Analysis: China and Saudi Arabia: Reinvigorating ties

King Salman receives warm welcome upon his arrival in China on Wednesday. (SPA)
Updated 16 March 2017
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Analysis: China and Saudi Arabia: Reinvigorating ties

At the invitation of Chinese President Xi Jinping, Saudi Arabia’s King Salman is paying a state visit to China. The visit by the monarch, arguably the most strategically significant leg of his month-long Asia tour, comes as Riyadh has boosted its efforts to diversify the economy away from oil dependence, and broaden the Kingdom’s foreign partners.
Although energy and trade will likely occupy an important place in the talks between the two leaders, the relations between both countries have expanded in various fields, especially in defense and security.
Energy cooperation remains the foundation of relations between Saudi Arabia, the world’s top exporter of crude oil, and China, the world’s biggest importer. China’s oil consumption has risen dramatically from 2.9 million barrels per day (mbpd) in 1993 to 11.90 mbpd in 2016. Thus, oil imports have also rapidly increased, rising from zero percent in 1993 to more than 66 percent of China’s total oil supply, or around 7.6 mbpd last year.
Importantly, the International Energy Agency (IEA) expects China’s appetite for crude oil imports to remain strong over the next decade, growing at an average rate of 2.4 percent over 2017-2022 to around 9.4 mbpd in 2022, with a possible additional 1.5-2 mbpd by 2030. In this context, Saudi Arabia will fight very hard to protect its growing energy interests in China.
Beyond oil, China also offers important economic advantages to Saudi Arabia’s sizeable downstream and petrochemicals sectors. Saudi Basic Industries Corp. (SABIC) already holds a stake in a polycarbonate complex in Tianjin with China Petroleum & Chemical Corporation (Sinopec Group), while Saudi Aramco holds a stake in the Fujian Refining & Petrochemical Company.
Against this backdrop the main concern for Riyadh is the future trajectory of China’s economy and the uncertainty over its oil demand. Growing competition is also an emerging challenge as Saudi Arabia is now facing competition for Chinese market share from Russia, Iraq, Iran, Venezuela and even Brazil.
Russia last year overtook Saudi Arabia to become China’s biggest crude oil supplier for the first time ever, shipping some 1.05 mbpd compared to Saudi Arabia’s 1.02 mbpd. Meanwhile, China’s petrochemical capacity is also projected to grow significantly over the coming years, while the yuan devaluation is reducing production costs and raising the price of imports. This situation would inevitably reduce the country’s reliance on imports.

Top trade partner
China’s rapid economic development over the past three decades contributed to a significant increase in its oil imports. In the process, Saudi Arabia become China’s top partner in the Middle East and North Africa (MENA). Looking forward, HSBC projects that China will remain the number one export market for Saudi Arabia to 2030, and will increase its dominance given its still relatively fast growth and demand for energy.
Today, more than 160 Chinese companies are operating in several sectors of the Saudi economy and the number of Chinese projects in the Kingdom reached around 175. The Chinese economic footprint in Saudi Arabia is most pronounced in the telecommunication and construction sectors. Huawei Technologies has a prominent presence in Saudi Arabia and represents one of the major success stories of Chinese companies in the Kingdom.
Yet China-Saudi relations are still transactional in their nature and have been restricted mainly to energy exports (oil, petroleum products and petrochemicals), Chinese manufacturing goods and limited cross-investment. To be sure, the trade between the two countries has dropped significantly to $42.4 billion in 2016, a decline of almost 18 percent from the previous year and nearly 40 percent since 2014, when the oil prices started to decline.
In this context lies the importance of the Saudi king’s visit to China, especially to attract more Chinese investment to the Kingdom and the use of Chinese expertise to contribute to the diversification of the Saudi economy away from oil.

Growing defense ties
Developing strategic relations with China is one of the most important foreign policy goals of Riyadh in the coming years. In January 2016, during President Xi Jinping’s state visit to Saudi Arabia, the two countries established a comprehensive strategic partnership.
From the Saudi perspective, Beijing could be regarded as a valuable source of political support as Saudi Arabia continues a path of selective economic reforms whilst also seeking to deflect Western pressure in the political arena. For example, last October China backed Saudi Arabia’s sovereign immunity and criticized the so-called Justice Against Sponsors of Terrorism Act (JASTA).
Counterterrorism is an emerging area of cooperation between the two countries. Last November, Riyadh and Beijing revealed a five-year plan for security cooperation including counterterrorism cooperation and joint military drills.
There is potential for Chinese companies to win more Saudi defense procurement over the next decade, particularly as Riyadh is seeking to diversify its military sources, and receive technology transfer as Riyadh aims ambitiously to localize over 50 percent of military equipment spending by 2030.
All in all, and despite several obstacles, Saudi-Chinese relations will be strengthened steadily in the future. Or as Chinese Foreign Ministry Spokeswoman Hua Chunying, during her regular press conference on March 13, put it: “We stand ready to take King Salman’s visit as an opportunity to take China-Saudi Arabia comprehensive strategic partnership to a higher level.”
• Dr. Naser Al-Tamimi is a UK-based Middle East researcher, political analyst and commentator with interests in energy politics and Gulf-Asia relations. Al-Tamimi is author of the book “China-Saudi Arabia Relations, 1990-2012: Marriage of Convenience or Strategic Alliance?” He can be reached on Twitter @nasertamimi and e-mail: nasertamimi@hotmail.co.uk.


Saudi leadership approves over SR3bn of Ramadan aid disbursement

Updated 18 March 2025
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Saudi leadership approves over SR3bn of Ramadan aid disbursement

  • Initiative part of government’s efforts to improve quality of life, enhance standard of living

RIYADH: The Saudi leadership has approved the disbursement of over SR3 billion ($800 million) to social security beneficiaries as part of an aid initiative during the holy month of Ramadan.

Under the leadership of King Salman and Crown Prince Mohammed bin Salman, the scheme will address the needs of beneficiary families and fulfill their requirements during Ramadan, the Saudi Press Agency reported.

Over SR3 billion will be given as follows: each breadwinner will receive SR1,000, and each dependent in the household will receive SR500. The funds will be deposited directly into the bank accounts of the beneficiaries on Tuesday, March 18, the SPA said.

Saudi Minister of Human Resources and Social Development Ahmad bin Sulaiman Al-Rajhi expressed gratitude to the Saudi leadership for helping to provide citizens with a decent livelihood.

The initiative is part of the Saudi government’s efforts to improve the quality of life and enhance the standard of living for social security beneficiaries, especially during Ramadan, the SPA added.


Nearly 11m iftar meals served at Two Holy Mosques during first half of Ramadan

Updated 18 March 2025
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Nearly 11m iftar meals served at Two Holy Mosques during first half of Ramadan

  • Number iftar meals provided during Ramadan to has increased this year due to growth in the number of Umrah pilgrims at Grand Mosque and Prophet’s Mosque, officials say

MAKKAH: Saudi authorities provided almost 11 million iftar meals to Umrah pilgrims and other worshippers at the Two Holy Mosques in Makkah and Madina during the first half of Ramadan.

The General Authority for the Affairs of the Grand Mosque and the Prophet’s Mosque said on Monday, the 17th day of Ramadan, it has provided 10,822,999 iftar meals and 10,290,000 packets of dates so far during the holy month, which is a time of worship for Muslims during which they fast from sunrise to sunset.

The authority said the number of iftar meals it provides during Ramadan to pilgrims performing Umrah, and other visitors to the mosques, has increased this year due to growth in the number of pilgrims, the Saudi Press Agency reported. The food is served in designated iftar areas at the mosques, in adherence with strict health standards to ensure the safety of worshippers, it added.

In the run-up to the holy month, the authority introduced an online service through which individuals, charitable organizations and endowments could submit requests to donate iftar meals at the Grand Mosque, the SPA added.


Palestinian, Egyptian envoys awarded with King Abdulaziz Sash of the Second Class

Palestinian and Egyptian ambassadors to Saudi Arabia are awarded with the King Abdulaziz Sash of the Second Class on Monday. SPA
Updated 17 March 2025
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Palestinian, Egyptian envoys awarded with King Abdulaziz Sash of the Second Class

  • Basem Al-Agha and Ahmed Farouk Tawfiq were given the awards for their efforts to strengthen relations between their countries and the Kingdom

RIYADH: The Palestinian and Egyptian ambassadors to Saudi Arabia were awarded with the King Abdulaziz Sash of the Second Class on Monday. 

Basem Al-Agha and Ahmed Farouk Tawfiq were given the awards for their efforts to strengthen relations between their countries and the Kingdom, Saudi Press Agency reported.

Saudi Deputy Foreign Minister Waleed Al-Khuraiji awarded the sashes on the directive of King Salman, SPA added. 


Saudi Culinary Arts Academy receives full institutional accreditation

Updated 17 March 2025
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Saudi Culinary Arts Academy receives full institutional accreditation

  • The accreditation follows an agreement signed on March 10 between the academy and the Education and Training Evaluation Commission

RIYADH: The Saudi Culinary Arts Academy (ZADC) was awarded a full institutional accreditation certificate on Sunday, with the support of Prince Saud bin Nayef bin Abdulaziz Al-Saud, Governor of the Eastern Province.

The recognition was granted during the inauguration ceremony of the academy’s new building on March 16.

The accreditation follows an agreement signed on March 10 between the academy and the Education and Training Evaluation Commission to implement institutional accreditation processes.

The achievement underscored ZADC’s commitment to maintaining the highest standards of quality and excellence in culinary education and training.

By equipping national talents with specialized skills, the academy aims to contribute to the growth of Saudi Arabia’s tourism and hospitality sector.

The achievement also aligns with the broader efforts of the Education and Training Evaluation Commission to ensure quality and excellence in education and training institutions across the Kingdom.


Saudi Foreign Ministry hosts Iftar reception for diplomats and international organizations

Updated 17 March 2025
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Saudi Foreign Ministry hosts Iftar reception for diplomats and international organizations

  • Several senior ministry officials attended

RIYADH: Under the patronage of Saudi Foreign Minister Prince Faisal bin Farhan and in the presence of Deputy Foreign Minister Waleed Al-Khuraiji, the Foreign Ministry hosted a gathering of the heads of diplomatic missions, regional offices, and international organizations accredited to the Kingdom to mark the holy month of Ramadan.

The ministry hosted an iftar reception at its headquarters in Riyadh, and those attending, which included several senior ministry officials, exchanged Ramadan greetings and engaged in cordial discussions, enhancing communication with diplomatic missions in the Kingdom, the Saudi Press Agency reported.