How Saudi Arabia has built new alliances

The increasing eastward orientation also reflects a desire by the Kingdom to reduce a reliance on the US as its single strategic partner. (File/AFP)
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Updated 21 June 2020
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How Saudi Arabia has built new alliances

  • The crown prince’s visits to Asia and Russia have solidified strategic economic relationships
  • Saudi Arabia, located right at the geographic center of this great tilt in economic power, has been increasingly looking towards the East

The world’s economic center of gravity has been moving inexorably eastwards for the past 50 years as the great trading powers of Asia – China, India, Japan, South Korea and a handful of others – have transformed themselves into modern consumer economies.

Asia is on the verge of overtaking the combined economic power of North America and Europe in terms of gross domestic product. Measured by accumulated wealth, Asia is already richer than either.

Saudi Arabia, located right at the geographic center of this great tilt in economic power, has been increasingly looking towards the East. That process has accelerated in the past three years, with a number of trading and investment relationships struck between the Kingdom and its new partners in what are still bizarrely referred to by some economists as “emerging markets.”

For Saudi Arabia, these countries have already emerged as a big focus for future economic and strategic direction. Even the global crisis of the coronavirus pandemic seems unlikely to slow the long-term process. 

The most important relationship is with China, the world’s biggest manufacturer and exporter, apparently destined to overtake the US as the world’s biggest economy in absolute terms sometime this decade.

However, since 2017 Saudi Arabia has also forged new commercial relations with India, a long-time trading partner of the Middle East, as well as enhancing older alliances with Japan and South Korea.

There has also been a blossoming of the partnership with Russia, based mainly on common interests in the energy sector, but also reflecting shared values across a range of investment goals in industry and infrastructure.

This increasing eastward orientation also reflects a desire by the Kingdom to reduce a reliance on the US as its single strategic partner.

“Maybe Saudi Arabia has realized that it risks being over-reliant on one big international partner in the USA. It is logical for the Kingdom to want to diversify its great power relationships.”

Frank Kane

Jonathan Fulton, assistant professor of political science at Zayed University in Abu Dhabi, told Arab News: “Maybe Saudi Arabia has realized that it risks being over-reliant on one big international partner in the USA. It is logical for the Kingdom to want to diversify its great power relationships.”

Surprisingly, given its historic role as a great power and trading base, China is the relative newcomer among the Kingdom’s eastern friends. Next month marks the 30th anniversary of the establishment of diplomatic relations between Riyadh and Beijing. 

The past three years have marked a rapid increase in Saudi-China links. King Salman visited the country as part of a six-country Asian tour early in 2017, setting the seal on a “comprehensive strategic partnership” between the two countries when he met Chinese President Xi Jinping.

A joint high-level committee was established to guide future economic development strategy. 

That was followed by a later visit by Crown Prince Mohammed Bin Salman, adding greater depth to the relationship and further aligning the two countries’ main economic development plans – the Belt and Road Initiative by which China seeks to play a leading role in regional development, and the Vision 2030 strategy aimed at diversifying Saudi Arabia away from oil dependency.

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“Saudi Arabia is willing to work with China to enhance synergy of development strategies, deepen cooperation in jointly developing the Belt and Road and bring benefits to both countries and peoples,” the crown prince said on his visit in February 2019.

Energy relations are at the heart of the new partnership. China is the biggest consumer of oil in the world, and Saudi Aramco is its biggest single supplier of crude. But the trading relationship goes a good deal farther.

“China is the economic base of the future in energy, and China’s appetite is the biggest in Asia. But it is not just crude oil. Increasingly, Saudi Aramco is a partner with China in downstream projects, like refining, petrochemicals and energy infrastructure,” Fulton said.

One of the first fruits was the Huajin Aramco Petrochemical Company, a joint venture with big Chinese partners to develop a $10 billion refining and petrochemicals complex. Aramco’s chief executive, Amin Nasser, said it was key to his strategy to move beyond a simple “buyer-seller relationship” in crude oil.

Similar commercial imperatives applied to the blossoming relationship with Japan, augmented by close personal relations between the Saudi royal family and the Japanese imperial dynasty. A big Saudi delegation attended the enthronement of the new Emperor Naruhito last year, coinciding with the launch online of Arab News Japan.

Energy and petrochemicals are again at the heart of the partnership. Japan is reliant on oil imports, and some 40 percent of its crude supplies are provided by Saudi Aramco, which has a long-term presence in Japan. SABIC, the big industrial conglomerate now part of Aramco, also has significant operations in the Tokyo area.

As Saudi Arabia extends its horizons beyond more traditional western partners, perhaps the best example of how common interests in the energy field can extend into other areas has come with Russia.

King Salman and the crown prince made the first official Saudi visit to Russia (or the former Soviet Union) in 2017, reflecting perhaps the most significant new alliance in the global energy sector for many decades.

The growth of American shale oil since the end of the global financial crisis gave Saudi Arabia and Russia – two of the top three global oil powers along with the US – a common interest in energy, which has translated into the Opec+ arrangement, an alliance of 23 of the biggest oil producers, to help regulate oil markets.

Just recently, Opec+ signed a historic deal to cut nearly 10 percent of the world’s crude output. which had been made surplus by the collapse in demand following global pandemic lockdowns. The deal is credited with having pulled global oil markets back from the chaos they suffered a couple of months ago.

An important player in the Opec+ negotiations was Kirill Dmitriev, chief executive of the Russian Direct Investment Fund (RDIF), an institution aimed at attracting inward investment into the country as well as entering into foreign investment partnerships. Saudi Arabia has been a key partner with RDIF in a range of investments in both countries, in areas such as transport, infrastructure and logistics.

To complete the circle of Saudi Arabia’s eastward shift, China has been brought into the Saudi-Russia partnership in a multi-billion dollar investment fund.

  • Frank Kane is an award-winning journalist based in Dubai. Twitter: @frankkanedubai


Officials detained as investigators smash drug-smuggling operation at Al-Jouf Airport

Updated 4 sec ago
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Officials detained as investigators smash drug-smuggling operation at Al-Jouf Airport

  • 9 people arrested, including Ministry of Interior employee, 4 people associated with the Zakat, Tax and Customs Authority, and a Saudi Electricity Company worker

RIYADH: A drug smuggling operation at Al-Jouf International Airport in Saudi Arabia, in which several government and other public-sector officials allegedly were involved, has been shut down following an extensive investigation.

An official source at the Ministry of Interior said on Thursday that nine people were detained, including a ministry employee, four people associated with the Zakat, Tax and Customs Authority, and one from the Saudi Electricity Company.

Their alleged roles in the smuggling network included helping to get the drugs into the Kingdom, ensuring shipments bypassed inspections, transporting them, and concealing them in homes and at other locations.

They also engaged in the promotion and distribution of the narcotics in the country, the Saudi Press Agency reported. The amount and type of drugs involved was not immediately apparent.

The Ministry of Interior said it remains committed to confronting all threats to national security and will take stringent action against anyone who jeopardizes the safety and stability of the country.


OIC discusses draft humanitarian funds statute

Updated 14 November 2024
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OIC discusses draft humanitarian funds statute

  • It discussed the draft humanitarian funds statute
  • Taha added that it was important to make every effort to finalize the statute of these funds

JEDDAH: The general secretariat of the Organization of Islamic Cooperation held a meeting of the open-ended Group of Governmental Experts in Jeddah on Thursday.
It discussed the draft humanitarian funds statute, in accordance with the Council of Foreign Ministers.
OIC Secretary-General Hussein Ibrahim Taha said that the meeting was held amid difficult and harsh humanitarian circumstances that required concerted efforts and collective action to adopt actions to help contain humanitarian crises and hardships.
In his speech, Taha added that it was important to make every effort to finalize the statute of these funds, undertake the necessary reforms to their working mechanism and support them with the financial resources to enable them to fulfil their role.
The statement delivered by assistant secretary-general for humanitarian, cultural and social affairs, ambassador Tariq Ali Bakhit, on behalf of OIC’s secretary-general, highlighted the significant challenges faced by member states in the humanitarian field.


KSrelief distributes shelter supplies in Afghanistan

Updated 14 November 2024
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KSrelief distributes shelter supplies in Afghanistan

  • KSrelief will distribute 4,882 shelter items, such as tents, blankets, plastic mattresses and other supplies

KABUL: The King Salman Humanitarian Aid and Relief Center has launched a shelter project for people returning from Pakistan to Afghanistan and victims of the 2024 floods.

It will distribute 4,882 shelter items, such as tents, blankets, plastic mattresses and other supplies across the provinces of Kabul, Ghazni, Bamyan, Badakhshan, Kunduz, Baghlan, Parwan, Kapisa, Panjshir, Herat, Nimroz, Nangarhar and Laghman. The project will help 29,292 people.

The scheme is part of the Kingdom’s humanitarian and relief efforts, through its humanitarian arm, KSrelief, to alleviate the suffering of the Afghan people.


KSrelief wins Global Humanitarian Achievement Award

Delano Roosevelt, CEO of National Council on US-Arab Relations, presents the award to the supervisor general of KSrelief.
Updated 14 November 2024
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KSrelief wins Global Humanitarian Achievement Award

  • Delano Roosevelt, the council’s second president and CEO, presented the award to the supervisor general of KSrelief, Dr. Abdullah Al-Rabeeah, in Washington
  • Dr. Al-Rabeeah said the award is an international acknowledgement of Saudi Arabia’s leading role in relief efforts

WASHINGTON: The Saudi aid agency KSrelief was honored with the Global Humanitarian Achievement Award by the National Council on US-Arab Relations, in recognition of relief efforts that have made a substantial impact in crisis regions around the world.

Delano Roosevelt, the council’s second president and CEO, presented the award to the supervisor general of KSrelief, Dr. Abdullah Al-Rabeeah, in Washington, the Saudi Press Agency reported.

Dr. Al-Rabeeah said the award is an international acknowledgement of Saudi Arabia’s leading role in relief efforts.

He underlined the Kingdom’s commitment to assisting people in need, supporting those affected by crises, and assisting refugees wherever possible.

He also affirmed that Saudi Arabia has consistently been a leader in charitable and humanitarian initiatives and is at the forefront of donor countries on regional and international fronts.


4th Saudi Green Initiative Forum hosted in COP16 Green Zone in Riyadh next month

Updated 14 November 2024
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4th Saudi Green Initiative Forum hosted in COP16 Green Zone in Riyadh next month

RIYADH: The Saudi Green Initiative announced on Thursday that the SGI Forum 2024 will take place on Dec. 3-4 under the theme “Action is in our nature.” 

The flagship climate and environment action event, now in its fourth year, will return to Riyadh for the first time since its launch in 2021 by Crown Prince Mohammed bin Salman, prime minister and chairman of the Supreme Committee for the Saudi Green Initiative.

The SGI Forum 2024 will coincide with the 16th session of the Conference of the Parties, or COP16, of the United Nations Convention to Combat Desertification, or UNCCD. 

According to an SGI press release, the Riyadh COP16 (Dec. 2-13) will be the largest-ever UNCCD conference, the first to be held in the Middle East region, and the largest multilateral conference hosted by Saudi Arabia.

At this year’s SGI Forum, hundreds of policymakers, business leaders and subject-matter experts from across the world will convene in a dedicated SGI Pavilion in the UNCCD COP16 Green Zone. 

Dozens of tailored sessions will explore best practices, innovations and progress against SGI targets, with the goal of deepening collaboration and scaling up action for a greener future.

Since the launch of SGI, a significant positive impact has been achieved, with 4+ GW of renewable energy capacity installed, more than 95 million trees and shrubs planted, and more than 1,660 endangered animals re-wilded across the Kingdom.

For the duration of COP16, the SGI will welcome the public to a 4,000 sq m SGI Pavilion, where visitors can enjoy an interactive journey through Saudi Arabia’s whole-of-society climate and environment efforts in the SGI Gallery. 

A multimedia showcase and a broad range of experts will enable guests to learn more about the more than 80 initiatives already launched as part of SGI. 

Visitors can also attend and exchange ideas during daily SGI Talks, an expert-led speaker series that launched in 2023.

The SGI was launched by the crown prince in 2021 to drive climate action across all levels of society and achieve Saudi Arabia’s ambition to achieve net-zero emissions by 2060. 

The initiative demonstrates the Kingdom’s dedication to improving the quality of life for current and future generations and addressing the region’s environmental challenges, including high temperatures, low rainfall, dust storms and desertification.

In 2022, the SGI Forum was held in Sharm El-Sheikh, Egypt, in tandem with UNFCCC COP27. The event revealed major climate action projects, including the launch of a circular carbon economy knowledge hub, and the establishment of a regional center for advancing emissions reduction with UNESCWA.

In 2023, the third SGI Forum took place in conjunction with UNFCCC COP28 in Dubai.

During the event, the Kingdom unveiled a 300 percent increase in installed renewable energy capacity since 2022, and more than 43 million trees were planted toward the goal of 10 billion.