Deng Xiaoping once said that "development is the hard truth." Yet at a program held by the China Environment Forum and Canada Institute, Victor Gao of the China National Association of International Studies suggested that China's new slogan should be: "green development is the hard truth, the soft truth, and the only truth." However as the panelists went on to discuss, China continues to rely to a large extent on both domestic and imported fossil fuels to meet its growing demand for energy, causing the country's global eco-footprint to escalate. The program explored China's current global energy strategy and ecological impact in its resource extractive business activities in Canada, the Congo, and Cambodia.
Wenran Jiang, associate professor of political science, University of Alberta, and Woodrow Wilson Center public policy scholar, discussed the complex world of Chinese investment in Africa, beginning with an explanation of the internal drivers of Chinese international expansion. With massive internal growth and an export centered economy, China's demand for natural resources has far outpaced its domestic supply. This has forced China to seek resources beyond its borders, particularly in accessible, developing countries. Jiang highlighted Chinese investment in the copper industry of the Democratic Republic of Congo (DRC) as a prominent example of China's pursuit of resources abroad.
The DRC contains 80 percent of global copper reserves and in the late 1990s copper prices rose sharply. This prompted thousands of small to medium privately-run Chinese smelting operations to move into the country. These companies have little to no association with the Chinese government and Jiang compared the explosion of Chinese copper smelters to the wild west in that any existing rules to regulate pollution or decrease social impacts were generally ignored and bribes to local officials were commonplace. Standardized emission levels for smelters were rarely implemented, specifically in the case of small and privately run smelters.
In the wake of the global economic decline, many smelters were simply being abandoned as copper prices fell and mining became less profitable. There has been absolutely no cleanup, environmental or otherwise. Although Chinese smelters are often a very dirty industry, Jiang noted that the DRC is in such great need for jobs and any investment that there is little domestic pressure to regulate even the dirtiest smelters. Even local citizens he interviewed queried "We need jobs, roads, food, what do you mean environment."
Terry Parnell of the East-West Management Institute spoke on the ecological impact that Chinese timber companies have had in Cambodia, where China is the largest investor and international aid partner. Chinese investment has helped develop a positive relationship between the two countries, leading the Cambodian government to consider China its most trustworthy international partner. As such, Cambodia has allowed Chinese companies significant timber concessions throughout the country.
While providing some employment, timber cutting has largely had a negative effect on Cambodia; it has constrained the ability of forests to absorb carbon and has left the country more prone to flooding in several areas. The loss of large swaths of Cambodian forest have had global ramifications as they are among the largest natural carbon reservoirs in the world. Locally, the loss of biodiversity and soil fertility have devastated local populations that depend on forest resources to survive.
Turning to Canada
Victor Gao discussed Chinese investments in international oil and gas resources, particularly in Canada's oil sands. Gao coined the term "Chinada" to illustrate how both countries would mutually benefit from a closer economic and energy partnership. China needs resources and Canada needs markets for its resources, Gao explained. Reiterating some of Jiang's earlier points, Gao stated that China's desire to become involved in international energy sources stems from rapidly increasing energy demand driven by remarkable internal growth.
Although China may have significant local sources of coal, railway transport is highly congested and the Chinese government has thus expanded coal and oil imports to supplement energy shortfalls. China imports 50 percent of its oil and this number is expected to grow to 65 and then 70 percent over the next decade. This increasing oil hunger explains why China has a strong interest in becoming involved in energy markets in Canada.
This is why China has a strong interest in becoming involved in energy markets in Canada. As for the environmental aspects, Gao simply stated that climate change is a global issue that everyone needs to address, but balancing climate change with energy demands will be a tricky task for all countries. Gao closed by stating that as China's energy demands continue to increase the relationship between Canada and China can only grow stronger.