East.

    Yep, this war has worked out just fine, just fine.



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