At a meeting of the China-Arab States Cooperation Forum in Beijing on Tuesday, Chinese President Xi Jinping offered $23 billion in loans and financial aid to Arab states and said China will pursue free trade deals with all 22 members of the Arab League.
“China would like to join the Arab countries … to become the keeper of peace and stability in the Middle East, the defender of equity and justice, promoter of joint development, and good friends that learn from each other,” Xi said, as quoted by the South China Morning Post.
China’s pledge of assistance included money for humanitarian assistance and reconstruction in war-torn nations such as Syria and Yemen, support for “social stability efforts,” cooperation on energy projects, and seed money for the Arab financial sector.
In addition to the loans and aid money, Xi pledged that China would import $8 trillion in goods from the Arab states over the next five years. His plan involves setting up a Chinese-Arab banking consortium with some $3 billion in assets.
The SCMP puts these commitments in the context of China’s massive “One Belt, One Road” infrastructure project – also known as the Belt and Road Initiative or New Silk Road – noting that while Beijing desires strategic influence in the region, Chinese investors are a bit nervous about how their money could disappear in the famously corrupt and unstable region:
Replacing the United States in 2010 as the largest trading partner to the bloc, Beijing has been boosting its economic ties with Arab countries, which remain largely defined by China’s energy demands – over half of its worldwide crude oil imports come from the Middle East.
But there have been growing concerns that Beijing’s economic ambitions there could be hijacked by volatility in the region, with fears that its national interests may be at risk from any sudden disruption to oil supplies or trade routes.
On Tuesday, Xi urged countries in the region to respect each other’s sovereignty, calling for dialogue to resolve the “complicated and deep-rooted situations in the Middle East.”
Joost Hiltermann of the International Crisis Group foresaw China running into the same problem as so many Western powers with ambitions in the Middle East:
Eventually, China will have little choice but to engage politically as well, especially if a security vacuum in the Middle East threatens its commercial interests and investments. It would find this very challenging … because it will force Beijing to make difficult political choices and make not just friends, but also enemies.
For their part, some of the Arab states have expressed skepticism about One Belt, One Road, especially the potential loss of sovereignty when China calls in its markers. Furthermore, the Sunni states aligned with Saudi Arabia worry that Iran and its Shiite alliance will benefit disproportionately and weaken Saudi influence. None of this skepticism appears strong enough to make key Arab leaders turn Xi away when he drives a truckload of Chinese cash into their neighborhoods.