Growing GCC-China ties: The Economic and Geopolitical Dimensions

By Prof. Tridivesh Singh Maini

The five day visit of senior officials from four Gulf Cooperation Council (GCC) countries to China is important for a number of reasons. Firstly, as a result of the turmoil in Kazakhstan, China is concerned about its energy needs being impacted. While all eyes are on likely agreements to be signed for strengthening energy cooperation as well as taking forward negotiations pertaining to a Free Trade Agreement between both sides. The timing of the visit is also important from a geopolitical standpoint, because China’s growing clout in the Gulf has impacted ties between US and some GCC countries like UAE and Saudi Arabia. So far GCC countries have been able to strike a balance but as China-US tensions rise this will be a tough task. Apart from this, GCC countries also need to bear in mind the growing proximity between Iran and China. While all eyes are on the economic component of the visit, the changing geopolitical landscape of the Middle East is one of the primary factors.

On January 10, 2022, Foreign Ministers from four GCC countries — Saudi Arabia, Kuwait, Oman and Bahrain — arrived in China for a five day visit.. Accompanying them was Nayef bin Falah Al-Hajraf, the Secretary-General of the Gulf Cooperation Council (GCC).

This visit is important for more than one reason. As a result of the turmoil in Kazakhstan, China is worried about its energy security, and during the visit China and GCC countries are likely to explore ways for further strengthening cooperation in the energy sector 

Both sides would are also aiming at making progress on  negotiations related to a Free Trade Agreement (FTA) between China and the GCC (deliberations between both sides have been on-going since 2004).

Chinese Foreign Ministry spokesperson Wang Wenbin, during a briefing on January 10, 2022, said:

“We are willing to work hard together with all sides from the GCC, pursue common development, and advance bilateral relations to a new stage.”

GCC-China relations: The many layers

GCC countries have been enhancing their economic linkages with Beijing in recent years. In 2014 China’s President Xi Jinping set a target for doubling trade with GCC by 2023. Beijing has upgraded relations with GCC member states to ‘strategic economic partnerships’ and they are all part of the Belt and Road Initiative (BRI).

Much to the chagrin of Washington DC, Saudi Arabia has been strengthening security links with Beijing . According to US intelligence agencies, satellite imagery revealed that Saudi Arabia was manufacturing ballistic missiles with China’s help. The UAE has even cancelled an agreement (estimated at $23 billion) for the purchase of F35 planes from the US, because it did not want to take sides in what it described as a ‘cold war’ between Washington and Beijing. The use of China’s 5G technology by the UAE and the construction by China of what the US described as a military installation inside the Khalifa Port near Abu Dhabi have led to souring of ties (UAE did stall the construction of the project, but said it was purely commercial in nature). 

Significantly, UAE and Saudi Arabia, along with many other Muslim nations, have not spoken up against China’s violent crackdown against the Uighurs (a Muslim ethnic minority group) in Xinjiang – on the contrary, they have supported Beijing’s controversial policies in Xinjiang. This has been attributed to the economic compulsions of GCC countries as well as an attempt to do a balancing act between China and the US. It would also be pertinent to point out that the US has been critical of China for its actions in Xinjiang and has imposed a series of economic sanctions on Chinese companies and government entities for their role in abetting human rights violations against the Uighurs.

Another motivating factor for the GCC to strengthen economic linkages with China is the increasing emphasis of the US to reduce its dependency on Gulf countries for oil. China is the world’s largest importer of crude oil  (in 2020, Saudi Arabia accounted for 15.9% of China’s crude oil imports).

While GCC countries like Saudi Arabia and  the UAE, have been seeking to improve their ties with Iran, they would not be comfortable with Beijing moving too close to Tehran. In March 2021, Iran and China had signed a 25 year strategic cooperation agreement (dubbed the  Comprehensive Strategic Partnership), under which Beijing would invest $400 billion in Iran in a number of sectors with a focus on energy and infrastructure.

In conclusion, the visit by senior GCC officials to China is important for a number of reasons. First, China’s economy has slowed down due to a number of factors; specifically the COVID-19 pandemic and stringent lockdowns enforced by the government and it would be keen to ensure that the situation in Kazakhstan does not result in any oil shortages. Second, Beijing would want to dispel the numerous question marks over its economic linkages with the rest of the world and the sustainability of BRI related projects  which have arisen over the past two years.

The GCC countries on the other hand have been recalibrating their foreign policy and while keeping their relationship with the US intact, they have been seeking to strengthen ties with China. They are all seeking to come up with a new economic paradigm and in this context their ties with Beijing are important. During a meeting with the Saudi Foreign Minister, Faisal bin Farhan Al Saud, Chinese Foreign Minister Wang Yi said that China would support Saudi Arabia’s vision 2030, while the Saudi Foreign Minister said that Riyadh was keen to align its Vision 2030 with China’s Belt and Road Initiative (BRI) (during a conversation in April 2021, Saudi Crown Prince Mohammed Bin Salman had spoken about the need for merging BRI and Vision 2030). 

The geopolitics of the Middle East is already complex, and the growing US-China rivalry is likely to make it even more so. The visit of senior GCC officials to China is likely to be observed closely by not just the US, but also countries like Iran which have robust ties with China and are important players in the Middle East.

Tridivesh Singh Maini is Assistant Professor, Jindal School of International Affairs, OP Jindal Global University, Sonepat, Haryana.

Image credits – Middle East Institute

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