[Epoch Times, April 17, 2022]Since the start of the war between Russia and Ukraine, the CCP’s attitude towards Russia has always been ambiguous, but a series of actions have revealed its inner fear.Recently there has been news that China’s largest offshore oil and gas producerCNOOC, is preparing to exit operations in the UK, US, and Canada over concerns that these assets could be the subject of Western sanctions. And a few days ago, China’s three major state-owned oil companies, including CNOOC, had pressed the pause button on the Russian deal.
In addition, we can also see that after the Russian-Ukrainian war, major international telecommunications companies have been withdrawing from Russia one after another.HuaweiOriginally had the opportunity to take advantage of the opportunity, but Huawei was extremely cautious, and even recently announced that it would suspend receiving new orders from Russia.
Judging from the CCP’s recent operations, it has been busy putting out fires in the backyard and preparing for decoupling. At the same time, the CCP is also busy looking for a new way out in Southeast Asia. So, what plans does the CCP have? Can it be successful? Let’s talk about that today.
fear of sanctions CNOOCDivestment from Anglo-American Canada
Let’s take a brief look at the situation of CNOOC.
In 2013, CNOOC acquired Calgary-based Nexen Energy Company (Nexen) for US$15 billion, thus acquiring North Sea assets, which is also CNOOC’s largest overseas acquisition to date. Nexen’s assets, including exploration, development, and production projects, are distributed in western Canada, the British North Sea, the Gulf of Mexico and other regions. As a result, CNOOC has brought its business to the UK, Canada and the US.
Currently, Nexen has assets in the Eagle Ford and Rocky Mountain shale basins in the United States, as well as holdings in two large offshore oil fields in the Gulf of Mexico. In Canada, Nexen’s main assets are the oil sands projects at Long Lake and Hangingstone in Alberta, which produce about 220,000 barrels of oil equivalent per day.
In the UK, CNOOC’s wholly-owned subsidiary is the operator of the Buzzard oilfield in the UK North Sea, with a 43.2% stake, which is one of the UK’s most productive oilfields.
In late March, Bloomberg reported sources claiming that CNOOC had hired Bank of America to sell assets in the North Sea worth $3 billion. While intending to withdraw from Western countries, CNOOC is seeking to acquire new assets in Latin America and Africa, and hopes to prioritize the development of large new oil fields in Brazil, Guyana and Uganda.
The source also mentioned that CNOOC plans to list on the Shanghai Stock Exchange in mid-to-late April. CNOOC also mentioned in its prospectus that it may face more sanctions.
So, has CNOOC been sanctioned before? That’s right.
In November 2020, former US President Trump (Trump) signed an executive order prohibiting Americans from investing in “Chinese companies with military backgrounds”, and CNOOC, on this “blacklist”, has CNOOC’s investment ban took effect on March 9 last year.
Prior to this, on February 26 last year, the New York Stock Exchange decided to officially start the delisting process of CNOOC’s American Depositary Receipts (ADS), and then on March 9, CNOOC ADS was suspended from trading. Yes, on October 22 last year, CNOOC was delisted from the New York Stock Exchange, and subsequently, CNOOC was also delisted from the Toronto Stock Exchange in Canada.
12 moreChina concept stocksFear of delisting
This happened last year. The US sanctions at that time were mainly aimed at companies with the background of the CCP’s military, and CNOOC’s sad exit was only a microcosm of Chinese companies with similar backgrounds. This year, CNOOC is further withdrawing from the West. Countries, it is conceivable that the large-scale enterprises of the CCP, their overseas tentacles are constantly being cut off.
And this year, the U.S. sanctions are approaching, and China’s listing in the U.S.China concept stocksEnterprises are facing the threat of delisting. Since March, the US Securities and Exchange Commission (SEC) has announced 23 Chinese companies that have been included in the “pre-delisting list”, including Weibo, Sohu , Baidu and other well-known Chinese companies.
On the 12th a few days ago, the US Securities and Exchange Commission just announced the latest fourth batch of lists. The 12 companies in the new list will be transferred to the “Delisting List” if they fail to submit evidence that they meet the listing conditions before May 3.
According to the “Foreign Company Accountability Act”, a company that is included in the “determined delisting list” needs to submit the documents required by the SEC within 3 years. If the company does not submit, or the submitted documents do not comply with Requirements, in theory, will face delisting at the beginning of 2024 after the disclosure of the 2023 annual report.
In fact, the U.S. had endured it for ten years before this, but with the start of the U.S.-China trade war, the U.S. did not want to endure it anymore, because the U.S. did realize that in the current international environment, as well as China’s internal Under the circumstances, if the US and China really decouple financially, the CCP will not be able to stand it.
Therefore, under the audit principles adhered to by the SEC, although the CCP has protested for more than a year, the CCP still has to make concessions. Not long ago, the China Securities Regulatory Commission issued a request for comments on the revision of the overseas listing of Chinese companies. It is clear that the audit of Chinese companies will be completed through the cross-border supervision cooperation mechanism, and it is mentioned that the China Securities Regulatory Commission and other institutions will provide necessary assistance.
Since China’s entry into the WTO, because the United States has always been a policy of appeasement against the CCP, the CCP has also followed the U.S. routine. The CCP is really worried about the severe sanctions against Russia.
US sanctions Sword of Damocles
As you can see, the Russian media recently disclosed thatHuaweiIt has suspended new orders from Russia, asked Russian employees to take more than a month off, and laid off employees in the marketing department.
Before that, because of the war between Russia and Ukraine, Apple, Ericsson, and Nokia had all announced their withdrawal from Russia. The market had speculated that Huawei might take the opportunity to expand its market share in Russia. However, Huawei also behaved very cautiously. The reason is also impossible, because many of Huawei’s current mobile phone components still need to obtain the license of the US government.
In addition, the three major Chinese oil companies we mentioned at the beginning have also suspended investment in Russia. According to sources quoted by Reuters, China’s “three barrels of oil”, namely Sinopec, CNOOC, and PetroChina, will only perform existing Russian oil contracts, but will avoid signing new contracts, although the prices are very favorable.
Earlier, Reuters also reported that the Chinese Ministry of Foreign Affairs had summoned the top executives of the three energy companies to review their business relations with Russian partners and their local operations. The Chinese Ministry of Foreign Affairs also reminded the three companies not to rashly purchase Russian assets. In addition, Sinopec has also called off negotiations to invest $500 million to build a new natural gas chemical plant in Russia.
The dilemma of the Chinese state-owned enterprises’ dilemma also illustrates the current dilemma the CCP is facing, that is, on the one hand, it has to face Russia, which has an uncapped cooperation relationship, and on the other hand, it is worried about secondary sanctions by the United States and other countries.
As we all know, the United States has issued many warnings about the CCP’s attitude towards the Russian-Ukrainian war. Recently, White House Trade Representative Dai Qi said that the goodwill efforts of the United States and the CCP to negotiate may have reached their limit. Dai Qi mentioned that in the long run, the CCP’s trade challenges to the United States far exceed today’s Russia crisis.
On the 13th, US Treasury Secretary Yellen was also calling on China to use its influence over Russia to end the war in Ukraine. Yellen also warned that if the CCP does not respect the principles of sovereignty and territorial integrity at a critical time, it cannot expect the international community to respect these principles when the CCP calls for them. Yellen’s words are very sharp, and they also bring to the table the role of the two-faced person that the CCP is good at.
At the same time, the United States is also making its position more and more clear on the Taiwan issue, the so-called bottom line of the CCP. As you can see, recently, US congressmen are frequently visiting Taiwan. On the 14th, a congressional delegation led by senior US Senator Lindsey Graham just arrived in Taiwan for a two-day visit. Prior to this, U.S. House of Representatives Speaker Nancy Patricia Pelosi also planned to visit Taiwan on April 10, which is currently postponed due to the confirmed infection.
Of course, the Ministry of Foreign Affairs of the Communist Party of China has also stated that it “resolutely opposes any form of official exchanges between the United States and Taiwan.” However, this opposition seems to have become air at present.
Moreover, on April 14, White House National Security Adviser Jake Sullivan reiterated the US’s security commitment to Taiwan. Sullivan believes that the CCP is closely monitoring the situation in Ukraine to learn from it. He also emphasized that the situation in Ukraine and Taiwan are different, and the US-Taiwan relations are based on the Taiwan Relations Act. That means that the United States will not sit idly by Taiwan.
In addition to exerting financial and diplomatic pressure on the CCP, the United States has also begun to impose sanctions on CCP officials who persecute human rights. On March 21, U.S. Secretary of State Blinken issued a statement imposing visa restrictions on Chinese officials involved in the “oppression” of ethnic minorities, religious groups, and people of spiritual belief. Before that, on March 16, the U.S. Department of Justice had already announced in a high-profile manner that it would indict five people representing the CCP’s secret police for spying on, harassing and smearing those Chinese in the United States who criticize the CCP, and even sabotaging the target’s campaign for U.S. Congress .
Decoupling from freedom and building a community with a shared future for the CCP?
It can be seen that the current attitude of the United States and Europe towards the CCP is very clear and increasingly tough. Although the CCP is reluctant to show weakness on the surface, secretly, I believe that it is also very worried that the same situation in Russia will occur. Therefore, the current CCP’s current situation The focus, also on the domestic market, is to reduce reliance on world trade.
On April 10, Xinhua News Agency once again mentioned the “domestic cycle” in an article. The article said that the construction of a “national unified market” should be accelerated, and it was also claimed that it was “a good way to resist external uncertainties”. support”. On the same day, the Chinese Ministry of Foreign Affairs suddenly raised the tone of confrontation with NATO. It seems that the CCP is worried about being decoupled, and has to pick up the slogan of “internal circulation” again.
To put it bluntly, the CCP has to use the banner of “internal circulation” and “unified big market” to deal with the decoupling of Western countries, or prepare to take the initiative to decouple.
In the future, what will happen if these Western friends are gone? Therefore, in addition to preparing to decouple from European and American countries, Beijing is planning to strengthen its relations with emerging economic countries in the southern hemisphere, especially the BRICS countries, to protect itself. If sanctions occur, Avoid getting hit harder.
For example, Chinese Foreign Minister Wang Yi recently made a whirlwind visit to India, hoping to persuade Indian Prime Minister Narendra Modi to attend this year’s BRICS summit in China.
In addition, Beijing wants to use its influence in Southeast Asia. In 2020, ASEAN replaced Europe as China’s largest trading partner. The CCP also extends to the Middle East and Africa through the “New Silk Road”.
It has to be said that some countries in these regions are open to the CCP’s investment, and many of them have adopted a neutral attitude in the wrestling between Western countries and Russia.
However, many examples also prove that governments and politicians who are close to the CCP always fall on the CCP in the end. Let’s talk about Ukraine. Some people say that it is precisely because of Ukraine that the CCP’s military power has been accelerated for 20 years. The CCP’s official media, the World Wide Web, also mentioned in an article in 2014 that without Ukraine, there would be no CCP’s national defense achievements. . But look now, how does the CCP treat Ukraine?
Institute of Financial and Commercial Economics
Planning: Yu Wenming
Written by: Chen Siyu
Editor: Wei Ran, Yu Wenming
Producer: Li Songyun
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