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Simorgh
01-24-2006, 07:23 AM
China's army leaner and meaner

By Antoaneta Bezlova


BEIJING - Recent cutbacks in China's vast military - part of Beijing's campaign to modernize and strengthen its army - were accompanied by an unusual public relations stunt.

In contrast to traditional secrecy surrounding the country's military affairs, China chose to publicize its new downsizing campaign by selecting two experts from military-backed think tanks to be interviewed on China Central Television (CCTV) on what the new cuts mean for Beijing's ambitions to build a slimmer and more mobile force.

A 200,000-soldier reduction, under way since 2003, was completed last month, leaving about 2.3 million troops in what is still the world's biggest standing army, according to a report in the official PLA Daily.

"Our military is marching towards the goal of an appropriately sized, structurally balanced, lean, command-responsive fighting force," the paper said this month.

But responding to doubts in the United States and neighboring Asian countries that its growing military clout might become a regional threat, Beijing chose not to limit its announcement to the state-run print media, but to air its views on the significance of the military cuts on CCTV.

Major-General Peng Guangqian, of the research unit of the China Military Control and Reduction Association, suggested the new round of downsizing has achieved a different objective than previous cuts.

"It is not only about reducing numbers; this time it is also about getting the army tailored to the needs of a new information age and the requirements of a future high-tech war," he said.

The latest staffing reductions included 170,000 officers - some 80% of all the cutbacks. "It reflects the need to trim commanding personnel and make the chain of decision-making swifter and more rational," Peng said.

Teng Jianqun of the Chinese Military Academy said, "In a high-tech environment where information technology is paramount, there won't be a need for so many layers of commanding personnel."

The emphasis on high-tech warfare, as opposed to China's traditional reliance on masses of ground troops, has also seen the infantry falling to an all-time low proportion of the military force, according to the People's Liberation Army's newspaper.

This modernization trend was also reflected in a series of military personnel changes completed last year. The Communist Party's decision-making Central Military Commission, which has long been dominated by the PLA, for the first time admitted into its ranks commanders from the air force, the navy and the missile forces in order to cope with high-tech warfare in the future.

Air force commander Qiao Qingchen, navy commander Zhang Dingfa and commander Jing Zhiyuan, whose units control China's ballistic missiles, joined the top military body in September, signaling the importance given to fighting a war in a new high-tech environment.

Nevertheless, Major-General Peng suggested further reductions in the proportion of ground troops were in the works, with an increase of the role of the navy and missile forces.

"Our goal is to cut fat and add muscle," Peng said. "We need to trim the tail and sharpen our teeth," he added, referring to a saying by the late Communist Party chairman Mao Zedong.

Both military experts took pains to emphasize that the top-to-bottom modernization drive aimed at forming a skilled and lean army was as important as the purchase of the sophisticated weapons China wants to acquire.

Over the past few years, Beijing has had to face accusations that a distinct regional military threat is emerging as the PLA stockpiles more modern weapons. The announced defense budget has risen by double-digit percentages in most recent years. For 2005, it was about US$30 billion, a 12.6% increase from the prior year.

The Pentagon says high-priced programs controlled by the PLA, such as space flights, and other military-backed research are not included in the official budget figure. Last October China reacted sharply when US Defense Secretary Donald Rumsfeld suggested that its true military spending might be three times the announced budget figure.

If true, that would make China's defense expenditures among the world's largest, but still far behind the $420 billion earmarked by the US for defense in 2005.

Though China's total spending is far below US levels, the rate of its increase is much greater than elsewhere in the West, and mainland China now ranks fifth in the world in terms of military spending.

As Rumsfeld's comments during his October visit to Beijing showed, the US and its allies remain very wary about the pace and scope of China's military expansion.

These concerns were heightened when, last August, China and Russia cooperated in the largest joint military exercise in decades. Some 10,000 PLA troops and a range of sophisticated Russian weaponry were deployed for the maneuvers that took place in China's Shangdong province.

Russia remains China's primary supplier of military hardware but Beijing has been lobbying the European Union to lift its ban on weapon sales this spring.

The lifting of the embargo foreseen originally for last spring was delayed by a combination of strong US opposition and the passing by Beijing of its Anti-Secession Law, which provides the PLA with the legal base for invading China's arch-rival - the democratic island of Taiwan.

Beijing has tried to assuage the international community's perceptions of threat caused by increasing military spending. Almost simultaneously with the announcement of the military cuts last month, the government released a foreign-policy white paper in which it made a "solemn promise" that its growing power will never become a threat to other nations.

"China's road of peaceful development is the inevitable way for China to achieve modernization and a serious choice and solemn promise made by the Chinese government and the Chinese people," the white paper said. "China did not seek hegemony in the past, nor does it now, and will not do so in the future when it gets stronger."


http://www.atimes.com/atimes/China/HA25Ad01.html

Simorgh
01-24-2006, 07:24 AM
China charts a new course with LNG carriers


By Michael Mackey


SHANGHAI - China's recent launch of its first domestically built liquefied natural gas (LNG) carrier ship marked a significant upgrade of the country's shipbuilding industry.

The ship, launched on December 29 by the China State Shipbuilding Corp's (CSSC) Shanghai-based Hudong-Zhonghua Shipbuilding (Group) Co Ltd, is 292 meters long and 43.35 meters wide with a capacity of 147,200 cubic meters.

Double-hulled, the vessel is of the prismatic, membrane type of LNG-carrier, which means the storage tanks conform to the ship's hull and the vessel therefore lacks the spherical tanks that give
Moss-type LNG-carriers (named after the Norwegian company Moss Maritime, which originated the design in 1971) their distinctive profile.

Building LNG carriers is "highly sophisticated stuff. Chinese yards have done easy-peasy stuff" until now, said one shipping-industry source who asked not to be named. "LNG [carriers bring in] a lot of money." Indeed, Hudong-Zhonghua has five further LNG vessels on order. A second is due to be delivered in early 2008, with the first two ships priced at US$400 million each.

Chinese officials also have no doubt that the specialized natural-gas carriers mark a significant departure for Chinese shipbuilding. "The construction of China's first LNG carrier implies that China's shipbuilding industry has entered a new phase, and it will make the industry more competitive in the world market," was the view of Zhang Xiangung, a senior official of the Commission of Science, Technology and Industry for National Defense.

There are said to be "very sensitive" negotiations for another 12 carriers ongoing. However, two problems will need to be addressed to ensure the ships don't turn into white elephants, both of them on the supply side. One is the issue of terminals; the second is the equally vexing issue of LNG sources and their cost.

Terminal plans
LNG terminals are as important to the process of moving the products as the ship. Because LNG is kept very cold (around -160 degrees Celsius) to maintain it in liquid state, it requires special handling at every stage, from initial recovery to end-user delivery. Chinese companies have proposed building 16 LNG terminals, of which 10 will be operational by 2010. However, so far only two terminals have secured gas supplies for the long term.

These are Guangdong Dapeng LNG and a second facility in Fujian, which are due to start operations in June and the end of 2007, respectively. More is known about the Dapeng facility, which is jointly owned by the China National Offshore Oil Corp (CNOOC) and various local investors.

The facility is reported to have cost about 7 billion yuan (US$868 million) and, when it goes online, will import 3 million tons of LNG annually from Australia. The Fujian terminal is a joint venture between CNOOC Gas and Power and Fujian Investment and Development. CNOOC, a natural for this field, is known to be building a string of terminals to receive imported LNG along China's affluent southwest coast.

Not all the terminals will be in one region. PetroChina has detailed plans to build throughout the central and northern provinces. It has named Yangkou Port near Rudong in Jiangsu province, Caofeidian Port near Tangshan in Hebei and Dalian in Liaoning province as the sites of its terminals. There has also been talk of similar facilities in the provinces of Zhejiang and Shandong.

All these proposed facilities face one common problem, which could well trim the number of terminals proposed - will there actually be enough LNG for all of them? One of the drivers of China's foreign policy at the moment is its need for commodities, especially energy.

As other big economies, such as India, start to join the melee, the competition will drive prices up and the results of this process are already pushing China financially.

"China will have a very difficult time buying LNG at the prices it's willing to pay," Mark Pilcher, vice president of BP's global LNG division, said recently. "Right now, there is a shortage of LNG in Asia and that's why prices are so high. [The same is] also definitely true in the world."

Foreign investment welcome
That future issue aside, the recent launch holds out the prospect, tantalizing for some and extremely challenging for others, of an expanded and invigorated Chinese shipbuilding industry on an almost epic scale - but one that is open to the rest of the world to an unprecedented degree, in terms of technology, exchanges and capital.

For shipbuilders, the specialized technology in LNG carriers, including Invar or Triplex membranes for the tanks, Perlite insulation layers to keep the gas cold, and all the associated plumbing, makes LNG vessels the highest class of civilian cargo ship. Well aware of this, the Chinese have put their hours in to make sure their country joins the elite club of shipbuilders.

"The technology required is very demanding and complicated. We have studied the building of LNG carrier[s] since 1997 and workers underwent about 8,400 programs of special training," said Wang Hengyuan, chief technology inspector of CSSC.

CSSC's progress transcends expanding the product line into LNG carriers, and is another emblem of how China's shipbuilding trade will shake the world in the coming years. Vice president Tan Zuojan said openly in a recent speech that CSSC's goal was to try to make itself the world's largest shipbuilder. Tan outlined a detailed, five-pronged vision for CSSC in the coming half-decade. The five prongs include redoubled efforts to construct a new shipbuilding base; adjusting the product mix; greater use of science and technology; enhancing overall competitiveness; and pursuing additional foreign linkages.

To many observers, the real surprise lay in the last point. Tan advocated moving from the existing approach of a reclusive shipbuilding industry, one virgin to overseas involvement, and offered not one but two modes of international linkage. The first is foreign exchanges and cooperation; the second, less standard, was an invitation for overseas investment.

"We sincerely welcome overseas capital actively to take part in the construction of CSSC's new shipbuilding bases and marine-related equipment production bases," the text of his speech said.

Shipbuilding Island
As for the actual building of ships, the focal point is building what is in effect the Shipbuilding Island of Changxing, just outside Shanghai. Changxing may eventually become the largest shipyard in the world. By 2015 its shipyards are projected to have a capacity of 8 million deadweight tons (dwt).

Other shipyards in the vicinity will have a total capacity of 12 million dwt - and that is to be just half of China's production.

"We will step up the new shipbuilding base project in Changxing Island," said Tan. The real impact of Changxing may actually not be the expansion of capacity that it will allow, impressive though this is, but in the across-the-board product mix strategy for which it appears to be a catalyst.

This reflects a major internal change within the Chinese industry as the old statist corporations run by Beijing give way to more market-based enterprises.

"A [new] structure pattern [in the] shipbuilding industry is taking shape gradually, with enterprises of multiple ownership, such as state-owned, privately owned, exclusively foreign, China-foreign joint ventures or cooperative ones to be developed together," noted Jin Caikuan, president of the Chinese Society of Naval Architecture and Marine Engineering, as he spoke credibly of "advancing towards the target of being the world's No 1 [shipbuilder]."


http://www.atimes.com/atimes/China_Business/HA25Cb05.html

MiG 31
01-24-2006, 07:55 AM
Thanks Simorgh, I always enjoyed reading your articles.

Simorgh
01-25-2006, 11:18 AM
Ma mokhlese jenab aaly hastim..

:)