Natural resources, as part of the commons, belong to the people of the country. It should be illegal to sell them below market value and siphon off profits or give sweetheart deals. Therefore, I would suggest a global agreement, that natural resource can only be
1) sold to the national government at an uninflated cost and
2) sold by the national government at international market prices
Natural resources should become the most transparant of all industries, instead of what it is today, which is the stuff of dictatorships that are client states to foreign mining companies, and the banks which own their stock and debt.
NATO's War on Libya is Directed against China: AFRICOM and the Threat to China's National Energy Security
by F. William Engdahl
Global Research, September 25, 2011
The Washington-led decision by NATO to bomb Gaddafi's Libya into submission over recent months, at an estimated cost to US taxpayers of at least $1 billion, has little if anything to do with what the Obama Administration claims was a mission to "protect innocent civilians." In reality it is part of a larger strategic assault by NATO and by the Pentagon in particular to entirely control China's economic achilles heel, namely China's strategic dependence on large volumes of imported crude oil and gas. Today China is the world's second largest importer of oil after the United States and the gap is rapidly closing.
If we take a careful look at a map of Africa and also look at the African organization of the new Pentagon Africa Command—AFRICOM—the pattern that emerges is a careful strategy of controlling one of China's most strategically important oil and raw materials sources.
NATO's Libya campaign was and is all about oil. But not about simply controlling Libyan high-grade crude because the USA is nervous about reliable foreign supplies. It rather is about controlling China's free access to long-term oil imports from Africa and from the Middle East. In other words, it is about controlling China itself.
Libya geographically is bounded to its north by the Mediterranean directly across from Italy, where Italian ENI oil company has been the largest foreign operator in Libya for years. To its west it is bounded by Tunisia and by Algeria. To its south it is bounded by Chad. To its east it is bounded by both Sudan (today Sudan and Southern Sudan) and by Egypt. That should tell something about the strategic importance of Libya from the standpoint of the Pentagon's AFRICOM long-term strategy for controlling Africa and its resources and which country is able to get those resources.
Gaddafi's Libya had maintained strict national state control over the rich reserves of high quality "light, sweet" Libyan crude oil. As of 2006 data Libya had the largest proven oil reserves in Africa, some 35%, larger even than Nigeria. Oil consessions had been extended to Chinese state oil companies as well as Russian and others in recent years. Not surprisingly a spokesman from the so-called opposition claiming victory over Gaddafi, Abdeljalil Mayouf, information manager at Libyan rebel oil firm AGOCO, told Reuters, "We don't have a problem with Western countries like the Italians, French and UK companies. But we may have some political issues with Russia, China and Brazil." China and Russia and Brazil either opposed UN sanctions on Libya or pressed for a negotiated settlement of the internal conflict and an end to NATO bombing.
As I have detailed elsewhere,1 Gaddafi, an old adherent of Arab socialism on the line of Egypt's Gamal Nasser, used the oil revenues to improve the lot of his people. Health care was free as was education. Each Libyan family was given a state grant of $50000 towards buying a new house and all bank loans were according to Islamic anti-usury laws, interest free. The state was also free of debt. Only by bribery and massive infiltration into the tribal opposition areas of the eastern part of the country could the CIA, MI6 and other NATO intelligence operatives, at an estimated cost of $1 billion, and massive NATO bombing of civilians, destabilize the strong ties between Gaddafi and his people.
Why then did NATO and the Pentagon lead such a mad and destructive assault on a peaceful sovereign country? Clear is that one of the prime reasons was to complete the encirclement of China's oil and vital raw material sources across northern Africa.
Pentagon alarm over China
Step-by-step in the past several years Washington had begun to create the perception that China, which was the "dear friend and ally of America" less than a decade ago, was becoming the greatest threat to world peace because of China's enormous economic expansion. The painting of China as a new "enemy" has been complex as Washington is dependent on China to buy the lion's share of the US Government debt in the form of Treasury paper.
In August the Pentagon released its annual report to Congress on China's military status. 2 This year the report sent alarm bells ringing across China for a strident new tone. The report stated among other things, “Over the past decade, China’s military has benefited from robust investment in modern hardware and technology. Many modern systems have reached maturity and others will become operational in the next few years,” the Pentagon said in the report. It added that “there remains uncertainty about how China will use its growing capabilities... China’s rise as a major international actor is likely to stand out as a defining feature of the strategic landscape of the early 21st century.”3
In a matter of perhaps two to five years, depending on how the rest of the world reacts or plays their cards, the Peoples' Republic of China will emerge in the controlled Western media painted as the new "Hitler Germany." If that seems hard to believe today, just reflect on how that was done with former Washington allies such as Egypt's Mubarak or even Saddam Hussein. In June this year, former US Secretary of the Navy and now US Senator from Virginia, James Webb, startled many in Beijing when he told press that China was fast approaching what he called a “Munich moment,” when Washington must decide how to maintain a strategic balance, a reference to the 1938 crisis over Czechoslovakia when Chamberlain opted for appeasement with Hitler over Czechoslovakia. Webb added, “If you look at the last 10 years, the strategic winner has been China.” 4
The same massively effective propaganda machine of the Pentagon, led by CNN, BBC, the New York Times or London Guardian will get the subtle command from Washington to "paint China and its leaders black." China is becoming far too strong and far too independent for many in Washington and in Wall Street. To control that, above all China's oil import dependency has been identified as her Achilles Heel. Libya is a move to strike directly at that vulnerable Achilles heel.
China moves into Africa
The involvement of Chinese energy and raw materials companies across Africa had become a major cause of alarm in Washington where an attitude of malign neglect had dominated Washington Africa policy since the Cold War era. As its future energy needs became obvious several years ago China began a major African economic diplomacy which reached a crescendo in 2006 when Beijing literally rolled out the red carpet to heads of more than forty African states and discussed a broad range of economic issues. None were more important for Beijing than securing future African oil resources for China's robust industrialization.
China moved into countries which had been virtually abandoned by former European colonial powers like France or Britain or Portugal.
Chad is a case in point. The poorest and most geographically isolated African countries, Chad was courted by Beijing which resumed diplomatic ties in 2006.
In October 2007 China's state oil giant CNPC signed a contract to build a refinery jointly with Chad's government. Two years later they began construction of an oil pipeline to carry oil from a new Chinese field in the south some 300 kilometers to the refinery. Western-supported NGO's predictably began howling about environmental impacts of the Chinese oil pipeline. The same NGOs were curiously silent when Chevron struck oil in 2003 in Chad. In July 2011 the two countries, Chad and China celebrated opening of the joint venture oil refinery near Chad's capital of Ndjamena. 5 Chad's Chinese oil activities are strikingly close to another major Chinese oil project in what then was Sudan's Darfur region bordering Chad.
Sudan had been a growing source of oil flows to China since cooperation began in the late 1990s after Chevron abandoned its stake there. By 1998 CNPC was building a 1500 km long oil pipeline from southern Sudan oilfields to Port Sudan on the Red Sea as well as building a major oil refinery near Khartoum. Sudan was the first large overseas oilfield project operated by China. By the beginning of 2011 Sudan oil, most all from the conflict-torn south, provided some 10% of China's oil imports from taking more than 60% of Sudan's daily oil production of 490,000 barrels. Sudan had become a point of vital Chinese national energy security.
According to geological estimates, the subsurface running from Darfur in what was southern Sudan through Chad into Cameroon is one giagantic oil field in extent perhaps equivalent to a new Saudi Arabia. Controlling southern Sudan as well as Chad and Cameroon is vital to the Pentagon strategy of "strategic denial" to China of their future oil flows. So long as a stable and robust Ghaddafi regime remained in power in Tripoli that control remained a major problem. The simultaneous splitting off of the Republic of South Sudan from Khartoum and the toppling of Ghaddafi in favor of weak rebel bands beholden to Pentagon support was for the Pentagon Full Spectrum Dominance of strategic priority.
The key force behind the recent wave of Western military attacks against Libya or more covert regime changes such as those in Tunisia, Egypt and the fateful referendum in southern Sudan which has now made that oil-rich region "independent" has been AFRICOM, the special US military command established by the Bush Administration in 2008 explicitly to counter the growing Chinese influence over Africa's vast oil and mineral wealth.
In late 2007, Dr. J. Peter Pham, a Washington insider who advises the US State and Defense Departments, stated openly that among the aims of the new AFRICOM, is the objective of "protecting access to hydrocarbons and other strategic resources which Africa has in abundance ... a task which includes ensuring against the vulnerability of those natural riches and ensuring that no other interested third parties, such as China, India, Japan, or Russia, obtain monopolies or preferential treatment." 6
In testimony before the US Congress supporting creation of AFRICOM in 2007, Pham, who is associated with the neo-conservative Foundation for Defense of Democracies, stated:
"This natural wealth makes Africa an inviting target for the attentions of the People’s Republic of China, whose dynamic economy...has an almost insatiable thirst for oil as well as a need for other natural resources to sustain it...China is currently importing approximately 2.6 million barrels of crude per day, about half of its consumption; more than 765,000 of those barrels—roughly a third of its imports—come from African sources, especially Sudan, Angola, and Congo (Brazzaville). Is it any wonder, then, that…perhaps no other foreign region rivals Africa as the object of Beijing’s sustained strategic interest in recent years...
Intentionally or not, many analysts expect that Africa—especially the states along its oil-rich western coastline—will increasingly becoming a theatre for strategic competition between the United States and its only real near-peer competitor on the global stage, China, as both countries seek to expand their influence and secure access to resources."7
It is useful to briefly recall the sequence of Washington-sponsored "Twitter" revolutions in the ongoing so-called Arab Spring. The first was Tunisia, an apparently insignificant land on north Africa's Mediterranean. However Tunisia is on the western border of Libya. The second domino to fall in the process was Mubarak's Egypt. That created major instability across the Middle East into north Africa as Mubarak for all his flaws had fiercely resisted Washington Middle East pollicy. Israel also lost a secure ally when Mubarak fell.
Then in July 2011 Southern Sudan declared itself the independent Republic of South Sudan, breaking away from Sudan after years of US-backed insurgency against Khartoum rule. The new Republic takes with it the bulk of Sudan's known oil riches, something clearly not causing joy in Beijing. US Ambassador to the UN Susan Rice, led the US delegation to the independence celebrations, calling it "a testament to the Southern Sudanese people." She added, in terms of making the secssion happen, "the US has been as active as anyone." US President Obama openly supported seccession of the south. The breakaway was a project guided and financed from Washington since the Bush Administration decided to make it a priority in 2004. 8
Now Sudan has suddenly lost its main source of hard currency oil revenue. The secession of the south, where three-quarters of Sudan’s 490 000 barrels a day of oil is produced, has aggravated economic difficulties in Khartoum cutting some 37% off its total revenues. Sudan’s only oil refineries and the only export route run north from oilfields to Port Sudan on the Red Sea in northern Sudan. South Sudan is now being encouraged by Washington to build a new export pipeline independent of Khartoum via Kenya. Kenya is one of the areas of strongest US military influence in Africa.9
The aim of the US-led regime change in Libya as well as the entire Greater Middle East Project which lies behind the Arab Spring is to secure absolute control over the world's largest known oil fields to control future policies in especially countries like China. As then US Secretary of State Henry Kissinger is reported to have said during the 1970's when he was arguably more powerful than the President of the United States, "If you control the oil you control entire nations or groups of nations."
For the future national energy security of China the ultimate answer lies in finding secure domestic energy reserves. Fortunately there are revolutionary new methods to detect and map presence of oil and gas where even the best current geology says oil is not to be found. Perhaps therein lies a way out of the oil trap that has been laid for China. In my newest book, The Energy Wars I detail such new methods for those interested.
F. William Engdahl is author of Full Spectrum Dominance: Totalitarian Democracy in the New World Order
1 F. William Engdahl, Creative Destruction: Libya in Washington's Greater Middle East Project--Part II, March 26, 2011, accessed in http://www.globalresearch.ca/index.php?context=va&aid=23961
2 Office of the Secretary of Defense, ANNUAL REPORT TO CONGRESS: Military and Security Developments Involving the People’s Republic of China 2011, August 25, 2011, accessed in www.defense.gov/pubs/pdfs/2011_cmpr_final.pdf.
4 Charles Hoskinson, DOD report outlines China concerns, August 25, 2011, accessed in http://www.politico.com/news/stories/0811/62027.htmlhttp://www.politico....
5 Xinhua, China-Chad joint oil refinery starts operating, July 1, 2011, acessed in http://english.peopledaily.com.cn/90001/90776/90883/7426213.html. BBC News, Chad pipeline threatens villages, 9 October 2009, accessed in http://news.bbc.co.uk/2/hi/8298525.stm.
6 F. William Engdahl, China and the Congo Wars: AFRICOM. America's New Military Command, November 26, 2008, accessed in http://www.globalresearch.ca/index.php?context=va&aid=11173
8 Rebecca Hamilton, US Played Key Role in Southern Sudan's Long Journey to Independence, July 9, 2011, accessed in http://pulitzercenter.org/articles/south-sudan-independence-khartoum-sou...
9 Maram Mazen, South Sudan studies new export routes to bypass the north, March 12, 2011, accessed in http://www.gasandoil.com/news/2011/03/south-sudan-studies-routes-other-t...
F. William Engdahl is a frequent contributor to Global Research. Global Research Articles by F. William Engdahl