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Snubbed by US, China finds new space partners, boosts Asia ties

Snubbed by US, China finds new space partners, boosts Asia ties
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First Published: Tue, May 29 2007. 12 38 AM IST
Updated: Tue, May 29 2007. 12 38 AM IST
Beijing: For years, China has chafed at efforts by the US to exclude it from full membership in the world’s elite space club. So, lately China seems to have hit on a solution: Create a new club.
Beijing is trying to position itself as a space benefactor to the developing world—the same countries, in some cases, whose natural resources China covets here on earth. The latest and most prominent example came last week when China launched a communications satellite for Nigeria, a major oil producer, in a project that serves as a tidy case study of how space has become another arena where China is trying to exert its soft power.
Not only did China design, build and launch the satellite for Nigeria, but it also provided a huge loan to help pay the bill. China has also signed a satellite contract with another big oil supplier, Venezuela. It is developing an earth observation satellite system with Bangladesh, Indonesia, Iran, Mongolia, Pakistan, Peru and Thailand. And it has organized a satellite association in Asia.
“China is starting to market and sell this technology to developing countries that need it,” said Shen Dingli, a professor at Fudan University in Shanghai. Of the Nigeria deal, Shen added, “It gives substance to Sino-African relations. Not only does China buy raw materials, but also we sell some things.”
For China, the strategy is a blend of self-interest, broader diplomacy and, from a business standpoint, an effective way to break into the satellite market. Satellites have become status symbols and technological necessities for many countries that want an ownership stake in the digital world dominated by the West, analysts say. “There’s clearly a sense that countries like Nigeria want to have a stronger presence in space,” said Peter J. Brown, a journalist who specializes in satellite technology and writes about the satellite market in Asia. “More and more countries are moving to get satellites up.”
China’s more grandiose space goals, which include building a Mars probe and, eventually, putting an astronaut on the moon, are based on an American blueprint in which space exploration enhances national prestige and advances technological development. But Beijing also is focused on competing in the $100 billion (Rs4.1 lakh crore) commercial satellite industry.
In recent years, China has managed to attract customers with its less expensive satellite launching services. Yet it had never demonstrated the technical expertise to compete for international contracts to build satellites.
The Nigeria deal has changed that. Chinese engineers designed and constructed the geostationary communications satellite, called the Nigcomsat-1. A state-owned aerospace company, Great Wall Industry Corp., will monitor the satellite from a ground station in northwestern China. It will also train Nigerian engineers to operate a tracking station in Abuja, Nigeria’s capital.
Last week, a day after the launching, Ahmed Rufai, the Nigerian project manager for the satellite, was exultant as he paused between appointments at his Beijing hotel. Nigeria may be rich in oil, he said, but it lacks many of the basic building blocks of a modern, information-based economy.
“We want to be part of the digital economy,” Rufai said, noting that Africa suffers more than any other continent from the so-called digital divide.
Rufai predicted that the satellite would pay for itself within seven years as Nigeria sold bandwidth to commercial users. But he also predicted major improvements for Nigeria itself: “distance learning” educational programmes for remote rural areas; online public access to government records; a video monitoring system of remote oil pipelines to allow quicker responses to spills; and an online banking system.
Nigeria is a risky customer for any satellite manufacturer. It is consistently rated one of the most corrupt nations, and at least one Western aerospace company has become embroiled in business disputes there. “Business ventures with Nigeria have been difficult, to say the least,” said Roger Rusch, president of TelAstra, a satellite communications consulting firm in California.
Nigeria put the project out for bidding in April 2004. Rufai said that 21 bids had arrived from major aerospace firms but nearly all of them failed to meet a key requirement: a significant financial package.
Rufai said the Western companies saw Nigeria as a major gamble. “Their response was very cool,” he said of one financial institution approached about backing the deal. “They said, ‘Oh, Nigeria. Don’t touch it.’ ”
China was not so cautious. With the satellite priced at roughly $300 million (Rs1,230 crore), the state-owned Export-Import Bank of China, or China ExIm, granted $200 million in preferential buyer’s credits to Nigeria. The bank often provides the hard currency for China’s soft-power aspirations: In Africa, China ExIm has handed out more than $7 billion in loans in recent years, according to one study.
“They were the only ones who stated in concrete terms that they would be able to support the project,” Rufai said. Quality remained a concern. Last year, China suffered a major setback with the failure of the Sinosat-2. It was the most sophisticated satellite ever made in China, and it suffered a systems breakdown on its first launching. The Nigerian satellite was delayed for three months so that it could be retrofitted.
Joan Johnson-Freese, chairwoman of the Department of National Security Studies at the Naval War College, said China still trailed major aerospace companies in the quality and sophistication of its satellites, which is one reason it is marketing to developing countries. “They want to play a leadership role for developing countries that want to get into space,” Dr Johnson-Freese said earlier this year. “They are making political connections, it helps them with oil deals and they bring in hard currency to feed back into their own programme to make them even more commercially competitive.” Satellites also are becoming vital to Beijing’s domestic development plans. In the next several years, China could launch as many as 100 satellites to help deliver television to rural areas, create a digital navigational network, facilitate scientific research and improve mapping and weather monitoring.
But China’s focus on satellites has also brought suspicions, particularly from the US, since most satellites are “dual use” technologies, capable of civilian and military applications. Currently, China is overhauling its military in a modernization drive focused, in part, on developing the capacity to fight a “high-tech” war.
Analysts say China’s determination to develop its own equivalent to the Global Positioning System, or GPS, is partly because such a system would be critical for military operations if a war were to erupt over Taiwan.
China conducted an anti-satellite test in January by firing a missile into space, destroying one of its own orbiting satellites and scattering a trail of dangerous debris. Four months later, the US is still trying to parse China’s motivations.
China eyes the US warily. Earlier this year, Eric Hagt, director of the China programme for the World Security Institute, testified in Washington that China’s increasinginvestment in space has made it feel more vulnerable at a time when the US is advocating missile defense programmes.
China believes the US is determined to dominate space, even as China’s own national interests are increasingly tied to space, Hagt said.
The US is also realizing that many parts of the world are happy to give China that space. When the Nigerian satellite was launched, the blast-off was televised live to Nigeria, the Chinese news media reported. Nigerian newspapers proclaimed the satellite as aseminal moment in the country’s efforts to modernize its economy.
Rufai, the Nigerian project manager, said he was certain that other developing countries had noticed how China had designed, built, launched and financed the satellite.
“It’s a model that people will try to replicate,” he said.
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First Published: Tue, May 29 2007. 12 38 AM IST
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