Page 362 - Sustainable Cities and Communities Design Handbook

Energy Economics in China’s Policy-Making Plan Chapter j 17 335

China’s economic and foreign policy behavior is increasingly influenced by
growing energy concerns. Andrew Chung, principal at Lightspeed Venture
Partners in Silicon Valley, notes that the Chinese increase in clean (green) tech
financing is reflective of the US drop: “First, a lot of the clean technologies are
dependent on policy and government support to scale up. In some other parts
of the world, you have more consistency in the way these types of funds are
appropriated” (SJBJ, 2011, p. 8). As the world’s second largest economy and
trading nation in 2010, China’s search for energy and its global strategies for
energy security have led to heavy debates and even in some cases have resulted
in political conflict. China is predicted by some economists and members of
the US Congress to be the #1 economy and trading nation within the next
decade (US Congress, 2011).
The Western nations have been expecting that ideally China’s energy
vulnerability might drive it toward cooperation with rival oil-consuming
nations through participation in multilateral organizations and other forums.
Since energy security is no doubt playing a more decisive role in Chinese
foreign policy, Beijing’s relations with both the existing major energy-
consuming powers and energy-exporting countries will shape its motivation
and justification on energy issues as well as on nonenergy issues.
In recent years, China’s “going-out” economic and foreign policy
encouraged its national oil companies (NOCs) to try to acquire some Western
oil companies, but still secure the control over access to some overseas energy
supplies including purchasing equity stakes in foreign oil companies (US
Congress, 2011). This strategy has been regarded as “mercantilist” in the West
and particularly in the United States where the attempt of a Chinese NOC to
buy out the American oil corporation UNOCAL in 2005 triggered political
backlash in the US Congress causing the final withdrawal of the Chinese
company. The incident indicates the lack of trust of the United States in
China’s energy diplomacy, because the US politicians felt that the Chinese
move was to undermine American energy security. Hence the US oil and gas
company Chevron bought UNOCAL.
In the studies of China’s energy security with its economic and foreign
policy, a number of geopolitically vital areas cannot be disassociated with
China’s efforts to maintain both energy security and good international relations
within these regions and with the major Western powers. China’s energy
diplomacy with the Middle East, Russia and Central Asia, the Asia-Pacific,
Africa, and Latin America has become a global topic, where Beijing’s efforts
toward greater energy security through multilateral organizations is discussed.
It is still too early to predict whether the world is to witness the evidence
supporting the liberal hypothesis that economic interdependence promotes
international cooperation, or confirming the realist conviction that competition
and power accumulation will eventually lead states to conflict and war, as
history has shown. Energy demand is seemingly accelerating China’s “peaceful”
rise to global prominence, and moderating the conflicting aspects of Chinese