As allies struggle in battle, China moves in to do business: The Times, Nov 5

ByBronwen Maddox: World Briefing
Will it be China that finally pays the huge bills for repairing and rebuilding Afghanistan and Iraq — and reaps the rewards? It’s looking that way: as the US and Britain look for an exit from the battle zones, China is digging in.
From its point of view, the wreckage of other governments’ half-completed wars offers a chance to strike deals on terms that look cheap on all but the most apocalyptic views of the course of those conflicts. To some involved in development on the ground, that has benefits, if China will risk money where others fear to tread. But to many in Washington, it looks as if China is winning the benefit of the struggles of the US and its allies.
This week, China National Oil Corporation finally secured its place in Iraq. Together with BP, it signed the first big oil deal since the 2003 invasion. China’s oil companies set up a presence in Iraq soon after the invasion. Those observing their deliberations say that they were not indifferent to the security of their employees compared to Western companies — and were very keen not to be thought indifferent — but had the clear competitive advantage of being able to take a more relaxed approach to the legal uncertainties of title to Iraq’s oil revenues.
As it happens, that extra tolerance was not necessary, as BP’s part in the deal shows. For all the public protests that greeted the sale, the Baghdad Government had finally addressed some key questions that had stymied investment.
But China’s willingness to contemplate a rougher environment underpinned its presence during the worst turmoil, analysts say.
The Afghan copper mine deal struck two years ago, and just now getting under way, has come during an even worse stage of violence. But some analysts think it will prove extremely lucrative for China — the source of continuing controversy. In November 2007, the China Metallurgical Group won the right to develop the Aynak copper field south of Kabul, in a former al-Qaeda stronghold. China’s bid of $3 billion came with a pledge to build a coal power plant and the country’s first freight railway. Analysts reckon the field is one of the world’s largest undeveloped copper reserves. In the words of one senior Obama official, US geological surveys of Afghanistan’s untapped riches are “a good reason why it should not be considered a poor country”.
Senior Afghan officials, including the Ambassador to the US, have said that bidding was above board and that the Chinese company won partly because it could start work earlier. But US and Canadian companies have complained at the secretive process, suggesting that it was tilted towards China. Analysts suggest that the deal undervalues the mine. Chinese officials have not commented on allegations of bias, but say that their project will bring infrastructure and jobs soon, despite insecurity.
As President Obama weighs up whether to commit more troops, he has demanded that President Karzai should show cleaner, more open government than in the past. Even in the unlikely event that Karzai responds fully, Obama will still face criticism at home that while China has contributed little so far to Afghan security, it is reaping the rewards of others’ blood and money. www.timesonline.co.uk/tol/news/world/asia/article6903757.ece