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«A research undertaking by the Centre for Chinese Studies, prepared for the Extractive Industries Transparency Initiative (EITI) & Revenue Watch ...»

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The engagement strategy, designed to take place over an eight month period, has three main


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The inclusion of a research component will promote a sense of control and ownership of the process amongst Chinese stakeholders, greatly improve their understanding of transparency and the EITI, and empower the EITI with the knowledge and capacity to effectively engage with relevant Chinese stakeholders.

3.6.1 Component One: Preliminary Seminar in Beijing, PRC

Component One would consist of a seminar in Beijing, China, where key Chinese stakeholders would be informed of EITI and its objectives. The research carried out by the CCS in 2008 shows that it is imperative to inform Chinese stakeholders on transparency, CSR and the principles of EITI in their own language. The goal of this first component would therefore be to accurately inform key Chinese officials of EITI in Mandarin Chinese. During the seminar, a Chinese moderator would be used for the discussions. Simultaneous interpretation would be provided for non-Chinese speaking presenters and all printed information material would be made readily available in Mandarin Chinese. The participants would comprise a small group of 20-30 key stakeholders including Chinese government policy makers, academics and representatives from the Chinese business sector.

The CCS has already made initial contact with senior representatives of the NDRC Energy Research Bureau and the China Petroleum University and tentative interest in participating in such a seminar has been expressed by these institutions. Moreover, targeted sectors of the domestic Chinese media would also be engaged to raise the profile of the seminar and awareness of EITI. Key individuals within the news and media industry would also be invited to the event where a set of strategic interviews would be arranged.

Since the EITI is a non-governmental organisation, it is recommended that government officials from countries supporting EITI participate in these seminars to add weight and formalise the engagement with their Chinese counterparts.

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3.6.2 Component Two: Research Project on Transparency by Chinese Academics The aim of Component Two would be to initiate Chinese participation in the EITI process and foster a sense of genuine ownership and legitimacy of these issues within the Chinese stakeholder community. This is of great importance since it was identified during CCS’ research in Africa and China during 2008 that there is a strong sentiment among many Chinese stakeholders that they have been singled out as a particular challenge by EITI and other CSR initiatives.

The process of initiating a sentiment of inclusion of the EITI process among Chinese stakeholders would be addressed through a research project involving a team of Chinese researchers. Following the first seminar, four distinguished Chinese research specialists could be commissioned to research and compile a report in Mandarin Chinese exploring how transparency, CSR and EITI are perceived from a Chinese perspective, both in terms of advantages and potential challenges. The research methodology used to produce these reports would be qualitative in nature. Initial consultation of existing material on the area would be followed by interviews with relevant stakeholders. The final reports would be translated into English, French and possibly Portuguese from Mandarin Chinese.

It is important to note that both the final report produced and the research process in itself will be of equal significance to achieving the aim of this component. The final report will be disseminated to a wider audience during Component Three and provide important insights into Chinese perceptions of the EITI process that can be used to guide the design of further outreach programs to engage Chinese stakeholders. The research process in itself is important since it will give the Chinese researchers and respondents an opportunity to contribute to the EITI process in China.

3.6.3 Component Three: Launch of Chinese Research Report on Transparency in Beijing, PRC Component Three will consist of a seminar in Beijing, China, where the report produced during Component Two is launched. The aim of the launch, which will take place as an open forum, is to present the findings of the report to Chinese policy makers. At this stage, through the inclusion of Chinese researchers, it is anticipated that the process will have gained traction, and could therefore be launched to a broader audience on a larger scale. However, it is important to remember that at this point, the ideas of CSR and EITI will still be new for many of the participants of this seminar. It is therefore imperative to retain the culturally sensitive modus operandi of the introductory seminar, using a Chinese moderator for discussions and providing simultaneous interpretation for non-Chinese speaking presenters as well as having hard copies of the information material available in Mandarin Chinese.

Senior Chinese policy makers, corporate and academic representatives in addition to top officials from established multinational companies operating in the relevant African countries will be invited to participate. During the seminar, the report produced during Component Two will serve as a starting point for discussions to identify ways for Chinese and other actors operating in Africa to improve communication and collaboration in order to work together more effectively to implement EITI.

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3.7 Concluding remarks This report has outlined key actors and challenges in China’s energy policy formulation process and discussed perceptions- and implementation of EITI in this context. The report’s main suggestion is that there are two main challenges for the EITI to overcome when engaging in Beijing: first, lack of awareness of EITI, and second, perceptions of EITI as a ‘Western NGO initiative’. Also, as outlined in the report, China’s energy policy formulation is fragmented and continues to face a range of challenges. The complexities in terms of dynamics between the relevant government institutions at hand compound engagement efforts. However, it is believed that difficulties in conducting advocacy work in Beijing regarding EITI do mainly not emanate from the intricacies of the Chinese energy policy formulation process. Instead, it is mostly due to protocol challenges stemming from widely held perceptions of EITI as an NGO.

There are a great deal of common interests between EITI’s agenda and the Chinese government and CPC’s current priority areas, notably regarding corruption, transparency in financial transactions and the need for international engagement on the development and implementation of energy policy as its energy industry grows and becomes increasingly globalized. However, as the Chinese policy formulation process is considered to have very particular historical background, logic and implementation mechanisms, the Chinese leadership remains somehow wary of external intervention that might restrain development or otherwise prove detrimental.

Objective discussion, opinions and suggestions are however welcome. Certain institutions and sections of China’s energy industry will be considerably more receptive than others and an improved understanding of the complex dynamics involved will be the first step towards meaningful engagement on international cooperation.

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Endnotes Constantin, Christian (2007). “Understanding China’s Energy Security” in World Political Science Review, Article 2, Volume 3, Issue 3, pp. 4, 16.

For more information about the Extractive Industries Transparency Initiative, please refer to www.eiti.org Zhang, Ye (2003). “China’s Emerging Civil Society.” Brookings Institute, June. Page 2. Available on http://www.brookings.edu/~/media/Files/rc/papers/2003/08china_ye/ye2003.pdf McWilliams, Abagail; Siegel, Donald S. and Wright, Patrick M. (2006). “Corporate Social Responsibility: Strategic Implications” in Journal of Management Studies, Issue 43:1, January, page 1.

CSR Network (2009). ”What is CSR?” Accessed 28.07.2009 from http://www.csrnetwork.com/ csr.asp People’s Daily (2001). “China Launches Two-Way Investment Strategy for Better Access”.

Published 12.09.2001, accessed 09.01.2009 from http://english.peopledaily.com.cn/ english/200109/12/eng20010912_80006.html

-Christoffersen, Gaye (2005). “The Dilemmas of China’s Energy Governance: Recentralization and Regional Cooperation” in The China and Eurasia Forum Quarterly, Volume 3, Number 3, November, page 58.

Zhao, Hong (2007). “China-U.S. Oil Rivalry in Africa”. Paper presented at the international conference titled: China in the World, the World in China, 5-6 August 2007 at University of Malaya, Asia Research Centre, CBS, Copenhagen Discussion Papers 2007. Page 10.

Xinhua (2005). “CNOOC Withdraws Unocal Bid”. Published 03.08.2005, accessed 14.01.2009 from http://www1.china.org.cn/english/2005/Aug/137165.htm Kim, Seongjo (2008). “Chinese energy policy making process”. Paper presented at the MPSA Annual National Conference, Palmer House Hilton Hotel, Chicago, 03.04.2008, page 7.

Accessible at http://www.allacademic.com/meta/p268004_index.html Houser, Trevor (2008). “The Roots of Chinese Oil Investment Abroad” in Asia Policy, Number 5, January, page 153.

Lieberthal, K. (1992). “Introduction: the ‘fragmented authoritarianism’ model and its limitations” in Lieberthal, K. and Lampton, D. (eds.) Bureaucracy, Politics, and Decision Making in Post-Mao China. Berkeley: University of California Press.

Constantin, Christian (2007). Op. cit. p. 3.

Constantin, Christian (2007). Op. cit. pp. 2f.

Lieberthal, Kenneth and Oksenberg, Michel (1988). Policy Making in China: Leaders, Structures, and Processes. Princeton (NJ): Princeton University Press, Andrews-Speed, Philip (2004). Energy Policy and Regulation in the Peoples Republic of China.

The Hague: Kluwer Law International. Page 31.

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Shirk, Susan L. (1993). The Political Logic of Economic Reform in China. Los Angeles:

University of California Press.

Interview, Beijing, 05.11.2008.

China Daily (2008). “Fuel Tax Reform an Energy Milestone.” Published 29.12.2008.

Downs, Erica S. (2008). “China’s Energy Policies and Their Environmental Impacts”, presentation for the U.S.-China Economic & Security Review Commission, 13 August. Available at http://www.brookings.edu/testimony/2008/0813_china_downs.aspx Andrews-Speed, Philip (2004). Op. cit. Page 48.

Xu, Yi-chong (2008). China’s Struggle for Power, Lowy Institute for International Policy or the Griffith Asia Institute, August. Page 2.

Ibid. Page 13.

People’s Daily (2005). “CPC Central Committee Approves Proposals for Formulating 11th Fiveyear Plan.” Published 11-10-2005. The Preamble of the Outline reads as follows: “The Outline of the 11th Five-Years Plan for National economic and Social Development was formulated in accordance with the CPC Proposals for Formulating the 11th Five-Year Plans for National Economic and Social Development.” For a brief outline of the policy, please refer to the NDRC’s website at http://en.ndrc.gov.cn/hot/

t20060529_71334.htm For example:

-“China’s Energy Security: domestic and international issues”, Survival, Vol. 48, no. 1 (Spring 2006), pp. 170-189.

- “China in Northeast Asia: the energy-security nexus”, ERINA Booklet (Japan), Vol. 3 (November 2004), pp. 58-61.

For extensive list of publications, see http://sis.ruc.edu.cn/teacher/resume/zha_e.pdf

For example:

China's Energy Dependence and Stabilizing Role in the Gulf and the Central Asia (1998), available at http://iwaas.cass.cn/en/others/show_fruit.asp?id=497 The Indian Ocean Economic Rim and China (2001) http://iwaas.cass.cn/en/others/show_fruit.asp?id=496 For extensive list of publications, see http://iwaas.cass.cn/en/others/show_user.asp?id=80 Downs, Erica (2006). “China: Energy Security Studies”, Brookings Foreign Policy Studies, the Brookings Institution, December. Available at http://www.brookings.edu/~/media/Files/rc/ reports/2006/12china/12china.pdf

-Downs, Erica (2008). “China’s “New” Energy Administration” in China Business Review, November–December. Available at http://www.brookings.edu/~/media/Files/rc/articles/2008/11_ china_energy_downs/11_china_energy_downs.pdf Andrews-Speed, Philip (2004). Op. cit.

Constantin, Christian (2007). Op. cit.

Andrews-Speed, Philip (2004). Op. cit. Page 48.

Hu Jintao, Wu Bangguo, Wen Jiabao, Jia Qinglin, Li Changchun, Xi Jinping, Li Keqiang, He Guoqiang and Zhou Yongkang.

Naughton, Barry (2008). “China’s Economic Leadership after the 17th Party Congress” in China Leadership Monitor, Number 23. Available at http://media.hoover.org/documents/CLM23BN.pdf Information Office of the State Council (2007). “White paper on energy”. Published 26.12.2007, available on http://www.china.org.cn/english/environment/236955.htm Lam, Willy (2008). “Beijing's Stimulus Plan: Preemptive Crisis Management” in China Brief, Jamestown Foundation, Volume 8, Issue 22, November 24. Available at http://

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www.jamestown.org/programs/chinabrief/single/?tx_ttnews%5Btt_news%5D=34165&tx_ ttnews%5BbackPid%5D=168&no_cache=1 Weng, Shiyou; Yuan, Zhaohui and Cheng, Zhiyun (2008). “China’s Congress Revitalizes NDRC” in Economic Observer Online. Published 21.03.2008, accessed 15.01.2009 from http:// www.eeo.com.cn/ens/Politics/2008/03/21/94671.html Downs, Erica S. (2008). “China’s Energy Policies and Their Environmental Impacts”, presentation for the U.S.-China Economic & Security Review Commission, 13 August. Available at http://www.brookings.edu/testimony/2008/0813_china_downs.aspx Xu, Yi-chong (2008). China’s Struggle for Power, Lowy Institute for International Policy or the Griffith Asia Institute, August. Page 12.

Fu, Jing (2008). “Energy management reshuffle starts” in China Daily. Published 07.07.2008, accessed 14.01.2009 from http://www.chinadaily.com.cn/bizchina/2008-07/07/content_6825155.

htm Downs, Erica S. (2008). Op. cit.

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