China-GCC Summit: Bringing “Strategicness” Into the Domain of Cooperation?

The president of China and high officials from the GCC nations met for the first time at the China-Gulf Cooperation Council (GCC) Summit in Riyadh on Dec. 9, 2022. The two sides’ long-standing friendship continued and the “strategicness” of their relations was further enhanced. A joint declaration and action plan for the strategic engagement between China and the GCC nations was also endorsed at the conference. In his statement at the summit, Chinese President Xi Jinping urged the two sides to work together to advance unity, development, security, and civilizations. China and the GCC, according to Xi, are natural partners because they share similar values and objectives. The strategic alliance between China and the GCC nations would be re-established and strengthened as the summit determined.

The GCC was established in 1981 and currently consists of six nations: Saudi Arabia, Bahrain, Kuwait, Oman, Qatar, and the United Arab Emirates (UAE). China relies heavily on the GCC nations for assistance while working with the Middle East. Since the GCC’s founding, China has kept in touch with it. However, data from China’s General Administration of Customs show that China continues to be both the GCC’s top trading partner and petrochemical export market. Chinese imports of fossil fuels from Saudi Arabia, Oman, and the UAE amounted $44.9 billion, $25.4 billion, and $21.3 billion, respectively, in 2021, when bilateral trade exceeded $230 billion. Besides, the relationship is not confined to trade only, technology transfer and other sort of cooperation also took place among the states. However, China and the Gulf Cooperation Council (GCC) announced the beginning of discussions for a free trade agreement in July 2004. So far, the parties involved had conducted five rounds of negotiations and have agreed to terms on the majority of matters relating trade-in products.

The scheduling of Xi’s visit coincides with a period of tension between Riyadh and Washington over issues relating to human rights, energy policy, and Russia, as well as Gulf skepticism regarding US commitment to the area as the key security provider. All these had an impression on the summit since there are talks on energy and other strategic issues. The write-up will examine the issues highlighted in the summit and will sort out the ramifications also.

China benefits from a sizable consumer market and an integrated industrial system, whereas the Gulf region is known for its abundant oil resources and successful economic development. As both the Chinese and the Gulf belong to an Eastern civilization with comparable cultural values and peoples who understand and talk with each other and share in both good and terrible times, the two sides make perfect partners for collaboration and understanding. In light of that, according to the president, China will continue to increase its imports of crude oil and liquefied natural gas from the GCC nations, create a framework for bilateral economic and investment cooperation, deepen its cooperation in the use of digital currencies, and construct a big data and cloud computing center with them.

Besides, the adoption of the joint 2023–27 action plan to deepen the current strategic alliance between the Gulf countries and China in the economic, political, and cultural domains was one of the first areas of cooperation to be considered. Trade between the GCC countries and China was $228.9 billion in 2021, a significant increase from the $148.2 billion figure from the year before- a reflection of continued collaboration with the help of the 2004 based FTA.

Therefore, leaders emphasized the need to swiftly conclude free trade negotiations as well as the significance of continuing to promote international cooperation in the areas of energy, trade, investment, finance, industry, advanced technology, and space. It was also considered how there should be more connections between the domains of sport, media, tourism, education, and culture.

Moreover, in his remarks, Xi praised the gains made between the two sides over the previous years and urged the GCC nations and China to maintain their longstanding friendship and use the opportunity presented by the strategic partnership to strengthen the strategic significance of their relations. According to him, the two sides should work together to advance unification, build political trust, and vehemently defend one other’s fundamental interests.

To the president of China, the two sides should coordinate their development goals, create security together, and benefit from one another’s wonderful cultural accomplishments fostering future cooperation

In this regard, five key areas for collaboration between China and the GCC nations over the next three to five years were suggested by the Chinese president: energy, finance and investment, innovation and new technologies, aerospace and language and cultures. The visit and the connotations will personify some ramifications. 

Firstly, the relationship will see a boost in terms of cooperation in certain domains. The amicable ties between the two sides have constantly improved in recent years. For instance, on September 19, Chinese State Councilor and Foreign Minister Wang Yi met with the foreign ministers of the GCC collectively in New York, outside of the UN General Assembly. In order to send out positive signals and aid in each other’s growth, the two sides agreed to “make collaborative efforts to seek mutual understanding on the China-GCC Free Trade Agreement (FTA) at an early date.” These will happen in a frequent way. Besides, leaders from other GCC nations praised GCC-China relations and the summit, stating that they thought it was a significant turning point in the history of GCC-China relations.

In addition to working with the Gulf to import natural gas, Xi stated that he wanted to increase collaboration in the areas of upstream recycling, engineering services, storage, and gas and oil refining, as well as make full use of the Shanghai Petroleum and Natural Gas Exchange as a platform for oil.

Besides, China and the Gulf countries should fully utilize the Shanghai Petroleum and National Gas Exchange as a platform to carry out yuan resolution of oil and gas trade, according to China’s President Xi Jinping.

Secondly, the GCC nations wholeheartedly accept the idea of a single China and are prepared to collaborate with China to put the summit’s decisions into action, strengthen bilateral ties in strategic areas, and benefit the two peoples more. The engagement in the strategic domain will bring new security threats both in the gulf and in the subsequent regions of China since this will antagonize the US policies for the gulf.

Thirdly, China will expand its collaboration in the areas of clean and carbon-free energy technologies, including hydrogen energy, energy storage, and smart electrical networks, as well as in the consolidation of the manufacture of new energy instruments.

Fourthly, there will be cooperation seen in the nuclear energy sector for the rising significance of it. In order to train 300 skilled specialists in the GCC nations’ use of nuclear energy for peaceful purposes, he declared his ambition to build a Chinese-Gulf forum for responsible nuclear energy usage as well as a center of excellence for nuclear security.

Fifthly, China will continue to provide steadfast support to the GCC nations in safeguarding their security as well as assistance to the nations of the area in resolving conflicts through communication, consultation, and the creation of a regional collective security system. Besides, China invites the GCC nations to take part in the global security initiative so that they can work together to maintain peace and stability in the area and progress civilization.

Finally, China is eager to work with GCC nations on financial regulation which will make it easier for GCC businesses to access China’s capital market, organize a joint investment organization with GCC, and boost bilateral collaboration between sovereign wealth funds in various ways.

In a nutshell, if the discussions during the sessions can be clustered in different sections, one common factor can be identified- the addition of strategic impetus in every other sector hence the term “strategicness” has been used by different sources to showcase the wholeness of the summit. However, these two sides must improve the alignment of the plans, activate the benefits of integration, and create a development impetus if they are to cooperate in the pursuit of progress. Security, stability, and the importance of reestablishing world peace through compassion and collaboration were other subjects discussed at the summit should also be taken into account with perspective otherwise the strategic rivalry between the USA and China will affect the outcomes of the summit.

[Photo by Saudi Press Agency, via Twitter]

*Syed Raiyan Amir is a Research Associate at the Center for Bangladesh and Global Affairs. He was a Research Assistant at the United Nations Office on Drugs and Crime (UNODC) and International Republican Institute (IRI). He has completed his internship at Bangladesh Enterprise Institute (BEI). The views and opinions expressed in this article are those of the author.

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