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China Entices Arab States with ‘Belt and Road’ Initiative

By Maya Margit | The Media Line

July 12, 2018

Kuwait's emir, Sheikh Sabah Al Ahmad Al Sabah (3rd from right), speaks during a meeting with Chinese President Xi Jinping (3rd from left) in Beijing earlier this week. (Photo by Andy Wong - Pool/Getty Images)

Beijing’s offer of loans and aid to Arab countries is about economics, not politics, analysts say

China has pledged to provide billions in loans and aid to Middle Eastern countries as part of its long-term economic strategy aimed at securing lucrative trade routes throughout the region.

At the recent China-Arab States Cooperation Forum in Beijing, Chinese President Xi Jingping pledged roughly $20 billion in loans intended to promote infrastructure projects and foster job growth in the Middle East.

In addition, Xi earmarked $105 million in financial aid to Jordan, Lebanon, Syria, Yemen and the Palestinians, which includes donations to the United Nations Relief and Works Agency for Palestine (UNRWA). Of this total aid package, $15 million will go towards supporting Palestinian economic development.

Boosting trade and economic ties with Arab countries is part of the Chinese government’s ambitious “Belt and Road Initiative,” a development strategy aimed at increasing cooperation between Eurasian countries through the establishment of modern trade routes and infrastructure projects linking China to central Asia, east Africa and Europe. China’s multi-trillion dollar plan plan is being billed as a revival of the old Silk Road network, a series of ancient trading routes on land and by sea that connected China and the East with Europe centuries ago.

“This is an economic and reconciliatory long-term endgame,” François Godement, the director of the European Council on Foreign Relations’ Asia and China program, told The Media Line.

“What I read in the huge discrepancy between the amount of loans and the amount of financial aid is that China believes the Syrian Civil War is going to end, and the Chinese are starting to take a position on the building of infrastructure and on the connectivity issues for the so-called ‘Silk Road,'” he said, noting that their ultimate “target” is direct access to the Mediterranean Sea for the movement of Chinese goods.

Godement believes Xi’s moves are in keeping with China’s long-standing reluctance to intervene in Middle Eastern politics. The Chinese government’s aims here, he added, are purely about business.

“In terms of aid, this is a tiny shift,” the French historian argued. “I suspect that the amount that’s going to be given to the UNRWA is part of the commitment that Xi made in 2015 to the U.N. for the creation of a fund,” he added, referring to the Chinese president’s promise to create a $1 billion “peace and development” fund to support the UN’s work. “As much as the Chinese did not want to be involved in the management of the refugee crisis, the Syrian war, and the difficulties it caused in neighboring countries, they will want to get involved in what will be the lucrative business of postwar reconstruction and infrastructure building.”

Oded Eran, a Senior Researcher at Israel’s Institute for National Security Studies and a specialist in China-Israel relations, also did not view the move as a shift in Beijing’s Middle East policy.

“I don’t see it as a significant change in their policy,” Eran conveyed to The Media Line, noting that despite the money earmarked for the Palestinians, he did not believe China is looking to replace the U.S. as a broker in the Israeli-Palestinian peace process.

“Up until now, China has kept a very low profile in relation to the Israeli-Palestinian conflict,” Eran noted. “We don’t really see Beijing carrying out any political activity in that area and I don’t believe the decision to give some money to the Palestinians indicates any change in policy.”

It is not the first time China has offered substantial loans to Arab nations. The East African nation of Djibouti alone has already accrued $1.3 billion in debt to Beijing, according figures from the China Africa Research Initiative. Located on the Horn of Africa, the Arabic-speaking country hosts China’s first overseas military base.

Alexander Pevzner, the founding director of the Chinese Media Center in Israel, said Xi’s announcement is part of a wider initiative to broaden China’s economic clout in the region.

“China aims to strengthen its position in the Middle East as it seeks to raise its diplomatic profile globally,” Pevzner told The Media Line. “It believes that development is the key issue plaguing the Middle East. However, the Middle East is not short on money; it is short on the will to cooperate. If China can indeed bring different players together using economic incentives, then it’s a good thing.”

Despite this growing economic presence, there is currently no push from China to intervene in the Israeli-Palestinian conflict, Pevzner added, though “China still wants to be seen as an honest broker in the region.”

Godement agreed with Pevzner and Eran that China has no intention of replacing the U.S. or other Western powers in the Middle East, at least as far as peace making is concerned. The Chinese government has so far only offered “cosmetic” proposals toward solving the region’s conflicts.

“They always count on others to establish peace and then they come in for business,” Godement said. Nevertheless, he explained, the direction of Chinese loans and aid indicate a “novel” pivot away from Iran.

“There’s the possibility that for the first time the Chinese are acting separately from Iran; they seem to be courting the Sunni countries in the region,” Godement concluded.

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