KSA-China growing relations will benefit Pakistan
ACCORDING to the Ministry of Investment, Saudi Arabia, the Kingdom has hosted the 10th Arab-China Business Conference on 11-12 June 2023 at King Abdulaziz International Conference Centre, Riyadh, under the theme “Collaborating For Prosperity” with the aim of supporting and promoting cooperation in the areas of economy, trade and investment to achieve solutions of common interest for both Arab nations and China through strategic collaboration.
This conference comes shortly after Chinese President Xi Jinping visited Riyadh in December 2022. During that visit, Mr. XI had attended the Arab countries’ summit, held a joint meeting with Arab leaders, signed over thirty energy and investment deals, and he also inked a comprehensive strategic partnership agreement with Riyadh. China’s efforts in the last 30 years to improve relations with Saudi Arabia have benefitted both sides in a major way.
Trade between the two was worth over $80 billion in 2021, and Chinese companies have made more than $36 billion in contracting Saudi Arabia since 2005. From the Saudi side, China is the Kingdom’s number one trade partner, a major tech supplier, a long-term energy customer and a comprehensive strategic partner, with a permanent seat on the United Nations Security Council. In 2003 Saudi Arabia became China’s largest oil supplier.
Currently, China is advancing its relations with Saudi Arabia and other Arab/Gulf countries, to also harmonize the Belt and Road Initiative (BRI) and Saudi Vision 2030, in order to fast track the development of BRI. According to the Atlantic Council experts, Xi’s December 2022 visit demonstrated that Saudi Arabia and other Gulf/Arab countries will continue to leverage their increased strategic importance to global stakeholders to gain the best of both worlds.
Saudi Foreign Minister Prince Faisal, while commenting on Xi’s December 2022 visit, had said, “We do not believe in polarization or choosing between one partner and another. The Kingdom’s economy is rapidly growing, and we need all partners. Even in terms of security, while there is no absolute substitute for the United States’ integrated deterrence, China is already offering alternatives in advanced weapons systems”.
As per Al Jazeera news dated 12 June 2023, during the Business Conference held on 11-12 June 2023, Saudi Arabia has signed a $5.6bn deal with a Chinese company to manufacture electric vehicles (EV). The deal accounted for more than half of the $10bn in investment signed on the first day of the business conference.
According to the Saudi Press Agency, the 10th Arab-China Business Conference aims to enhance a “strategic” partnership based around the Belt and Road Initiative. As reported by Al Jazeera on 12 June 2023, Saudi officials announced billions of dollars worth of agreements in sectors spanning technology, renewable energy, agriculture, real estate, metals, tourism and healthcare, including a $533m deal for establishing an iron factory in Saudi Arabia, and a $500m cooperation agreement on copper mining in the kingdom.
Saudi Foreign Minister Prince Faisal bin Farhan Al Saud, who addressed the conference as a keynote speaker, hailed growing links between China and the Arab world. “Our meeting today is an opportunity to work and strengthen the historical Arab-Chinese friendship and to work on building a common future”. Saudi officials told the conference that the total volume of trade between China and the Arab world reached a record $430bn in 2022, with Saudi Arabia accounting for about 25 percent with a massive trade volume of $ 106 billion.
The above discussion indicates that Saudi Arabia and other Gulf countries are interested in economic/investment oriented and technology sharing wide ranging relationship with China. They all want China’s heavy investment and technological expertise to convert their oil based economies to industrial economies, combined with infrastructure development.
The Arab/Gulf countries also want alternative sources for acquiring the defence equipment and weapons at competitive prices. These countries also wish to have balanced and good relations with all major powers, like the US/EU, China and Russia to draw equal benefits from all. Hence, Saudi Arabia’s and other Arab/Gulf countries’ growing economic relations with China and their efforts to have balanced relations with all major powers are welcome developments which will also be beneficial for Pakistan. Already, a recent rapprochement between Saudi Arabia and Iran, facilitated by China’s mediation is a good development, as it would be now much easier for Pakistan to have friendly relations with both the countries.
Saudi Arabia and Arab/Gulf countries’ deeper BRI friendly relations with China will also be beneficial for Pakistan in attracting Arab countries’ investment for the CPEC-related projects, as these countries will now have more confidence in doing that. China-Arab countries’ growing relations will also enhance the CPEC-based trade between China and these countries, including Russia/CARs, whose trade to Arab countries, will also be routed through this route.
For availing above-mentioned opportunities to Pakistan’s diplomatic and economic benefit, it is important for Pakistan’s major political parties to develop a culture of mutual tolerance and agree on a comprehensive charter of domestic politics to be followed by all. The major political parties should also agree on a consensus based minimum 15 years long economic development charter to be followed by all successive governments to make Pakistan economically a self-reliant country. All the major political parties should also agree on a legal framework for holding transparent elections and arresting corruption in the country. After signing the aforementioned charters by the major political parties, the successive Pakistani governments should focus on an early completion of the CPEC, along with aptly handling the terrorism issue.
—The writer is also a former Research Fellow of IPRI and Senior Research Fellow of SVI Islamabad.
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