Saturday, February 11, 2012

Cloaks & Daggers From Beijing To Tehran, Washington To Ottawa And Even Unto Kitimat.

(Monday's Ottawa Citizen version of this blog post here & National Post version here)

My column in Saturday's Ottawa Citizen offers just a glimpse into the perilous territory where Ottawa’s clever China enthusiasts have led us lately. The column starts out with the unsettling tale of Huawei Technologies Co. Ltd., of the Special Economic Zone of Shenzhen, in the Chinese province of Guangdong. It's pretty well all straight reportage. Here's some of the backstory.

The column goes into how it is that in the United States, the State Department has just begun an investigation into charges that Huawei has broken the 2010 U.S. Comprehensive Iran Sanctions law. In Canada, Huawei's clients include Telus, Bell Canada, Wind Mobile and Sasktel. In Iran, Huawei’s partners in Zaeim Electronic Industries count the Khomeinist regime’s defence ministry and the Iranian secret police on their client list, along with the fanatical and violently pro-regime Islamic Revolutionary Guards Corps.

I've always thought it was odd that the Islamic Revolutionary Guards Corps is considered a terrorist entity in the U.S., but not in Canada. Very odd. But to be even clearer than I had space to make it in today's column, I'm an agnostic on the whole question about whether Huawei is a conduit for Chinese spies or whether anyone in the company has violated American sanctions laws on Iran. If I wasn't clear enough, my heart goes out particularly to Huawei's 400-plus Canadian workers who've had to put up with suspicions about the telecom giant's global operations. In India not long ago there were even nasty allegations that Huawei technology was finding its way into the hands of the Taliban.

But getting investigated is one thing, and getting busted is another. This brings us to the Beijing money behind the proposed $6.5 billion Enbridge pipeline from Alberta's oilsands to awaiting supertankers at Kitimat. That money brings us to Sinopec, also known as the China Petroleum & Chemical Corporation, and if there are suspicions Ottawa would like to clear up a good place to start would be to let everybody in on where all of Enbridge's up-front pipeline cash is coming from. We're not allowed to know. Seriously. Try asking Enbridge some time.

Another thing that has never been clearly explained is why Ottawa thinks Sinopec is suddenly Canada’s lifeline to economic prosperity in China. I can't find anyone who knows anything about the oilsands who thinks so. Inconveniently, Sinopec is also the Khomenist regime's lifeline to a nuclear bomb. I can't find anyone in the oil industry or anywhere else who doesn't think so.

I report in my column that Sinopec is the biggest buyer of Iranian oil, directly and through its subsidiary Unipec, and also via its main Iranian oil buyer, Zhuhai Zhenrong. I merely report that only last month the State Department busted Zhuhai Zhenrong under the 2010 Comprehensive Iran Sanctions law. Zhuhai Zhenrong immediately went looking for greener pastures. One of the first places it started looking was Alberta's oilpatch. Howdy, neighbour.

But there's a whole lot more to this. For starters: Sinopec Engineering Inc. is deeply integrated within Iran's energy infrastructure, in oilfield operations, refineries, and gas plants. So is, just for instance, the Islamic Revolutionary Guards Corps. The IRGC has lately been scrambling like crazy to cover its ownership and control over huge Iranian energy-sector enterprises and construction monoliths like Oriental Oil Kish, Sahel Consultant Engineering, and Khatam al-Anbia.

Let's give our heads a shake for a moment, shall we? No matter what the Americans want, and no matter what Beijing might say, Beijing has been crystal clear that it is opposing sanctions. And besides, Chinese oil giants aren't going to give any backchat to President Mahmoud Ahmedinejad when he instructs them that the price of doing business in Iran's energy sector includes the costs of circuitous arrangements with Revolutionary Guardsmen who show up to meetings in business suits. And more besides, that's exactly the way business is done back in Beijing anway.

When Communist Party bigshot Su Shulin was appointed Sinopec chairman, it wasn't considered a blot on his record that he'd amassed troops to mobilize against the thousands of Daqing Oilfield workers he'd stiffed out of backpay in 2002, or that he'd seen to it that western journalists were kept away during the whole thing. Last year, the party reassigned Comrade Su to take a firm hand in the riot-prone province of Fujian. He's governor there now.

The politburo only recently reassigned Zhou Yongkang from his job as president of China National Petroleum to the top command post of Minister of Public Security, where he immediately set about the work of ramping up internet censorship. Just this week, Comrade Yongkang is busy shooting Tibetans.

It should go without saying that you need to give your head another really big shake if you have actually bought into the new party line in Canada that Beijing's state-owned and party-commanded entities are uninterested in politics and will behave according to strictly "commercial" motives. As if there is a difference in those upper echelons anyway. It is a foundational operating principle at the very core of the thing that still calls itself the Chinese Communist Party that no distinctions are to be tolerated between commerce and politics.

Washington reckons that if Beijing-owned conglomerates like Sinopec and Zhuhai Zhenrong and their various subsidiaries and intermediaries and trading arms and clients are allowed to banjax the U.S.-led sanctions against Iran, then it will mean war, maybe as soon as April. The last big play before war would be a Euro-American oil embargo. The one thing that would cost Sinopec even more dearly than effective sanctions is an oil embargo.

So far, it hasn't mattered much that Tehran is losing oil customers every day, because Sinopec has been happily picking up the slack (thanks, friend). The business wires have been buzzing with reports about the ways Beijing has been signing contracts and making big spot-buys for Saudi oil to put the big squeeze on Iran, hoping the ayatollahs will cave in and cough up major discounts. We are meant to find all this just fascinating. And it is, truth be told. It also doesn't change a thing.

Canada talks tough on sanctions, and so to handle any impudent questions about Sinopec and Enbridge, a deft spin is required. Here's the latest: Wouldn't you rather have China buy Canadian oil than Iranian oil? It's a dodge that is crafted to take your eye off the fact that life simply doesn't work that way. Canadian oil doesn't compete with Iranian oil for China's affections. Oil markets don't work like that, and neither do the laws of logic or physics or economics. If Canada surrendered every last drop of its vast bitumen resources to China for free, Beijing will still want Iranian oil. It wouldn't change a thing.

Here's a question that changes the subject back to what we were talking about. If Canada is suddenly happy to sit down with the degenerate thugs in command of the Chinese Communist Party to conclude trade pacts that are enforceable here in Canada, why should Canada scruple about doing a little business with the degenerate thugs in command of Tehran's Party of God?

The other thing about the "Wouldn't you rather have China buy Canadian oil?" question is that the pro-Beijing lobby in Canada has formally allowed it as a "legitimate" question we might ask. Well, how too generous of them. Try asking how the hell one of Beijing's overseas energy-acquisition syndicates ended up with a deciding-vote seat at the board table of Canada's oilsands giant Syncrude. Try asking why the Investment Canada Act was amended in 2009 to make that kind of move not just perfectly legal but beyond the bounds of a proper regulatory review.

Ask questions like that and they'll call you a Sinophobe. Getting quarantined in this way is not as bad as getting hauled up on an unanswerable subversion warrant in Beijing for writing a poem that might offend President Hu Jintao (come to think of it, you can end up in prison in Iran for writing the same sort of poem), but the Asia-Pacific Foundation of Canada is counting on that kind of disgusting innuendo to work just as efficiently in shutting people up here in Canada.

Everybody wants to play Junior Geostrategist these days. Well, count me out. I will not be told to apologize for preferring to side with the Chinese people and against their tormentors in Beijing, or preferring that things should not go so far as an oil embargo that would cause the Iranian people immeasurably greater suffering than they're already expected to put up with. I'd rather sanctions worked so we could skip the whole thing. I'd also rather my Israeli friends and my Iranian friends were not expecting the skies to grow dark with missiles any day now.

I'd really very much rather that Canadians who want to have conversations amongst themselves about what the hell is happening in Ottawa these days were not suddenly finding themselves bullied and quarantined by filthy insinuations about Sinophobia or subjected to insane allegations that they must be taking bribes from somebody named Al Gore.

It's gotten just like a Hockey Night in Canada play by play. There's Foreign Affairs Minister John Baird jetting off to Tel Aviv to renew Canada's claim to be Israel's best friend in the world - which isn't even high-sticking, by the way, because it's sad but true. Here's Prime Minister Stephen Harper jetting off to Beijing to take tea with President Hu Jintao, who will have to step out of the parlour for a moment to declare war on Tibetan monks. There goes President Obama into the Oval Office on a Sunday to sign his new head-breaking executive order on sanctions: you can do business with the United States or you can do business with Iran. Your call.

All that within 72 hours. It's a fast-paced game, and to be allowed within cheering distance of the Prime Minister's office you must first loudly observe how clever they must be in there, doing whatever it is they do behind those doors, the way they have been so canny as to apply their new parliamentary majority so quickly to bring us back up from the minors. How exciting it is to be playing in the big leagues. Even the Prime Minister's most ardent fans can't tell the players without a program anymore, and nobody even knows whose damn team we're on.


Blogger Steve V said...

Great post Terry!

9:31 AM  

Post a Comment

<< Home