The Chinese connection
By Andre Bagoo Sunday, August 21 2011
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Chinese Ambassador Yan Youming ... busy schedule...
THE CHINESE Ambassador to Trinidad and Tobago, Yan Youming, is a busy man. Just two weeks ago, he met with Finance Minister Winston Dookeran.
In March, the ambassador visited Port-of-Spain mayor Louis Lee Sing, in May San Fernando Mayor Marlene Coudray. In May as well, the ambassador called on Central Bank Governor Ewart Williams to lobby for cooperation in the areas of the economy and finance. In July, he met with the staff of a private media house. Youming has even met with students of St Joseph’s Convent, Port-of-Spain.
It is a diary schedule which, while par for the course for a diplomat, arguably tells the tale of China’s clear interest in forging contacts in this country.
This month, China announced a deal to acquire a ten percent stake in the crucial Atlantic LNG plant at Point Lisas. The China Investment Corporation (CIC) will acquire French firm GDF Suez’s stake in the plant for a reported TT$5.5 billion as part of a larger deal to allow GDF Suez access to the Chinese and Asia Pacific markets.
The deal has prompted Energy Minister Kevin Ramnarine to launch a review to determine whether it complies with the shareholders’ agreement for the Atlantic LNG Train 1. Ramnarine has said that the State was not aware of the deal, until it was announced.
“The ministry was not informed about this transaction and I have asked the NGC to give me an opinion,” Ramnarine told Sunday Newsday last week.
NGC is the State’s shareholder in Train 1 of the Atlantic LNG facility.
Additionally, the ministry’s director of the LNG and Gas Exports Division, Selwyn Lashley, has been asked to submit a report on the issue to help the State reach a determination in the matter.
“I am awaiting a brief on the matter from my lawyers and the NGC,” Ramnarine said.
US law firm Cravath Swaine & Moore advised GDF Suez on aspects of the LNG deal, while CIC instructed US firm Vinson & Elkins.
However, while the Ministry of Energy and Energy Affairs was in the dark over the developments, they hardly come as a surprise given the increasing trend of China acquiring energy assets in Trinidad and Tobago.
For instance, in 2008 the Chinese state oil company, Sinopec, set up a local subsidiary called Soogl Antilles (Trinidad) Limited, in order to focus on core business activities such as exploration and development within the oil and gas industry.
Soogl acquired 45.4 percent interest in the offshore East Brighton Block, a 107 square km area off the south west coast of Trinidad in the Gulf of Paria. Although State-owned Petrotrin owns 30 percent and Primera East Brighton (a CL Financial subsidiary) owns the remaining 24.5 percent of the block, Soogl is the designated operator in an area which is believed to be rich in hydrocarbons.
A Chinese joint venture also holds equity in the Greater Angostura field, Block 2C, 40 kilometres off the northeastern coast.
Chaoyang Petroleum (Trinidad) Block 2C Limited is owned 50/50 by the Chinese National Offshore Oil Corporation (CNOOC) and Sinopec. It holds a 25 percent stake in the field which has a reported design capacity of 280 million cubic feet of gas per day. The share was acquired by Chaoyang from Canadian firm Talisman in May 2009 for $1.6 billion.
Also in May 2009, Chaoyang Petroleum (Trinidad) Block 3A Limited bought a 25.5 percent interest in the production sharing contract for Block 3A from Talisman for $5 million. As at 31 December, 2009, block 3A was in the exploration stage.
The current trend of China aggressively buying energy assets differs somewhat from its older relationship with this country, where it has been largely seen as a provider of goods and services.
China is one of the six largest sources of imports for this country and its products are everywhere with their “Made in China” labels.
Additionally, under the terms of a purported government to government loan arrangement, this country, under the PNM, was loaned billions to fund a new Prime Minister’s Residence and Diplomatic Centre and two performing arts academies.
Contracts for these projects, which easily total in excess of $1.5 billion, were awarded to Chinese firm SCG International (Trinidad and Tobago) on a sole-select basis. SCG also took on other work for the State in the market, such as the Public Administration Tower in Port-of-Spain, as well was a church at the Heights of Guanapo, Arima, which was reportedly being built at the behest of former Prime Minister Patrick Manning’s so-called spiritual adviser Juliana Pena.
Other Chinese contractors, such as Beijing Luijian Construction Corporation, were awarded contracts to build schools, among them the Tranquility Government Primary School. Another, the China Railway Construction (Caribbean) Company, was awarded a $700 million contract for the completion of the Scarborough Hospital in Tobago.
The projects all saw an influx of Chinese labourers who came to this country under conditions which have raised strong suspicion of human trafficking. Some workers have said they were denied wages, others said they were lured by the idea of sun, sand and sea, only to end up living in squalid conditions (such as containers stacked, at one point, Frederick Street, Port-of-Spain). In fact, Chinese workers contracted dengue, died at worksites due to OSHA violations and even staged protests for wages, marching along the streets and highways of the country in October 2009. But the Chinese connection also involves efforts to exert influence in other sectors.
In January, the Arthur Lok Jack Graduate School of Business signed a memorandum of association with China’s International Cooperation Centre to deepen educational ties.
The Chinese Army has even paid a visit, with General Ma Xiaotian, the deputy chief of the General Staff of the People’s Liberation Army, paying a visit from February 28 to March 2, on an invitation from the Ministry of National Security.
But while China has been able to woo officials with its increasingly powerful economic and, arguably, political ties, it remains dogged by its own human rights record.
In April, in an apparent reaction to the “Arab Spring” of uprisings in former dictatorial regimes, China launched a crackdown against thousands of “troublemakers”, including the acclaimed artist Ai Weiwei, rights activists, lawyers, bloggers, journalists and academics. Some were charged with “creating a disturbance” or “inciting subversion”; others have disappeared through extra-judicial procedures. Amnesty International has warned that on an annual basis, China kills thousands in secret executions.
With the exception of one Government Minister (Arts and Multi-Culturalism Minister Winston Gypsy Peters), this country has been slow to condemn China, perhaps due to its increasing economic might (made all the more evident by the US credit rating downgrade this month).
The reluctance to condemn human rights violations appears to be a part of a larger international trend, with some questioning whether recent crackdowns are a sign of change in China itself.
“To make sense of what is unfolding right now, and to fully appreciate the range of possible outcomes, we have to acknowledge that profound change, both economic and political, has taken place in China in recent years,” notes MIT professor of Political Science, Edward Steinfield, in this month’s Boston Review.
“In places such as Taiwan and South Korea, brutal crackdowns on dissent were the last vestiges of authoritarian rule. In contemporary China that could also be true.”
Whatever the case, China’s increasing influence in the Caribbean is not limited to this country. It has made no effort to disguise its regional ambitions.
On Friday, China announced that it will “donate” a hospital to Suriname as a gift to the country. The Chinese Ambassador in Suriname, Yuan Nansheng, stated that the gift is likely to be discussed at a key summit between regional officials and China. That summit, the third China-Caribbean Economic and Trade Cooperation Forum, will take place next month. The summit’s venue? Trinidad and Tobago.