Xi Jinping’s Visit: Gulf Nations Bolstering Collaboration with China

Fri Dec 09 2022
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DUBAI: Arab Gulf nations, strategic partners of the United States, are strengthening relations with China that involve diversifying their economies from fossil fuel to green energy.

The China-Gulf summit is focused on key areas of economic cooperation between China and the six-member Gulf Cooperation Council (GCC).

Xi Jinping’s visit to strengthen energy cooperation 

By 2020, China had become a key trading partner with the Gulf Cooperation Council member states, especially collaborations in the field of energy.

China imports hydrocarbons from Saudi Arabia, Oman, Kuwait, and the United Arab Emirates. China alone imported 17 percent of the oil in 2021 from Gulf countries.

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Qatar provides China with liquefied natural gas (LNG) — a trade that the global energy crisis has increased due to the Ukraine war.

In November, Qatar signed a $60 billion natural gas deal with China for 27 years. Qatar termed the deal as the longest such agreement so far.

Xi Jinping to hold free trade talks

In July 2004, China and the Gulf Cooperation Council announced negotiations to strike a free-trade deal.

Around two decades later, following nine rounds of negotiations, the parties have yet to reach a final agreement, despite announcing in January to further accelerate the talks process.

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Today’s China-Gulf summit in Xi Jinping’s attendance is widely considered an opportunity to launch negotiations.

China’s trade ties are particularly strong with the United Arab Emirates (UAE), the biggest Middle East market for Chinese goods, and is a big export market for Chinese products and goods, particularly to other Arab countries.

Investment

According to the American Enterprise Institute’s data, from 2005 to 2022, Chinese companies made investments worth over $107 billion in the Gulf states.

Chinese investment’s largest share went to the Arab world’s biggest economy, Saudi Arabia.

According to the think tank, Chinese investments in Saudi Arabia were valued at nearly $49.6 billion over the past 17 years.

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Technology and weapons

The Gulf countries have also turned to China for arms and technology as part of the Arab world’s efforts to diversify its suppliers as the US is closely monitoring the developments. An agreement in this regard is also expected during Xi Jinping’s visit.

UAE would purchase twelve attack planes from China, weeks after warning to cancel its purchase of F-35s from the US.

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