Page 210 - 2020 White Paper on the Business Environment in China
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0 White Paper on the Business Environment in China
2.6 Resources and Industrial Materials
Key Take-Aways Jinping and Premier Li Keqiang pin much of their
economic hopes for the next decade on a new
U.N.study warns China is consuming round of urbanization. In the last three decades,
minerals and fossil fuels at a rate never China has grown from a modest user of minerals,
before seen. The results may become catastrophic. fossil fuels and other primary materials to become
the world’s largest consumer, the report found.
China forms a national oil and pipeline company, The country consumed 25 billion US tons of such
the first public acknowledgment of the massive materials in 2008—nearly a third of the world’s
energy industry overhaul planned since at least total—up from 1.8 billion tons in 1970. It consumes
2014. four times as much as the United States, the
second-biggest user (Li).
The US’s potential to be the world’s largest
LNG exporter suggests that China will eventually Oil and Gas
purchase US LNG if the two countries can reach a
deal to conclude the trade war. China’s unprecedented economic development
since Deng Xiaoping’s Open-Door Policy has
By June 2019, China started talking about using transformed the country into the second largest
rare earth elements as a playing card in the current economy of the world. The booming economy has
trade conflict with the US. This could cripple the US had the undesired side-effect of increasing Beijing’s
cellular and other industries. dependence on foreign oil imports. Twenty-five
years ago, China produced approximately 4 million
Background barrels per day, which was enough to satisfy the
Asian country’s domestic demand for petroleum
China’s transformation from agricultural products. In April 2019, on average, 10.64 million
backwater to booming industrial powerhouse has barrels per day were imported, which is a new
required it to consume resources at a speed and record. In 2018, the ratio of foreign oil dependency
scale the world has never seen, a new UN study reached 70 percent this number is expected to grow.
has found. “China’s dramatic economic growth over Beijing is aware of its relative weakness because
the past few decades has increased demands for most of the imported oil reaches mainland China
natural resources within and beyond the country through shipping lanes, which are controlled by the
itself in ways that are unprecedented in human US Navy. The relative weakness of the Chinese navy
history,” UN Undersecretary General Achim Steiner increases the risks and exemplifies the security
said in the report. “While that growth has lifted threat in case of a blockade. Therefore, Beijing
millions out of poverty, it has also come with rising has been pushing domestic energy companies to
environmental challenges.” The report credited increase production from local oil fields. In the next
China’s “exceptionally good” efforts at improving five years China’s ‘big three’, PetroChina, Cnooc,
resource efficiency, but it cautioned that the pace and Sinopec, aim to increase spending by 517
of this improvement was insufficient to offset the billion yuan (US$77 billion), which is a growth of 18
environmental damage from extracting, processing percent compared to 2018. In contrast to Western
and consuming natural resources. Analysts said firms, the Chinese state-owned energy giants are
the report could raise concerns about the potential investing in oil fields that are mature and require
for further ecological degradation as President Xi high-costs to raise production. These assets need
210
2.6 Resources and Industrial Materials
Key Take-Aways Jinping and Premier Li Keqiang pin much of their
economic hopes for the next decade on a new
U.N.study warns China is consuming round of urbanization. In the last three decades,
minerals and fossil fuels at a rate never China has grown from a modest user of minerals,
before seen. The results may become catastrophic. fossil fuels and other primary materials to become
the world’s largest consumer, the report found.
China forms a national oil and pipeline company, The country consumed 25 billion US tons of such
the first public acknowledgment of the massive materials in 2008—nearly a third of the world’s
energy industry overhaul planned since at least total—up from 1.8 billion tons in 1970. It consumes
2014. four times as much as the United States, the
second-biggest user (Li).
The US’s potential to be the world’s largest
LNG exporter suggests that China will eventually Oil and Gas
purchase US LNG if the two countries can reach a
deal to conclude the trade war. China’s unprecedented economic development
since Deng Xiaoping’s Open-Door Policy has
By June 2019, China started talking about using transformed the country into the second largest
rare earth elements as a playing card in the current economy of the world. The booming economy has
trade conflict with the US. This could cripple the US had the undesired side-effect of increasing Beijing’s
cellular and other industries. dependence on foreign oil imports. Twenty-five
years ago, China produced approximately 4 million
Background barrels per day, which was enough to satisfy the
Asian country’s domestic demand for petroleum
China’s transformation from agricultural products. In April 2019, on average, 10.64 million
backwater to booming industrial powerhouse has barrels per day were imported, which is a new
required it to consume resources at a speed and record. In 2018, the ratio of foreign oil dependency
scale the world has never seen, a new UN study reached 70 percent this number is expected to grow.
has found. “China’s dramatic economic growth over Beijing is aware of its relative weakness because
the past few decades has increased demands for most of the imported oil reaches mainland China
natural resources within and beyond the country through shipping lanes, which are controlled by the
itself in ways that are unprecedented in human US Navy. The relative weakness of the Chinese navy
history,” UN Undersecretary General Achim Steiner increases the risks and exemplifies the security
said in the report. “While that growth has lifted threat in case of a blockade. Therefore, Beijing
millions out of poverty, it has also come with rising has been pushing domestic energy companies to
environmental challenges.” The report credited increase production from local oil fields. In the next
China’s “exceptionally good” efforts at improving five years China’s ‘big three’, PetroChina, Cnooc,
resource efficiency, but it cautioned that the pace and Sinopec, aim to increase spending by 517
of this improvement was insufficient to offset the billion yuan (US$77 billion), which is a growth of 18
environmental damage from extracting, processing percent compared to 2018. In contrast to Western
and consuming natural resources. Analysts said firms, the Chinese state-owned energy giants are
the report could raise concerns about the potential investing in oil fields that are mature and require
for further ecological degradation as President Xi high-costs to raise production. These assets need
210
