Energy

Xi’s ‘Pioneering’ Saudi Trip to Boost Energy, Tech Ties

 

Saudi Crown Prince Mohammed bin Salman laid on a lavish welcome for President Xi Jinping on Thursday as the Chinese leader heralded “a new era” in Sino-Arab relations.

In an op-ed published in Saudi media, Xi said he was on a “pioneering trip” to “open a new era of China’s relations with the Arab world, the Arab countries of the Gulf, and Saudi Arabia”.

Xi is due to meet with other Gulf oil producers and attend a wider gathering of Arab leaders on Friday. These states were a “treasure trove of energy for the world economy … and are fertile ground for the development of high-tech industries,” he wrote.

 

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Chinese and Saudi firms also signed 34 deals for investment in green energy, information technology, cloud services, transport, construction and other sectors, state news agency SPA reported. It gave no figures, but had earlier said the two countries would seal initial agreements worth $30 billion.

Saudi Arabia is China’s top oil supplier and Xi’s visit takes place while uncertainty hangs over energy markets after Western powers imposed a price cap on sales of oil from Russia, which has been increasing volumes to China with discounted supplies.

 

Saudi ‘reliable’ energy partner

The Saudi energy minister on Wednesday said Riyadh would remain a “trusted and reliable” energy partner for Beijing and that the two would boost cooperation in energy supply chains by establishing a regional centre in the kingdom for Chinese factories.

Tang Tianbo, Middle East specialist at the China Institutes of Contemporary International Relations (CICIR) – a Chinese government-affiliated think tank – said the visit would result in further expansion of energy cooperation.

The “Belt and Road” initiative – Xi’s signature infrastructure investment project – dovetailed with Saudi plans to diversify its economy under its “Vision 2030”, Tianbo wrote in an article on Saudi-Chinese relations.

China, the world’s biggest energy consumer, is a major trade partner of Gulf states and bilateral ties have expanded as the region pushes economic diversification, raising US hackles about Chinese involvement in sensitive Gulf infrastructure.

The meeting between the global economic powerhouse and Gulf energy giant signals Riyadh’s interest in deepening ties with Beijing despite US wariness.

Saudi Arabia and other Gulf states like the United Arab Emirates have said that they would not choose sides between global powers and were diversifying partners to serve national economic and security interests.

The United States, warily watching China’s growing sway and with its ties to Riyadh at a nadir, said on Wednesday the visit was an example of Chinese attempts to exert influence around the world.

 

  • Reuters, with additional editing by Vishakha Saxena

 

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Vishakha Saxena

Vishakha Saxena is the Multimedia and Social Media Editor at Asia Financial. She has been working as a digital journalist since 2013, and is an experienced writer and multimedia producer. As an eager stock market trader and investor, she is keenly interested in economy, emerging markets and the intersections of finance and society. You can tweet to her @saxenavishakha

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