Gulf-China relations are strictly business

Alamy via Reuters

Hardly a day goes by without a story about China’s growing presence in the Gulf, which is a remarkable transition. When I started working on a PhD focusing on China-GCC relations in 2011, an economist at a regional sovereign wealth fund dismissed the project out of hand: “How are you going to write 100,000 words on selling cheap stuff and buying oil”?

Nearly 15 years later the narrative has shifted hard in the other direction, with China generally considered a major external power in the region. That does not mean its role in the Gulf is any better understood.  

Many project a maximalist view of China, anticipating a rising power that challenges American dominance worldwide. Perceptions of US policy drift in the Middle East contribute to this, leading to an assumption that China will come to play a major role in the Arab world.

To understand what kind of actor Beijing will be here, however, you must have a clear understanding of what China wants in the region and how the Gulf features in China’s bigger picture. 

First and foremost, the Gulf remains a place to get energy. For decades, China has had a voracious appetite for imported oil and gas and it will continue to be the world’s largest importer in the near term. Gulf countries typically provide it with between 40-50 percent of its crude oil imports and an increasingly large percentage of its LNG.  

• The Gulf has a tricky path to plot between China and the West
• China renewables pivot to Middle East to avoid Trump tariffs
• Lenovo completes $2bn deal to open Saudi PC factory

While Beijing has set 2030 as its target for peak hydrocarbon consumption, it will continue to rely on imported energy and petroleum products and Gulf producers will be important in meeting that demand.

Less obvious is the money Chinese companies make in the Gulf. China’s position as a global trading superpower is well-established and it consistently ranks at or near the top of trade partners for every country in the region.  

Beyond trade, the synergy between China’s Belt and Road Initiative (BRI) and Gulf ‘Vision’ development agendas has created tremendous opportunities for Chinese contractors.

Since the BRI was announced in 2013, Chinese companies have signed $103 billion in infrastructure contracts in the GCC, with $17 billion in Iraq and another $12 billion in Iran. The Gulf is a very lucrative market for China, making it a major economic hub.

No appetite for politics

Given this economic interdependence, it is tempting to project a greater political or security role for China – naturally, the thinking goes, Beijing will need to be more proactive in protecting the source of so much energy and revenue.

For the short to near term, however, this logic is wrong. China has made it clear, time and again, that it is not willing to play the kind of security role that external powers have traditionally adopted here.  

If you read China’s policy documents for the Middle East, you see a country that is pursuing economic interests.

Its 2016 Arab Policy Paper, to date its only official Mena-centred white paper, largely focuses on hydrocarbons, trade and investment, infrastructure construction, and exporting technology in its own satellite, renewable and nuclear energy sectors.

When it mentions security, it describes China in a supporting role; it is the job of regional actors to sort out the region. China is here for business.

This is completely reasonable. The Middle East does not feature prominently in China’s foreign policy priorities. China shares land and maritime borders with 20 countries, many of which are weak, unstable or hostile. It has a tremendously challenging strategic environment and managing this requires most of the time, attention and resources of its foreign policy decision-makers.

The competitive world order

It also has to consider its competitive relationship with the US, which remains – despite perceptions – the most consequential extra-regional power in the Middle East.

China does not have the same depth of experience, relationships, or expertise about the Gulf, and is not able to compete with Washington as a security or diplomatic actor. 

In a recent conversation with a Chinese Gulf expert, I provocatively described China as a second-tier power here; his response was, “On a good day. We’re third-tier at best.” His hierarchy was the US, then the UK, France, Turkey and Russia all lumped together, and then China. I think he was right.

That is not to say China is not important, but if we are going to accurately understand it as an actor in the Gulf, we have to start with the realisation that the region is not a top priority for Beijing. 

As long as the energy continues to flow and the contracts continue to be signed, China will largely be satisfied. Expecting a major Chinese presence beyond the economic realm is wishful thinking.

Jonathan Fulton is an associate professor of political science at Zayed University in Abu Dhabi and a nonresident senior fellow for Atlantic Council’s Middle East Programs and the Scowcroft Middle East Security Initiative