Showing posts from category China.
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Rare Earths No More? Mineral Discoveries a Potential Game-Changer for East Asia
›July 7, 2011 // By Schuyler NullDiscoveries announced in a journal article over the weekend may prove a game-changer for global rare earth supplies and recent diplomatic maneuvering in East Asia between China, Japan, Vietnam, and the United States. A team of researchers from Japan’s Agency for Marine-Earth Science and Technology published findings in Nature Geoscience that indicate vast underwater reserves of rare earth minerals are scattered across a huge swath of the Pacific, including south and east of Japan. The U.S. Geological survey estimates current global reserves of rare earth minerals at about 110 million tons; Yasuhiro Kato, the lead author of the Japanese team, told Reuters that the sites surveyed could contain an additional 80 to 100 billion metric tons (yes, with a “b”) of the valuable resources.
The authors write that an “area of just one square kilometer, surrounding one of the sampling sites, could provide one-fifth of the current annual world consumption of these elements.” The team collected data from 78 sites in total, with the largest concentrations centered east of the Hawaiian and Polynesian islands (see a map of the surveyed areas here).
Resource Relationships
The discovery could prove crucial for Japan, as it has been seeking alternative sources of rare earth minerals after an embargo earlier this year by China, which controls 97 percent of the world’s current supply. The embargo (which China denied) was imposed in October of last year after the Japanese navy arrested the captain of a Chinese fishing boat, which was alleged to be encroaching on Japanese territorial waters. China’s response increased tensions across the region and produced a flurry of warnings in Washington over the security of U.S. supplies.
Although the embargo was later lifted, Japan and Vietnam reached an agreement for development of Vietnamese mines in November. The tensions sparked by the encounter also spread to the South China Sea where Chinese, Vietnamese, and Filipino forces have stepped up their jockeying over disputed and resource-rich waters to the highest levels in years. Vietnamese and Chinese naval forces recently held mirror exercises, and Filipino officials invoked a 1950-era defense pact with the United States. Chinese Vice Foreign Minister Cui Tiankai told reporters in June: “I believe the individual countries are actually playing with fire, and I hope the fire will not be drawn to the United States.”
Secretary of State Hillary Clinton called concerns over navigability and Chinese insistence on bilateral (as opposed to multilateral) negotiations in the South China Sea a matter of “national interest” for the United States last year.
The Japanese team’s discovery has the potential to significantly impact the power dynamics behind these tensions. China has used its rare earth monopoly to pressure Japan and the United States, which in turn may have also helped embolden its recent more aggressive maritime policies. If the new rare earth discoveries prove viable, that calculus could change considerably.However serious questions remain: Many of the discoveries lie outside of established exclusive economic zones, so who has the rights to mine them? They’re also between 11,500 and 20,000 feet below the surface – how long before we have the technologies to extract them at an industrial scale? And how safe – both for humans and the environment – will those processes be? Aboveground rare earth mines are some of the most damaging to the environment – part of the claimed reason China curbed overall exports earlier this year, which drove up global prices and drew the ire of the World Trade Organization.
For more on the importance of rare earth minerals to the defense and electronics industries, see New Security Beat’s “Rare Earth: A New Roadblock for Sustainable Energy?” and “Reading Radar: The Mineral Security of the United States.” For more on the exclusive economic zones map, see “Eye on Environmental Security: Natural Resource Frontiers at Sea;” and on the South China Sea and what it reveals about future diplomatic fault lines between the United States and China, see “U.S. v. China: The Global Battle for Hearts Minds and Resources.”
Sources: Asia Sentinel, The Atlantic, BBC, Government Accounting Office, Nature Geoscience, The New York Times, Reuters, Tech News Daily, U.S. Department of State.
Photo Credit: Adapted from “USS Mustin underway in the Pacific Ocean,” courtesy of flickr user Official U.S. Navy Imagery, and “Exclusive Economic Zone,” used with permission courtesy of Theo Deutinger and TD Architects. -
Keith Schneider, Circle of Blue
Double Choke Point: Demand for Energy Tests Water Supply and Economic Stability in China and the U.S.
›The original version of this article, by Keith Schneider, appeared on Circle of Blue.
The coal mines of Inner Mongolia, China, and the oil and gas fields of the northern Great Plains in the United States are separated by 11,200 kilometers (7,000 miles) of ocean and 5,600 kilometers (3,500 miles) of land.
But, in form and function, the two fossil fuel development zones – the newest and largest in both nations – are illustrations of the escalating clash between energy demand and freshwater supplies that confront the stability of the world’s two biggest economies. How each nation responds will profoundly influence energy prices, food production, and economic security not only in their domestic markets, but also across the globe.
Both energy zones require enormous quantities of water – to mine, process, and use coal; to drill, fracture, and release oil and natural gas from deep layers of shale. Both zones also occur in some of the driest regions in China and the United States. And both zones reflect national priorities on fossil fuel production that are causing prodigious damage to the environment and putting enormous upward pressure on energy prices and inflation in China and the United States, say economists and scholars.
“To what degree is China taking into account the rising cost of energy as a factor in rising overall prices in their economy?” David Fridley said in an interview with Circle of Blue. Fridley is a staff scientist in the China Energy Group at Lawrence Berkeley National Laboratory in California. “What level of aggregate energy cost increases can China sustain before they tip over?”
“That’s where China’s next decade is heading – accommodating rising energy costs,” he added. “We’re already there in the United States. In 13 months, we’ll be fully in recession in this country; 9 percent of our GDP is energy costs. That’s higher than it’s been. When energy costs reach eight to nine percent of GDP, as they have in 2011, the economy is pushed into recession within a year.”
Continue reading on Circle of Blue.
Photo Credit: Used with permission, courtesy of J. Carl Ganter/Circle of Blue. In Ningxia Province, one of China’s largest coal producers, supplies of water to farmers have been cut 30 percent since 2008. -
Keith Schneider, Circle of Blue
China’s Other Looming Choke Point: Food Production
›The original version of this article, by Keith Schneider, appeared on Circle of Blue.
Even along the middle reaches of the Yellow River, which irrigates 402,000 hectares (993,000 acres) of farmland north of the Ningxia Hui Autonomous Region’s provincial capital, there is still no mistaking the smell of dry earth and diesel fuel, the abiding scents of a desert province that is also among China’s most efficient grain producers.
Ningxia farmers have relied on the Yellow River since 221 BCE, when Qin Dynasty engineers clawed narrow trenches from the sand, introducing some of the first instances of irrigated agriculture on earth. Despite persistent droughts, in each of the last five years irrigation has made it possible for annual harvests to increase by an average of 100,000 metric tons.
The 2010 harvest of 3.5 million metric tons was nearly double what it was in 1990. The 3.9 million people who live and work on Ningxia’s 1.2 million farms, most no larger than three-quarters of a hectare (1.6 acres), produce the highest yields of rice and corn in the nine-province Yellow River Basin, according to central government crop statistics.
In sum, the farm productivity of this small northern China region – about the same size as West Virginia and located 1,200 kilometers (745 miles) to the west of the Bohai Sea – reflects the major shifts in geography and cultivation practices over the last generation that have made China both self-sufficient in food production and the largest grain grower in the world.
Yet Chinese farm officials here and academic authorities in Beijing are becoming increasingly concerned that China does not have enough water, good land, and energy to sustain its agricultural prowess. As Circle of Blue and the Woodrow Wilson Center’s China Environment Forum have reported in the Choke Point: China series, momentous competing trends – rising energy demand, accelerating modernization, and diminishing freshwater resources – are putting the country’s energy production and security at risk.
The very same trends also threaten China’s farm productivity. Last year, the national farm sector and the coal sector combined used 85 percent of the 599 billion cubic meters (158 trillion gallons) of water used in China.
Continue reading on Circle of Blue.
Keith Schneider is the senior editor of Circle of Blue and was a New York Times national correspondent for over a decade, where he continues to report as a special writer on energy, real estate, business, and technology.
Photo Credit: Used with permission, courtesy of J. Carl Ganter/Circle of Blue. -
Elizabeth C. Economy, Council on Foreign Relations
The Truth About the Three Gorges Dam
›May 26, 2011 // By Wilson Center StaffThe original version of this article, by Elizabeth C. Economy, appeared on the Council on Foreign Relations’ Asia Unbound blog.
It has only taken 90 years, but China’s leaders have finally admitted that the Three Gorges Dam is a disaster. With Wen Jiabao at the helm, the State Council noted last week that there were “urgent problems” concerning the relocation effort, the environment and disaster prevention that would now require an infusion of US$23 billion on top of the $45 billion spent already.
Despite high-level support for the project since Sun Yat-sen first proposed it in 1919, the dam has had serious critics within China all along. One of China’s earliest and most renowned environmental activists, Dai Qing, published the book Yangtze! Yangtze! in 1989, which explored the engineering and social costs of the proposed dam. The book was a hit among Tiananmen Square protestors, and Dai spent a year in prison for her truth-telling. In 1992, when the dam came up for a vote in the National People’s Congress, an unprecedented one-third of the delegates voted against the plan.
Once the construction began in 1994, the problems mounted. The forced relocation of 1.4 million Chinese was plagued with corruption; former Premier Zhu Rongji accused the construction companies of shoddy engineering, and little of the pollution control measures that were planned were actually taken. Water pollution skyrocketed in the reservoir. As Chinese officials acknowledged a few years back, “The Three Gorges Dam project has caused an array of ecological ills, including more frequent landslides and pollution, and if preventive measures are not taken, there could be an environmental catastrophe.”
It would be easy to argue that the State Council’s admission was too little too late. However, the new transparency matters for at least two reasons. First, it plays into the hands of environmentalists who have been arguing against Beijing’s aggressive plans for additional large-scale hydropower plants. Premier Wen, who has tried to slow the approval process for dams over the past several years, now has a bit more ammunition. Second, any acknowledgement by the Party that mistakes have been made is an important step toward the public’s right to question future policies. Let’s hope that more such transparency is on the way.
Elizabeth C. Economy is the C.V. Starr Senior Fellow and director for Asia Studies at the Council on Foreign Relations.
Photo Credit: Adapted from “Construction of the Three Gorges Dam,” courtesy of flickr user Harald Groven. -
Meeting Half the World’s Fuel Demands Without Affecting Farmland Joan Melcher, ChinaDialogue
Biofuels: The Grassroots Solution
›May 24, 2011 // By Wilson Center StaffThe original version of this article, by Joan Melcher, appeared on ChinaDialogue.
The cultivation of biofuels – fuels derived from animal or plant matter – on marginal lands could meet up to half of the world’s current fuel consumption needs without affecting food crops or pastureland, environmental engineering researchers from America’s University of Illinois have concluded following a three-year study. The findings, according to lead author Ximing Cai, have significant implications not only for the production of biofuels but also the environmental quality of degraded lands.The study, the final report of which was published in the Journal of Environmental Science and Technology late last year, comes at a time of increasing global interest in biomass. The International Energy Agency predicts that biomass energy’s share of global energy supply will treble by 2050, to 30 percent. In March, the UK-based International Institute for Environment and Development called on national governments to take a “more sophisticated” approach to the energy source, putting it at the heart of energy strategies and ramping up investment in new technologies and research programs.
The University of Illinois project used cutting-edge land-use data collection methods to try to determine the potential for second-generation biofuels and perennial grasses, which do not compete with food crops and can be grown with less fertilizer and pesticide than conventional biofuels. They are considered to be an alternative to corn ethanol – a “first generation” biofuel – which has been criticized for the high amount of energy required to grow and harvest it, its intensive irrigation needs and the fact that corn used for biofuel now accounts for about 40 percent of the United States entire corn crop.
A critical concept of the study was that it only considered marginal land, defined as abandoned or degraded or of low quality for agricultural uses, Cai, who is civil and environmental engineering professor at the University of Illinois in the mid-western United States, told ChinaDialogue.
The team considered cultivation of three crops: switchgrass, miscanthus, and a class of perennial grasses referred to as low-impact high-diversity (LIHD).
Continue reading on ChinaDialogue.
Sources: Sources: International Energy Agency, Journal of Environmental Science and Technology, Reuters, University of Illinois.
Photo Credit: Adapted from “Biofuels,” courtesy jurvetson. -
Southern Africa, China, and “Sustainable Access”
The Mineral Security of the United States
›In a report titled “Elements of Security: Mitigating the Risks of U.S. Dependence on Critical Minerals,” author Christine Parthemore from the Center for a New American Security writes, “Growing global demand coupled with the mineral requirements necessary for both managing military supply chains and transitioning to a clean energy future will require not only clearer understanding, but also pragmatic and realistic solutions.” Minerals and rare earth elements such as lithium, gallium, and rhenium are critical elements for many defense technologies (e.g. jet engines, satellites, missiles, etc.) and alternative energy sources (batteries and wind turbines). Parthemore argues that U.S. policy should focus on preventing suppliers from exerting undue leverage (as China did in 2010), mitigating fiscal risk and cost overruns, reducing disruption vulnerability, and ensuring the United States is able to meet its growth goals in clean energy and other high-tech fields.In a report from the U.S. Air War College, author Stephen Burgess writes of the potential for conflict over competition for “strategic minerals” in five southern African states: South Africa, the Democratic Republic of the Congo, Zambia, Zimbabwe, and Namibia. The report, titled “Sustainability of Strategic Minerals in Southern Africa and Potential Conflicts and Partnerships,” states that growing industrial countries like China will compete, potentially aggressively, with the United States for sustainable access to elements such as chromium, manganese, cobalt, uranium, and platinum group metals. Burgess recommends that the United States become more engaged in southern Africa by providing development assistance to mining communities and developing strategic partnerships. -
Ten Billion: UN Updates Population Projections, Assumptions on Peak Growth Shattered
›May 12, 2011 // By Schuyler NullThe numbers are up: The latest projections from the UN Population Division estimate that world population will reach 9.3 billion by 2050 – a slight bump up from the previous estimate of 9.1 billion. The most interesting change however is that the UN has extended its projection timeline to 2100, and the picture at the end of the century is of a very different world. As opposed to previous estimates, the world’s population is not expected to stabilize in the 2050s, instead rising past 10.1 billion by the end of the century, using the UN’s medium variant model.
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Dividend or Deficit? The Economic Effects of Population Age Structure
›According to the latest projections, the global population will hit the seven billion mark later this year and perhaps nine billion by 2050. Yet, while the global population is growing, it is also aging, due to falling fertility rates and longer life expectancies. By 2050 the number of people aged 60 and over will reach two billion. At an event at the Wilson Center on April 1, Andrew Mason of the University of Hawaii at Manoa and the East-West Center and Ronald Lee of the University of California, Berkeley, discussed their research on the economic effects of an aging world with discussant Dalmer Hoskins of the Social Security Administration. [Video Below]
Changing Age Structures and Economic LifecyclesThere are three phases of age transition, Mason explained: during the first phase, high fertility rates and declining infant and child mortality rates increase the share of children in the population. In the second phase, the proportion of the working age population (those aged 15-64) increases, potentially providing a boost to production and consumption, and in the third phase, the elderly proportion increases due to lower fertility rates, decreasing production and increasing the burden on state support systems.
From 2010-2015, 85 countries are projected to witness the largest absolute increase in history of their populations aged 60 and over. This increase in elder populations is significant, Mason said, because it may mean slower economic growth.
Based on data collected through National Transfer Accounts, Mason and Lee’s economic lifecycle tracks the labor income and consumption rates of a population at a given age. In high income countries, consumption increases around the teen years as a result of investments in education, then dips slightly, and, finally, sharply rises around the age of 80 due to high health care expenditures. The consumption rate remains relatively flat in low income countries, with consumption differing the most in the older ages.
The support ratio measures the number of workers relative to the number of consumers, while taking into account age-specific variances in number of hours worked and level of consumption. Mason explained that China, after four decades of rapid growth, has reached the peak of its support ratio, with many workers relative to the number of consumers. However, China is rapidly aging, like much of Northeast Asia, and also because of its one-child policy. The resulting decline in its support ratio will likely limit its economic growth; however, Mason cautioned that it would be “rash” to say that its growth will bottom out completely.
The United States has an age structure that is “quite a bit more favorable” than other industrial countries, Mason said. Higher fertility, lower life expectancy, and a higher rate of immigration mean that aging is coming more slowly to the United States than other developed countries.
The Second Demographic Dividend: An Investment OpportunityDuring the first demographic dividend, the labor force grows more rapidly than the dependent population, thus allowing more resources to be spent on economic growth. But what happens after that? As populations age, there is a “semi-automatic” increase in investment in human, physical, or financial capital, Lee explained; for example, as fertility falls, the amount invested per child increases. This second demographic dividend, said Lee, can help somewhat offset the decline in support ratio that comes in the third phase of the age transition – aging.
One response to the increased costs of an aging population, said Lee, is to reduce consumption in proportion to the decline in the support ratio. Another option would be adding more hours to the work day or pushing the retirement age back. In the United States, Lee said that to offset the declining support ratio entirely by postponing retirement would require postponement by eight years up to 2050, and 10 years by 2085.
Brazil, Lee said, is the “world champion” of pension generosity, where pensions make up 12 percent of the GDP. The United States, by contrast, relies on asset income from physical or financial investments for about two-thirds of its retirement income. Brazil’s challenge, when it begins to feel the effects of aging (it is still relatively young), will therefore be much greater than in the United States.
A “New Lens” on Aging
Aging, Hoskins said, is not the “catastrophe” that it has been portrayed to be in the media. Supporting an aging population is “something we can plan for and handle,” he said. It is possible “to do the right thing to make sure citizens have a decent life.” The problems come when a country waits too long or does not plan at all, such as in Nigeria and the Philippines where, Hoskins said, they have very underdeveloped social protection systems and the elderly have little to no income. Mason and Lee’s analysis of the work/consumption ratio, said Hoskins, offers a “new lens” into how the world will deal with aging.
Sources: Los Angeles Times, National Transfer Accounts, UNFPA, World Bank.
Image Credits: “Elderly couple – Meiji-jingu,” courtesy of flickr user Tom Spender. Chart courtesy of Ronald Lee and Andrew Mason, National Transfer Accounts.
