Hungry China sees more riches than war in Afghan future

China is moving to revitalize the ancient Silk Road trade route, and its plan runs through a nation that has bedeviled both the U.S. and Russia for decades: Afghanistan.

In 2011, the U.S. unveiled a plan for a New Silk Road that would help Afghanistan strengthen relationships with its neighbors through resumed trading routes and the rebuilding of critical infrastructure. It was supposed to promote stability in the region after the U.S. began to withdraw its forces. Two years later China announced its own blueprint for the long-defunct trade corridor, called the Belt and Road Initiative, and according to foreign policy experts, China’s ambitions are now plowing right over the U.S. plan.

An Afghan policeman destroys poppies during a campaign against narcotics in Kunar province, April 29, 2014.

Parwiz | Reuters
An Afghan policeman destroys poppies during a campaign against narcotics in Kunar province, April 29, 2014.

China’s initiative is two-pronged. The Silk Road Economic Belt is the revived land network connecting Asia, Europe and Africa, while the 21st Century Maritime Silk Road is an economic passageway running through the Pacific and Indian oceans. Together, the two amount to a set of free trade agreements and infrastructure projects that reach 4.4 billion people, or 63 percent of the world’s population.

China seems willing to spend heavily to promote its plan.

Dr. Zhiqun Zhu, a professor of political science and international relations at Bucknell University, said the high-end estimate is that China spends 14 to 15 times the cost of the Marshall Plan, with inflation. The Marshall Plan cost about $13 billion in 1950, which translates to more than $100 billion in 2015.

While the estimated cost is high, one potential prize among Silk Road riches are undeveloped mineral resources in Afghanistan, worth a reported $1 trillion.

“It’s a very rich country when it comes to mineral resources,” said Jack Medlin, program manager at the U.S. Geological Survey.

Afghanistan’s mineral deposits include an estimated 1.4 million metric tonnes of rare earth elements (REEs), such as lanthanum, cerium and neodymium.

Such deposits, buried deep in the land that was at the core of the U.S. Silk Road plan, are used widely in the making of cellphones, cameras, cars, wind turbines and computers, among many other technology products.

China’s rare advantage

“It would be too bad if China ended up with all the rare earth minerals that are apparently in Afghanistan,” said a former senior Obama administration official who has worked on relationships in the Asia region.

That’s because China already maintains a virtual stranglehold on the REE market, controlling more than 90 percent of production and consuming over 60 percent of it, according to various market research firm estimates. China has used this near-monopoly to manipulate the global market for rare earth elements in the past, slowing and, on occasion, even halting production, leading to supply shortages around the world and steering government-backed U.S. researchers to look for laboratory replacements for naturally occurring REEs.

“It’s certainly possible that rare earths in Afghanistan would pose an attractive investment target for China,” said Jennifer Harris, a senior fellow at the Council on Foreign Relations. “Insofar as Afghanistan has commodities, like REE, that could help its economic development to some meaningful degree. I imagine this fact would also figure into any U.S. development vision for the region as well.”

But Harris said it’s not clear at this point if the U.S. government will continue to push an alternative plan for Afghanistan or if it is prepared to spend as much as China.

“It would be too bad if China ended up with all the rare earth minerals that are apparently in Afghanistan.”-former senior Obama administration official

In addition to a state-backed Silk Road Fund worth $40 billion, China is also preparing to launch the Asia Infrastructure Investment Bank (AIIB), which is meant to serve as the project’s financial arm. So far, the U.S. has not thrown support behind the bank — which is viewed by many experts as the greatest threat to U.S. global financial dominance in decades — even though allies, like Britain and Germany, are supporting the AIIB.

The former senior White House official said it is unfortunate that the U.S. government is opposing the China-led bank, because it would be preferable to influence the standards at the AIIB from within.

It’s been suggested that the Chinese initiatives may spark a new “Great Game,” as China moves to assert its power and prowess in Asia. Harris said the Silk Road is part of a plan designed to weave all of these countries closer to China.

Alain Guidetti, senior diplomatic advisor at the Geneva Centre for Security Policy, said the emergence of structures like the AIIB indicate that the era of the U.S. as a lone actor shaping the world is over.

“The New Silk Road and the institutions that will underpin it may indeed profoundly impact the current global order,” Guidetti wrote in a recent report. “The consequences are still not clear, but China will definitely increase its footprint over global governance, challenging the U.S. and Western leadership.”

The vying investment plans for nations like Afghanistan could impact the overall relationship between the the established and emerging global powers.

According to Yang Xiyu, a senior fellow at the China Institute of International Studies, if the U.S. and China can combine Silk Road initiatives into one overarching policy for overlapping regions, such as Afghanistan, even small achievements made by the Silk Road plans could lead to an improved U.S.-China relationship. But such cooperation can’t be guaranteed, and Xiyu said that geopolitical competition along the Silk Road implies that the U.S.-China relationship would inevitably slide into confrontation.

There is a silver lining — albeit a speculative one. Zhu said that over time the U.S. may well shift its position on the AIIB. He believes that U.S. misunderstood this initiative as an attempt by China to undermine world financial institutions, such as the World Bank.

Zhu said he thinks that it’s becoming clearer that the AIIB would serve as a complementary player to those institutions. “I remain optimistic that someday the U.S. will be part of it.”

The U.S. is not standing still in the Pacific, recently signing the historic Trans Pacific Partnership with a host of Asian nations. And China’s bold Silk Road plan has shown signs of stress, with recent tensions between China and Turkey emerging over the balance of power between new economic partners.

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