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China’s ties to Gaddafi mean it could lose out in Libya

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Jeremy Hobson: Now to Libya, which is no longer home to some members of Muammar Gaddafi’s family. His wife and three children have fled to Algeria in the latest sign that his rule is coming to an end — even though no one can find him. And while rebels search for him, other countries are stepping in to help rebuild Libya.

But as Marketplace’s Rob Schmitz reports now from Shanghai, China may have problem because of its recent support of Gaddafi.

Rob Schmitz: Here are the stakes for China: it’s invested $20 billion in Libya; 35,000 Chinese workers were employed there; and 3 percent of China’s imported oil comes from Libya. Now, China stands to lose all of this because it placed its bets on the wrong guy.

William McCahill is a former senior American diplomat who’s now a financial services consultant in Beijing.

William McCahill: Now with Gaddafi ousted and the rebels having formed a new regime, the Chinese are trying, in a sense, to recapture the commercial interests that they had had, and they’re having some difficulty in doing that.

The new Libyan state oil company says China may lose out on future oil contracts. That’s because earlier this year, China declined to vote on a UN referendum to help protect Libyan civilians. McCahill says China’s booming economy needs that oil. One example? China’s adding 14 million cars a year. So any drop in the oil supply threatens Chinese productivity.

In Shanghai, I’m Rob Schmitz, for Marketplace.

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