China has already made its mark as the world’s number one builder, with a development budget of over $500 billion for infrastructure projects in developing nations for 2013 alone. In many countries, China pays for oil and other natural resources in highways, ports, airports, hospitals and universities, thus making sure that it is the people who directly benefit, rather than politicians and middlemen, who would often prefer to be paid in cash. The downside of this for host countries is that Chinese companies often bring their entire workforce from China, leaving native workers helplessly looking on. Iraq seems determined to avoid this situation, and is favouring joint ventures between Chinese and Iraqi companies – mostly state companies from both sides. In 2010, Beijing made clear its intentions were serious by cancelling 80% of Iraq’s $8.5 billion debt to China. In the two years up till then, Iraq and China had already signed trade deals worth nearly $4 billion. In October 2008, Chinese National Petroleum became the first foreign oil company to sign an oil contract in the post-invasion period, when it renegotiated a deal signed with the Ba’ath administration to develop the Al Ahdab Field in Wasit Province. This success was quickly followed by China winning three of the 11 oil field development contracts offered by the Iraqi government, including in the giant Rumaila field in Basra. As Iraqi officials pointed out, since Chinese state companies don’t have to worry about shareholders, they can offer very attractive terms and are quite happy with the small profit margins the Iraqi government has wisely restricted the oil companies to. zeroanthropology.net/2013/10/26/the-chinese-reconstruction-of-iraq/
Posted on: Sun, 27 Oct 2013 03:05:56 +0000