Relations are getting tighter, Arab-Chinese agree on an investment of IDR 149 trillion
While relations with the US have been strained, Saudi Arabia's relationship with China has continued to improve. Beijing-Riyadh continues to increase investments worth tens of billions of US dollars.
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Crown Prince of Saudi Arabia Mohammed bin Salman received President of China Xi Jinping in Riyadh in December 2022. On June 11, 2023, in Riyadh, Saudi Arabia and China reaffirmed their agreement to a $10 billion US investment cooperation.
RIYADH, MONDAY — Economic relations between Arab countries and China continue to grow. Saudi Arabia announced a $10 billion investment agreement, equivalent to approximately IDR 148.68 trillion, between Arab countries and China on the first day of the business conference in Riyadh, Saudi Arabia on Sunday (12/6/2023).
The Ministry of Investment of Saudi Arabia via a written statement stated that the majority of the investment agreements are related to projects in Saudi Arabia or projects of Saudi Arabian government entities or companies.
The Saudi Arabian Ministry of Investment also announced that the businesspeople of both countries met on the sidelines of the Arab-China Business Conference in Riyadh. In the conference held on July 11-12, 2023, almost 4,000 representatives from businesses and governments in China, Saudi Arabia, and other countries were present.
The energy sector, fossil and renewable, has been the most targeted for investment. There are also investments in technology and transportation. "I am not surprised that there are many investment agreements in this forum," said Saudi Arabian Minister of Energy Abdulaziz bin Salman, as quoted by Arab News and Al Arabiya.
Read also: China-Arab Increasingly Closer
Saudi Arabian train company, Sabatco, has teamed up with Chinese company, CRRC, in a $250 million agreement. Sabatco and CRRC will establish a train factory in Saudi Arabia. Meanwhile, Hong Kong-based application developer, Hibobi, has entered a $266 million partnership. Hibobi is set to create a tourism promotion application for Saudi Arabia.
Saudi Arabia also wants to develop its chemical industry with the help of China. The value of the agreement reached is up to 150 million US dollars. There are a total of 30 investment agreements with a value of 10 billion US dollars during the first day of the Arab-China Business Conference. "There is synergy between the two countries. The 2030 vision of Saudi Arabia is in line with the Belt and Road Initiative," said Abdulaziz.
The photo released by Chinese news agency Xinhua shows Iran's Secretary of the Supreme National Security Council, Ali Shamkhani (right), shaking hands with Saudi Arabia's National Security Advisor, Musaad bin Mohammed al-Aiban (left), witnessed by senior diplomat China Wang Yi, in Beijing on Saturday (11/3/2023).
Abdulaziz also stated that his party disregarded those who criticized the increasingly cordial Beijing-Riyadh relationship. "In business, it is natural to seek opportunities wherever they may be. We do not think about those who say they are with us or against us," he said.
"Together with us or against us" is a statement made by the 43rd President of the United States, George W. Bush, referring to US foreign policy. This policy later became known as the Bush Doctrine, which appeared several times in Bush's speeches.
Entering his second year of presidency, Bush released the US National Security Strategy. According to PBS, this is the first time that various elements of the Bush doctrine have been formally articulated in a single 33-page document that presents a bold and comprehensive redefinition of US foreign policy.
In business, it is normal to search for opportunities anywhere. We don't consider those who say they will join us or confront us.
This outlines the more aggressive posture of the US. It is mentioned that the US will exploit its military and economic strength to push for a "free and open society." The policy only provides two options for countries in the world, either with the US or against the US.
This US doctrine has evolved. However, its fundamental spirit remains the same, which is only to provide two places for countries in the world, namely to ally with the US or confront the US.
In the last 20 years, US officials and their allies have repeatedly used the term to gather cross-country alliances. The Western policy in the Ukrainian War and the US-China competition reflect the Bush Doctrine.
The 43rd President of the United States, George W Bush, gave a response at a press conference in the East Room of the White House on February 14, 2007 in Washington, DC, USA. On that occasion, Bush spoke about the war in Iraq.
Abdulaziz's statement regarding the Bush Doctrine came at a time when a number of parties continued to doubt US influence on Saudi Arabia. Over the past few years, Riyadh has been seen drifting away from Washington. In fact, in a Washington Post report, the Crown Prince of Saudi Arabia Prince Mohammed bin Salman (MBS) is said to have threatened the US.
Threats were thrown after US President Joe Biden mentioned that Saudi Arabia would bear the consequences of the decision to cut oil production. MBS disregarded the threat and instead made a counter-threat. Saudi Arabia continues to cut its oil production. However, Biden hopes that Saudi Arabia will increase its oil production.
China's oil demand will continue to rise and we will seize this opportunity. Why compete with China when we can collaborate?
As tensions between the US and Saudi Arabia escalate, the relationship between Saudi Arabia and China continues to strengthen. The economic closeness between Saudi Arabia and China is reflected in the increasing volume of trade between the two countries. By 2022, its value will reach 106 billion US dollars, up 30 percent from 2021.
The closeness between Saudi Arabia and China can also be seen from the investment that continues to increase. In March 2023, Saudi Arabia and China agreed to sell a 10 percent stake in Rongsheng Petrochemical to Saudi Arabia. The transaction value reached 3.6 billion US dollars.
"The oil demand of China will continue to rise and we will take advantage of this opportunity. Instead of competing with China, it is better to collaborate," said Abdulaziz.
The Crown Prince of Saudi Arabia Prince Mohammed bin Salman (right) met with United States Secretary of State Antony Blinken in Jeddah, Saudi Arabia, on Wednesday (7/6/2023). The meeting between Blinken and Prince MBS is seen as an effort by both countries to ease diplomatic tension that has been ongoing for the past year.
Prior to the March and June 2023 agreements, Beijing-Riyadh also continues to increase their investments between them. In December 2022, Beijing stated that China's investment in Saudi Arabia reached 23 billion US dollars throughout 2021. Beijing is optimistic that cooperation with Riyadh will continue to increase in the future.
Senior researcher at the Atlantic Council, Jonathan Fulton, said that China's diplomatic patterns and foreign policies are important factors. China does not push its partners to side with Beijing and distance themselves from other parties.
Also read: Following Iran, Saudi Arabia Getting Closer to China
"They don't want their partners to be trapped in a dilemma position, whether to choose them (China) or other parties," he said.
China also repeatedly emphasizes that it does not interfere in the internal affairs of other countries. For Saudi Arabia and many other countries, this stance is very important.
Unlike the West who always interfere in domestic affairs in other countries. With the reasons of human rights, freedom of speech, and democracy, the US and its allies repeatedly make Saudi Arabia and other countries uneasy because of their interference in domestic affairs. (AFP/REUTERS)
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CORRECT:
This news has been revised from the initial version. Investment agreements worth US$10 billion or approximately Rp.148.68 trillion were made between Arab countries and China, not between Saudi Arabia and China, as previously written. Revisions will be made on Monday, 12 June 2023, at 20.00 WIB - Editor
