Wednesday, May 25, 2005

China agrees $600m Uzbek oil deal

http://news.ft.com/cms/s/52c68f7a-cd75-11d9-aa26-00000e2511c8.html
China agrees $600m Uzbek oil dealBy Andrew Yeh in Beijing and Guy Dinmore in Washington Published: May 26 2005 00:34 Last updated: May 26 2005 00:34
Uzbekistan's President Islam Karimov announced on Wednesday the signing of a $600m oil deal with China, just a day after Beijing declared its support for the central Asian leader in his crackdown against anti-government protesters.
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Mr Karimov has come under pressure from the US, Europe and the United Nations for an international investigation into the killing of possibly hundreds of civilians this month, but has found political backing from China and Russia.
The Uzbek leader told China's People's Daily, the official Communist party's newspaper, that the deal marked an important step in energy co-operation between the two countries. Uzbekneftegaz, a state energy company, and China National Petroleum Corp (CNPC) would finalise a joint venture during his current visit to China, Mr Karimov said.
Asked to comment on the oil deal, a US State Department spokeswoman said: “We welcome any new supplies reaching the world market.”
China's willingness to conclude a high-profile deal at a time when Uzbekistan faces international criticism illustrates Beijing's priorities in relations with central Asia, and reflects its strategy to source large quantities of oil from central Asian neighbours. Uzbekistan's energy sector, based on gas, is dominated by ties to Russia.
China offered rare public support for the Uzbek leader this week, saying his actions had been necessary to restore order.
“We support efforts by the Uzbekistan government to stabilise their domestic situation and their commitment to the country's peaceful development,” said Kong Quan, a foreign ministry spokesperson. “To maintain stability in central Asia, the primary concern is to strike down on the three forces, which include terrorism, separatism and extremism.”
Russia has also stood by Mr Karimov, saying an international investigation was not needed. Although the US has been critical of Mr Karimov, its own statements have remained cautious.
The Bush administration, which has little economic interest in Uzbekistan but keeps a close military and intelligence relationship, affirmed on Wednesday that their partnership would not be affected by the government crackdown.
“The kind of co-operation we can have with Uzbekistan, again, in the fight against terrorism is based on common interests,” said Richard Boucher, State Department spokesman. “It doesn't do any of us any good to abandon the effort against terrorism in this critical region. So we will continue to work with them in many areas, including the fight against terrorism.”
He reiterated US calls for an international investigation into what happened in Andizhan. Government forces are reported to have opened fire on protesters in the eastern town on May 13 after armed men stormed government buildings and clashed with security forces. Some broke into a prison to free businessmen accused of being Islamic extremists.
Uzbek authorities say 169 people died, most of them militants, but other reports put the death toll at more than 500.
Mr Boucher expressed concern about a detained human rights activist, Saidjahon Zaynabitdinov, who had received US-funded training and assistance.
“We think the government is trying to silence activists and journalists through the arrests,” he said.
Mr Karimov met Hu Jintao, the Chinese president, on Wednesday and is scheduled to see Wen Jiabao, the prime minister, during his trip.

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