Saturday December 10, 2022
Saudi Crown Prince Mohammed Bin Salman stands with Chinese President Xi Jinping in Riyadh, Saudi Arabia. (Saudi Press Agency/Handout via REUTERS)
Saudi Arabia and China reaffirmed their cooperation on global oil markets and the principle of non-interference in internal affairs during Chinese President Xi Jinping’s visit, which was aimed at deepening strategic relations, at a time when Washington’s ties with Riyadh appear increasingly frayed.
Xi and Saudi King Salman signed a series of deals, including one involving Chinese tech giant Huawei, since the Chinese leader’s state visit began on Wednesday.
In a joint statement on Friday, the two sides said they “exchanged views regarding ways to reinforce and develop comprehensive strategic partnership relations between the kingdom and China”.
The statement stressed the principles of sovereignty and “non-interference”, while affirming the importance of a peaceful solution to the Ukraine conflict.
In a nod to Gulf security concerns over Iran, another oil supplier to China and with whom Beijing has good ties, they agreed on the need to “strengthen joint cooperation to ensure the peaceful nature of Iran’s nuclear programme”, and for Tehran to respect “principles of good-neighbourliness”.
Xi said his visit heralded a “new era” in relations.
Xi calls for trade in yuan
Later on Friday, Xi met other Gulf oil producers and attended a wider summit with Arab League countries, telling them that China would continue to import large quantities of oil from the region as well as increase its imports of liquefied natural gas.
He called for the use of the yuan in settling oil and gas trade transactions. If it were to happen, such a move would weaken the US dollar’s hold on international trade while simultaneously propping up China in establishing its currency globally.
However, most of Saudi Arabia’s assets and reserves are in US dollars. The Saudi riyal, as well as other currencies in the Gulf, are pegged to the dollar.
“China looks forward to working with Saudi Arabia and Arab states to turn the two summits into milestone events in the history of China-Arab relations and China-GCC [Gulf Cooperation Council] relations and bring these relations to new heights,” China’s foreign ministry cited Xi as saying.
Qatar’s emir, Kuwait’s crown prince, and the presidents of Egypt, Tunisia, Djibouti, Somalia and Mauritania, were among the rulers attending, alongside leaders and prime ministers of Iraq, Morocco, Algeria, Sudan and Lebanon.
Xi held bilateral talks with several regional leaders ahead of the summit, such as Egyptian President Abdel Fattah el-Sisi, Iraqi Prime Minister Mohammed Shia al-Sudani, Sudanese leader General Abdel Fattah al-Burhan and Palestinian President Mahmoud Abbas.
“This summit establishes a new phase of the relation between our countries, as it strengthens our partnership in fields that we share a common interest in and to ensure the future that our people strive for,” said Saudi Crown Prince Mohammed bin Salman.
‘Internal affairs of the kingdom’
Riyadh reaffirmed its adherence to the “one-China principle”, by which the People’s Republic of China (PRC) is the sole legal government and Taiwan is an inalienable part of China’s territory.
China is determined to forestall Taiwanese independence and bring about the island’s unification with the mainland. Western governments, including the United States, recognise the PRC as the sole legal government of China but simultaneously maintain unofficial relations with Taiwan.
In turn, Beijing “affirmed its opposition to any actions that would interfere in the internal affairs of the Kingdom of Saudi Arabia”.
The two sides stressed the importance of stability in world oil markets, the statement said, and agreed to explore investment opportunities in the petrochemicals sector, as well as sources of renewable energy.
China is the world’s largest importer of crude oil, for which it is heavily reliant on Saudi Arabia.
They also welcomed the involvement of Saudi companies in various energy and investment partnerships within the framework of the Belt and Road Initiative, a massive infrastructure project that would stretch from East Asia to Europe that enhances “the Kingdom’s location as a regional centre for Chinese companies”.
INTERACTIVE - Saudi Arabia and China bilateral trade
Deepening ties
Beijing has been cementing ties with Gulf states over the past few years, but its foreign ministry this week described Xi’s trip as the “largest-scale diplomatic activity between China and the Arab world” since the PRC was founded.
The Saudi crown prince is looking at the world’s second-largest economy as a critical partner in his sweeping Vision 2030 agenda and ambitious megaprojects, including the futuristic $500bn megacity Neom.
The Saudis are also pushing to diversify their economic and political alliances at a time when relations with their long-term US allies appear roiled by disagreements.
US President Joe Biden travelled to Saudi Arabia in July in an attempt to convince the Saudis to raise oil production and lower gas prices at the pump, despite criticism from lawmakers in Washington over human rights concerns.
The Saudi-led OPEC+ in October decided to cut oil production by two million barrels, which Biden’s administration viewed as a direct affront ahead of the 2022 midterm elections.
Saudi Arabia and its Gulf allies have been defiant in the face of US pressure to break with fellow OPEC+ oil producer Russia over its invasion of Ukraine and to limit dealings with China, as they try to navigate a polarised world order with an eye on national economic and security interests.
On Friday, Saudi Foreign Minister Prince Faisal bin Farhan Al Saud said his country would continue to work with all its partners.
“We don’t see this as a zero-sum game,” he said when asked about Riyadh’s ties with Washington given the lavish reception that Xi received.
“We do not believe in polarisation or in choosing between sides,” he told a news conference.