CHAD: CHINESE ENGAGEMENT AND POTENTIAL AREAS FOR

UNCLAS SECTION 01 OF 02 NDJAMENA 000085

SIPDIS
SENSITIVE

STATE FOR AF/C
STATE FOR EAP/CM
STATE FOR AF/RSA - MAZEL, GRIESMER, BOWLES
STATE FOR S/USSES
OSD FOR DASD HUDDLESTON
NSC FOR GAVIN
LONDON FOR POL - LORD
PARIS FOR POL - BAIN AND KANEDA
ADDIS ABABA ALSO FOR AU

E.O. 12958: N/A
TAGS: PREL EAID CN CD
SUBJECT: CHAD: CHINESE ENGAGEMENT AND POTENTIAL AREAS FOR
COOPERATION

REF: STATE 10152


1. (U) Following paras provide answers to reftel request
for information on Chinese engagement in Chad in advance of
the U.S-China sub-regional dialogue to be held in Washington
March 4.


2. (SBU) China's major investment in Chad is in oil
exploration and refining. In 2008 the China National
Petroleum Company, operating as a 60 per cent partner in a
joint venture with the Chadian National Hydrocarbon Company
(40 per cent),began building a refinery north of N'Djamena.
The facility is expected to produce 20,000 barrels a day once
it becomes fully operational. The initiative aimed initially
at supplying Chad's internal petroleum requirements. In 2009
new oil fields being developed with Chinese assistance showed
promise of having sufficient yield that a quantity of oil is
likely to be exported, perhaps through an existing Esso-Chad
pipeline across Cameroon to ports on the coast. The
pipeline-sharing arrangement, if it comes to fruition, will
require that the Chinese-Chadian joint venture adhere to
Esso's high standards of environmental protection and
financial transparency.


3. (SBU) Chinese firms are also engaged in cement
production, road-paving and reconstruction of Chad's National
Assembly, destroyed in rebel attacks in 2008. Cement workers
are the only Chinese laborers to have been accused by local
Chadians of exploitative practices and disregard for the
customs of citizens dwelling near their area of operation.
Although Chadians speak disparagingly of the quality of
Chinese products in markets, and suspect that China is
dumping consumer merchandise of too low a quality to attract
current buyers in the country of origin, general attitudes
toward the Chinese are relatively positive in Chad. Road
workers with Chinese firms operating in N'Djamena seem to be
viewed with gratitude -- not surprising given the state of
Chad's transportation network. Chadians appear eager to
patronize a recently-arrived team of Chinese medical experts
(some traditional and some Western-oriented) who have set up
shop in a Chinese-built and run hotel in N'Djamena. Chadians
turn out in force at the numerous Chinese restaurants here.
President Deby uses a private room in one of N'Djamena's
longest-established Chinese (actually Taiwan) restaurants to
entertain state visitors.


4. (SBU) Our current Chinese Embassy contacts are
presentable and personable. They speak good French, engage
actively in P-5 initiatives, and seem not to disdain Chad for
its many problems or to regret their lives in this rather
austere diplomatic community. On October 1, 2009, the
Chinese Ambassador delivered a speech -- widely carried in
the local media -- stating that his nation sought to move
beyond its previous lack of transparency in assistance
provision and to coordinate openly with other donors and with
Chadians at all levels to ensure that Chinese investments and
aid served Chad's needs and meshed with activities of the
rest of the international community. The Chinese Ambassador
has since spoken several times with us and with French and EU
counterparts to emphasize that he is interested in gathering
information on what educational and health projects his
nation could usefully undertake to complement initiatives
already under way through the sponsorship of other donors.



5. (SBU) The Chinese Ambassador has made clear to us that
his nation seeks stability and better governance in Chad --
two goals we share. He has also offered that his nation
doubts the value of democracy in Chad and elsewhere, and that
in his view, a communist party would do Chad much good. The
Chinese Ambassador has expressed concern that Chadian
elections, if not carried out in an acceptable manner, could
provoke dissatisfaction and destablilization -- in order to
help ensure that Chad's 2010 electoral process is credible,
China has decided to contribute USD 250,000 to the operating

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budget of the Independent Electoral Commission (CENI). The
notion of China helping to fund an election has provoked some
surprise, but no opposition, on the part of democratic
representatives here.


6. (SBU) Beyond its current projects, China seems
interested in helping Chad with basic education, girls'
education, scientific education, Chinese language teaching,
and medical assistance, including in infant and maternal
health, malaria treatment and treatment of diarrheal
diseases. The Chinese have also told us that they would be
willing to help Chad's agricultural sector, but its problems
are so numerous that they don't know where to start. No
current U.S.-China joint projects are under way as of yet,
but we think there is potential in any of the areas above.


7. (SBU) Chad has had relations variously with China and
Taiwan over the years, and President Deby has been known to
express nostalgia for the quality of Taiwan-made goods. Deby
has also referred in both more and less direct statements to
concerns that China's long-standing close relations with
Sudan imply that it is not a neutral player in Chad. We do
not share this perception. As for Taiwan, some of its
investors remain here in private capacities, and a Taiwan
construction firm left as the island's legacy the one major
bridge across the Chari River, known locally as the Taiwan
Bridge. (Two parallel rivers divide Chad from Cameroon, so
the Taiwan bridge is Chad's lifeline to the most stable of
its neighbors, and one with a coastline.) This seems not to
bother our Chinese counterparts, who have never sought to
engage with us on Taiwan's status, Tibet or other points of
contention in the U.S.-China relationship.


8. (U) Minimize considered.
NIGRO