The Great Game Changer: Belt and Road Intiative (BRI; OBOR)

[TaiShang]

China to Launch 30 Beidou Satellites in Next 5 Years
(to cover countries on the Belt & Road Initiative, OBOR)
2016-05-19 20:22:52 Xinhua Web Editor: Guan Chao

A computer-simulated image shows China’s Beidou navigation satellite system. [Photo: baidu.com]

China plans to launch 30 Beidou navigation satellites during the 13th five-year plan period (2016-2020), capping its three-step strategy to build a global navigation system by 2020.

The first batch of 18 satellites will be launched before 2018 to cover countries along the routes in "the Belt and Road" initiative, said Ran Chengqi, director of the China Satellite Navigation Office, during the China Satellite Navigation Conference, which opened on Wednesday.

After having achieved the first two steps -- building a regional functional navigation system by 2012, the accuracy and stability of the Beidou system must be improved, said Ran, adding international cooperation will also help the nascent navigation system.

Aside from announcing satellite navigation cooperation with the United States, China and Russia have agreed to make the Beidou and Glonass satellite navigation systems compatible with each other, said Ran.

He added that Beidou also successfully synchronized its frequency with the Galileo navigation system operated by the European Union.

Ran said China will detail the development ideas and proposals of the Beidou system in a white paper, which is expected to be released soon.

The white paper also elaborates on how Beidou will work with the International Civil Aviation Organization and International Maritime Organization to bring benefits to the world, according to Ran.

"To let the whole world know about Beidou, understand Beidou and use Beidou, we still have much technical and coordination work to do," he said.

 

[TaiShang]

The 'Petroyuan' Is the Big Bet of Russia and China

The two BRICS giants are leading the world in 'de-dollarization'

Ariel Noyola Rodriguez
(Voltairenet)
Fri, May 20, 2016 |

Originally appeared at Voltairenet.

In place of humiliating Russia, the “economic war” that Washington and Brussels had promoted was counterproductive, since it only contributed to fortify the energy team between Moscow and Beijing. We recall that in May of 2014 the Russian company Gazprom agreed to supply gas to China up to 38 billion cubic meters annually during three decades (starting in 2018) through the signing of a contract for 400 billion US dollars with the China National Petroleum Corporation (CNCP) [1].

At the present time both powers coordinate the work of an ambitious plan of strategic projects that include the construction of gas and oil pipelines as well as the combined operation of refineries and large petrochemical complexes. Without proposing to do so, the coming together of Moscow and Beijing has produced deep changes in the world oil market in favor of the Orient, dramatically undermining the influence of Western petroleum companies.

Even Saudi Arabia, that until recently was the principal supplier of petroleum to the Asian giant, has been undermined by Kremlin diplomacy. While from 2011 the petroleum exports of Saudi Arabia to China were growing at a rhythm of 120 billion barrels per day, those of Russia grew at a velocity of 550 billion barrels per day, that is to say, almost five times more rapidly. In fact, in 2015 the Russian companies managed to overcome the sales of petroleum from the Saudis four times: Riyadh had to conform with being the second provider of crude to Beijing in May, September, November and December [2].

It is worth noting that the countries that make up the European core have also seen their share of the market diminished in the face of the Asian region: Germany, for example, was supplanted by China at the end of 2015 as the greater buyer of Russian petroleum [3]. In this way, the great investors operating in the world oil market can hardly believe how, in a few months, the principal purchaser (China) became the favorite client of the third major producer (Russia). In accord with the Vice-President of Transneft (the Russian company charged with the implementation of national oil pipelines), Serge Andronov, China is disposed to import a total volume of 27 million tones of Russian petroleum during 2016 [4].

The Russian-Chinese energy alliance is proposed to go longer. Moscow and Beijing have made their interchanges of petroleum a channel of transition towards a multipolar monetary system, that is to say, a system that is no longer based on the dollar alone, but takes into account various currencies and above all, that reflects the correlation of forces in the current world order. The economic sanctions imposed by Washington and Brussels drove the Russians to eliminate the dollar and the euro from their commercial and financial transactions, since otherwise, they would be too exposed to suffer sabotage in the moment of realizing buying and selling operations with their principal trading partners.

For this reason, from mid-2015, the hydrocarbons that China buys from Russia are paid in yuans, not in dollars, information that has been confirmed by high executives of Gazprom Neft, the petroleum branch of Gazprom [5]. This has lead to the use of the “people’s currency” (‘renminbi’) in the world oil market and at the same time allows Russia to neutralize the economic offensive launched by the United States and the European Union. The underpinnings of a new financial order supported by the petroyuan is emerging: the Chinese money is preparing to become the axis of commercial exchanges of the Asian-Pacific region with the principal petroleum powers.

© David Manrique
Today Russia realizes its interchanges of petroleum with China in yuans, in the future the Organization of the Petroleum Exporters Countries (OPEC) will do the same if China demands it. Or will the cult of Saudi Arabia for the dollar make them lose one of their principal clients? [6] Other geoeonomic powers have already followed the path of Russia and China, since they have understood that in order to establish a more balanced monetary system, the “de-dollarization” of the world economy is a priority.

No less important is that after the fall of oil prices, more than 60% (from mid-2014), the Chinese banks have become a decisive financial support for the joint energy infrastructure works. For example, to establish as soon as possible the Russian-Chinese gas pipeline “Force of Siberia”, Gazprom requested from the Bank of China a five-year loan for an amount equivalent to 2 billion euros this past month of March [7]. This is the greatest bilateral credit that Gazprom has contracted with a financial institution to date. Another example is the loan that China gave Russia some weeks ago for a total of 12 billion US dollars for the Yamal LNG project (for liquefied natural gas) in the Arctic region [8]. Obviously, the foreign policy of Russia in energy have not lost any strength due to isolation, on the contrary, it is now enjoying its best moments, thanks to China.

In conclusion, the hostility of the leaders of the United States and the European Union against the government of Vladimir Putin has precipitated the strengthening of the Russian-Chinese team that at the same time has only increased the weight of the Orient in the world market of hydrocarbons. The great bet of Moscow and Beijing is the petroyuan, the strategic instrument of payment that brings with it a challenge to the dominion of the dollar in the fixing of prices for black gold.

@vostok , @Chinese-Dragon , @AndrewJin , @Jlaw , @Kiss_of_the_Dragon , @cirr , @ahojunk , @WSHH , @dy1022 , @rott et al.

 

[ahojunk]

One truth - whatever you do, if you exclude the biggest or second biggest player in the world, your plan will not be successful.

China is now the biggest consumer of petroleum. I believe Russia is the second biggest producer and the biggest outside of OPEC. The Saudi are now not able to dictate the price of petroleum any longer. China as the biggest consumer is in a better position to dictate the price as it is now buying from multiple big suppliers.

In the past, when Saudi reduce production, the price of petroleum will go up. However, if they do it now, they will lose market share, so it's not in their interest to do so. The market dynamics has changed.

The Americans and the Europeans in their haste to sanction Russia forgot to nicely ask China whether it was a good idea.
Oh, it is little late now.

==========
Oh! that reminds me of TPP.

Q: What is the chance of success of TPP as it is excluding the biggest player in the world?
A: None, zip, zero. A big fat chance!

Also, I believe neither Trump nor Hillary are too keen on TPP too.

 

[Beast]

China buys Russia oil and paid in Yuan. Russia uses Yuan to buy Chinese goods since China is the world factory producing almost all commercial available. Its a win plus jackpot for China.

I notice Aliexpress Russian website is filled with large number of Russian customers.

 

[jhungary]

Petroyuan would probably destabilise Yuan first, before any damage done to US dollar.

Yuan need currency reform to be used to anchor anything, the more it uses Yuan, the more it will make it unstable as more currency flow, now imagine what would Russian feel if Russian sold China oil and gas and got paid by RMB, and Chinese government done a devalue like they did in q3 2015?

Country trade with RMB today usually used USD as a guarantor (As in holding the same amount in USD to exchange with RMB), which mean the more yuan is used internationally, the more USD trade, and in fact, petro yuan did not destabilise dollar, in fact, they were strengthening dollar as world reserve currency. It jump from 63% on 2014, to 64.7 in 2015.

 

[Beast]

Petroyuan would probably destabilise Yuan first, before any damage done to US dollar.

Yuan need currency reform to be used to anchor anything, the more it uses Yuan, the more it will make it unstable as more currency flow, now imagine what would Russian feel if Russian sold China oil and gas and got paid by RMB, and Chinese government done a devalue like they did in q3 2015?

Country trade with RMB today usually used USD as a guarantor (As in holding the same amount in USD to exchange with RMB), which mean the more yuan is used internationally, the more USD trade, and in fact, petro yuan did not destabilise dollar, in fact, they were strengthening dollar as world reserve currency. It jump from 63% on 2014, to 64.7 in 2015.

I thought you wish the dollar collapse and you can forgot your housing debt?

 

[jhungary]

I thought you wish the dollar collapse and you can forgot your housing debt?

Sometime you don't get what you wish for, plus, we still have 6 days to go, so it's hard to say

 

[TaiShang]

China is now the biggest consumer of petroleum. I believe Russia is the second biggest producer and the biggest outside of OPEC. The Saudi are now not able to dictate the price of petroleum any longer. China as the biggest consumer is in a better position to dictate the price as it is now buying from multiple big suppliers.

In the past, when Saudi reduce production, the price of petroleum will go up. However, if they do it now, they will lose market share, so it's not in their interest to do so. The market dynamics has changed.

Very well explained. It is a promising sign that imports from Saudi Arabia (Middle East in general) have been leveled for a while whereas Russia climbed as China's largest crude source. When the gas deal becomes online in 2018, a similar dynamic will take place with respect to natural gas. Rendering KSA insignificant is going to put another nail on the USD coffin.

The Americans and the Europeans in their haste to sanction Russia forgot to nicely ask China whether it was a good idea.
Oh, it is little late now.

Sanctions on Russia have proven to be a losing game. Sadly, EU has to suffer because their sovereignty has been arrested by the US. Japan, smartly, was able to foresee what is upcoming and defied US sanctions. Sanctions not only pushed China-Russia closer, it also convinced Russia to be more on China's side in SCS territorial dispute.

US was unlikely to coerce China into anything it does not wish to do in SCS, and now with Russia's explicit support at the highest level, it has become even less likely.

Thankfully, what Middle East did from 2000-2008, East Europe has been doing since 2013-14--digging holes under the US feet as it clumsily structures irrational foreign policy.

 

[dy1022]

China wins again !!!

 

[Chinese-Dragon]

Sanctions on Russia have proven to be a losing game.

Sanctioning Russia was the stupidest thing I have ever seen. Even more stupid than invading the entire Middle East and North Africa region in one decade.

Russia won't forget these sacntions from America, not in a thousand years.

 

[TaiShang]

Sanctioning Russia was the stupidest thing I have ever seen. Even more stupid than invading the entire Middle East and North Africa region in one decade.

Russia won't forget these sacntions from America, not in a thousand years.

I was very concerned when Medvedev pressed the reset button along with Hillary. That was one point I felt really stressed in terms of larger geopolitics of Greater China.

Luckily, history found its right course; pitting the US against Russia in such a way that created a greater psychological chasm between US regime and our Russian partners than the entire Cold War.

During Cold War, if not the Soviet elite, a considerable size of Russian population had a favorable view of the Western regimes, if not explicitly, under countless Western regime propaganda. Hence, USSR was weaker ideologically and in terms of information warfare.

Russia is a different beast today in terms of global information and agenda making. That's one great man; I guess everything starts and ends with leadership. It is make or break for a country.

We need to be thankful to dialectical forces that brought two great statesmen, Mr. Xi and Mr. Putin, together at the same historical moment whereas, on the other side, there was first Bush and his religious fanatics and then Obama and his (although I believed Obama's initial sincerity) Asia-Pacific fascists.

It is just great. As you say, really, the US has made itself entirely irrelevant in the Eurasia by making a perfect enemy from Russia.

@vostok

 

[jhungary]

One truth - whatever you do, if you exclude the biggest or second biggest player in the world, your plan will not be successful.

China is now the biggest consumer of petroleum. I believe Russia is the second biggest producer and the biggest outside of OPEC. The Saudi are now not able to dictate the price of petroleum any longer. China as the biggest consumer is in a better position to dictate the price as it is now buying from multiple big suppliers.

In the past, when Saudi reduce production, the price of petroleum will go up. However, if they do it now, they will lose market share, so it's not in their interest to do so. The market dynamics has changed.

The Americans and the Europeans in their haste to sanction Russia forgot to nicely ask China whether it was a good idea.
Oh, it is little late now.

==========
Oh! that reminds me of TPP.

Q: What is the chance of success of TPP as it is excluding the biggest player in the world?
A: None, zip, zero. A big fat chance!

Also, I believe neither Trump nor Hillary are too keen on TPP too.

Umm, no........

US Oil consumption is standing at 19 million barrel per day in 2015. China is touching 13 millions barrel a day, The reason why US import less than China is because US produced a lot more than China

And no, if any trade pact would not work without the biggest market in the world, then all Chinese Free trade pact would not work as they did not include US in it, which is as of now, the Biggest Economy in the world.

 

[rott]

China is now the biggest consumer of petroleum.

Buddy, can you provide a link?

 

[TaiShang]

Buddy, can you provide a link?

I think it is still the second largest, with a daily consumption of about 9 million barrels. The US consumes about 14 million barrels. That's right from my memory, figures might be a little higher or lower.

China, however, is the largest importer. It is also the largest consumer of energy.

 

[S10]

Even with cheap oil and plentiful suppliers, China should start reducing its requirement for oil and seek more alternative energy. For one, the pollution and carbon produced by burning of fossil fuel is killing the environment.