by Anadolu Agency
The Arab-China Business Conference was launched by China in 2013 as a long-term strategy to enhance cooperation and integration between Asia, Europe, the Middle East and Africa. It aims to upgrade infrastructure in the countries located on the Belt and Road Initiative (BRI), enhance connectivity between countries and facilitate trade. As China looks to build its geopolitical role in the region, having deeper economic and investment ties with the economies of the Arab countries is undoubtedly essential.
The conference came amid growing commercial and diplomatic ties between China and Arab countries. In recent years, Chinese firms have built billions of dollars in infrastructure in Arab countries, and China is a significant source of manufactured goods in the region, as well as worldwide. China is the largest trading partner for Arab countries, with the volume of commerce reaching a record $430 billion in 2022, a 31 per cent increase over 2021, with Saudi Arabia representing 25 per cent of the $432 billion trade between China and Arab countries. China's foreign direct investment in the Arab world totalled $23 billion in 2021, with $3.5 billion invested in Saudi Arabia.
This trade and investment growth mirrors China's increasing geopolitical influence in the Middle East, illustrated by China's pivotal role in brokering the Saudi-Iranian agreement, leading to the resumption of diplomatic ties between these long-standing rivals. These robust trade numbers exemplify the growing economic relations and mutual benefits enjoyed by both China and Arab countries, setting the stage for further prosperous collaborations.
What were the most important subjects?
Over 4,500 government officials, investors, business representatives and experts from 26 countries have participated in the event, co-organised with the Arab League, the China Council for the Promotion of International Trade and the Union of Arab Chambers of Commerce. The Conference helped to boost ties between China and the Arab world, resulting in several deals between Saudi and Chinese entities and renewed momentum for China's push into the region. During the Conference, they signed 23 Memoranda of Understanding (MoUs) worth a total value of $10 billion, spanning more than 30 deals across various sectors. Among the most notable agreements signed was a $5.6 billion contract between the Kingdom's Ministry of Investment and Human Horizons, under the brand, HiPhi, to establish a joint venture for automotive research, manufacturing and distribution.
The most important subject of this Conference is the enhancement of China's burgeoning relationship with Saudi Arabia, which has recently reached unprecedented levels. China is Saudi Arabia's largest trading partner, while the latter has emerged as one of China's primary oil suppliers (about 1.75 million barrels of oil per day in 2022), and it is Saudi Arabia's intention to join China-led blocs such as the Shanghai Cooperation Organisation (SCO) and BRICS. In 2022, trade between Saudi Arabia and China witnessed a remarkable surge, amounting to $106 billion, marking an impressive 30 per cent increase from the preceding year's figures. The Kingdom seeks broader trade and economic ties with its global partners, and China is at the top of its list. This also raised prospects for a successful conclusion to negotiations for a free trade deal between China and the Gulf Cooperation Council (GCC).
What does it signal about the future cooperation between China and Arab countries?
Exchanges between the Arab states and China are set to get an upgrade after the 10th Arab-China Business Conference. The conference laid the foundation for continued collaboration with a focus on several fields, namely, strengthening economic partnerships, exploring new opportunities for cooperation, supporting entrepreneurship, exchanging research and scientific innovations, organising training programs to enhance human capital, activating cooperation to achieve market stability, addressing socio-economic challenges, strengthening economic integration and amplifying renewable energy sources.
In the era of great-power competition, the conference will fuel rapid growth in Arab-Chinese trade and, with that growth, will come further Chinese regional influence as it seeks to promote regional stability to protect its investments. This is especially important when the US and Arab countries are trying to find, currently without success, a new centre of gravity in relations that would replace a decades-old bargain of preferred US access to Arab oil in exchange for US defence against foreign challenges.
This content was published in Middle East Monitor on June 16, 2023. To restrict the overall size; some images may have been excluded.
Opinions expressed in this article are the author's own and do not necessarily reflect the views of UMMnews.
