Lu Zhifang’s mother was horrified at the prospect of her leaving China for the first time to take up a job in South Sudan, and she tried to stop her getting a passport. So when 29 Chinese workers were kidnapped north of the border by South Sudan-aligned rebels within a month of Ms Lu’s arrival this year, her mother’s worst fears appeared to be justified.

“My parents are really very worried. I have to call every day to say I’m safe,” she says.

For the manager of the Eastern Pearl Restaurant, part of a year-old Chinese complex offering rooms, buffets and night-time karaoke, the view on the ground in Juba, the South Sudanese capital, is anything but dangerous. “It’s just like a miracle. Before I had only seen Africa and Africans on TV,” she says. “South Sudan maybe itself is a little pearl.”

Its bright red lanterns in sharp contrast to Juba’s dusty streets, the complex is one of many burgeoning Chinese businesses in the capital. The Chinese not only dominate the new country’s oil industry but also have interests in hotels restaurants, telecommunications and construction.

But China’s interest in the world’s newest nation now faces a serious test

As Ms Lu’s mother illustrates, Beijing is facing a domestic outcry about the safety of expatriate workers following the January abductions. Perhaps more importantly, however, it is now also caught in a wrangle over oil between longstanding ally Sudan and the year-old South Sudan that threatens its economic and diplomatic relations with both. Casting a shadow over it all is the historic mistrust bred by years of war between the two Sudans and what many southerners see as China’s role in it.

“Old memories die hard – it is common knowledge the Chinese were the ones helping the Arabs to kill us,” says Henry Odwar, chairman of South Sudan’s parliamentary committee on energy and mining, referring to China’s supply of weapons to Khartoum throughout years of war, claims of which continue today.

Ever since the 2005 peace deal between southern Sudan and its former warring foe Sudan that paved the way to last year’s referendum on secession, however, China has sought to court South Sudan and its oil.

Three-quarters of the oil is produced in the south but exported via Chinese-built infrastructure in the north, including a refinery and pipelines. Chinese-led consortia produce oil from what is now the independent south, and the pair agreed new contracts last month.

But a decision last month by the south to shut down its oil production after it failed to reach a deal with Khartoum over transit fees has renewed fears of hostilities and threatened Chinese investment and its oil supply.

It has also put China in a difficult spot diplomatically. South Sudan hopes the closure will force China, which draws 5 per cent of its oil imports from the two Sudans, to convince Khartoum to reduce its demand for transit fees. “Instead of just sitting there they should pressure their friends in Khartoum. The onus is still on the Chinese,” says Mr Odwar.

“That they haven’t done more upsets the South Sudanese,” says one senior western diplomat of China, arguing it has the greatest leverage of all foreign players.

The dispute is testing China’s longstanding policy of not interfering in the domestic affairs of trade partners. Daniel Large, research director at The Africa Asia Centre of the School of Oriental and African Studies, says the policy these days is more “a doctrine of intention rather than effect”. Still, “the problem for China is that [Sudan and South Sudan] are trying to use it for their own purposes,” says Mr Large. “China has ultimately very limited room to manoeuvre.”

In December China sent mediator to help negotiate between the two sides as they were locked in a dispute over oil payments.

China has also courted South Sudan actively. President Salva Kiir, senior members of the cabinet and of the South’s ruling party, even junior civil servants have all been flown to China at Beijing’s expense.

“As each other’s neighbour, Sudan and South Sudan can only achieve common development through peaceful co-existence which is also conducive to regional peace and stability,” Liu Weimin, a Chinese foreign ministry spokesman, told reporters last week.

In the end, however, China has failed to keep the oil flowing, its primary concern. It has also left the leadership of a fledgling nation of only 8.3m people feeling they are in a rare position of strength over the emerging superpower.

“It’s a good indication of the dilemma they are in: it’s their problem more than ours,” says Elias Nyamlell Wakoson, South Sudan’s deputy minister for foreign affairs, although oil makes up 98 per cent of the country’s revenues and it may need massive loans from China to survive.

As the diplomatic games unfold, boredom and the heat are the biggest complaints for many Chinese workers in Juba.

“It’s just too hot,” says Dong Hongmei, who doesn’t like to leave the compound of the Beijing Juba Hotel where she works as a receptionist. She left home for the first time to join her husband, a pastry chef at the same hotel, until fire damaged a wing of its prefab complex housing the restaurant.

Whatever the teething tensions, however, there is no question the Chinese are here to stay. Beijing Juba Hotel is rebuilding its restaurant in brick.

Additional reporting by Leslie Hook in Beijing

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