South Sudan Expels Chinese Oil Executive

The Chinese executive in charge of South Sudan’s largest foreign oil producer was expelled from the country following a dispute with Sudan. From the AP:

China said Thursday it hopes talks will remove any misunderstanding with South Sudan after the Chinese head of the largest foreign oil company in the country was kicked out over allegations he conspired with neighboring Sudan to steal the south’s oil.

Foreign Ministry spokesman Hong Lei said China had seen the reports of Liu Yingcai’s expulsion but would not comment on it directly. South Sudan officials say Liu, who is president of the Petrodar Operating Company, was notified Monday that he had 72 hours to leave the country.

This incident, which follows the kidnapping of a number of Chinese workers in Sudan, is causing Chinese companies investing in Africa to develop new strategies. But observers do not expect Chinese investment in the region to slow considerably. From Reuters:

If anything, China will broaden its exposure to the region, home to some of the world’s most resource-rich but unstable countries, as it scours the globe for resources needed by the factories and businesses of the world’s fastest-growing economy.

Any major change is instead likely to be in tone rather than intent, with Chinese investors expected to take a less aggressive approach and to increasingly partner with other foreign firms in dangerous and unpredictable markets.

“When Chinese firms started in Africa, it was more driven by the political motivations of top executives of state energy giants,” said a Beijing-based oil executive.

“So the investments were made in a rushed and aggressive manner … But (now) I think they will be more cautious when it comes to due diligence and investment decisions.”

Read more about Chinese investment in Africa, via CDT.

February 23, 2012 10:21 PM
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