Weekly News Roundup: Dispatches from the Silk Road Economic Belt

China thinks big in backing Russian Arctic LNG project
Belt and Road turns north toward vast resources and key shipping route.Russia has commenced shipments of liquefied natural gas from the Arctic as part of one of the world's largest LNG development projects, and it owes China a big "thank you."
To read the full sto (Nikkei)

Arctic will make Russia richer with China’s help: Putin

The Independent Barents Observer said Putin made notable mention of China in a four-hour long press conference at the Kremlin on December 14 after returning from the official launch of the new Yamal LNG plant and Sabetta sea port in Siberia.“Putin made clear that the Arctic is a key ground for cooperation with the great Asian power, and underlined that the country “expresses big interest to the Northern Sea Route,” the Norway-based online publication noted. (Asia Time)

US$1.6 billion ship deal will put Russian LNG on fast track to China

A joint venture between China LNG shipping and Teekay LNG has reportedly signed a US$1.6 billion deal to finance six LNG carriers, which will service Russia’s Yamal LNG project.The carriers, currently being built by South Korea’s Daewoo, can operate the northern route from the Yamal peninsula to destinations on Asia-Pacific market without icebreaker assistance, according to the report in The Asset. The first vessel is expected to deliver in January of next year, while the rest will arrive by 2020. (Asia Times)

More than 1 trln USD invested in western China
China has plowed 6.85 trillion yuan (1.04 trillion U.S. dollars) into the development of its western regions since 2000 to help the less-prosperous inland catch up with coastal areas. "So far, there have been 317 major projects...which not only improved infrastructure in western regions but boosted advantageous industries and people's livelihood," Meng Wei, spokesperson with the National Development and Reform Commission (NDRC), said Monday at a press conference. In 2017, nearly 500 billion yuan was pumped into 17 infrastructure projects covering railways, roads, water conservation and energy.(Xinhua)

Can Chinese investment help Nepal’s new communist alliance make the break from India?
A coalition of two communist parties secured about two-thirds of the seats in both the Parliament and the Provincial Assembly, Nepal’s two legislative bodies.The large margin by which the communist alliance, which is seen as closer to China, won the landmark polls was widely viewed as a repudiation of long-standing Indian influence in the country and an endorsement of stronger ties with Beijing.
The new government will be formed by the Communist Party of Nepal (Unified Marxist-Leninist) (CPN-UML) and the CPN (Maoist Centre). Ishwor Pokhrel, general secretary of the CPN-UML said in an interview with the South China Morning Post that the result showed that voters wanted an end to the nation’s instability. “People voted in this election towards political stability,” he said. “This result [is one] which Nepalese people have very eagerly awaited for a long time.”(Scmp)

Cross-border yuan settlement in China’s Xinjiang reaches 39 billion in Nov, grows 50-fold in seven years (Global Times)

AP Exclusive: Anger with China drives Uighurs to Syrian war
Since 2013, thousands of Uighurs, a Turkic-speaking Muslim minority from western China, have traveled to Syria to train with the Uighur militant group Turkistan Islamic Party and fight alongside al-Qaida, playing key roles in several battles. Syrian President Bashar Assad’s troops are now clashing with Uighur fighters as the six-year conflict nears its endgame. (AP)

China-Kazakhstan border woes dent Silk Road ambitions
Delays, high costs and mutual animosity hamper key trade hub on Beijing’s Belt and Road (Financial Times)

Pakistan, China say economic partners till 2030

Pakistan and China on Monday unveiled a long-term cooperation plan in economic development envisioning cooperation until at least 2030 in areas ranging from infrastructure to information technology. (Reuters)

YUAN PROPOSAL PUZZLES FINANCIAL CIRCLES

THE recent announcement by Planning Minister Ahsan Iqbal that all trade between China and Pakistan will now be settled in local currency, whether the Pakistani rupee or Chinese yuan, has raised some interesting questions. A swap arrangement between China and Pakistan was signed on Dec 31, 2011. The fact that Pakistan runs a large and persistent deficit in its bilateral trade with China means that the supply of yuan will continuously need to be replenished, either through borrowing or through an expansion of the swap arrangement, or a combination of both. Since the signing of the swap arrangement, Pakistan’s bilateral trade deficit with China has more than tripled, going from $4bn to more than $12bn today. Imports from China were $14bn last fiscal year, whereas exports stood at $1.5bn.(Dawn)

Pakistan considering plan to use yuan in trade with China

Pakistan is considering a proposal to replace the U.S. dollar with the Chinese yuan for bilateral trade between Pakistan and China, the English-language daily newspaper Dawn reported on Tuesday.Bilateral trade between the countries totaled $13.8 billion in 2015 to 2016.

Interior Minister Ahsan Iqbal, who has been central to the planning and implementation of China-Pakistan economic ties, was reported discussing the proposal after unveiling a long-term economic development cooperation plan for the two countries. (Reuters)

Are Pakistan, Iran and China prepared for trilateral nexus?

The idea that China, Pakistan and Iran should develop a trilateral nexus seems to be gaining momentum. It is evident from the emerging consensus among the three countries and their civil societies. (Asia Times)

Turkmenistan gas to ease winter shortage in China
China’s increasing imports from the Amy Darya natural gas project in Turkmenistan will further secure supply for China’s residential heating, in an effort to ease the country’s current winter gas shortage, announced China National Petroleum Corp (CNPC).According to statistics released by CNPC on Dec.17, the company’s 101 gas wells and two gas processing stations in Turkmen have kicked into overdrive to increase gas supply to China, while its daily volume of imported gas has increased 5 million cubic meters to 39 million cubic meters for the last six days. (People's Daily)

CENTRAL ASIA

Uzbek leader says he will curb power of state security service 

Uzbek president Shavkat Mirziyoyev said on Friday he would reform the Central Asian nation’s state security service, adding that its power had become excessive under his predecessor Islam Karimov. (Reuters)

Uzbek dictator Islam Karimov to be memorialised by British sculptor
The late president of Uzbekistan, Islam Karimov, was widely regarded as one of the most ruthless dictators in recent history. His regime jailed and tortured critics, and massacred hundreds of unarmed protesters in the town of Andijan in 2005.However, despite his reputation, a leading British sculptor is working on a memorial in Moscow to Karimov, who died last year after a 27-year rule over Uzbekistan. (Guardian)

Attacks on Press Freedom Show Central Asia’s Authoritarian Side

In the past few weeks and months, a staggering number of attacks on press freedom has dotted Central Asia, exposing the hypersensitive disposition of the authorities toward critical voices. One of the most worrying cases involved independent journalist Khayrullo Mirsaidov. He was arrested after he penned an open letter to Tajik President Emomali Rahmon denouncing a request for a bribe that he received from a public official. The official denied the allegation and sued Mirsaidov for defamation. (Diplomat)

GDF Suez corteggia Taiwan

Alla fine di marzo, la società francese GDF Suez ha reso noto il raggiungimento di un accordo per il trasferimento di LNG (Liquefied Natural Gas) dagli Stati Uniti a Taiwan; un'operazione che rivela la reale portata della rivoluzione energetica americana e la dislocazione geografica delle ambizioni dei colossi internazionali. GDF Suez, rifornita da sei Paesi differenti, è il primo importatore di LNG in Europa, il quarto gruppo mondiale (terzo per capitalizzazione con 86,7 miliardi di euro) nel gas e nell'elettricità tra le utilities quotate in Borsa, nonché la seconda utility del mondo.

L'intesa, siglata con la compagnia di Stato taiwanese CPC, prevede la vendita di 800 milioni di tonnellate di LNG all'anno per vent'anni a partire dal 2018. Il gas, in parte ricavato dallo scisto, fluirà dall'impianto della Cameron LNG, in Louisiana, dove il gigante energetico francese possiede 4 milioni di tonnellate di capacità di esportazione annua. Nei mesi scorsi la 'Reuters' aveva riferito di accordi simili tra GDF Suez e società giapponesi, cinesi e cilene, tuttavia il Vicepresidente della compagnia, Jean-Marie Dauger, ha definito la vendita a CPC «la prima di questo genere», spiegando che «contribuirà all'export di gas naturale -shale gas incluso- dagli Stati Uniti verso il mercato globale, aiutando a diversificare e a rendere più sicuro l'approvvigionamento energetico». Senza troppi giri di parole: «[l'accordo] rivela l'ambizione di GDF Suez di incrementare il proprio ruolo nell'Asia-Pacifico ed espandere la fornitura a lungo termine in una regione dove la domanda di LNG in futuro sarà elevata. Siamo lieti di essere tra i primi a esportare shale gas dagli States, stringendo rapporti di lunga durata con CPC e contribuendo a mantenere sicuri i rifornimenti in Asia». In realtà, come fa notare a 'L'Indro' Matteo Verda, dottore di ricerca dell'Università di Pavia e ricercatore associato dell'ISPI, nonché co-autore del focus trimestrale sulla sicurezza energetica per l'Osservatorio di politica internazionale (Parlamento e MAE), "le quantità sono modeste: parliamo di 1 miliardo di metri cubi all'anno, ossia meno di un quinto di quanto non importi l'Italia di solo GNL e circa il 5% dei consumi annuali di Taiwan".

Sebbene il valore dell'accordo non sia stato reso noto, secondo fonti dell'agenzia di stampa britannica, CPC nel corso del primo anno pagherà alla GDF Suez 12 dollari per milione di Btu; un prezzo scontato rispetto ai 16 dollari che normalmente si trova a sborsare in Asia, che come l'Europa, fissa i prezzi del gas naturale secondo contratti di lungo termine legati al costo del petrolio. Ora la possibilità di accedere al gas naturale intrappolato nelle formazioni rocciose, utilizzando la fratturazione idraulica o la perforazione orizzontale, hanno abbassato i prezzi di LNG americano a una frazione di quelli di altri Paesi. (Segue su L'Indro)