The Eurasian Century Is NOW Unstoppable

The transfer of the geopolitical center of gravity to Eurasia is something the West will have to get used to

 

William Engdahl is strategic risk consultant and lecturer, he holds a degree in politics from Princeton University and is a best-selling author on oil and geopolitics, “New Eastern Outlook


I recently returned from a fascinating two week speaking tour in China. The occasion was the international premier of my newest book, One Belt, One Road–China and the New Eurasian Century.

In the course of my visit I was invited by China’s Northwest University in Xi’an to give a lecture and seminar on the present global political and economic situation in the context of China’s New Economic Silk Road as the One Belt, One Road project is often called.

What I’ve seen in my many visits to China, and have studied about the entirety of this enormously impressive international infrastructure project convinces me that a Eurasian Century at this point is unstoppable.

The idiotic wars of the Washington war-hawks and their military industry–in Syria, in Ukraine, Libya, Iraq and now the South China Sea provocations against China–are not going to stop what is now clearly the most impressive and economically altering project in more than a century.

The term “American Century” was triumphantly proclaimed in a famous editorial in Life magazine in 1941 in the early phase of World War II, before the United States had even entered the war, to describe the system publisher Henry Luce saw dominating the postwar world after the fall of the rival British Empire.

The American Century has lasted a mere seven decades if we date from the end of the war. Its record has been one of dismal failure on balance. The industrial base of the United States, the predominant leading industrial nation and leading scientific innovator, today is a hollowed, rotted shell with once-booming cities like Detroit or Philadelphia or Los Angeles now burned-out ghettos of unemployed and homeless.

The Federal Debt of the United States, owing to the endless wars its Presidents engage in, as well as the fruitless bailouts of Wall Street banks and Government Sponsored Enterprises like Fannie Mae, is well over 103% of GDP at an astonishing $19.5 trillion, or more than $163,000 per taxpaying American and Washington is adding to the debt this year at near $600 billion. Countries like China and Russia are moving away from subsidizing that debt at a record pace.

America’s economic basic infrastructure–bridges, sewer and water treatment plants, electric grid, railways, highways–have been neglected for more than four decades for a variety of reasons.

The American Society of Civil Engineers recently estimated that gross domestic product will be reduced by $4 trillion between 2016 and 2025 because of lost business sales, rising costs and reduced incomes if the country continues to underinvest in its infrastructure. That is on top of the fact that they estimate the country at present urgently requires new infrastructure investment of $3.3 trillion by the coming decade just to renew.

Yet US states and cities are not able to finance such an investment in the future in the present debt situation, nor is the debt-choked Federal Government, so long as a cartel of corrupt brain-dead Wall Street banks and financial funds hold America to ransom.

This is the sunset for the American Century, a poorly disguised imperial experiment in hubris and arrogance by a gaggle of boring old patriarchs like David Rockefeller and his friends on Wall Street and in the military industry. It is the starkest contrast to what is going on to the east, across all Eurasia today.

Flowing the Thought to Transform

The Eurasian Century is the name I give to the economic emergence of the countries contiguous from China across Central Asia, Russia, Belarus, Iran and potentially Turkey. They are being integrally linked through the largest public infrastructure projects in modern history, in fact the most ambitious ever, largely concentrated on the 2013 initiative by Chinese President Xi Jinping called the One Belt, One Road initiative or OBOR.

The project and its implications for Europe and the rest of the world economy have been so far greeted in the west with a stone silence that defies explanation.

It’s been now three years that have transpired since then-new Chinese President Xi Jinping made one of his first foreign visits to Kazakhstan where he discussed the idea of building a vast, modern network of high-speed train lines crossing the vast Eurasian land space from the Pacific coast of China and Russia through Central Asia into Iran, into the states of the Eurasian Economic Union, principally Russia and potentially on to the select states of the European Union.

That initial proposal was unveiled in detail last year by the National Development and Reform Commission (NDRC), China’s economic planning organization, and the ministries of Foreign Affairs and Commerce.

It’s a useful point to look now more closely at what has transpired to date. It reveals most impressive developments, more because the development process is creative and organic. The great project is no simple blueprint made by the Central Committee of the Communist Party of China and then simply imposed, top down, across the so-far 60 countries of Eurasia and South East Asia.

An international conference was recently held in Xi’an, origin of the ancient version of One Belt, One Road, namely the Silk Road. The purpose of the international gathering was to review what has so far taken place.

It’s fascinating, notably, in the care that’s being taken by China to do it in a different way, as indications so far are, different from the way American Robber Barons like Cornelius Vanderbilt, E.H. Harriman, Jay Gould or Russell Sage built rail monopolies and deluded and defrauded investors with railroad monopolies more than a century ago.

The seminar, titled the Belt and Road Initiative (BRI): Shared Memory and Common Development, on September 26th, brought together over 400 participants from more than 30 countries including government officials, universities, corporations, think tanks and media.

A key role is being played by Renmin University of China’s Chongyang Institute for Financial Studies to identify progress and problems of the OBOR project. Their report in Xi’an presented principles underlying the OBOR international project: It adheres to the principles of the UN Charter; it is completely open for new participant nations to cooperate; it will follow market rules and seek mutual benefit of participating countries.

Those are noble words. What’s more interesting is the flow process underway to realize such words and to build the mammoth game-changing infrastructure.

Notably, China’s Xi Jinping decided to encourage input from sources other than the state central planning agency or the Communist Party for the complex OBOR. He encouraged creation of private and independent think-tanks to become a source of new creative ideas and approaches.

Today there is a Chinese Think Tank Cooperation Alliance group coordinating efforts around OBOR headed by the dean of the Renmin University. In turn they partner with think tanks along the OBOR route including think tanks in Iran, Turkey, India, Nepal, Kazakhstan and other countries.

There will be two main routes of the OBOR. On land there are several routes or corridors in work. The Initiative will focus on jointly building what is being called a new Eurasian Land Bridge from China via Kazakhstan on to Rotterdam. Other OBOR land rail corridors include developing China-Mongolia-Russia, China-Central Asia-West Asia, China-Pakistan, Bangladesh-China-India-Myanmar, and China-Indochina Peninsula economic corridors.vThis is huge.

It will build on international transport routes, relying on core cities along the OBOR route and using key economic industrial parks as “cooperation platforms.”

At sea, the Initiative will focus on jointly building smooth, secure and efficient transport routes connecting major sea ports along the “Belt and Road” including modern upgraded super port construction that will link present China ports at Haikou and Fujian with Kuala Lumpur’s port in Malaysia at the Malacca Strait passage, Calcutta in India, Nairobi in Kenya and via the Suez Canal to Athens and beyond. Crucial is that land and sea parts of OBOR are seen as one whole circulatory system or flow of trade.

The OBOR Initiative will link key Eurasian ports with interior rail and pipeline infrastructure in a way not before seen

To date China has signed memoranda of understanding with 56 countries and regional organizations regarding OBOR. Since his initial proposal in 2013, President Xi Jinping has personally visited 37 countries to discuss implementation of OBOR. China Railway Group and China Communications Construction Company have signed contracts for key routes and ports in 26 countries.

Power plants, electricity transmission facilities and oil and gas pipelines, covering 19 countries along the “Belt and Road” in some 40 energy projects have begun. China Unicom, China Telecom and China Mobile are speeding up cross-border transmission projects in countries along the “Belt and Road” to expand international telecommunication infrastructure.

Already, taking the full sea and land routes of OBOR, some $3 trillion of China trade since June 2013 has flowed over the route, more than a quarter of China’s total trade volume.

To date China has also invested more than $51 billion in the countries along the present OBOR route. The new land rail routes will greatly reduce transportation costs across Eurasia, enable formerly isolated regions to connect efficiently to sea and land markets and ignite tremendous new economic growth across Eurasia.

The effects of the OBOR are already beginning to appear. Earlier this year an Iranian container ship arrived at Qinzhou Port in China with 978 containers from several countries along the 21st-Century Maritime Silk Road opening the first shipping route linking the Middle East and the Beibu Gulf or Gulf of Tonkin in Vietnamese.

In February 2016 a container train with Chinese goods took only 14 days to complete the 5,900 mile (9,500km) journey from China’s eastern Zhejiang province through Kazakhstan and Turkmenistan.

That was 30 days shorter than the sea voyage from Shanghai to the Iranian port of Bandar Abbas, according to the head of the Iranian railway company. China and Iran, now formally part of the OBOR, have targeted bilateral trade, none in US dollars by the way, to exceed $600 billion in the coming decade.

China is presently in negotiations with 28 countries China is in talks with 28 countries including Russia, on high-speed rail projects, China’s train maker, China CNR reports.

It includes a major joint China-Russia $15 billion high-speed Kazan to Moscow line. The 770 kilometers of track between Moscow and Russia’s Tatarstan capital, Kazan, will cut time for the journey from 12 hours now to just 3.5 hours. China has agreed to invest $6 billion in the project which would become a part of a $100 billion high-speed railway between Moscow and Beijing.

Notably, for the new high-speed track being laid, China is developing a new generation of trains capable of reaching speeds of 400 kilometers per hour. And the new trains will solve the costly rail gauge switching problem between China rails and Russian.

Trains in Russia run on a 1520mm track, compared to the narrower 1435mm track used in Europe and China. Jia Limin, the head of China’s high-speed rail innovation program told China Daily that, “The train… will have wheels that can be adjusted to fit various gauges on other countries’ tracks, compared with trains now that need to have their wheels changed before entering foreign systems.”

Given its strategy of building thousands of kilometers of high-speed railways and developing its domestic Chinese rail sock manufacture as well as other rail technology, China today is the world’s leading producer of rail technology.


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Russian Nuclear Power Industry and export – NO NUCLEAR WASTE

 

Mainstream media, or any other media, to the best of my knowledge, has not published any articles relating to the high-tech development that Russia is going to build in many countries around the world.

This technology will not be using newly-mined uranium, but nuclear waste, which is recycled and made harmless. Enough nuclear waste has already been accumulated to enable these power stations to run for the next 300 years.

At the moment nuclear waste cannot be safely disposed of and has a life expectancy of some 1,000 years or more creating extremely dangerous areas where it has been buried or of more concern, thrown out to sea in full fathom five, disintegrating concrete blocks.

Due to the patent that Rosatom has on no nuclear waste and the fuel of the future, they have and are becoming world leaders and providers on a global scale. This technology can also be extended to include upgrading current and outdated nuclear plants and bring them in line with making hazardous waste harmless rather than a liability.

 

The Russian nuclear industry

The Russian nuclear industry is an undisputed leader in advanced nuclear technologies, providing innovative engineering and construction solutions for nuclear reactors and production of nuclear fuel. Since 1954, when the world’s first nuclear power plant was launched in Obninsk, ROSATOM has amassed a wealth of experience and acquired extensive competencies in large-scale nuclear projects. Russia possesses the most sophisticated nuclear enrichment and reactor engineering technologies – pressurized water reactors designed by Russian engineers have proved their reliability through thousands of reactor years of accident-free operation.

Today the Russian nuclear industry comprises over 400 companies with over 250,000 employees operating in the nuclear fuel cycle, power generation, and R&D sectors. With its 10 nuclear power plants (34 operating power units with 25.2 GW of installed capacity), which generate about 18% of total power output, and the world’s only nuclear icebreaker fleet, Russia is focused on development of the Northern Sea Route and further expansion of nuclear power generation. Recent achievements in these areas include construction of 9 new nuclear reactors (Novovoronezh NPP-2, Leningrad NPP-2, the world’s first floating NPP and others), an additional fourth power unit at Beloyarsk NPP, and a new nuclear icebreaker flagship laid down in 2013 at the Baltic shipyard in Saint Petersburg. Its launch will mark a new stage in exploration of the Arctic region.

International nuclear projects are another focus area of ROSATOM, which is now engaged in the construction of 29 new nuclear reactors in Kudankulam (India), Akkuyu (Turkey), Belarus, Vietnam, Bangladesh and China.

Development of the nuclear industry is seen as a top national priority. It is perceived to be a key sector of the Russian economy, essential for national energy security. The nuclear industry drives demand for other products and services and therefore stimulates engineering, steel making, geology, construction and other sectors of the national economy.

Russian expertise

State-owned Rosatom says that Russia’s nuclear industry amounts to over 400 companies and more than 255,000 employees working across the fuel cycle, power generation and R&D sectors, 34 operating power facilities with an installed capacity of 25.2GW, and the only nuclear-powered icebreaker fleet in the world.

“Rosatom has one highly significant advantage – its the only company in the world which can provide the industry’s complete range of products.”

A succession of initiatives from Vladimir Putin has helped establish the continued development of this industry as a top national priority, both as a means to ensure future domestic energy security and as a key economic sector in its own right, with international projects forming a big focus area for growth. All of the thousands of reactor-years of experience gained since Obninsk – including the safety lessons learnt in the wake of the disaster at Chernobyl – have been effectively packaged to create a unique selling point for Russian expertise on foreign markets. While many critics felt that Fukushima would finally herald the demise of nuclear power, it seems that quite the reverse has turned out to be true. With its appeal now fast growing, particularly in Asia, Russia has been wooing prospective clients with a range of tempting incentives.

BOO

A business model known as ‘BOO’ (build, own, operate) has been one of Rosatom’s most successful ploys in this respect. Offered through its export division, Atomstroyexport, BOO was first used five years ago in a deal struck with Turkey and has featured in other agreements since. In effect, the purchasing country simply has to provide a suitable site and sign up to buying the electricity produced, with Russia covering the costs of building and operating the power plant. Particularly for developing countries which cannot afford the high up-front capital investment, the attraction of the BOO model is clear, and there are significant direct benefits for Russia too, not least in terms of the employment it supports.

Brilliant strategic move?

However, there is another side to consider – the push towards exporting nuclear power represents both a move to diversify income now, and a hedge against the future.

By channelling the income stream gained from oil and gas sales into long-term assets, the goal is to cement the country’s future role as a major energy nation. With even Russia’s vast hydrocarbon reserves set to run out eventually – assuming that the world does not abandon fossil fuels altogether, as some suggest it must, long before they do – recycling O&G profits into nuclear power generation against a background of rising demand makes good business sense.

Writing in January 2014, Adams said, “Russia’s decision to invest in nuclear energy capabilities is a brilliant strategic move befitting a nation of chess players”, but back then the Russian sovereign wealth fund was big, and getting bigger. Times – and gas revenues – have changed since then

Driving new developments

Export initiatives aside, there is considerable domestic scope for Russia’s nuclear industry, with Moscow having set a target of increasing the share of electricity generated to 25% by 2030, and Rosatom focussed on developing new technologies, including types of reactors that will be able to burn some spent fuels.

The rising economic and strategic importance of the Arctic, too, provides a potential driver for atomic technology, as Russia looks to develop the Northern Sea Route and explore for energy and mineral resources in the High North. The experience gained with nuclear powered ice-breakers has already led to the production of the Academic Lomonosov – a 144m-long, non-self-propelled vessel, equipped with two reactors and able to generate up to 70MW of electricity. As the flagship of a planned whole new class of ship-based generators, it is destined to be the world’s first mass-produced floating nuclear power station when it comes into service towards the end of 2016.

Mobile and capable of powering small cities, ports or industrial infrastructure, these floating reactors could be a huge asset in remote or inhospitable regions, and Rosatom say that 15 countries, including China, Indonesia and Malaysia, have already expressed an interest in the vessels.

According to the WNA, there are 70 nuclear reactors currently under construction – the most in a quarter of a century – and some 500 more are proposed. While not all of those will ultimately go ahead, it speaks to the world’s growing appetite for nuclear power and for Russia, owning around 40% of the world’s uranium enrichment capacity and a significant share of the proven global uranium reserves. The value of Russia’s current tally of international deals already runs to over $100bn, and the new nuclear tech titan is really only just beginning to flex its muscles.