China, Ghana and Oil

The emergence of China as a world power should be motivation to Africa and its leaders. It shows that if we try hard enough, we can bring economic well-being to our people. The purpose of this note is to caution our leaders on their relationship with China, and dare I say with other countries. China National Offshore Oil Corporation (CNOOC) recently made a pitch to acquire Kosmos’s rights in the Jubilee Oil Fields, after Kosmos had offered the rights to Exxon-Mobil. This is what has prompted this article.

Technology

China has leap-frogged technology by relying on technology invented by other countries. Even as of now, China is still pursuing assets which can offer it technology without having to invest in research – Ford was reported to have agreed the sale of Volvo to Geely, a Chinese car maker.

The Jubilee Oil Field was developed by technology from the West, and in my view, efficient exploitation of the field would rely heavily on western technology. To offer the field to China and bring in China as an investor/operator would mean China would be using technology from the west. Whilst there is nothing wrong with that, I believe the best results can only be gained by using those technologies directly, not through a third party, and that means having Exxon-Mobil or BP, or Tullow manage the oil fields, but not China.

Safety

My second objection to China’s involvement is on safety. Any follower of mining accidents in the world would agree that China does not have an enviable record. In a Christian Science Monitor article in 2006 entitled: In China: energy needs vs. mine safety, it was reported that the deadliest job in China was coal mining. The paper described it as sending hundreds of thousands of workers underground each day to dig coal from mines that one labor-rights group labeled slaughterhouses.

The records have not improved. In November 2009, the Bangkok Post reported that a coal mine accident in China killed 42 miners whilst 66 remained trapped underground.

Whilst I am not saying that the operation of the oil fields by Exxon-Mobil or BP would be devoid of accidents, at least people can seek recourse in courts in the US or UK. In June 2009, Shell agreed to pay $15.5 million to settle a lawsuit brought against it by relations of executed Nigerian writer Ken Saro-Wiwa and other activists. I do not believe such an outcome could be expected from courts in China.

Emigration

My last objection is on the grounds of emigration. China does not appear to have any respect for other countries’ laws; instead, they take advantage of the failings of bureaucracies in third world countries. In an article in The New York Times this week, it was reported that the town of Trung Son in Vietnam thought they struck gold when a Chinese and a Japanese company arrived to jointly build a coal-fired power plant. Thousands of jobs would start flowing in, or so the residents hoped. Four years later, the Chinese workers overwhelm the Vietnamese workers.

The same paper reported further that China, famous for its export of cheap goods, is increasingly known for shipping out cheap labor. Vietnam generally bans the import of unskilled workers from abroad and requires foreign contractors to hire its citizens to do civil works, but that rule, according to the article, is sometimes violated by Chinese companies.

In Defense of China

Some might argue that despite all impropriety that might be labeled against China, they rise to the assistance of third world countries whilst the third world countries are down. An interesting story about this was captured in Tanzania in an article I cannot now remember the source. The story may not be factually true but I shall relate it to demonstrate the point.

In order to construct the Tazara railways, a rail link between Tanzania and Zambia, the two governments went to the World Bank. Consultants were engaged, many aircrafts were flown over the two countries, and several volumes of reports were produced, but no rail link was built. The stringent terms attached to any financing of the project might have made it too onerous.

In their frustration, the two countries consulted with China. China sent technical personnel who after looking at the project produced a 35 page report. The Tanzania Government was baffled; comparing the 35 page report to the World Bank’s several volumes. The Chinese ambassador was summoned and queried how they could build a railway from a 35 page report. The ambassador was also baffled, in his diplomatic maneuver he requested to consult with his home country. The curt reply from the home country was: Tanzania should say whether they wanted a railway or a report. To cut a long story short, Tazara was built. So China has some good things to offer, but our countries should be careful. I would liken China to Kwaku Ananse, not so far as describing them as locusts. In a blog posted in 2005, an angry blogger said the following: “When you ask people what comes to mind when they think about China, the answer will, undoubtedly, vary depending on who is asked. For example, if you ask a tourist they may say 'history'. If you ask a consumer, they will probably say 'cheap electronics'. However, if you ask an environmentalist, they might just respond by describing China as being like a swarm of locusts; descending on a location and consuming all natural resources, before moving on to the next feeding ground without a thought for sustainability or the harm that it causes”.

I rest my case.

Korku Vigah