Promising Arab-China collaboration

Haitham Nouri , Saturday 28 Jul 2018

China’s commercial cooperation with the Arab world serves both parties economically, but the Arabs get to score a political win against Iran along the way

Mohammed bin Zayed al-Nahyan and Xi Jinping
Abu Dhabi's Crown Prince Sheikh Mohammed bin Zayed al-Nahyan (L) welcomes Chinese President Xi Jinping to Abu Dhabi, United Arab Emirates July 19, 2018 (Photo: AFP)

China’s President Xi Jinping wrapped up his Middle East and Africa tour after visiting the United Arab Emirates, Senegal, Rwanda and South Africa. This is Xi’s first foreign tour since his re-election for a second presidential term in March.

Xi commenced his tour by landing in the UAE. For the past 29 years Abu Dhabi hadn’t received a Chinese president.

The importance of the visit is derived from the fact that the UAE has become the first Gulf country to sign a strategic cooperation agreement with China, according to Xinhua, China’s official state-run news agency.

In less than two decades, Beijing has become Abu Dhabi’s second biggest commercial partner and the first source for the UAE’s imports, said WAM, the official news agency of the UAE.

Thanks to the investment-friendly laws at Jebel Ali Freezone, Dubai is the outlet for 60 per cent of China’s exports to the Middle East, according to Reuters.

WAM reported that UAE Minister of Economy Sultan bin Said Al-Mansouri said that trade between China and the UAE has recorded a 10 per cent increase on last year, with $58 billion in 2018 and $53.5 in 2017.

The UAE is important to China, being the main source of oil consumed by Beijing. The UAE is also one of the world’s key trading hubs.

The two countries agreed to establish a new free zone at Dubai Port as part of the maritime route of the Belt and Road Initiative, also known as the Silk Road Economic Belt.

The initiative was launched in 2013 by President Xi with the aim of connecting China to the Asian, African and European markets.

Belt and Road is based on the trading routes of the Middle Ages — the Silk Road connecting China with the Islamic world and Europe, and through the Indian Ocean, the Persian Gulf and the Red Sea.

According to Xinhua, eight Arab countries are party to the Belt and Road Initiative: Egypt, Saudi Arabia, Djibouti, the UAE, Qatar, Bahrain, Kuwait and Oman.

The overland road of the initiative starts at Luoyang, north of China, and ends at Hamburg, the major city port in northern Germany.

The maritive route embarks from the Chinese coastal city of Chaozhou all the way to Rotterdam in the Netherlands, as reported on the initiative’s Website affiliated to Xinhua.

The Silk Road Economic Belt, with its network of railroads and ports, may cost up to $2 trillion, according to Reuters.

At the end of Xi’s two-day visit to the UAE, the two parties signed 13 financial and trade agreements, including a $1.6 billion deal between the Abu Dhabi National Oil Company and the China National Petroleum Corporation which allows China to conduct oil and gas exploration in an area measuring 53,000 square kilometres in the UAE.

China is the world’s biggest consumer of oil, gas and coal and the UAE is one of the top 15 exporters in these fields to the Asian economic giant.

President Xi’s visit to the UAE promises to be the beginning for a major Arab-Chinese economic cooperation, coming a few weeks after the China-Arab States Cooperation Forum held in Beijing in the attendance of Emir of Kuwait Sabah Al-Ahmed Al-Jaber Al-Sabah.

The forum was established in 2004 during the visit of then president Hu Jintao to the headquarters of the Arab League.

The two events — Xi’s UAE visit and Kuwait’s attendance at the forum — are strong indicators of China’s utmost interest in Middle East oil wealth, which according to Arab reports will open the door wide open for more Arab-Chinese cooperation in the fields of construction and industry.

Many Chinese corportations are engaged in Arab projects, such as the business district in Egypt’s new administrative capital, and a Chinese industrial city in the Suez Canal Zone.

China is also participating in building dams to generate electricity in Sudan, as well as other projects in Algeria, Jordan and a number of Gulf countries.

In addition, China has decided to build its first offshore military base in Djibouti, to stand abreast with France, the UK and the US as a recognised force in the African continent.

Despite the major economic role China plays in the Arab world, it keeps a low profile when it comes to Middle East politics.

Nevertheless, China supports a number of Arab causes, such as the rights of Palestinians, and along with Russia it stands behind the Bashar Al-Assad regime in Syria.

The Arabs, however, don’t want China to meddle in the Middle East’s political affairs, and they want Beijing — as well as Moscow — to separate their interests from the Arabs’ arch-rival, Iran.

Iran has long depended on Russia and China for support against the West. This is evident in the fact that Tehran envoys to Moscow and Beijing come from the Supreme Guide’s camp — the highest authority in Tehran — while Iranian envoys to Western countries come from President Hassan Rouhani’s team, considered of a lesser degree of authority than those of the Supreme Guide.

Saudi Arabia, Kuwait and the UAE, which are the Arab world’s richest in oil production and export, have stepped in to fill the gap in world markets after the US imposed an embargo on Iran.

It looks likely Kuwait’s attendance at the China-Arab States Cooperation Forum and President Xi’s visit to the UAE come within the same framework.

Parallel to economic cooperation with China, the Gulf is deeply engaged with Russia, especially in the field of energy and buying arms.

Looking East doesn’t mean the Arabs have decided to do away with the West, the US in particular, but it is an attempt to diversify their connections, on the one hand, and to weaken Tehran by winning China and Russia over to their side, on the other.

Gulf countries are exploiting US President Donald Trump’s embargo on Iran to exert more pressure on Tehran to oblige it to withdraw its influence from Iraq, Syria, Lebanon and Yemen.

Along with Trump’s tightening policies against Iran, Tehran has been suffering from the Grand Bazaar protests in which thousands demonstrated against the deflating economy, as well as protests in other parts of the country calling for exiting Syria and paying more attention to domestic issues.

The Gulf, Saudi Arabia and the UAE in particular, are trying to win over a Shia bloc from Iraq, Syria and Yemen to form a spearhead against Iranian religious and political influence in these three countries.

Maybe, after all, the Arab strategy to diversify its connections will ultimately lead to the weakening of the Ayatollah state and a decrease in Iran’s weight in the region.

*A version of this article appears in print in the 26 July 2018 edition of Al-Ahram Weekly under the headline: Promising Arab-China collaboration

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