The Recalcitrant China

Just as the US makes an impassioned push for tougher economic sanctions on Iran and Venezuela, China is reportedly increasingly building up relationships with these countries.

According to Reuters, the state-owned China National Petroleum Corp (CNPC) trading unit – shipped two cargoes totaling 600,000 barrels of gasoline to Iran in exchange for $55 million. Additionally, Unipec – the trading arm of China Petroleum & Chemical Corp (Sinopec) agreed to sell 250,000 of gasoline to Iran. It can be worse for its relationship with the US as Washington has spent months lobbying the international community to tighten sanctions on Iran, which is openly expanding its uranium enrichment capacity. In November 2009, Iran has announced its plans to build 10 uranium enrichment facilities and earlier this year, officials said construction would start at two sites by March 2011. In retaliation, US trade officials asserted that China undervalues its currency and earlier this year, the US followed through with a $400 billion arms sale to Taiwan and welcomed the Dalai Lama in spite of Chinese admonishments.

On the other hand, Venezuelan President Hugo Chavez, a staunch ally of Iranian President Mahmoud Ahmadinejad said that China has agreed to extend $20 billion in loans to his country. CNPC confirmed that it signed several agreements with Venezuela on a long-term credit-for-oil and a joint-venture to develop the country’s Junin 4 oil block. The Chinese state-owned oil company said it also signed a crude oil supply contract with Petroleos de Venezuela to guarantee the repayment of a 10-year loan. In return, Venezuela said it sends some 460,000 barrels a day of crude oil to China, although figures from Chinese government indicate China only imported an average of 132,000 barrels per day from Venezuela during the first couple of months of 2010.

Similarly, China has anted up to secure resources in Africa, even if that is meant dealing with some unsavory regimes. China’s friends in Africa included President Omar Bashir of Sudan, who is currently wanted by the International Criminal Court for war crimes, and Zimbabwe President Robert Mugabe, who has been accused of driving his country into economic ruin and starvation and is heavily sanctioned by the United States and European Union.

China is the largest supplier of arms to Sudan, which received $7 billion of Chinese defense exports between 2003 and 2007, according to the US Department of Defense.

Still, Beijing insists that its relationship with these countries is mutually beneficial. One thing that I am sure is that China is not as concerned as they used to be about irritating the US.