CIUDAD REAL, Spain -- To sell his vision of a high-speed train network to the American public, President Barack Obama this week cited Spain, a country most people don't associate with futuristic bullet trains.
Spain's system of 218-mile-an-hour bullet trains, the AVE -- meaning 'bird' in Spanish -- has increased mobility for many residents, though critics say it has come at the expense of less-glamorous forms of transportation.
Yet the country is on track to bypass France and Japan to have the world's biggest network of ultrafast trains by the end of next year, figures from the International Union of Railways and the Spanish government show.
The growth of the Alta Velocidad Española, or AVE, high-speed rail network is having a profound effect on life in Spain. Many Spaniards are fiercely attached to their home regions and studies show they are unusually reluctant to live or even travel elsewhere.
But those centuries-old habits are starting to change as Spain stitches its disparate regions together with a €100 billion ($130 billion) system of bullet trains designed to traverse the countryside at up to 218 miles an hour.
"We Spaniards didn't used to move around much," says José María Menéndez, who heads the civil engineering department at the University of Castilla-La Mancha. "Now I can't make my students sit still for one second. The AVE has radically changed this generation's attitude to travel."
Spain opened its first high-speed line, between Madrid and Seville, in 1992. At the time, the decision to run the line to sleepy Seville, host to the World Expo that year, was deeply controversial. Critics said it would be a costly failure for then-Prime Minister Felipe González, and that he built the line just to take him to Seville, his hometown, on the weekends.
But the AVE-which means "bird" in Spanish- proved to be a popular and political success. Politicians now fight to secure stations in their districts. Political parties compete to offer ever-more ambitious expansion plans. Under the latest blueprint, nine out of ten Spaniards will live within 31 miles of a high speed rail station by 2020.
By last year, the sprawling network of lines that stretches out from the capital, Madrid, reached Málaga in the south, Valladolid to the north and Barcelona in the country's northeast. Now, residents of Barcelona can be in Madrid in just over two-and-a-half hours-a journey that takes around six hours by car.
In the year since the Madrid-Barcelona line opened in February 2008, the AVE, costing passengers roughly the same as what they would pay to fly, has snatched half the route's air-passenger traffic.
"We had expected it to be mostly business travelers on this line," says Julio Hermida, a spokesman for Renfe, the state train operator. "But we're finding it's just as busy on the weekends," as Barcelona residents discover Madrid and vice-versa, despite a long-lived rivalry between the two cities. "To some extent, it's changing the way people think about each other."
Not everyone is pleased. ETA, the militant Basque separatist group, has said it would target anyone involved in the construction of a high-speed train line that will connect the restive northern region with Madrid and France. In December, ETA killed the owner of a company working as a contractor on the project, and in February detonated a bomb at the headquarters of Ferrovial SA, another contractor working on the project.
Other, nonviolent critics say the country's massive investment in high speed rail has come at the expense of other, less-glamorous forms of transportation. Starved of funds, Spain's antiquated freight-train network has fallen into disuse, forcing businesses to move their goods around by road. That means the Spanish economy is unusually sensitive to changes in the price of crude oil.
Critics say the AVE will never stop losing money. Even its backers say high-speed rail can only be economical if the state bears much of the construction costs. But they say the train's benefits-lower greenhouse-gas emissions, less road congestion and, in Spain's case, greater social cohesion and economic mobility-make it an investment worth making.
"The country is becoming far more intertwined," says José María Ureña, a professor of city and regional planning at the University of Castilla-La Mancha. "In a country that tends to separate out somewhat, that can only be a good thing."
The AVE was originally designed to compete with the airplane for commutes between major cities around 300 miles apart. But the biggest, and least expected, effect of the AVE has been on the smaller places in between.
Perhaps the most striking example is Ciudad Real, a scrappy town 120 miles south of Madrid in Castilla-La Mancha which, Mr. Ureña says, "had completely vanished from the map." In medieval times, the town was a key stopover point on the route between the two of most important cities of the time, Córdoba and Toledo. But the railway and the highway south later bypassed the town, and Ciudad Real began to wither.
Now it has an AVE station that puts it just 50 minutes away from Madrid, and Ciudad Real has come alive. The city has attracted a breed of daily commuters that call themselves "Avelinos." The AVE helped attract a host of industries to Ciudad Real, and the train is full in both directions.
Indra, an information technology company, moved a "software factory" to Ciudad Real a decade ago. "Along with the University, the AVE was one of the key reasons we moved here," says Ángel Villodre, the director of the center.
The University of Castilla-La Mancha's campus here has grown sharply in size and importance. "The school is here because of the AVE," says Mr. Menéndez, the department head. "Without it, it would be impossible to attract the high-level staff we need."
Around a third of Mr. Menéndez's students are from a different region of Spain -- almost unheard of in a country where students mostly stay close to home.
Airlines have in the past lobbied hard against high-speed rail projects, seeing them as unfair, government-subsidized competition. Southwest Airlines was credited with helping to kill a project to build a Texan bullet train in the 1990s.
But in Ciudad Real, an international airport has just opened its doors. Its key selling point? The AVE. The private owners of the airport have placed it next to the high speed line, hoping to offer a cheap alternative to Madrid's airports.
"If you can't beat them, join them," shrugs José Lopes, director of airlines development at Aeropuerto Central.
http://online.wsj.com/article/SB124018395386633143.html#
Showing posts with label infrastructure. Show all posts
Showing posts with label infrastructure. Show all posts
21 April 2009
26 March 2009
Liquid war: Welcome to Pipelineistan
What happens on the immense battlefield for the control of Eurasia will provide the ultimate plot line in the tumultuous rush towards a new, polycentric world order, also known as the New Great Game.
Our good ol' friend the nonsensical "global war on terror", which the Pentagon has slyly rebranded "the Long War", sports a far more important, if half-hidden, twin - a global energy war. I like to think of it as the Liquid War, because its bloodstream is the pipelines that crisscross the potential imperial battlefields of the planet. Put another way, if its crucial embattled frontier these days is the Caspian Basin, the whole of Eurasia is its chessboard. Think of it, geographically, as Pipelineistan.
All geopolitical junkies need a fix. Since the second half of the1990s, I've been hooked on pipelines. I've crossed the Caspian in an Azeri cargo ship just to follow the $4 billion Baku-Tblisi-Ceyhan pipeline, better known in this chess game by its acronym, BTC, through the Caucasus. (Oh, by the way, the map of Pipelineistan is chicken-scratched with acronyms, so get used to them!)
I've also trekked various of the overlapping modern Silk Roads, or perhaps Silk Pipelines, of possible future energy flows from Shanghai to Istanbul, annotating my own do-it-yourself routes for LNG (liquefied natural gas). I used to avidly follow the adventures of that once-but-not-future Sun-King of Central Asia, the now deceased Turkmenbashi or "leader of the Turkmen", Saparmurat Niyazov, head of the immensely gas-rich Republic of Turkmenistan, as if he were a Conradian hero.
In Almaty, the former capital of Kazakhstan (before it was moved to Astana, in the middle of the middle of nowhere) the locals were puzzled when I expressed an overwhelming urge to drive to that country's oil boomtown Aktau. ("Why? There's nothing there.") Entering the Space Odyssey-style map room at the Russian energy giant Gazprom's headquarters in Moscow - which digitally details every single pipeline in Eurasia - or the National Iranian Oil Company (NIOC)'s corporate HQ in Tehran, with its neat rows of female experts in full chador, was my equivalent of entering Aladdin's cave. And never reading the words "Afghanistan" and "oil" in the same sentence is still a source of endless amusement for me.
Last year, oil cost a king's ransom. This year, it's relatively cheap. But don't be fooled. Price isn't the point here. Like it or not, energy is still what everyone who's anyone wants to get their hands on. So consider this dispatch just the first installment in a long, long tale of some of the moves that have been, or will be, made in the maddeningly complex New Great Game, which goes on unceasingly, no matter what else muscles into the headlines this week.
Forget the mainstream media's obsession with al-Qaeda, Osama "dead or alive" bin Laden, the Taliban - neo, light or classic - or that "war on terror", whatever name it goes by. These are diversions compared to the high-stakes, hardcore geopolitical game that follows what flows along the pipelines of the planet.
Who said Pipelineistan couldn't be fun?
Calling Dr Zbig In his 1997 magnum opus The Grand Chessboard, Zbigniew Brzezinski - realpolitik practitioner extraordinaire and former national security advisor to Jimmy Carter, the president who launched the US on its modern energy wars - laid out in some detail just how to hang on to American "global primacy". Later, his master plan would be duly copied by that lethal bunch of Dr No's congregated at Bill Kristol's Project for a New American Century (PNAC, in case you'd forgotten the acronym since its website and its followers went down).
For Dr Zbig, who, like me, gets his fix from Eurasia - from, that is, thinking big - it all boils down to fostering the emergence of just the right set of "strategically compatible partners" for Washington in places where energy flows are strongest. This, as he so politely put it back then, should be done to shape "a more cooperative trans-Eurasian security system".
By now, Dr Zbig - among whose fans is evidently President Barack Obama - must have noticed that the Eurasian train which was to deliver the energy goods has been slightly derailed. The Asian part of Eurasia, it seems, begs to differ.
Global financial crisis or not, oil and natural gas are the long-term keys to an inexorable transfer of economic power from the West to Asia. Those who control Pipelineistan - and despite all the dreaming and planning that's gone on there, it's unlikely to be Washington - will have the upper hand in whatever is to come, and there's not a terrorist in the world, or even a "long war", that can change that.
Energy expert Michael Klare has been instrumental in identifying the key vectors in the wild, ongoing global scramble for power over Pipelineistan. These range from the increasing scarcity (and difficulty of reaching) primary energy supplies to "the painfully slow development of energy alternatives". Though you may not have noticed, the first skirmishes in Pipelineistan's Liquid War are already on, and even in the worst of economic times, the risk mounts constantly, given the relentless competition between the West and Asia, be it in the Middle East, in the Caspian theater, or in African oil-rich states like Angola, Nigeria and Sudan.
In these early skirmishes of the 21st century, China reacted swiftly indeed. Even before the attacks of September 11, 2001, its leaders were formulating a response to what they saw as the reptilian encroachment of the West on the oil and gas lands of Central Asia, especially in the Caspian Sea region. To be specific, in June 2001, its leaders joined with Russia's to form the Shanghai Cooperation Organization. It's known as the SCO and that's an acronym you should memorize. It's going to be around for a while.
Back then, the SCO's junior members were, tellingly enough, the Stans, the energy-rich former SSRs of the Soviet Union - Kyrgyzstan, Uzbekistan, Kazakhstan and Tajikistan - which the Bill Clinton administration and then the new George W Bush administration, run by those former energy men, had been eyeing covetously. The organization was to be a multi-layered economic and military regional cooperation society that, as both the Chinese and the Russians saw it, would function as a kind of security blanket around the upper rim of Afghanistan.
Iran is, of course, a crucial energy node of West Asia and that country's leaders, too, would prove no slouches when it came to the New Great Game. It needs at least $200 billion in foreign investment to truly modernize its fabulous oil and gas reserves - and thus sell much more to the West than US-imposed sanctions now allow.
No wonder Iran soon became a target in Washington. No wonder an air assault on that country remains the ultimate wet dream of assorted Likudniks as well as former vice president Dick ("Angler") Cheney and his neo-conservative chamberlains and comrades-in-arms. As seen by the elite from Tehran and Delhi to Beijing and Moscow, such a US attack, now likely off the radar screen until at least 2012, would be a war not only against Russia and China, but against the whole project of Asian integration that the SCO is coming to represent.
Global BRIC-a-brac
Meanwhile, as the Obama administration tries to sort out its Iranian, Afghan, and Central Asian policies, Beijing continues to dream of a secure, fast-flowing, energy version of the old Silk Road, extending from the Caspian Basin (the energy-rich Stans plus Iran and Russia) to Xinjiang province, its Far West.
The SCO has expanded its aims and scope since 2001. Today, Iran, India, and Pakistan enjoy "observer status" in an organization that increasingly aims to control and protect not just regional energy supplies, but Pipelineistan in every direction. This is, of course, the role the Washington ruling elite would like the North Atlantic Treaty Organization (NATO) to play across Eurasia. Given that Russia and China expect the SCO to play a similar role across Asia, clashes of various sorts are inevitable.
Ask any relevant expert at the Chinese Academy of Social Sciences in Beijing and he will tell you that the SCO should be understood as a historically unique alliance of five non-Western civilizations - Russian, Chinese, Muslim, Hindu, and Buddhist - and, because of that, capable of evolving into the basis for a collective security system in Eurasia. That's a thought sure to discomfort classic inside-the-Beltway global strategists like Dr Zbig and president George H W Bush's national security advisor Brent Scowcroft.
According to the view from Beijing, the rising world order of the 21st century will be significantly determined by a quadrangle of BRIC countries - for those of you by now collecting New Great Game acronyms, that stands for Brazil, Russia, India and China - plus the future Islamic triangle of Iran, Saudi Arabia and Turkey. Add in a unified South America, no longer in thrall to Washington, and you have a global SCO-plus. On the drawing boards, at least, it's a high-octane dream.
The key to any of this is a continuing Sino-Russian entente cordiale.
Already in 1999, watching NATO and the United States aggressively expand into the distant Balkans, Beijing identified this new game for what it was: a developing energy war. And at stake were the oil and natural gas reserves of what Americans would soon be calling the "arc of instability," a vast span of lands extending from North Africa to the Chinese border.
No less important would be the routes pipelines would take in bringing the energy buried in those lands to the West. Where they would be built, the countries they would cross, would determine much in the world to come. And this was where the empire of US military bases (think, for instance, Camp Bondsteel in Kosovo) met Pipelineistan (represented, way back in 1999, by the AMBO pipeline).
AMBO, short for Albanian Macedonian Bulgarian Oil Corporation, an entity registered in the US, is building a $1.1 billion pipeline, aka "the Trans-Balkan", slated to be finished by 2011. It will bring Caspian oil to the West without taking it through either Russia or Iran. As a pipeline, AMBO fit well into a geopolitical strategy of creating a US-controlled energy-security grid that was first developed by president Bill Clinton's energy secretary Bill
Richardson and later by Cheney.
Behind the idea of that "grid" lay a go-for-broke militarization of an energy corridor that would stretch from the Caspian Sea in Central Asia through a series of now independent former SSRs of the Soviet Union to Turkey, and from there into the Balkans (from thence onto Europe). It was meant to sabotage the larger energy plans of both Russia and Iran. AMBO itself would bring oil from the Caspian basin to a terminal in the former SSR of Georgia in the Caucasus, and then transport it by tanker through the Black Sea to the Bulgarian port of Burgas, where another pipeline would connect to Macedonia and then to the Albanian port of Vlora.
As for Camp Bondsteel, it was the "enduring" military base that Washington gained from the wars for the remains of Yugoslavia. It would be the largest overseas base the US had built since the Vietnam War. Halliburton's subsidiary Kellogg Brown & Root would, with the Army Corps of Engineers, put it up on 400 hectares of farmland near the Macedonian border in southern Kosovo.
Think of it as a user-friendly, five-star version of Guantanamo with perks for those stationed there that included Thai massage and loads of junk food. Bondsteel is the Balkan equivalent of a giant immobile aircraft carrier, capable of exercising surveillance not only over the Balkans but also over Turkey and the Black Sea region (considered in the neo-con-speak of the Bush years "the new interface" between the "Euro-Atlantic community" and the "Greater Middle East").
How could Russia, China, and Iran not interpret the war in Kosovo, then the invasion of Afghanistan (where Washington had previously tried to pair with the Taliban and encourage the building of another of those avoid-Iran, avoid-Russia pipelines), followed by the invasion of Iraq (that country of vast oil reserves), and finally the recent clash in Georgia (that crucial energy transportation junction) as straightforward wars for Pipelineistan?
Though seldom imagined this way in our mainstream media, the Russian and Chinese leaderships saw a stark "continuity" of policy stretching from Bill Clinton's humanitarian imperialism to Bush's "global war on terror". Blowback, as then Russian President Vladimir Putin himself warned publicly, was inevitable - but that's another magic-carpet story, another cave to enter another time.
Rainy night in Georgia
If you want to understand Washington's version of Pipelineistan, you have to start with Mafia-ridden Georgia. Though its army was crushed in its recent war with Russia, Georgia remains crucial to Washington's energy policy in what, by now, has become a genuine arc of instability - in part because of a continuing obsession with cutting Iran out of the energy flow.
It was around the Baku-Tblisi-Ceyhan (BTC) pipeline, as I pointed out in my book Globalistan in 2007, that American policy congealed. Zbig Brzezinski himself flew into Baku in 1995 as an "energy consultant", less than four years after Azerbaijan became independent, and sold the idea to the Azerbaijani elite. The BTC was to run from the Sangachal Terminal, half-an-hour south of Baku, across neighboring Georgia to the Marine Terminal in the Turkish port of Ceyhan on the Mediterranean.
Now operational, that 1,767-kilometer-long, 44-meter-wide steel serpent straddles no less than six war zones, ongoing or potential: Nagorno-Karabakh (an Armenian enclave in Azerbaijan), Chechnya and Dagestan (both embattled regions of Russia), South Ossetia and Abkhazia (on which the 2008 Russia-Georgia war pivoted), and Turkish Kurdistan.
From a purely economic point of view, the BTC made no sense. A "BTK" pipeline, running from Baku through Tehran to Iran's Kharg Island, could have been built for, relatively speaking, next to nothing - and it would have had the added advantage of bypassing both mafia-corroded Georgia and wobbly Kurdish-populated Eastern Anatolia. That would have been the really cheap way to bring Caspian oil and gas to Europe.
The New Great Game ensured that that was not to be, and much followed from that decision. Even though Moscow never planned to occupy Georgia long-term in its 2008 war, or take over the BTC pipeline that now runs through its territory, Alfa Bank oil and gas analyst Konstantin Batunin pointed out the obvious: by briefly cutting off the BTC oil flow, Russian troops made it all too clear to global investors that Georgia wasn't a reliable energy transit country. In other words, the Russians made a mockery of Zbig's world.
For its part, Azerbaijan was, until recently, the real success story in the US version of Pipelineistan. Advised by Zbig, Bill Clinton literally "stole" Baku from Russia's "near abroad" by promoting the BTC and the wealth that would flow from it. Now, however, with the message of the Russia-Georgia War sinking in, Baku is again allowing itself to be seduced by Russia. To top it off, Azerbaijan President Ilham Aliyev can't stand Georgia's brash President Mikhail Saakashvili. That's hardly surprising. After all, Saakashvili's rash military moves caused Azerbaijan to lose at least $500 million when the BTC was shut down during the war.
Russia's energy seduction blitzkrieg is focused like a laser on Central Asia as well. (We'll talk about it more in the next Pipelineistan installment.) It revolves around offering to buy Kazakh, Uzbek, and Turkmen gas at European prices instead of previous, much lower Russian prices. The Russians, in fact, have offered the same deal to the Azeris: so now, Baku is negotiating a deal involving more capacity for the Baku-Novorossiysk pipeline, which makes its way to the Russian borders of the Black Sea, while considering pumping less oil for the BTC.
Obama needs to understand the dire implications of this. Less Azeri oil on the BTC - its full capacity is 1 million barrels a day, mostly shipped to Europe - means the pipeline may go broke, which is exactly what Russia wants.
In Central Asia, some of the biggest stakes revolve around the monster Kashagan oil field in "snow leopard" Kazakhstan, the absolute jewel in the Caspian crown with reserves of as many as 9 billion barrels. As usual in Pipelineistan, it all comes down to which routes will deliver Kashagan's oil to the world after production starts in 2013. This spells, of course, Liquid War. Wily Kazakh President Nursultan Nazarbayev would like to use the Russian-controlled Caspian Pipeline Consortium (CPC) to pump Kashagan crude to the Black Sea.
In this case, the Kazakhs hold all the cards. How oil will flow from Kashagan will decide whether the BTC - once hyped by Washington as the ultimate Western escape route from dependence on Persian Gulf oil - lives or dies.
Welcome, then, to Pipelineistan! Whether we like it or not, in good times and bad, it's a reasonable bet that we're all going to be Pipeline tourists. So, go with the flow. Learn the crucial acronyms, keep an eye out for what happens to all those US bases across the oil heartlands of the planet, watch where the pipelines are being built, and do your best to keep tabs on the next set of monster Chinese energy deals and fabulous coups by Russia's Gazprom.
And, while you're at it, consider this just the first postcard sent off from our tour of Pipelineistan. We'll be back (to slightly adapt a quote from Terminator). Think of this as a door opening onto a future in which what flows where and to whom may turn out to be the most important question on the planet.
Pepe Escobar is the roving correspondent for Asia Times Online and an analyst for the Real News. This article draws from his new book, Obama does Globalistan. He is also the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007) and Red Zone Blues: a snapshot of Baghdad during the surge. Pepe may be reached at pepeasia@yahoo.com.
(Copyright 2009 Pepe Escobar.)
link
Our good ol' friend the nonsensical "global war on terror", which the Pentagon has slyly rebranded "the Long War", sports a far more important, if half-hidden, twin - a global energy war. I like to think of it as the Liquid War, because its bloodstream is the pipelines that crisscross the potential imperial battlefields of the planet. Put another way, if its crucial embattled frontier these days is the Caspian Basin, the whole of Eurasia is its chessboard. Think of it, geographically, as Pipelineistan.
All geopolitical junkies need a fix. Since the second half of the1990s, I've been hooked on pipelines. I've crossed the Caspian in an Azeri cargo ship just to follow the $4 billion Baku-Tblisi-Ceyhan pipeline, better known in this chess game by its acronym, BTC, through the Caucasus. (Oh, by the way, the map of Pipelineistan is chicken-scratched with acronyms, so get used to them!)
I've also trekked various of the overlapping modern Silk Roads, or perhaps Silk Pipelines, of possible future energy flows from Shanghai to Istanbul, annotating my own do-it-yourself routes for LNG (liquefied natural gas). I used to avidly follow the adventures of that once-but-not-future Sun-King of Central Asia, the now deceased Turkmenbashi or "leader of the Turkmen", Saparmurat Niyazov, head of the immensely gas-rich Republic of Turkmenistan, as if he were a Conradian hero.
In Almaty, the former capital of Kazakhstan (before it was moved to Astana, in the middle of the middle of nowhere) the locals were puzzled when I expressed an overwhelming urge to drive to that country's oil boomtown Aktau. ("Why? There's nothing there.") Entering the Space Odyssey-style map room at the Russian energy giant Gazprom's headquarters in Moscow - which digitally details every single pipeline in Eurasia - or the National Iranian Oil Company (NIOC)'s corporate HQ in Tehran, with its neat rows of female experts in full chador, was my equivalent of entering Aladdin's cave. And never reading the words "Afghanistan" and "oil" in the same sentence is still a source of endless amusement for me.
Last year, oil cost a king's ransom. This year, it's relatively cheap. But don't be fooled. Price isn't the point here. Like it or not, energy is still what everyone who's anyone wants to get their hands on. So consider this dispatch just the first installment in a long, long tale of some of the moves that have been, or will be, made in the maddeningly complex New Great Game, which goes on unceasingly, no matter what else muscles into the headlines this week.
Forget the mainstream media's obsession with al-Qaeda, Osama "dead or alive" bin Laden, the Taliban - neo, light or classic - or that "war on terror", whatever name it goes by. These are diversions compared to the high-stakes, hardcore geopolitical game that follows what flows along the pipelines of the planet.
Who said Pipelineistan couldn't be fun?
Calling Dr Zbig In his 1997 magnum opus The Grand Chessboard, Zbigniew Brzezinski - realpolitik practitioner extraordinaire and former national security advisor to Jimmy Carter, the president who launched the US on its modern energy wars - laid out in some detail just how to hang on to American "global primacy". Later, his master plan would be duly copied by that lethal bunch of Dr No's congregated at Bill Kristol's Project for a New American Century (PNAC, in case you'd forgotten the acronym since its website and its followers went down).
For Dr Zbig, who, like me, gets his fix from Eurasia - from, that is, thinking big - it all boils down to fostering the emergence of just the right set of "strategically compatible partners" for Washington in places where energy flows are strongest. This, as he so politely put it back then, should be done to shape "a more cooperative trans-Eurasian security system".
By now, Dr Zbig - among whose fans is evidently President Barack Obama - must have noticed that the Eurasian train which was to deliver the energy goods has been slightly derailed. The Asian part of Eurasia, it seems, begs to differ.
Global financial crisis or not, oil and natural gas are the long-term keys to an inexorable transfer of economic power from the West to Asia. Those who control Pipelineistan - and despite all the dreaming and planning that's gone on there, it's unlikely to be Washington - will have the upper hand in whatever is to come, and there's not a terrorist in the world, or even a "long war", that can change that.
Energy expert Michael Klare has been instrumental in identifying the key vectors in the wild, ongoing global scramble for power over Pipelineistan. These range from the increasing scarcity (and difficulty of reaching) primary energy supplies to "the painfully slow development of energy alternatives". Though you may not have noticed, the first skirmishes in Pipelineistan's Liquid War are already on, and even in the worst of economic times, the risk mounts constantly, given the relentless competition between the West and Asia, be it in the Middle East, in the Caspian theater, or in African oil-rich states like Angola, Nigeria and Sudan.
In these early skirmishes of the 21st century, China reacted swiftly indeed. Even before the attacks of September 11, 2001, its leaders were formulating a response to what they saw as the reptilian encroachment of the West on the oil and gas lands of Central Asia, especially in the Caspian Sea region. To be specific, in June 2001, its leaders joined with Russia's to form the Shanghai Cooperation Organization. It's known as the SCO and that's an acronym you should memorize. It's going to be around for a while.
Back then, the SCO's junior members were, tellingly enough, the Stans, the energy-rich former SSRs of the Soviet Union - Kyrgyzstan, Uzbekistan, Kazakhstan and Tajikistan - which the Bill Clinton administration and then the new George W Bush administration, run by those former energy men, had been eyeing covetously. The organization was to be a multi-layered economic and military regional cooperation society that, as both the Chinese and the Russians saw it, would function as a kind of security blanket around the upper rim of Afghanistan.
Iran is, of course, a crucial energy node of West Asia and that country's leaders, too, would prove no slouches when it came to the New Great Game. It needs at least $200 billion in foreign investment to truly modernize its fabulous oil and gas reserves - and thus sell much more to the West than US-imposed sanctions now allow.
No wonder Iran soon became a target in Washington. No wonder an air assault on that country remains the ultimate wet dream of assorted Likudniks as well as former vice president Dick ("Angler") Cheney and his neo-conservative chamberlains and comrades-in-arms. As seen by the elite from Tehran and Delhi to Beijing and Moscow, such a US attack, now likely off the radar screen until at least 2012, would be a war not only against Russia and China, but against the whole project of Asian integration that the SCO is coming to represent.
Global BRIC-a-brac
Meanwhile, as the Obama administration tries to sort out its Iranian, Afghan, and Central Asian policies, Beijing continues to dream of a secure, fast-flowing, energy version of the old Silk Road, extending from the Caspian Basin (the energy-rich Stans plus Iran and Russia) to Xinjiang province, its Far West.
The SCO has expanded its aims and scope since 2001. Today, Iran, India, and Pakistan enjoy "observer status" in an organization that increasingly aims to control and protect not just regional energy supplies, but Pipelineistan in every direction. This is, of course, the role the Washington ruling elite would like the North Atlantic Treaty Organization (NATO) to play across Eurasia. Given that Russia and China expect the SCO to play a similar role across Asia, clashes of various sorts are inevitable.
Ask any relevant expert at the Chinese Academy of Social Sciences in Beijing and he will tell you that the SCO should be understood as a historically unique alliance of five non-Western civilizations - Russian, Chinese, Muslim, Hindu, and Buddhist - and, because of that, capable of evolving into the basis for a collective security system in Eurasia. That's a thought sure to discomfort classic inside-the-Beltway global strategists like Dr Zbig and president George H W Bush's national security advisor Brent Scowcroft.
According to the view from Beijing, the rising world order of the 21st century will be significantly determined by a quadrangle of BRIC countries - for those of you by now collecting New Great Game acronyms, that stands for Brazil, Russia, India and China - plus the future Islamic triangle of Iran, Saudi Arabia and Turkey. Add in a unified South America, no longer in thrall to Washington, and you have a global SCO-plus. On the drawing boards, at least, it's a high-octane dream.
The key to any of this is a continuing Sino-Russian entente cordiale.
Already in 1999, watching NATO and the United States aggressively expand into the distant Balkans, Beijing identified this new game for what it was: a developing energy war. And at stake were the oil and natural gas reserves of what Americans would soon be calling the "arc of instability," a vast span of lands extending from North Africa to the Chinese border.
No less important would be the routes pipelines would take in bringing the energy buried in those lands to the West. Where they would be built, the countries they would cross, would determine much in the world to come. And this was where the empire of US military bases (think, for instance, Camp Bondsteel in Kosovo) met Pipelineistan (represented, way back in 1999, by the AMBO pipeline).
AMBO, short for Albanian Macedonian Bulgarian Oil Corporation, an entity registered in the US, is building a $1.1 billion pipeline, aka "the Trans-Balkan", slated to be finished by 2011. It will bring Caspian oil to the West without taking it through either Russia or Iran. As a pipeline, AMBO fit well into a geopolitical strategy of creating a US-controlled energy-security grid that was first developed by president Bill Clinton's energy secretary Bill
Richardson and later by Cheney.
Behind the idea of that "grid" lay a go-for-broke militarization of an energy corridor that would stretch from the Caspian Sea in Central Asia through a series of now independent former SSRs of the Soviet Union to Turkey, and from there into the Balkans (from thence onto Europe). It was meant to sabotage the larger energy plans of both Russia and Iran. AMBO itself would bring oil from the Caspian basin to a terminal in the former SSR of Georgia in the Caucasus, and then transport it by tanker through the Black Sea to the Bulgarian port of Burgas, where another pipeline would connect to Macedonia and then to the Albanian port of Vlora.
As for Camp Bondsteel, it was the "enduring" military base that Washington gained from the wars for the remains of Yugoslavia. It would be the largest overseas base the US had built since the Vietnam War. Halliburton's subsidiary Kellogg Brown & Root would, with the Army Corps of Engineers, put it up on 400 hectares of farmland near the Macedonian border in southern Kosovo.
Think of it as a user-friendly, five-star version of Guantanamo with perks for those stationed there that included Thai massage and loads of junk food. Bondsteel is the Balkan equivalent of a giant immobile aircraft carrier, capable of exercising surveillance not only over the Balkans but also over Turkey and the Black Sea region (considered in the neo-con-speak of the Bush years "the new interface" between the "Euro-Atlantic community" and the "Greater Middle East").
How could Russia, China, and Iran not interpret the war in Kosovo, then the invasion of Afghanistan (where Washington had previously tried to pair with the Taliban and encourage the building of another of those avoid-Iran, avoid-Russia pipelines), followed by the invasion of Iraq (that country of vast oil reserves), and finally the recent clash in Georgia (that crucial energy transportation junction) as straightforward wars for Pipelineistan?
Though seldom imagined this way in our mainstream media, the Russian and Chinese leaderships saw a stark "continuity" of policy stretching from Bill Clinton's humanitarian imperialism to Bush's "global war on terror". Blowback, as then Russian President Vladimir Putin himself warned publicly, was inevitable - but that's another magic-carpet story, another cave to enter another time.
Rainy night in Georgia
If you want to understand Washington's version of Pipelineistan, you have to start with Mafia-ridden Georgia. Though its army was crushed in its recent war with Russia, Georgia remains crucial to Washington's energy policy in what, by now, has become a genuine arc of instability - in part because of a continuing obsession with cutting Iran out of the energy flow.
It was around the Baku-Tblisi-Ceyhan (BTC) pipeline, as I pointed out in my book Globalistan in 2007, that American policy congealed. Zbig Brzezinski himself flew into Baku in 1995 as an "energy consultant", less than four years after Azerbaijan became independent, and sold the idea to the Azerbaijani elite. The BTC was to run from the Sangachal Terminal, half-an-hour south of Baku, across neighboring Georgia to the Marine Terminal in the Turkish port of Ceyhan on the Mediterranean.
Now operational, that 1,767-kilometer-long, 44-meter-wide steel serpent straddles no less than six war zones, ongoing or potential: Nagorno-Karabakh (an Armenian enclave in Azerbaijan), Chechnya and Dagestan (both embattled regions of Russia), South Ossetia and Abkhazia (on which the 2008 Russia-Georgia war pivoted), and Turkish Kurdistan.
From a purely economic point of view, the BTC made no sense. A "BTK" pipeline, running from Baku through Tehran to Iran's Kharg Island, could have been built for, relatively speaking, next to nothing - and it would have had the added advantage of bypassing both mafia-corroded Georgia and wobbly Kurdish-populated Eastern Anatolia. That would have been the really cheap way to bring Caspian oil and gas to Europe.
The New Great Game ensured that that was not to be, and much followed from that decision. Even though Moscow never planned to occupy Georgia long-term in its 2008 war, or take over the BTC pipeline that now runs through its territory, Alfa Bank oil and gas analyst Konstantin Batunin pointed out the obvious: by briefly cutting off the BTC oil flow, Russian troops made it all too clear to global investors that Georgia wasn't a reliable energy transit country. In other words, the Russians made a mockery of Zbig's world.
For its part, Azerbaijan was, until recently, the real success story in the US version of Pipelineistan. Advised by Zbig, Bill Clinton literally "stole" Baku from Russia's "near abroad" by promoting the BTC and the wealth that would flow from it. Now, however, with the message of the Russia-Georgia War sinking in, Baku is again allowing itself to be seduced by Russia. To top it off, Azerbaijan President Ilham Aliyev can't stand Georgia's brash President Mikhail Saakashvili. That's hardly surprising. After all, Saakashvili's rash military moves caused Azerbaijan to lose at least $500 million when the BTC was shut down during the war.
Russia's energy seduction blitzkrieg is focused like a laser on Central Asia as well. (We'll talk about it more in the next Pipelineistan installment.) It revolves around offering to buy Kazakh, Uzbek, and Turkmen gas at European prices instead of previous, much lower Russian prices. The Russians, in fact, have offered the same deal to the Azeris: so now, Baku is negotiating a deal involving more capacity for the Baku-Novorossiysk pipeline, which makes its way to the Russian borders of the Black Sea, while considering pumping less oil for the BTC.
Obama needs to understand the dire implications of this. Less Azeri oil on the BTC - its full capacity is 1 million barrels a day, mostly shipped to Europe - means the pipeline may go broke, which is exactly what Russia wants.
In Central Asia, some of the biggest stakes revolve around the monster Kashagan oil field in "snow leopard" Kazakhstan, the absolute jewel in the Caspian crown with reserves of as many as 9 billion barrels. As usual in Pipelineistan, it all comes down to which routes will deliver Kashagan's oil to the world after production starts in 2013. This spells, of course, Liquid War. Wily Kazakh President Nursultan Nazarbayev would like to use the Russian-controlled Caspian Pipeline Consortium (CPC) to pump Kashagan crude to the Black Sea.
In this case, the Kazakhs hold all the cards. How oil will flow from Kashagan will decide whether the BTC - once hyped by Washington as the ultimate Western escape route from dependence on Persian Gulf oil - lives or dies.
Welcome, then, to Pipelineistan! Whether we like it or not, in good times and bad, it's a reasonable bet that we're all going to be Pipeline tourists. So, go with the flow. Learn the crucial acronyms, keep an eye out for what happens to all those US bases across the oil heartlands of the planet, watch where the pipelines are being built, and do your best to keep tabs on the next set of monster Chinese energy deals and fabulous coups by Russia's Gazprom.
And, while you're at it, consider this just the first postcard sent off from our tour of Pipelineistan. We'll be back (to slightly adapt a quote from Terminator). Think of this as a door opening onto a future in which what flows where and to whom may turn out to be the most important question on the planet.
Pepe Escobar is the roving correspondent for Asia Times Online and an analyst for the Real News. This article draws from his new book, Obama does Globalistan. He is also the author of Globalistan: How the Globalized World is Dissolving into Liquid War (Nimble Books, 2007) and Red Zone Blues: a snapshot of Baghdad during the surge. Pepe may be reached at pepeasia@yahoo.com.
(Copyright 2009 Pepe Escobar.)
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5 March 2009
China’s Surge: There’s Infrastructure and Infrastructure
March 4th, 2009
By David Goldman
My longtime colleague Uwe Parpart, now chief Asia strategist at Cantor Fitzgerald in Hong Kong, has argued all year that the Chinese economy will avoid recession thanks to aggressive intervention by the Chinese government. Today’s 6.2% surge in the Shanghai Composite in response to the likely increase in the existing stimulus package bears out the China bulls. This optimism has spilled over into commodity prices and raw materials stocks worldwide.
What’s the difference between infrastructure spending in China (stocks up 20% year to date) and infrastructure spending in the US (stocks down 20% year to date)? China needs infrastructure; the interior of the country remains horrifically backward and spending on infrastructure feeds rapidly into productivity, just as the huge infrastructure spend in the coast had a massive effect on productivity. The US could use some repairs, but putting a few hundred billion dollars into the hands of construction unions won’t change life in the United States.
The US was invited to take part in the $120 billion Asian currency stabilization fund created last month, and turned the opportunity down — again, epic stupidity on the Cecil B. DeMille scale (Ridley Scott for you youngsters). Stabilizing the dollar against the Chinese yuan (and prospectively against other currencies in the region) could be the first step in a Sino-American economic partnership.
Francesco Sisci, La Stampa’s Asia Editor, and I argued that America’s road to recovery ran through China last November:
Recovery requires a great change in direction of capital flows. For the past decade, poor people in the developing world have financed the consumption of rich people in America. America has borrowed nearly $1 trillion a year, mostly from the developing world, and used these funds to import consumer goods and buy homes at low interest rates. The result is a solvency crisis of the American household, which shows up as a solvency crisis for financial institutions. If we reckon the retirement needs of households as a liability, the household sector is as good as bankrupt.
No recovery is possible unless American households can save, and they cannot save in an economic contraction when incomes spiral downwards. To save, Americans must sell goods and services to someone else, and a glance at the globe makes clear who that must be: nearly half the world’s population, and most of the world’s capacity for economic growth, is concentrated in China and the Pacific Littoral.
China’s economic problem is the inverse of America’s: China has achieved fast rates of growth at the expense of huge disparities between the prosperous coast and the backward interior, as well as excessive dependence on foreign markets. China’s policy response to the economic crisis is far more radical than Washington’s. Rather than attempting to patch up the situation and restore the status quo ante, China plans to spend nearly a fifth of its gross domestic product on an internal stimulus focused on infrastructure in its interior. Severe execution risk attends the Chinese proposal, and markets remain to be convinced.
China can reduce the execution risk of its great economic shift towards home consumption, and America can solve its savings problem, through a grand partnership. This partnership need not be exclusive to America and China, but it must be founded on America and China, two of the world’s largest economies. India and the other Asian economies should be encouraged to join this partnership. A great deal has been written about prospective conflict between China and the United States, but very little explanation is offered as to what issues might arise between China and the United States. China and America have far more to gain from cooperation than from conflict.
link
By David Goldman
My longtime colleague Uwe Parpart, now chief Asia strategist at Cantor Fitzgerald in Hong Kong, has argued all year that the Chinese economy will avoid recession thanks to aggressive intervention by the Chinese government. Today’s 6.2% surge in the Shanghai Composite in response to the likely increase in the existing stimulus package bears out the China bulls. This optimism has spilled over into commodity prices and raw materials stocks worldwide.
What’s the difference between infrastructure spending in China (stocks up 20% year to date) and infrastructure spending in the US (stocks down 20% year to date)? China needs infrastructure; the interior of the country remains horrifically backward and spending on infrastructure feeds rapidly into productivity, just as the huge infrastructure spend in the coast had a massive effect on productivity. The US could use some repairs, but putting a few hundred billion dollars into the hands of construction unions won’t change life in the United States.
The US was invited to take part in the $120 billion Asian currency stabilization fund created last month, and turned the opportunity down — again, epic stupidity on the Cecil B. DeMille scale (Ridley Scott for you youngsters). Stabilizing the dollar against the Chinese yuan (and prospectively against other currencies in the region) could be the first step in a Sino-American economic partnership.
Francesco Sisci, La Stampa’s Asia Editor, and I argued that America’s road to recovery ran through China last November:
Recovery requires a great change in direction of capital flows. For the past decade, poor people in the developing world have financed the consumption of rich people in America. America has borrowed nearly $1 trillion a year, mostly from the developing world, and used these funds to import consumer goods and buy homes at low interest rates. The result is a solvency crisis of the American household, which shows up as a solvency crisis for financial institutions. If we reckon the retirement needs of households as a liability, the household sector is as good as bankrupt.
No recovery is possible unless American households can save, and they cannot save in an economic contraction when incomes spiral downwards. To save, Americans must sell goods and services to someone else, and a glance at the globe makes clear who that must be: nearly half the world’s population, and most of the world’s capacity for economic growth, is concentrated in China and the Pacific Littoral.
China’s economic problem is the inverse of America’s: China has achieved fast rates of growth at the expense of huge disparities between the prosperous coast and the backward interior, as well as excessive dependence on foreign markets. China’s policy response to the economic crisis is far more radical than Washington’s. Rather than attempting to patch up the situation and restore the status quo ante, China plans to spend nearly a fifth of its gross domestic product on an internal stimulus focused on infrastructure in its interior. Severe execution risk attends the Chinese proposal, and markets remain to be convinced.
China can reduce the execution risk of its great economic shift towards home consumption, and America can solve its savings problem, through a grand partnership. This partnership need not be exclusive to America and China, but it must be founded on America and China, two of the world’s largest economies. India and the other Asian economies should be encouraged to join this partnership. A great deal has been written about prospective conflict between China and the United States, but very little explanation is offered as to what issues might arise between China and the United States. China and America have far more to gain from cooperation than from conflict.
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21 December 2008
India suffers massive internet disruption after undersea cables break
More cables pulled by dragging anchors....when it comes to infastructure breakdowns it doesn't rain, it pours, apparently.
"(Monica M. Davey)
... or not, as it happens. India and Egypt have nothing to celebrate after huge internet disruption
Murad Ahmed, Technology Reporter
Tech Central: er, something's happening
Millions of people across the Middle East and Asia have lost access to the internet after two undersea cables in the Mediterranean suffered severe damage.
Huge numbers in Egypt and India were left struggling to get online as a result of the outage, when the major internet pipeline between Egypt and Italy was cut.
Internet Service Providers (ISPs) throughout the region, including those in United Arab Emirates, Kuwait and Saudi Arabia, also reported problems. International telephone calls, which have also been affected, are being rerouted to work around the problem.
Industry experts told The Times that two sub-sea cables went down just off Alexandra, causing the mass disruption. It happens to a single cable typically once a year, and companies have developed the fail-safe of redirecting traffic to a second cable should this occur.
“It is incredibly rare to experience a dual-break where both cables are down simultaneously,” said a spokesperson for Interoute, the internet networks company.
The Egyptian ministry said it will take “several days” for cables to be repaired and is trying to reroute Egypt’s internet connections.
Indian ISPs said their problems were due to the cable damage off Egypt. Speaking to reporters, Rajesh Chharia, president of the Internet Service Providers’ Association of India, said: "Information technology companies, software companies and call centres that provide online services to the UK or the US east coast are the worst affected."
Rafaat Hindy, from the Egyptian ministry, said: "Despite this being an international cable affecting many Gulf and Arab countries, we are closest to it and so we have a lot of responsibility.
"We are working as fast as we can."
It is thought that up to 70 per cent of web services in Egypt, and 60 per cent in India, were disrupted yesterday. There were reports that phone and internet difficults had spread to Yemen, Sudan, Bangladesh and Sri Lanka.
The shut down will take several days to fix, and could have a major impact on the region and across the world. It is likely to hit businesses who will struggle to communicate in the affected countires. Call-centres who work for British companies are likely to be offline or hard to contact in the coming days. Others warned that bank and stock market trading could be affected.
The digital blackout highlighted the vulnerability of global communications. Hundreds of millions of people access the web, but the vast majority of international traffic runs through a a small amount of cables submerged below the sea.
Industry insiders warned that a domino effect was occuring today, causing the disruption to spread across the globe. As companies’ private internet services went down, workers were forced to use the public internet and mobile phones to communicate. This has resulted in a heavy strain on phone and internet networks, meaning calls could go down and cause the internet to become slower or blackout completely."
link
"(Monica M. Davey)
... or not, as it happens. India and Egypt have nothing to celebrate after huge internet disruption
Murad Ahmed, Technology Reporter
Tech Central: er, something's happening
Millions of people across the Middle East and Asia have lost access to the internet after two undersea cables in the Mediterranean suffered severe damage.
Huge numbers in Egypt and India were left struggling to get online as a result of the outage, when the major internet pipeline between Egypt and Italy was cut.
Internet Service Providers (ISPs) throughout the region, including those in United Arab Emirates, Kuwait and Saudi Arabia, also reported problems. International telephone calls, which have also been affected, are being rerouted to work around the problem.
Industry experts told The Times that two sub-sea cables went down just off Alexandra, causing the mass disruption. It happens to a single cable typically once a year, and companies have developed the fail-safe of redirecting traffic to a second cable should this occur.
“It is incredibly rare to experience a dual-break where both cables are down simultaneously,” said a spokesperson for Interoute, the internet networks company.
The Egyptian ministry said it will take “several days” for cables to be repaired and is trying to reroute Egypt’s internet connections.
Indian ISPs said their problems were due to the cable damage off Egypt. Speaking to reporters, Rajesh Chharia, president of the Internet Service Providers’ Association of India, said: "Information technology companies, software companies and call centres that provide online services to the UK or the US east coast are the worst affected."
Rafaat Hindy, from the Egyptian ministry, said: "Despite this being an international cable affecting many Gulf and Arab countries, we are closest to it and so we have a lot of responsibility.
"We are working as fast as we can."
It is thought that up to 70 per cent of web services in Egypt, and 60 per cent in India, were disrupted yesterday. There were reports that phone and internet difficults had spread to Yemen, Sudan, Bangladesh and Sri Lanka.
The shut down will take several days to fix, and could have a major impact on the region and across the world. It is likely to hit businesses who will struggle to communicate in the affected countires. Call-centres who work for British companies are likely to be offline or hard to contact in the coming days. Others warned that bank and stock market trading could be affected.
The digital blackout highlighted the vulnerability of global communications. Hundreds of millions of people access the web, but the vast majority of international traffic runs through a a small amount of cables submerged below the sea.
Industry insiders warned that a domino effect was occuring today, causing the disruption to spread across the globe. As companies’ private internet services went down, workers were forced to use the public internet and mobile phones to communicate. This has resulted in a heavy strain on phone and internet networks, meaning calls could go down and cause the internet to become slower or blackout completely."
link
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