China's MidEast push has limits

Abandoning neutral diplomacy, China seems to be edging toward a more proactive role in the Middle East, stepping up trade links with the region. The shift has prompted the United States and others to boost efforts to counter the influence of Beijing.

Recently, a virtual conference took place between UAE President Mohammed Bin Zayed and Indian Prime Minister Narendra Modi, joined online by Israeli Prime Minister Yair Lapid and visiting US President Joe Biden from Jerusalem.

The four held a dialogue to launch I2U2, a new quadrilateral arrangement to rival China’s Belt and Road Initiative (BRI). I2U2 aims to boost business between the four countries and the official statement released after the conference noted their intention to “modernize infrastructure.” 

Just days later Adani Ports, the largest port developer and operator in India, acquired the lease of Tel Aviv’s Haifa Port, the second-largest port in Israel, until the year 2054 along with a local partner. Planning to boost trade lanes with its holdings in Indian ports, this joint venture could help connect Europe and the Middle East as Haifa is well located to serve as a regional hub. 

China’s BRI has slowed down lately and left space for new competitors. 

Unveiled by President Xi Jinping in 2013, the megaproject signified China’s opening up to the world and spelled out a bolder foreign policy. As per Xi’s vision, the BRI would create trade opportunities, expand regional connectivity and provide strategic leverage.

Even though China was the largest trading partner of the oil-rich Arab states last year with bilateral trade worth $330 billion (a year-on year increase of nearly 37%), these relations may have no long-term guarantee. But Beijing needs sustainable ties for its energy security and so is looking to play a more active role in the Mideast. 

Working on removing this setback, Chinese Foreign Minister Wang Yi hosted an important meeting of GCC foreign ministers early this year to finalize a free trade agreement that has been under discussion since 2004

Recently, addressing his Syrian counterpart Faisal Mekdad by video link, Wang affirmed Beijing’s commitment to the region, saying, “China firmly supports the people of the Middle East in exploring the path of development independently and supports Middle Eastern countries in resolving regional security issues through unity and self-empowerment.”

However, referring to other global powers, Wang became more critical. Mohammedbagher Forough, a research fellow at the German Institute for Global and Area Studies, told Al-Monitor that there is a “larger trend (which has slowly emerged since Xi Jinping came to power) of Chinese diplomats and politicians generally asserting themselves in an outspoken fashion. They have become more self-assertive under Xi Jinping and are not shy about using strong language to defend their positions or national interests. This wasn’t the case in the pre-Xi era.” 

How successful has China’s BRI proved to be in the Middle East?

Saudi Arabia is a prime example. It became China’s primary energy source, part of the BRI and largest trading partner with bilateral trade worth over $67.2 billion in 2020, but Beijing has still not been able to displace its stable ties with the West.

Sebastian Sons, a researcher at CARPO-Center for Applied Research in Partnership with the Orient in Bonn, told Al-Monitor, “For China’s Belt and Road Initiative, Saudi Arabia plays a fundamental role due to its relevant geostrategic location linking Asia with Africa and its geographic proximity to the Suez Canal, the Bab al-Mandab and the Strait of Hormuz.”

He went on, “So far, Sino-Saudi relations have been focused mainly on economic partnership. In terms of trade, China has emerged as the top partner of the kingdom and also started to invest in Saudi mega projects such as NEOM and other infrastructure.”

Apparently, the biggest setback for Sino-Saudi ties was the lack of a military role for Beijing. Since the 1980s, China has provided the kingdom with intermediate-range missiles and recently some equipment and technology was given for manufacturing ballistic missiles, but it is insufficient.

Sons explained, “China and Saudi Arabia have extended their military cooperation as China aims to develop a local Saudi defense industry and delivers drones.” While Sons says that Saudi Arabia has been looking more toward China, “the partnership has its limits as it is based on a purely commercial rather than a strategic vision.”

Mainly, he said, “Despite all tensions with the United States, Saudi Arabia still considers Washington as a long-term traditional economic partner and security provider. Saudi Arabia’s military infrastructure still heavily relies on US equipment, which cannot be replaced easily with Chinese technology.”’

As a result, Sons said, “The Saudi leadership will continue its hedging efforts characterized by balancing partnerships in a multipolar world. Against this backdrop, it seems unlikely that China could replace the US in terms of political and military cooperation.”

Therefore, notwithstanding low phases due to changes in administration, Riyadh gives priority to Washington and depends on US arms for its defense needs.

Not interested in connecting on a military basis, Beijing then resorted to building partnerships all over the region. When Beijing and Riyadh moved toward a “comprehensive strategic partnership” based on “stable long-term energy cooperation,” the catch was that China had clinched similar deals with other Arab states, as well as Iran. 

Highlighting this pattern, Jacopo Scita, Al-Sabah doctoral fellow at Durham University in the United Kingdom, told Al-Monitor, “China’s approach to the Middle East has been remarkably successful in the past decade, with ‘partnership diplomacy’ as the trademark of Beijing’s engagement with the region. The latter is crucial in explaining why China has gained so much momentum in the Middle East.”

Explaining how these broad-spectrum deals fit multiple scenarios, he said, “The success of China’s ‘partnership diplomacy’ is due to the tool’s capability to provide a multi-level framework that is flexible enough to be adapted to the different bilateral relations while also creating a clear map of Beijing’s priorities and objectives in the region that responds to its partners’ needs.” 

According to Scita, “The accomplishment of ‘partnership diplomacy’ is the successful establishment of comprehensive strategic partnerships [CSP] — the highest in the hierarchy of China’s partnerships in the Middle East — with Iran, Saudi Arabia and the UAE. This is a result of the economic rationale that characterizes Beijing’s ‘partnership diplomacy,’ which, at the same time, is also crucially deprived of the mutual defense commitments typical of alliances.” 

Scita elaborated, “For instance, China’s partnerships with the UAE and Iran present significant differences, with the former being more fast-paced and focused on tech cooperation, investments and more robust people-to-people interaction, reflecting the more accessible political-economic landscape offered by the UAE. The latter, otherwise, has been bumpier, facing significant struggles in its implementation, and more charged with political and ideological significance.”

He added, “The Sino-Saudi CSP could be ideally located in a middle ground between the UAE and Iran. Saudi Arabia is one of China’s key suppliers, making the partnership particularly valuable for both powers.”

In the end, Beijing has inked similar contracts with so many countries in the region that the deals have yielded minimal benefit.

Assessing Wang’s critical take about the United States, Scita said, “Saudi Arabia is one of China’s key suppliers, making the partnership particularly valuable for both powers. Wang Yi’s criticism of the US reflects China’s attempts to capitalize on the relative advantage it has gained vis-à-vis Washington due to Biden’s urgency to mend US-Saudi relations amid the global energy shock caused by the war in Ukraine.”

“Nonetheless," Scita noted, "it is worth noting that Wang’s message seems carefully calibrated not to suggest that China is a substitute for the United States. This goes back to the essence of China’s ‘partnership diplomacy,’ whose absence of a military alliance component is not only a convenient tool to remain out of the regional rivalries but also an implicit-yet-clear signal that Beijing does not have the will and the capabilities to play a security role in the Persian Gulf in the substitution of the United States.” 

Lately, there have been reports that Riyadh might allow Beijing to pay for its oil with the Chinese yuan, as sanctions have made Russian oil difficult to procure after the Russia-Ukraine war. But even if this happens, it could facilitate both countries, but not make much difference globally as Sino-Saudi trade is valued at around $320 million per working day while trade in US dollars equals to nearly $6.6 trillion on every working day.