In early December, Chinese President Xi Jinping
met with the Gulf Cooperation Council (GCC) – a group made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates – to discuss trade and investment. Also on the agenda were talks on forging closer political ties and a deeper security relationship.
This summit in Saudi Arabia was the latest step in what
research by myself and a colleague shows is an increasingly close relationship between China and the Arab Gulf states. Economic ties have been growing consistently for several decades (largely at the expense of trade with the US and the European Union) and are specifically suited to their respective needs.
Simply put, China needs oil, while the Gulf region needs to import manufactured goods including household items, textiles, electrical products and cars.
China’s
pronounced growth in recent decades has been especially significant for the oil-rich Gulf state economies. Between 1980 and 2019, their exports to China grew at an annual rate of 17.1%. In 2021,
40% of China’s crude-oil imports came from the Gulf – more than any other country or regional group, with
17% from Saudi Arabia alone.
China has benefited from increasing demand for its manufactured products, with exports to the Gulf growing at an
annual rate of 11.7% over the past decade. It overtook the US in 2008 and then the EU in 2020 to become the Gulf’s most
important source of imports.
These are good customers for China to have. The Gulf economies are expected to grow by around
5.9% in 2022 (compared with a lackluster
2.5% predicted growth in the US and EU) and offer attractive opportunities for China’s export-orientated economy. It is likely that the fast-tracking of a free-trade agreement was high on the summit’s agenda in early December.
Strong ties
The Gulf’s increased reliance on trade with China has been accompanied by a reduction in its appetite to follow the West’s political and cultural lead.
As a group, it was supportive of the West’s military action in Iraq, for example, and the broader fight against Islamic State. But more recently, the Gulf notably
refused to support the West in condemning Russia’s invasion of Ukraine. It also threatened Netflix with
legal action for “promoting homosexuality,” while
Qatar has been seen actively banning rainbow flags supporting sexual diversity at the FIFA men’s World Cup.
So Xi’s visit to Saudi Arabia was well timed to illustrate a strengthening of this important partnership. And to the extent that anything can be forecast, a deepening of the Gulf-China trade relationship seems likely. On the political front, however, developments are less easy to predict.
China is seeking to safeguard its interests in the Middle East in light of the
Belt and Road Initiative, its ambitious transcontinental infrastructure and investment project.
But how much further might the Gulf states be prepared to sacrifice their long-standing security pacts with Western powers (forged in the aftermath of the Second World War) in order to seek new ones with the likes of Beijing?
Currently, the US has military bases (or stations)
in all six Arab Gulf countries, but it is well documented that the GCC is seeking ways to diversify its self-perceived over-reliance on the US as its primary guarantor of security (a sentiment within the bloc that was
pronounced while Barack Obama was president, less so with
Donald Trump, but on the rise again with
Joe Biden).
In the coming period, the GCC will need to decide which socioeconomic path to pursue in the
post-oil era where AI-augmented, knowledge-based economies will set the pace. In choosing strategic ties beyond trade alone, the Gulf states must ask whether the creativity and innovative potential of their populations will be best served by allegiances to authoritarian governments or to accountable governments.
Mr.BadGuy
Publisher
These soldiers are from a country whose president is a Jew Zelensky. Orthodox churches are also being destroyed in this country. Synagogues are not touched. Surprisingly, it turns out that Jews get along well with the Bandera Nazis.