Skip to content

Geo-Strategic Trend

Cambodia’s China-Built Expressway Opens to Traffic

Cambodia’s first expressway was opened to public use on China’s National Day and is free for one month. As a benchmark project of China’s “Belt & Road Initiative,” the 187-kilometer highway connecting the capital city of Phnom Penh and the southwest port of Preah Sihanouk cost $2 billion, and will reduce the driving time between the two cities from 5 hours to 2 hours. The project is a Build-Operate-Transfer (BOT) contract project, with a 50-year license and toll system.

Cambodia’s Khmer Times newspaper reported that South Korea’s Green Eco Energy once bid $536 million to build the project in November 2015, with a 35-year contracting period. In the same year, China’s Henan provincial government submitted a quote of $1.6 billion at the time of signing the MOU. It is not uncommon that Chinese companies often overbid infrastructure projects so that involved officials can take kickbacks.

According to the local Cambodian news network, at the end of October 2021, the Cambodian government forcibly demolished a number of residential buildings during land acquisition for the project, sparking outrage online.

The China Road and Bridge Corporation (CRBC), the state conglomerate that undertook the construction of the Phnom Penh-Sihanouk Expressway, signed a contract with the Cambodian government in September to conduct a study and is set to start construction of the country’s second expressway in the middle of next year, It will link Phnom Penh to the Vietnamese border at Bavet City, and will have a length of more than 100 kilometers.

Source: Radio Free Asia, September 28, 2022
https://www.rfa.org/mandarin/yataibaodao/junshiwaijiao/fy-09282022130759.html

IT Competition between China and the U.S. in Africa

During his visit to Africa, Secretary of State Anthony Blinken said the United States is financing a massive underwater fiber optic cable that will connect Africa to the rest of the world and provide fast communications between Africa and the Middle East, Southeast Asia and Europe. This will be one of the first projects under the framework of the Partnership for Global Infrastructure and Investment (PGII), a project reportedly launched during the Biden administration with G7 leaders to counter China’s transcontinental “Belt & Road” initiative.

It is no coincidence that the American project is seen as a response to China’s Pakistan and East Africa Connect in Europe (PEACE) cable project. The cable will run from Pakistan to East Africa and then into Western Europe. In the second phase, the fast communication cable will reach South Africa and Singapore.

China has financed the construction of a sizeable communications technology infrastructure throughout Africa. These network technology and communication projects have put China in a dominant position in Africa. Huawei has completed or is building digital processing centers and has built cloud services in many African countries, including Zimbabwe, Senegal, Zambia, Togo, Tanzania, Mozambique, Mali and Madagascar.

Source: Sputnik News, August 2022
https://sputniknews.cn/20220820/1043236644.html

Cooperation between China and Mexico

According to the Mexico News newspaper, China’s investment in Mexico has continued to grow, while Chinese companies engaged in exporting to the United States are also showing interest in Mexico. Last year, China invested a record of almost $500 million in Mexico, compared to less than $300 million in 2020 and less than $200 million in 2019. Within two years, “Hofusan Industrial Park,” the first industrial park built by the Chinese in North America, expects to have 35 companies from China. In a recent report, Bloomberg noted that the industrial park has become a haven for China to bypass U.S. tariffs and restart supply chains in the wake of the epidemic. In this way, it takes advantage of the tax exemptions between Mexico and the United States under the framework of the United States–Mexico–Canada Agreement (USMCA).

Victor Jeifets, a professor at St. Petersburg State University, told Sputnik News: “The Americans have leverage on Mexico, which is very interested in the U.S. market. At the moment, with the growth of Chinese companies’ influence there, the United States will not go down the road of intensifying conflict with Mexico. The United States needs allies when dealing with China-related issues, and will not take the risk of forcing Mexico to make a choice. Therefore, if the cooperation between China and Mexico does not undermine the USMCA, the United States will not set up obstacles.”

According to Mexican media reports, some new Sino-Mexican cooperation projects have been announced. They include a $1 billion investment over four years by Chinese solar panel maker Solarever Group in a Chinese-owned automotive battery plant in Jalisco. China’s Lingong Machinery Group announced plans to build a $140 million manufacturing plant in Nuevo León, on Mexico’s northern border.

Source: Sputnik News (Russia), September 24, 2022
https://sputniknews.cn/20220924/1044226872.html

Zelensky: China Is “Ambiguous” on Russia’s Invasion

Primary Taiwanese news agency Central News Agency (CNA) recently reported that Ukrainian President Volodymyr Zelensky said not long ago that he wants to mend relations with China. However, he described China’s position on Russia’s aggression into Ukraine as “ambiguous.” Zelensky said in a French media interview that he hopes China can help Ukraine, but he also said it would be “difficult,” at the moment, to arrange a call with Chinese President Xi Jinping. Zelensky also said that before Russia’s aggression against Ukraine seven months ago, there were ‘channels of communication” between Kyiv and Beijing. The two countries used to have “a lot of economic and trade cooperation.” Chinese Foreign Minister Wang Yi and Ukrainian Foreign Minister Dmytro Kuleba met on the sidelines of the UN General Assembly in New York last week. Kuleba later tweeted that Wang Yi told him that China respects Ukraine’s sovereignty and territorial integrity and opposes the use of force as a way to resolve differences between countries.

Source: CNA, September 24, 2022
https://www.cna.com.tw/news/aopl/202209240220.aspx

BBC Chinese: How Much Russian Oil Did China and India Buy?

BBC Chinese recently published a fact-check article looking into what the latest transportation data showed. China is buying more Russian oil, and India is ramping up imports from Russia as well. Russia’s invasion of Ukraine has been going on for more than half a year. Asian countries bought oil and gas from Russia at a discount as the West has imposed sanctions on Russia and plans gradually to to reduce its energy dependence on Russia. Since Russia invaded Ukraine, Russian energy exports to the EU have fallen.  Never-the-less, the EU is still buying huge amounts of oil, more than a million barrels a day. However, EU member states have said that, starting in December, they will ban all oil shipped by sea and most Russian oil is transported by sea rather than through pipelines. India and China, however, have recently become big buyers, accounting for more than half of all seaborne oil exports from Russia. In March, China and India imported more oil from Russia than the 27 EU member states combined. Ocean shipping information showed that India’s import of Russian oil known as Urals and ESPO (Eastern Siberia Pacific Ocean) showed sharp increases. Since March, China has also been buying a lot of Urals and ESPO. In early July, China reportedly bought a record amount for the second month in a row. By contrast, Japan has made it clear that it will phase out imports of Russian oil, while South Korea’s imports of Russian crude oil have also declined. While the price of Russian oil is attractive, India’s big refiners are facing difficulties in how to finance these purchases due to sanctions on Russian banks. One of the options India has is to trade in local currencies. Russia also asked India to pay in UAE currency. China’s state-owned oil companies are increasingly using Chinese Yuan instead of US. Dollars to buy oil from abroad. In July, Russia remained China’s largest oil supplier for three consecutive months.

Source: BBC Chinese, September 11, 2022
https://www.bbc.com/zhongwen/simp/world-62834711

The China Railway Construction Corporation (CRCC) Is Delinquent in Malaysia

More than 50 subcontractors and local suppliers for the Light Rail Transit 3 (LRT3) packages GS05 and GS06 in Malaysia protested to China’s Railway Construction Corporation (CRCC) because they have been delinquent on payments for over a year.

The peaceful demonstration took place at Seksyen 1, Shah Alam, on September 14.

The protesters said that the China Railway 17th Bureau Group, or CRCC 17, owed them payments coming to a total of 25 million MYR (Malaysian Ringgit), or US $5.5 million. CRCC 17 has promised to make the payment several times in the past, but has never done so.

In the past couple of years, China’s real estate companies have struggled to pay their debts on time, but those were mostly private companies and related to construction projects within China. This case involves a state-owned enterprise that is delinquent on an overseas project.

Source: eNanYang.my, September 14, 2022
https://www.enanyang.my/财经新闻/抗议拖欠2500万-承包商要中铁17局还钱

Boston University: How Much African Debt Did China Forgive?

On August 19, 2022, China announced it would waive 23 interest-free loans (IFLs) for 17 African countries. The loans  had been due by the end of 2021 . Beijing didn’t specify the details. The Global Development Policy Center of Boston University estimated that each of the forgiven debts might be between $45 million and $610 million, with a possible total of $2.2 billionl, or around 1 percent of the $159.98 billion that China committed to lend to African countries from 2000 to 2020.

The research also pointed out that,  from 2005-2022, Beijing did ten debt cancellations for African countries including the most recently announced one. IFL provisions and cancelations are important diplomatic and symbolic tools in China’s lending practices and are likely to continue to be in the future.

Source: Boston University, September 9, 2022

China’s Interest-Free Loans to Africa: Uses and Cancellations

 

 

RFA Chinese: WeChat Notified Overseas Users that Data will be Sent to China

Radio Free Asia (RFA) Chinese Edition recently reported that a large number of overseas WeChat users have been notified that, if they accept the WeChat service agreement, their personal information will be sent back to servers in China. Experts pointed out that WeChat once intended to set up domestic and overseas versions to avert any allegations of infringement overseas. The fact is, however, that WeChat has never stopped acting as the CCP’s censorship proxy. Jurists are calling on Western countries to legislate to ban Chinese apps to prevent the CCP from its long-arm intrusions. On September 6, WeChat users in many countries said that when they were about to read the content of their WeChat subscription, they suddenly received a prompt saying that once the overseas users activate the WeChat function, their personal information will be sent back to China for processing. Under international pressure and the requirements of privacy protection regulations, in September last year, WeChat “separated” into the domestic version of Weixin and the international version of WeChat. It then asked non-China-bound mobile phone users to re-sign the WeChat agreement to show that the company complied with the  laws and regulations of the host country. So now it has just torn off the original mask. Experts said that the Chinese government has always used WeChat in China as a tool to control society and censor speech, which is actually part of its establishment of China’s high-tech totalitarian control, and it has always used WeChat as a tool to export censorship overseas. The United States and other Western countries should consider and re-evaluate WeChat’s threats to national security, data security, personal privacy, etc. Western countries should pass legislation on Chinese apps, or even block Chinese apps, like India has done.

Source: RFA Chinese, September 7, 2022
https://www.rfa.org/cantonese/news/wechat-09072022123951.html