"At this stage, neither Russia nor the USA is able to hinder China’s strengthening positions in the energy sector of Kazakhstan and Central Asia as a whole," Sigov says. He also says Kazakhstan is the key link in China’s plans and highlights the importance for Kazakhstan to take advantage of this factor. The following is Yuriy Sigov’s article "Kazakh map of Beijing ", published by Kazakh newspaper Delovaya Nedelya on 16 November; subheadings as published:

China is expanding its cooperation with Astana, hoping the latter will help it to resolve the issue of energy supplies to its western regions.

At a time the European Union and the United States are desperately fighting with Russia over the issue as to which direction main gas pipelines should go from the Caspian region, China prefers to refrain from making loud statements and sending top officials to shuttle along the Astana-Asgabat-Baku trip, and it [prefers to] work individually with countries that have oil and gas reserves.

Culture days backed by natural gas

In keeping with traditions, China uses two "parallel paths" to boost cooperation with this or that country; the two paths are people’s diplomatic and official paths. Beijing also always tries to use mutual interest for itself by this or that country [sentence as published]. For example, an event dedicated to Kazakhstan’s culture days was recently held in China. The event, in the words of Kazakh ambassador in Beijing Ikram Adyrbekov, will help to strengthen the close partnership between the two countries and the nations.

At a time Kazakh artists represented their culture and arts on the Chinese soil, Beijing announced that the number of Chinese tourists visiting Kazakhstan had almost doubled in the first six months of this year, while the number of businessmen increased by 35 per cent. Apart from this it was noted that there was a jump in Kazakh citizens’ interest in China. The Chinese leadership attributes this above all to the fact that about 3,000 Kazakh students study in China.

"It has become a fashion in Almaty and Astana to send children to study in Chinese universities and colleges in centres such as Shanghai, Hong Kong and Beijing," an official from the Chinese Education Ministry said. "We are very glad that Kazakh families increasingly more often choose our higher educational establishments over US or British ones," he added.

Kazakhstan more often views China as a key guarantor of stability and security in the entire Central Asia. It is not accidental that, within the framework of the SCO [Shanghai Cooperation Organization], Kazakhstan almost always tries to support initiatives and closely cooperate with China in the struggle against terrorism and Muslim extremism in the region, and it hopes to develop its processing and food industries with China’s help. But the most important thing for the two countries is great volumes of bilateral economic ties that are now accompanied by numerous cultural exhibitions and artistic shows [as published]. Kazakhstan is now the biggest trade partner of China not only in Central Asia, but also in the CIS after Russia (here 80 per cent of Russian exports to China are exclusively weapons and military machinery).

The volumes of bilateral trade between Astana and Beijing reached 8.3bn dollars last year. This year the figure may reach 10bn dollars (the figure was just 370m dollars in 1992).

During his recent visit to Kazakhstan, Chinese President Hu Jintao said that trade between Kazakhstan and China should increase to 15bn dollars in 2015. But if one takes into account the rapid development of bilateral relations, the figure might be reached much earlier, approximately by 2010.

Gas and oil are China’s best friends

When Chinese companies just started to work in the energy sector of Kazakhstan, US newspapers immediately said: it is Chinese companies not Russian ones that will be the main rivals to US businesses in Central Asia and that Kazakhstan will sell increasingly more of its oil and gas to Chinese companies since the western regions of China, which are now suffering from a shortage of energy resources, are located near Kazakh gas and oil deposits.

At the same time, what is to China’s benefit in this field is also fairly beneficial to Kazakhstan. Apart from this, increasing energy exports to China is clearly in line with Astana’s multi-vector diplomacy. Moreover, the Chinese have never given ground to doubt whether they are reliable and predictable as purchasers.

The first oil pipeline from Kazakhstan to China was completed in 2005; the sides are now negotiating the second oil pipeline that will carry Kazakh oil from the Caspian Sea to western China; China today extracts about 13m tonnes of oil in Kazakhstan; it plans to double the extraction in the near future; Kazakhstan and China recently signed an agreement to build a gas pipeline from Kazakhstan to China.

Experts believe that the agreement [to build a gas pipeline from Kazakhstan to China] is the first step in the implementation of accords reached during Chinese President Hu Jintao’s visit to Kazakhstan in the summer. The agreement defines the main principles of planning, financing, building and running the [future] gas pipeline from Kazakhstan to western China. Moreover, the implementation of such a project will ensure not only the transport of Kazakh natural gas, but also the transit of Turkmen gas to China, as well as make it possible to diversify export routes of Kazakh gas to world markets.

China and Kazakhstan have already agreed to set up on equal footing a special project company in this field. Moreover, it is exactly this company that will be the owner of the new gas pipeline.

The construction of the gas pipeline from Kazakhstan to China will be carried out in two stages. The first segment of the gas pipeline from the Uzbek-Kazakh border to the Kazakh-Chinese border via the Kazakh [southern] town of Shymkent to the town of Khorgos (China) will have a throughput capacity of 40bn cu.m. of gas [per year]. The length of this segment of the pipeline will be 1,333 km and its diametre will be from 1,024 to 1,067 mm. It is expected that the gas pipeline will be finished by the end of 2009.

The second segment of the pipeline will go via the Beyneu-Bozoy-Kyzylorda-Shymkent route. Its throughput capacity will be approximately 10bn cu.m. of natural gas per year. The length of the pipeline’s segment and its diametre will be 1,480 km and 1,016 mm respectively. Its construction will start on mutual agreement by Astana and Beijing only after economic calculations will show that there are good grounds to say that the project is feasible.

It is significant that China is pressurizing into starting the construction of this pipeline using all channels. To do this it is using its contacts with not only Kazakhstan but also with Turkmenistan and Uzbekistan. Chinese representatives are lobbying [Turkmen President Gurbanguly] Berdimuhamedow and Uzbek leader [Islam] Karimov to speed up the process. In turn, the presidents have already promised to assist in the construction of the segments of the gas pipeline that go via their territories, even though Uzbekistan, in the near future, is going to be primarily engaged in the presidential election in the country and not in the Chinese gas pipeline.
It is also important that, at this stage, neither Russia nor the USA is able to hinder China’s strengthening positions in the energy sector of Kazakhstan and Central Asia as a whole. If in the Caspian projects Washington, Moscow and Brussels have potentially strong levers of putting pressure on Kazakhstan (the planned Astana’s chairmanship of the OSCE in 2007 speaks volumes about this), Turkmenistan and Azerbaijan, then the leading players in the Central Asian game can hardly do anything considerable to divert the above mentioned gas pipeline from the Chinese direction. Moreover, for the largest exporters of energy resources in Central Asia the Chinese route is most promising when taking everything into account. It is also a long-lasting route: no matter how much gas is delivered to China, it will not be enough if one takes into account the economic growth rates China has been demonstrating in the past several years. That is why the Chinese route is an alternative route to other options for taking the region’s gas and oil to world markets.

Astana also realizes that China considers Kazakhstan the key link in the chain. That is why it is very important for Kazakhstan at this moment not just simply try to sell natural gas at higher prices and become an important transit country for delivering Turkmen and Uzbek gas, but also to bargain out from China a number of important economic and investment "carrots".

In might happen that when the gas pipeline along the Kazakhstan-China route is ready, Beijing may fairly likely think that it can establish its own rules in the region’s "energy game" and not take into much account the opinions and interests of others.

Source: BBC Monitoring Central Asia