Sunday, May 13, 2012

Turkey, China, and the Eurasian Land Bridges

A follow-up to my post earlier this week on Turkey:

The recent visit to China of a high-level Turkish delegation, led by Prime Minister Recep Tayyip Erdogan, signified Ankara's growing role in China's Eurasian Land Bridge strategy, aimed at connecting the massive Sino factory base to the markets of Central Asia, Eastern Europe, and Western Europe.  Erdogan was the first Turkish Prime Minister to visit China in 27 years.  As the economist F. William Engdahl recently put it in an extensive article on the subject:
The fact that Erdogan was also granted a high-level meeting with Chinese Vice President Xi Jinping, the man slated to be next Chinese President, and was granted an extraordinary visit to China’s oil-rich Xinjiang Province also shows the high priority China is placing on its relations with Turkey.

Source: Bingol Online
While in China, Erdogan solidified plans for the Chinese to finance and build a high-speed rail line running across the Anatoloian plateau, connecting Turkey's easternmost province of Kars with its far west province of Erdine, a $35 billion project first introduced in 2010.  From Erdine, the rail line would link up with existing train lines running West, eventually reaching the Atlantic capitals of London and Madrid.  The Kars-Erdine rail corridor was neatly summed up in a report in the Turkish english language newspaper Today's Zaman:
The line is designed to pass through 29 provinces, connecting the east and west of Turkey and reducing the duration of travel from the current 36 hours to 12. With the completion of the planned Edirne-Kars line, the total length of high-speed rail inside Turkey is expected to reach 10,000 kilometers by 2023. Under an agreement signed between China and Turkey in October 2010, China agreed to extend loans of $30 billion for the planned rail network. The Baku-Tbilisi-Kars (BTK) railway connecting Azerbaijan's capital city of Baku to Kars, currently under construction, increases the strategic importance of the Edirne-Kars line.
For China, the Erdine-Kars line is the key link in their attempt to build a third Eurasian Land Bridge, connecting the Chinese ports of Gaundong and Shenzhen to the Atlantic port of Rotterdam, and on the way connecting the giant markets of Southern Asia, running through Myanmar, Bangladesh, India, Pakistan, and Iran.  At this point, the line connects to Erdine-Kars, and then hooks up with the existing lines to Western Europe.  Overall, the third land bridge would touch 20 countries and have a total length of about 15,000 kilometers, a distance 3,000-6,000 km less than the maritime journey through the Indian Ocean and the Straits of Malacca.  This plan was developed in 2009, at China's Pan Pearl River Delta Cooperation and Development Forum.  There is also future hope to build rail lines from Turkey down through Syria, Palestine, and Egypt, connecting China directly to the African Continent.

Source: Yunus Emre Hatunaglo
Besides the Erdine-Kars line, China has made numerous other inroads into Turkish infrastructure development, tying together the world's two fastest growing economies.  Chinese firms are bidding to build two nuclear power plants in Turkey, at Akkayu on the Mediteranean Coast and Sinop on the Black Sea, as well as a major bridge over the Bosporus and a proposed third airport in Istanbul.  All together, 27 Chinese CEOs attended meetings with Turkish PM Erdogan on his recent visit to China.

For an example of how the  high speed rail networks effect commerce, one has to only turn back a year, to the launch of China's Second Eurasian Land Bridge Project, rail lines that run through Kazakhstan to Russia, then through Beluras to Western Europe.  May 2011 saw the launch of five-day-a-week direct freight rail service from Antwerp, Europe's second largest port and rail-hub, to Chongquin, the industrial center in southwest China.  It now only takes 20-25 for cargo like automotive and chemical goods to traverse Eurasia, compared to the 36 day maritime journey.  There are, however, plans to quickly cut the duration of the rail journey down to only 15-20 days, at which point the transcontinental journey would be cut in half, and the pace of industry doubled. 

For BMW, this has already become a reality, with the October 2011 launch of daily freight shipments over high-speed rail from their plant in Liepzieg, Germany to Shenyang, in Northeast China, crossing a distance of 7,000 miles in only 23 days. According (to Dr. Karl-Friedrich Rausch, a board member of DB Schencker, the transportation group that operates the German side of the railway, "the direct trains are twice as fast as maritime transport, followed by over-the-road transport to the Chinese hinterland."

Besides its function as an East-West corridor, Turkey also sits right next to the recent energy discovery boom taking place in the Eastern Mediterranean Sea.  In the past three years, massive new natural gas and oil fields have been discovered underneath the waters of Israel, Cyprus, Greece, and Turkey.  The story begins in Israel, when in 2009 Noble Energy, the Houston based firm that held the Israeli exploration contract, discovered the Tamar gas field 50 miles west of Haifa.  At first estimates, Tamar was thought to contain 8.3 trillion cubic feet of natural gas, the largest gas discovery of the year, and one that increased Israel's gas reserves from 1.5 tcf to 9.8 tcf, a rise of over 900%. 

Prompted by this discovery, the U.S. Geological Survey undertook their first ever comprehensive assessment of the region, officially known as the Levant Basin Province.  Their results, published in April 2010, were stunning, finding that the Basin contained 122 tcf of natural gas, and 1.7 billion barrels of oil.  Brenda Pierce, the program coordinator, called the region "comparable to some of the other large provinces in the world," holding gas resources "bigger than anything we have assessed in the United States."

The possibilities of this new el Dorado were confirmed later that year, when Noble Energy discovered the Leviathan field, 84 miles west of Haifa and 3 miles undersea.  Leviathan is estimated to hold 16 tcf of gas, the worlds largest deepwater gas discovery in a decade.  Israel now found itself with enough energy to supply its electricity needs for 100 years, and soon positioned itself to become an exporter of energy.  

Hoping for their own bonanzas, other countries in the region began to explore for offshore energy deposits, and soon Greece, Turkey, Cyprus, and potentially Syria had all discovered new resources.  In Greece, surveys conducted in 2010 estimated that the Ionian Sea contains 22 billion barrels of oil, while the Aegean Sea contains another 4 billion barrels.  Cyprus soon joined the club as well, with Noble Energy believing it will strike another major find at the Aphrodite field, in Cyprus's offshore Block 12 (located only 34 kilometers from Israel's Leviathan Field.  Estimates for Block 12's energy potential were originally as high as 10 tcf of gas, however in November 2011, Noble Energy Vice President Susan Cunningham revised this down, to 3-9 tcf, and gave only a 60% chance of reaching the deposits.  

These discoveries, or course, has created a whole new set of diplomatic kerfuffles.  Lebanon has claimed that some of the Israeli discoveries lie within Lebanese territorial waters (known as an "Exclusive Economic Zone"), going so far as to submit maps to the United Nations and drawing in the U.S State Department to mediate.  Cyprus, divided between a Greek North (an EU state) and a Turkish South, is partnering with Israel to develop a pipeline to export gas to Western Europe, against the wishes of Ankara.  For Greece, the EU-imposed economic austerity provisions took the sail out of the oil boom, as first on Brussel's chopping block were state-run enterprises like energy and port companies.  And this does not even touch on the "Arab Spring" protests that have shaken the region, the NATO backed regime change in Libya, or the armed insurrection in Syria.
Source: James Fishelon, Yale SRAS
This type of energy geopolitics is at the heart of the Turkish-Chinese partnership, as Beijing's dream is to break the Seven Sisters (Houston and London "Big Oil") century-old control of world energy resources, and render the USAF and Fifth Fleet impotent in stopping them.  China has begun to achieve this dream, starting with the 2006 completion of an oil pipeline from Kazakhstan's Caspian littoral to China's western province of Xinjiang.  If they could build a similar pipeline from the Caspian to Turkey, they would have a direct connection to the new energy fields in the Mediterranean.  In fact, they would then have duel freight and oil lines crossing Eurasia, putting them in economic control of the worlds largest and richest continent.  As the economist Engdahl puts it, "the aim is to literally create the world’s greatest new economic space and in turn a huge new market for not just China but all Eurasian countries, the Middle East and Western Europe."

China's international body to control this foreign policy is the Shanghai Cooperation Organization (SCO), formed in 1996 between China, Russia, Kazakhstan, Kyrgzstan, and Tajikistan.  Uzbekistan soon joined the group as well, and observer status was granted to Iran, India, Pakistan, and Mongolia.  As it is put by the eminent Dilip Hiro in his book "After Empire:"
 The new charter adopted by the SCO in 2003 specified "noninterference and nonalignment" in international affairs while aiming to create "a new international and political order"--implying thereby to end the role of the United States as the sole superpower, an aim first expressed by China and Russia four years earlier.
It seems that Turkey is now the key to this new political order. To put it bluntly, if China can steal Ankara from under NATO's nose, they will have won the Great Game. The "Pan-Turkic world," dreamt up as a NATO sword striking into China will have instead been flipped into a new silk road for the benefit of a Chinese dominated Asia. Highlighted in this process is the implicit failure of of U.S. Post Cold War global strategy, what the Pentagon calls an attempt at "Full Spectrum Dominance." After spending the last two decades pouring money into militarizing Central Asia, the U.S. is now seeing their influence slip away as China rushes in with industrial development.  And now Turkey, a NATO member for 60 years, could go the same way.

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