Energy Security and Foreign Policy
On 9-10 December 2010, RSIS Centre for Non-Traditional Security (NTS) Studies held a regional workshop on dealing with energy vulnerabilities in East Asia. One issue frequently mentioned by the participants during the workshop was China’s surging energy demands and its implications for both the country itself and the region at large. China’s increasing dependency on energy imports has become a major concern for Chinese policy makers. As a result, the need to secure its energy supply represents an important aim of Chinese foreign and security policy.
China’s impressive economic growth has fueled its appetite for all sorts of natural resources, among which the demand for energy is growing exceptionally fast. During the workshop, Mr Kensuke Kanekiyo, research advisor and former managing director of IEEJ, forecasted that ‘China will soon become the single largest energy consuming country in the world. By 2035, China’s energy demand will be triple the amount demanded in 2008. With regard to the energy mix of China, coal is the predominant energy source, which accounted for 70% of the country’s energy consumption in 2009. China is the largest coal producer and reserve-holder, which means it can generally strike a balance between the supply and demand of coal. However, in terms of oil – the most important strategic energy resource, China became a net oil importer since 1993. The lack of oil reserves implies that China has to turn to those oil rich countries for oil supply, such as Sudan.
Valerie Hudson (2007) argues that natural resources, or the lack of it, may play a role in foreign policy. In the case of China, its reliance on foreign energy sources has partly shaped its policy toward its suppliers. The Chinese oil company CNPC holds substantial amount of stake in several of Sudan’s major oil fields. It bought 2/3 of Sudan’s oil export. The oil pipeline from Kyaukpyu Port through Burma to southwest China cuts the costs for transmitting crude oil from the Middle East and Africa. The need to secure energy supply has made China very cautious and conservative in dealing with its relationship with Sudan and Myanmar. It vetoes most of the Security Council resolution against the two countries.
Cooperation in the energy sector can also contribute to improved bilateral ties. China, Japan, and South Korea, are now competitors in the energy market. It was noted in the workshop however that the three neighbors are in fact complimentary to each other. China has a huge consuming market, while Japan and South Korea possess advanced technologies in nuclear and renewable energy. The potential for cooperation is enormous. Furthermore, greater interdependence in energy can also contribute to easing the historical mistrust between them.
In conclusion, energy security and foreign policy are mutually interlinked. On one hand, it helps shape the foreign policy aims of the country, while on the other it serves as a catalyst for improved relations between countries.
