Is South Sudan a Game-Changer in China’s Foreign Policy?

Thu, May 1, 2014 - 8:17am

by Dominykas Broga, an analyst at Global Risk Insights

China’s active bid for South Sudan’s peace deal may mark a shift away from its traditional ‘non-interference’ foreign policy towards a more proactive role in global politics.

Despite China’s unprecedented rise as an economic giant with global interests, its foreign policy has strictly upheld the principles of non-interference and peaceful coexistence for over 60 years. But China’s role in addressing the crisis in South Sudan is challenging this stance for the first time.

In May 2012, China agreed not to veto or abstain from the UN resolution on sanctions for Sudan. Since then, Zhong Jianhua, China’s Special Representative on African Affairs, has also joined January 2014 peace talks on a ceasefire in South Sudan, commenting that China “should be engaging more in peace and security solutions for any conflict.”

In addition, Chinese diplomats from Ethiopia and South Sudan have played an active role in early attempts at ceasefire monitoring – a welcome move that caught many Western diplomats by surprise.

Finally, Chinese Foreign Minister, Wang Yi, has expressed China’s commitment to oversee the cessation of violence in South Sudan, offering his personal mediation between the warring parties. These new developments hint at possible changes in China’s foreign policy strategies and a more proactive international role.

Why does South Sudan matter to China?

There are three key reasons underlying China’s shift on this occasion.

1. As the main recipient of South Sudan’s oil (over 66 percent of the total oil output), China stands to lose most if the conflict in the country persists. The conflict between the rebels and the government within the country since December 2013 has reduced South Sudan’s oil output by 20 percent and partially affected the rise of oil prices to over $99/barrel in January 2014.

Given the low levels of Libyan oil production and continued violence in Iraq, the situation in South Sudan has international ramifications for oil markets. Continuing conflict in an oil-producing country also closes transnational energy corridors throughout Central / East Africa and fuels instability – a worrying trend for China’s heavy investments in African energy markets.

2. China remains the biggest foreign investor in South Sudanese infrastructure. Since the 1990s, China has invested heavily (about $20 billion) in the oil infrastructure of the united Sudan. After the 2011 partition, it has also pledged an additional $8 billion for infrastructure developments in South Sudan – the world’s youngest state that holds over 75 percent of the Sudanese oil and provides twice as much oil imports to China as Nigeria each year. Given the Chinese experience in losing over $20 billion of infrastructure investments in the Libyan conflict, China seems to have learnt the price of a passive international role for its investments.

3. South Sudan holds symbolic value for China’s government. Sudan has historically been the longest standing ally of the Chinese Communist Party (CCP) in Africa and the first region to experience China’s ‘go-out’ policy. Hence, the close relationship between the two countries is undoubtedly fuelling China’s willingness to play a more proactive role in protecting regional stability.

Is South Sudan an Exception Rather Than a Rule?

There is reason to be cautious about labeling the case of South Sudan as a substantive future tendency for China’s foreign policy. The Intergovernmental Authority on Development (IGAD) – the U.S., Britain and Norway –, rather than China, are still seen as the key forces behind the peace talks.

[Hear More: The Collapse of Macroeconomics: An Interview With Dr. Woody Brock]

Despite the increased Chinese role in South Sudan’s domestic affairs, its interests are driven primarily by economic necessity. This could be seen as limiting its potential scope for similar future policies.

China’s assertiveness in foreign policy also remains defined by careful impartiality. As China needs South Sudan’s oil reserves as well as Sudan’s pipelines with refining equipment to reach it, China is balancing its involvement without taking any sides.

Zhong has been reported as expressing reservations on China’s role: “We are not the party to propose our own initiative, at least at this stage. So, we urge all parties concerned to respect an African solution proposed by African parties.” These reservations leave space to question the speed and extent to which China would go to transform its status in Africa and other regions of the world.

Economic Needs Will Dictate China’s Greater International Involvement

On the other hand, though a more proactive involvement by China in South Sudan may be driven by pure necessity, its future foreign policy is likely to be dictated by similar needs on an increasingly frequent basis in the medium to long-term.

China has recently overtaken the US as the world’s largest net oil importer. While the US net oil imports dropped to 5.9 million bpd in December 2012, China’s net oil imports surged to 6.12 million bpd, signifying that for the first time the developing rather than developed world may become the biggest oil consumer.

Considering China’s continued economic growth and increasing domestic reliance on oil imports (56 percent in 2012), the country is likely to explore new energy markets.

With all known global markets having been dominated by Western companies or off-limits due to international sanctions, China is being forced to adopt high-risk strategies of overseas investment.

In recent years, China has diversified and expanded its overseas oil sector to increasingly unstable areas, such as Russia, Iran, Iraq, Angola, Nigeria, Sudan, South Sudan and Venezuela. It has taken tremendous risks in its search for oil investments. Its role as the biggest oil consumer and investor in high-risk markets may necessitate it securing stability in oil-producing high-risk regions through sacrificing parts of its non-interference policy.

Therefore, its traditional foreign policy diplomacy is likely to take a backseat to keeping pace with its growing business interests across high-risks areas. It looks like China will be intervening more frequently.

About the Author

Editor
admin [at] globalriskinsights [dot] com ()
randomness