The wealth of the Middle East is flowing to China

Oil-rich gulf states are deepening their ties with China as concerns grow about the future of their longstanding security partnership with the United States.

Seven months after Chinese Communist Party leader Xi Jingping attended the first China-Gulf summit in Riyadh, economic ties between the world's second-largest economy and countries such as Saudi Arabia and the United Arab Emirates have begun to go far beyond Beijing-dominated crude oil purchases.

According to data compiled by Bloomberg, the value of acquisitions and investments of Gulf companies in China increased by more than a thousand percent year-on-year, reaching 5.3 billion dollars. According to the data, this year is about to be the busiest year ever in terms of the number of such deals.

Saudi officials describe China as an indispensable partner of Vision 2030, Crown Prince Mohammed bin Salman's multi-trillion-dollar economic and social transformation plan, and point out that China has entered into a series of agreements for the NEOM project, which will cover 26,500 square meters of the Tabuk region near Saudi Arabia's borders with Jordan and Egypt.

On the other hand, China's relations with Saudi Arabia are developing outside of economic relations. Xi has offered to mediate negotiations between Iran and Saudi Arabia and played a role in a landmark deal restoring ties between the bitter rivals signed in Beijing in March.

China's growing influence challenges the United States
The United States is concerned that China's growing influence in the Middle East may affect American interests in the long run.

General Michael Eric Corella, commander of the US Central Command, warned in a recent speech to Congress that while the United States remains the dominant military partner of the Gulf states, there are efforts on the part of China to undermine this, noting a jump in Beijing's commercial and military sales to the region.

Corella said Chinese military sales in the region have increased by 80 percent over the past decade, compared with a 30 percent decline in U.S. sales.

Hassan al-Hassan, a researcher at the Bahrain-based Institute for Strategic Studies who meets regularly with senior Gulf officials, said dissatisfaction with the United States is growing in the Middle East.

Hassan said that foreign policies in the Gulf have been redefined according to economic agendas ," will prioritize relations that serve its National Economic Vision".

On the other hand, Gulf officials say that the goal of their moves against China is not to replace Washington with Beijing as their main partner, but they want a wider range of global alliances.

Trade is the key to the China-Gulf relationship
Trade, especially oil, remains the key to the China-Gulf relationship.

The flow of trade between Saudi Arabia and China has slowed from 834 million dollars three decades ago to 117 billion dollars last year. According to data compiled by Bloomberg, bilateral trade between the UAE and China has increased almost a hundredfold from 1.15 billion in 1992 to 107 billion dollars in 2022.

Bai said in a statement that she expects trade with China to continue to increase, as with other important economic partners.

While trade relations between the Gulf countries and China are growing, energy agreements are deepening in December. The latest big deal occurred when the Saudi energy company Aramco bought a 10 percent stake in China's Rongsheng Petrochemical for 3.6 billion dollars.

Negotiations with the United States have been suspended

At a time when relations between the Gulf states and China are expanding, negotiations with the United States have been suspended as a result of some tensions with the United States. December.

In 2021, the UAE suspended negotiations on a 23 billion dollar deal to buy F-35s and other weapons after the United States rejected some of its conditions, including a Chinese demand to remove Huawei from the telecommunications network.

BAE later purchased Chinese L-15 light attack and combat training aircraft. A senior Saudi official said his country sees the need to ease tensions with other countries in the region and find other partners to work with, because it does not consider the United States a reliable security partner.

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18/07/2023
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