The oil trade between China and Angola
Name:Zhao Juan Student ID:s07332
Research paper supervisor:Dr.Seku Conde
Minzu University of China
2007-2008 Academic Year
Abstract: In this paper, the topic is about the oil trade between China and Angola. As we know, Africa is very large, it includes five parts: North Africa, South Africa, East Africa, West Africa and Central Africa. In Africa, there are about 20 oil production countries, the oil output of Nigeria、Algeria、Libya、Angola and Egypt accounts for about 84 percent of the total output of Africa. And Angola is the new member of OPEC and it is the second-largest oil production countries in sub-Saharan Africa after Nigeria. Today, Angola is china’s most important partner on the African continent and it is the largest source of Chinese crude oil imports. Also, there is a friendly relationship between China and Angola since the civil war. And China gives their aid to the restructure of Angola after the civil war. So there is a long relationship between the two countries. But different people and countries have different views about the oil trade between China and Angola which are based on their own benefits. After the analysis, I think we should take an opening view to the oil trade between the two countries. From the world view, the oil trade between China and Angola and the energy cooperation between China and Africa are mutually influences and are the model of the win-win policy in China and Africa.
Keywords: oil trade, oil production, win-win policy
Introduction: In this paper, I will talk about the oil trade between China and Angola. The paper consists of four parts. In the first part, it is about the oil production in Africa, especially in Angola. By right of the abundant reserves and the predominant geography location, Africa has become a very important role to influence the contrast of the force between different oil production countries and also become a new battlefield for the international oil magnate to competition. At the same time, Angola is the second-largest oil production countries in sub-Saharan Africa after Nigeria and it is the most important partner of China in Africa. So the Africa absorbs many countries to investment and competition. In the second part, it is about the development of the oil trade between China and Angola. In January 12th 1983, China and Angola found the foreign relations. After the civil war of Angola in 2002, the bilateral relations of the two countries enter into a new developmental phase. China gives their aid to Angola government and enterprises in order to help Angola’s reconstruction. In the third part, it is about the different views toward the oil trade between the two countries. Some countries think that the oil trade between China and Angola is benefit to the development of Angola and the Africa, not only for the economy development but also for the political stabilization and the development of the whole world. However, some countries and people have the opposite views. They think that what is China done to Angola is due to its own benefit, such as improve its international status and get the sustain from African continent. The entire parlance is based on its own benefits. After the analysis, I give my recommendation about this topic. From the world view, the oil trade between China and Angola and the energy cooperation between China and Africa are mutually influences and are the model of the win-win policy in China and Africa. Both the two countries can benefit from the cooperation, not only the economic development but also the political status. So we should take an opening view to the development of the two countries, especially during the oil trade.
The oil production in Africa, especially in Angola
During these years, with the roily situation of Middle East, the participation of the west force such as American, the demand of the oil for the world market and the shortage of the supply of the oil, the price of crude oil in the international market is always very high. “The price of every barrel is from 25 dollars average in 2001 to about 65 dollars in 2006.” [1]In order to guarantee the supply of crude oil and realize the diversification of the oil production, all the oil consumption countries put their eyes to Africa. By right of the abundant reserves and the predominant geography location, Africa has become a very important role to influence the contrast of the force between different oil production countries and also become a new battlefield for the international oil magnate to competition.
As we know, Africa is very large, it includes five parts: North Africa, South Africa, East Africa, West Africa and Central Africa. In Africa, there are about 20 oil production countries, the oil output of Nigeria、Algeria、Libya、Angola and Egypt accounts for about 84 percent of the total output of Africa. West Africa is one of the fastest-growing oil production regions in Africa and Mauritania, Mali and Niger will be among the list of oil producers in the next few years. “In Africa, the oil was first found in Algeria and Nigeria in 1956, according to the World’s Energy Statistics Data published on June 2007, up to the end of 2006, the oil reserves in all the countries of Africa was 117.2 billion barrels, which was just inferior to Middle East and Europe and in the third place in the world. According to the new materials, up to the end of 2006, the daily output of crude oil in African continent was about 9.99 million barrels, which accounted for 12.1 percent of the world oil production. And in the next five years, 25 percent of the oil output in the world will come from Africa.”[2]
As the new member of the OPEC (The Organization of Petroleum Exporting Countries), Angola is the second-largest oil production countries in sub-Saharan Africa after Nigeria. “Angolan government estimates that in 2008 the Angolan oil production will double in 2008 than in 2006, from 1 million barrels every day to 2 million barrels every day.”[3] Angola is moving to the world major oil-producing countries as its goal. “Their oil reserves which have been proved up are about 12.3 billion barrels.” [4]In the next ten years, Angola will compete the status of the largest oil production country in Africa with Niger. Angola is moving in the world major oil-producing countries of the goal.
Angola’s oil exploration and production activities began in the early 21st century; its crude oil output was less than 100,000 barrels every day until the 1970s. In 1975, Angola got rid of the colonial rule from the Portuguese and obtained national independence. Then Angola declared that all oil resources are owned by the State and issued a petroleum law, and then established the Ministry of Oil and the state oil company. This provides a legal guarantee to attract more foreign oil companies to enter Angola and then Angola’s oil industry is developing rapidly.
The oil producing areas in Angola are mainly distributed in the sea and under the control of the government, the oil production is less interference and the output of crude oil increased rapidly despite the continuous war in Angola. “To the beginning of this century the oil production has reached 800,000 barrels a day. From the 1980s, the Angolan oil exploration and exploitation activities gradually transferred to the deep sea areas and added its concession areas of marginal sea areas to 34.”[5] By 1990s, in Luanda and Kwanza, south of the estuary waters and Benguela Gulf waters, rich reserves of oil and oil fields were found constantly.
“The oil and gas industries, both considered highly promising, have attracted over $20 billion in foreign direct investment since 2003. The economy of Angolan is highly dependent on its oil sector, which accounts for over 40 percent of gross domestic product (GDP) and almost 90 percent of the government’s revenues.”[6]
The development of the oil trade between China and Angola
In January 12th 1983, China and Angola found the foreign relations. And after the foundation of the foreign relations between the two countries, the friendly cooperation relations of the two countries is growing fast, the cooperation and communication in every area is extending quickly. And during the international and regional affairs, the two countries keep favorable negotiation and cooperation too. In June 2006, the premier of Wen Jiabao visited Angola successfully, which was the first time of the China’s premier who gave a visitation to Angola after the foundation of the foreign relations of the two countries. And in November, the premier of Fernando of Angola which leads his group participated in the Beijing Summit of Forum of China-Africa Cooperation. The exchange visits of the two countries play an important role to the development of the two countries. After the civil war of Angola in 2002, the bilateral relations of the two countries enter into a new developmental phase.
2002, Angola’s civil war which was lasted for 27 years ended. During the war, there were about 500 thousand people dead and most of areas in the country became into in ruins. Frequently hampered by the war [...]
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