The $3bn bargain: how China dominates Pacific mining, logging and fishing

Exports of oil, metals and minerals from the Pacific - 2019

THE GUARDIAN – Sun 30 May 2021 21.00 BST – by Josh Nicholas

One country dominates the Pacific’s resources extraction.

Guardian analysis of trade data has revealed that China received more than half the total tonnes of seafood, wood and minerals exported from the region in 2019, a haul worth $3.3bn that has been described by experts as “staggering in magnitude”.

The country’s mass extraction of resources comes as China has deepened its connections with governments across the region, amid a soft power push that sees it rivalling the influence of the US and Australia in the Pacific.

China took more by weight of these resources from the Pacific than the next 10 countries combined, with experts saying China “would easily outstrip” other countries, including Australia, when it comes to “gross environmental impact of its extractive industries”.

Data analysis reveals the extent of China’s appetite for Pacific natural resources.Advertisement

In 2019 China imported 4.8m tonnes of wood, 4.8m tonnes of mineral products, and 72,000 tonnes of seafood from the Pacific.

The next single largest customer for the Pacific’s extractive resources was Japan, which imported 4.1m tonnes of minerals – mostly petroleum – 370,000 tonnes of wood and 24,000 tonnes of seafood. Australia imported 600,000 tonnes of minerals, 5,000 tonnes of wood and 200 tonnes of seafood.

Shane Macleod, a research fellow at the Lowy Institute, says that China is such a dominant customer of Pacific resources because of its proximity to the region and its need to power its economy.

“They just have the appetite. They have the need for natural resources and they’re looking for sources and the Pacific is geographically close. It has the added benefit that the supply lines are shorter,” he said. “So you can look at the Ramu nickel mine in Papua New Guinea. That is providing raw material for China in the region, directly, without having to be transported from the other side of the planet.”

From Solomon Islands, more than 90% of extractive resources go to China when measured by weight. And China regularly claims more than 90% of the total tonnes of wood exported by Papua New Guinea and Solomon Islands.

Beyond direct imports of resources, data from the American Enterprise Institute shows more than US$2bn was invested by Chinese companies in Pacific mining in the past two decades. These include investments in the controversial PorgeraRamu Nickel and Frieda River mines in PNG.

The Chinese government has also sent billions of dollars in official finance into the region, including tens of millions for new marine and industrial zones

Comparing the Pacific’s exports

China is the Pacific’s biggest customer whether measured by weight or US dollars. But Australia is close behind when measured in value – $2.8bn to China’s $3.3bn in 2019. This is due to the fact that many extractive products are heavy but relatively inexpensive commodities, like wood.

“In terms of the gross environmental impact of its extractive industries, China would easily outstrip other industrial nations that operate in the Pacific region, including Australia,” says Prof Bill Laurance from James Cook University in north Queensland.

“China’s mineral, timber, fossil fuel, food and other imports from Pacific Island nations are staggering in magnitude. They’re creating enormous challenges for sustainable development in the region.


Notes and methods

  • Guardian Australia’s trade flow dataset was constructed using the 2019 version of the BACI database created by CEPII. The BACI database was in turn created using UN Comtrade data, directly reported by each country.
  • Goods in the BACI database were identified using the HS17 version of the Harmonized System Codes.
  • The Guardian classified goods as “seafood products”, “wood products” or “oil, metal and mineral products” based on keywords in the Harmonised System Codes. Aggregate trade flows were calculated by grouping data by exporter, importer and the category assigned by the Guardian.


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