Guest essay by Eric Worrall
According to Time Magazine, China is increasingly participating in the financing of renewable energy projects, as well as provision of renewable infrastructure. But something ugly is happening behind the scenes.
China Is Bankrolling Green Energy Projects Around the World
NOVEMBER 1, 2019
BY CHARLIE CAMPBELL / SHANGHAI
Perched on the ochre scrub of Argentina’s sunbaked Puna Jujeña plateau, the $400 million Cauchari power station is the world’s highest-altitude solar farm at 13,000 ft (about 4,000 meters) above sea level. In Kenya’s volcano-strewn Rift Valley, a newly green-lit, super-efficient electrical substation will soon funnel clean power from the nearby Olkaria Geothermal Plant about 50 miles (80 km) to downtown Nairobi. Some 14 miles off blustery northeastern Scotland, Moray East is set to become the world’s largest offshore wind farm, helping to heat and light up to a million homes.
Three distinct renewable energy projects utilizing cutting edge technology in far-flung corners of the globe sharing one uniting characteristic: Chinese finance. Over the past five years, Chinese bankrolling of green energy projects overseas has soared as the world’s number two economy and number one polluter rebrands itself as an environmental champion.
For many Chinese investors, a combination of rising domestic competition and rolling back of subsidies at home has widened their gaze. In solar firm Sungrow’s six-story, steel-and-glass headquarters in China’s eastern province of Anhui, CEO Cao Renxian explains how “struggles with the U.S. trade war” forced him to relocate production to India in order to dodge the 25% tariffs the Trump Administration slapped on imported made-in-China panels last year.
The geostrategic corollaries are vast. These green investments chime with Chinese President Xi Jinping’s signature Belt and Road Initiative (BRI), a metaphorical repaving of the ancient Silk Road though a $1 trillion transcontinental trade-and-infrastructure network largely bankrolled by Beijing. It has the potential to be the world’s greatest building project since the Marshall Plan, which rebuilt Europe in the aftermath of World War II. The BRI will extend China’s presence across the globe while reorienting nations away from the U.S.-and-Eurocentricism of the last half century.
It’s not all blue skies ahead for China. The country still generates 70% of its power from coal, and will continue to consume about half the world’s coal until 2023, according to the International Energy Agency. It also approved 141 million tons of new annual coal mining capacity in the first half of this year; in the whole of 2018, Beijing approved just 25 million tons of new coal mining capacity.
The vast majority of the more than $244 billion that China has spent on energy projects worldwide since 2000 have been on fossil fuels, according to data from the Global Development Policy Center, a policy-oriented research body affiliated with Boston University. Despite Xi telling journalists at April’s second Belt and Road Forum in Beijing that he embraces “open, clean and green development,” China has financed more than 300 foreign coal plants from Egypt to the Philippines.
Read More: https://time.com/5714267/china-green-energy/
While Time Magazine and greens gush on about China’s support for renewables, a much darker story is unfolding on the ground. Not all of China’s energy projects have a happy ending.
It Doesn’t Matter if Ecuador Can Afford This Dam. China Still Gets Paid.
By Nicholas Casey and Clifford Krauss
Dec. 24, 2018
A giant dam was supposed to help lift Ecuador out of poverty. Instead, it’s part of a national scandal, and a future tethered to China.
REVENTADOR, Ecuador — The dam sits under the glare of an active volcano, with columns of ash spewing toward the sky.
Officials had warned against the dam for decades. Geologists said an earthquake could wipe it away.
Now, only two years after opening, thousands of cracks are splintering the dam’s machinery. Its reservoir is clogged with silt, sand and trees. And the only time engineers tried to throttle up the facility completely, it shook violently and shorted out the national electricity grid.
This giant dam in the jungle, financed and built by China, was supposed to christen Ecuador’s vast ambitions, solve its energy needs and help lift the small South American country out of poverty.
Instead, it has become part of a national scandal engulfing the country in corruption, perilous amounts of debt — and a future tethered to China.
Nearly every top Ecuadorean official involved in the dam’s construction is either imprisoned or sentenced on bribery charges. That includes a former vice president, a former electricity minister and even the former anti-corruption official monitoring the project, who was caught on tape talking about Chinese bribes.
To settle the bill, China gets to keep 80 percent of Ecuador’s most valuable export — oil — because many of the contracts are repaid in petroleum, not dollars. In fact, China gets the oil at a discount, then sells it for an additional profit.
Pumping enough oil to repay China has become such an imperative for Ecuador that it is drilling deeper in the Amazon, threatening more deforestation.
The Washington Post accuses China of using unaffordable debt traps as an instrument of Chinese imperialism.
China’s debt traps around the world are a trademark of its imperialist ambitions
By John Pomfret
August 28, 2018 at 1:26 a.m. GMT+10
Last Tuesday in Beijing, the Malaysian prime minister, Mahathir Mohamad, announced that his country was canceling two multibillion-dollar Chinese projects because Malaysia can’t repay its debts. “We do not want a situation where there is a new version of colonialism,” Malaysia’s leader told his grim-faced host, Premier Li Keqiang.
To say that Mahathir’s performance was rich in irony would be an understatement: Here you had Mahathir, an Asian politician who cut his teeth on anti-Americanism, warning China that it, too, risked becoming an imperialist nation. He made his statement in the Great Hall of the People, a veritable temple to China’s communist revolution and Beijing’s vaunted claims to represent the downtrodden of the earth.
But the 93-year-old leader, who recaptured the premiership this year on the back of a campaign that questioned China’s intentions, has a point. Is China becoming a new type of imperialist power?
This question is being asked around Asia and other parts of the world after the rollout of China’s Belt and Road Initiative in 2013. Once likened to the Marshall Plan that revived Europe’s struggling economies after World War II, the trillion-dollar program to fund and build ports, railroads, power plants, dams and pipelines in some 70 countries is now being framed by critics as not exactly an imitation of American largesse but more as an example of debt-trap diplomacy in which China angles to gain influence overseas by bankrupting its partners and bending them to its will.
Even loyal US allies like Australia are being tempted by Chinese easy credit. The state of Victoria recently signed a memorandum of understanding with China over Belt and Road financing.
And of course the USA itself is in debt to China, to the tune of at least 1.3 trillion dollars.
When recipients of Chinese easy credit get into trouble, China always has a solution; they seems ready to jump in at any moment and use the debt distress of their “partners” to extend Chinese influence.
You could argue that China is simply trying to find a way to get a return on their enormous cash surplus. But some of these projects look like they are deliberately engineered to fail, like the corrupt Ecuadorian dam project, built in an earthquake zone on the foothills of an active volcano.
via Watts Up With That?
November 4, 2019 at 08:48AM