Supervisors at a construction site, part of the Iraqi-Chinese “Oil for construction” project, on July 20, 2022 near Nasiriyah, in southern Iraq (AFP/Asaad NIAZI)
Rich in oil but poor in infrastructure, Iraq has become one of China’s strongholds, even shaking the privileged position of Westerners in the country by building with a vengeance, at the risk of ensnaring the Baghdad in debt.
Having been in Iraq for a long time, China has recently diversified its projects there as its own energy needs have soared.
After 40 years of war, Iraq has “an urgent need for foreign investment, especially in the field of energy infrastructure”, said John Calabrese of the Middle East Institute in Washington.
China is quick to break in: it became the first importer of Iraqi crude oil and now gets 44% of the 800,000 barrels of oil exported daily to Baghdad, according to Muzhar Saleh, adviser to the Prime Minister.
In southern Iraq, China’s Petrochina operates the Halfaya oil field with France’s TotalEnergies and Malaysia’s Petronas.
And “China is still in its infancy”, its ambassador Cui Wei recently insisted when trade exceeded 30 billion dollars in 2020, according to the Chinese embassy.
These exchanges embody “China’s ambition to reveal its potential, brighten its image and firmly anchor itself in a country dominated by the West, especially the United States”, Mr. Calabrese.
– “The Belt and the Road” –
Iraq is one of Beijing’s partners in its Belt and Road mega-project which aims to develop land and sea infrastructure to better connect China to Asia, Europe and Africa.
A construction site as part of the Iraqi-Chinese “Oil for Construction” project on July 20, 2022 near Nasiriyah in southern Iraq (AFP/Asaad NIAZI)
But the West sees this initiative as a tool for China’s influence on poor countries. They accused him in particular of inciting them into excessive debt, suspecting corrupt practices and criticizing the lack of respect for human rights.
A spokesman for the Chinese Ministry of Foreign Affairs assured AFP that “China is actively participating in the reconstruction of the Iraqi economy”. Baghdad, he continued, is an “important partner” in the “Belt and Road”.
A construction site as part of the Iraqi-Chinese “Oil for Construction” project on July 20, 2022 near Nasiriyah in southern Iraq (AFP/Asaad NIAZI)
Within this mega-project developed by 21 Arab countries for billions of dollars, Iraq remains China’s “third most important partner” in the field of energy between 2013 and 2022, said Christoph Nedopil of the Center for Green Finance and Development at Fudan University in Shanghai.
To take advantage of the infrastructure construction windfall, China signed an agreement with Iraq in 2019 called “Oil for construction”.
In Nassiriya (south), for example, the Power China group built a school. It is one of two Chinese companies chosen by Baghdad — along with Sinotech — to build a thousand schools in two years. Eventually, 8,000 schools and an airport should see the light of day.
– Mandarin lessons –
“Oil for construction” projects are paid for by Iraq by selling to China 100,000 barrels of oil per day.
A Chinese lesson in Erbil, capital of Iraqi Kurdistan, on July 20, 2022 (AFP/SAFIN HAMED)
The resulting income should be used to finance projects carried out by Chinese companies.
Chinese companies should, in turn, use Iraqi companies that “provide labor and raw materials”, explained Haider Majid, spokesman for the Iraqi Prime Minister’s secretariat.
But Yesar Al-Maleki, a researcher at the Middle East Economic Survey, warns: “most of these subcontractors are not well-known”. And to stir up “rumors about their political affiliation and therefore the risk of corruption”.
The risk, he continued, is that the Iraqis “abuse” the “Oil for construction” for “useless projects”. “They will find themselves in debt, like many African countries,” he said.
China also attracts Iraqis who want to do business there. The Iraqi-Chinese Friendship Association understands this well: recently, it offers Mandarin lessons.
A Chinese lesson in Erbil, capital of Iraqi Kurdistan, on July 20, 2022 (AFP/SAFIN HAMED)
Sajjad al-Kazzaz, a teacher, learned the language while studying in China. “When I returned to Baghdad, I realized that many people wanted to learn Chinese,” he explained.
Most of his students are businessmen, like Laith Ahmed who imports electronic devices from China.
“When I went there, I had a hard time communicating because most Chinese people don’t speak English,” he told AFP.
So, without waiting, he took the Mandarin. An investment that has already paid off, he said, because “Chinese products are flooding the Iraqi market”.
© 2022 AFP
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