sign in sign up
<<
Home , Mohammed Bin Salman

ResearchPolicy Analysis Forum

Reuters / Lintao Zhang / POOL

Saudi Arabia- Relations: A Brave Friendship or Useful Leverage? Yoel Guzansky and Galia Lavi

“China is not necessarily a better friend than the US, but it is a less complicated friend.” Prince Turki al-Faisal and Beijing are deepening their economic ties and expanding them in other areas as well. Overall, Saudi-Chinese relations enjoy relative stability but remain limited, inter alia due to China’s lack of interest in deeper involvement in the at the present time. Aware of Washington’s sensitivities, Riyadh and Beijing do not want to invite pressure from the . understands that there is no good alternative to the US security guarantees at the present time, but doubts about the credibility of Washington’s political commitment in the long term persist. Moreover, in Riyadh’s view, relations with China can complement its relations with Washington in certain respects, and may even serve as potential leverage over Washington. Keywords: Saudi Arabia, China, United States, , , Pakistan Yoel Guzansky and Galia Lavi | Saudi Arabia-China Relations: A Brave Friendship or Useful Leverage? 109

Introduction Geopolitical Interests With the exception of energy security, the Middle In China’s view, relations with the Gulf states East has long been mostly peripheral to China’s serve diverse interests, first and foremost overall map of interests. However, under the energy security and economic growth. China leadership of Chinese President Xi Jinping, a has publicly expressed its concern about the greater emphasis has been placed on the region friction between the Gulf states and Iran, and in general and the Gulf in particular, an emphasis among the Gulf states themselves, given that that goes beyond purely economic interests. For this friction could undermine stability in the example, China’s “Arab Policy Paper,” presented Gulf that is necessary for economic growth. by President Xi on the eve of his visit to the Relations between China and Saudi Arabia Middle East in early 2016, emphasized, alongside have grown closer since the year 2000, and trade and investment, the need to strengthen bilateral trade jumped from $3 billion to the political, cultural, and security aspects of $41.6 billion in one decade. Oil constitutes a China’s relations with Arab countries. These significant part of bilateral trade, and China is join Beijing’s traditional policy principles, most Saudi Arabia’s largest trading partner and oil notably mutual respect for sovereignty and consumer. China’s demand for oil is expected territorial integrity and non-interference in to increase in the coming decades; hence the domestic affairs of other countries. This Saudi Arabia’s central importance in China’s “neutral” policy on Beijing’s part can raise its overall considerations in the Middle East. In standing in the eyes of the Gulf rulers, who are addition, China sees Saudi Arabia as a potential sensitive to criticism regarding human rights investment market, both for heavy industry and freedom of expression in their countries. infrastructure such as ports and railways, and At the same time, there is a sense in the Gulf as a destination for Chinese technology. that the trend that began under the Obama At the same time, Beijing is concerned that in administration whereby the United States aims the event of American sanctions against China, to reduce its involvement in Middle East conflicts Saudi Arabia will remain loyal to its ally, the is continuing under President . United States. Furthermore, China retains close Paradigms that formerly characterized the ties with Iran, Saudi Arabia’s greatest enemy. Chinese perspective on the region remain China and Iran have developed extensive ties primary, most notably energy security. The over the years, which reflect China’s energy main motive behind Chinese involvement in the needs and Iran’s natural resources, as well as Middle East in general and the Gulf in particular, additional economic ties such as the sale of therefore, remains economic: the region is of arms—a partnership hardly to Riyadh’s liking. strategic importance to China, which imports As a permanent member of the about 70 percent of its oil needs, primarily Security Council, China has given significant from the Gulf. Moreover, the Gulf countries political backing to Iran, even though the scope believe their geographic location allows them of oil trade between them has declined since to integrate easily into the Chinese Belt and the US administration canceled the waivers it Road Initiative (BRI), and China, due to its granted Beijing. The cancellation of the waivers relative economic advantages, can assume a and deepening American sanctions against more central place in the reforms that Arab Gulf Iran led to a dramatic increase in Chinese oil states seek to implement in their economies. purchases from Saudi Arabia in 2019-2018, at This paper seeks to map the spectrum of the expense of oil purchases from Iran, making cooperation between Saudi Arabia and China, Saudi Arabia China’s largest oil supplier in the and to suggest potential ways this dynamic can Middle East. develop in various fields. 110 Strategic Assessment | Volume 23 | No. 2 | April 2020

In order to maintain a balance between identify a mutual zone of interest in economic Tehran and Riyadh, China is careful to divide development while preserving the ruling order. its contacts and visits equally between the two countries. Thus, in 2016, President Xi made sure Economics and Trade to visit both Saudi Arabia and Iran. Furthermore, Beijing makes frequent use of its economic just days before Mohammed bin Salman’s arrival power to promote its political objectives, and in Beijing in February 2019, the Chinese hosted the Gulf arena is no different in this respect. a senior delegation from Iran. From a military China’s increased economic activity in the Gulf perspective as well, China maintains such a can be explained by its desire to find markets balance; about a month after holding a joint for its products and surplus capacity, with military exercise with Saudi Arabia in November emphasis on infrastructures and its need 2019, it held a joint naval exercise with Iran for energy security, and hence its interest in (and ). geopolitical stability. Riyadh’s ties with China are increasingly The development of China’s economic connected to its insecurity with regard to its relationship with the Gulf is linked to its desire relations with the United States, and more to obtain natural resources from the Gulf. China and more it may come to see China through is dependent on oil imports from the Gulf, a prism of security. Riyadh understands that and the volume of trade between Arab Gulf at present, there is no substitute for a US countries and China has increased steadily military presence in the Gulf to halt Iranian from $10 billion in 2000 to $117 billion in 2016. expansion, but it does not want to find itself Furthermore, by 2020, China is expected to in a state of total dependence on the United become the main export destination for the States. The importance of the Kingdom as Arab Gulf countries (although this expectation a source of energy for the United States has is currently challenged by the outbreak of the diminished, and it is evident that the Saudis coronavirus in China: the drop in oil prices will in turn are sympathetic to the Chinese model increase sales to China, but the volume of trade of economic openness and controlled politics. may well decline as well). Saudi Arabia, one of Moreover, China is a reliable partner for Saudi the two largest economies in the Middle East, Arabia and a market that has huge potential is a major target for China, and its trade with for expansion. From Riyadh’s perspective, ties the Kingdom in 2017 was $45 billion (around with China are not meant to replace ties with 38 percent of China’s total trade with the Gulf the United States, but rather to complement states). them in economic and political aspects—and Beyond oil exports, Saudi Arabia, which without the bothersome Western criticism on seeks to diversify its economy and reduce issues of human rights and democratization. its dependence on oil exports, is looking to Thus for example, following the murder of position itself as a major destination for Chinese Saudi journalist , China was investments and, in order to do so, integrate one of the only countries to openly express into the Belt and Road Initiative. For Chinese support for Saudi Crown Prince Mohammed companies, increased involvement in Arab bin Salman. Both countries therefore find Gulf states—particularly in development and comfort in mutual respect of their sovereignty, construction of ports and railways—is (for the without striving for change in the other; both most part) economically worthwhile and (often) are troubled by the challenges to their stability the right move from a geopolitical perspective, posed by the upheavals in the Middle East; both as long as it matches party aspirations and strive for stability and security in the Middle provides concrete substance to the initiative. It is East and for secure energy supplies; and both not inconceivable that the Chinese presence on Yoel Guzansky and Galia Lavi | Saudi Arabia-China Relations: A Brave Friendship or Useful Leverage? 111

the ground will gradually lead to greater Chinese the world, including outside of the Middle East, political influence in Arab Gulf countries, when bin Salman visited Beijing in February including Saudi Arabia, and in the future may 2019, the Saudi Crown Prince justified Beijing’s even create potential Chinese leverage on the actions against the and declared that Gulf regimes. “China has the right to take anti-terrorism and de-extremism measures to safeguard national The Political-Strategic Arena security.” Furthermore, in July 2019, Saudi Arabia China is still largely sitting on the sidelines was among the thirty-seven countries that sent of the political playing field in the Middle the United Nations a letter of support for China East in general and the Gulf in particular. Its and praised it for “remarkable achievements in involvement in the Middle East arena does the field of human rights.” Interestingly, at the not receive the kind of attention that Russia’s same time a Chinese delegation from the Council involvement receives, but in the long term, for Promoting South-South Cooperation visited it could be far more significant. Political ties Riyadh and explored options for expanding between China and Saudi Arabia are conducted Chinese investment in the Kingdom. with mutual avoidance of issues of conflict in Strengthened political ties between China an attempt to focus on issues where there is and Saudi Arabia are evident in several areas, common ground. This delicate balancing act beyond increasingly frequent reciprocal visits has achieved significant success and isreflected by heads of state. In 2016, relations between in China’s consistent avoidance of declaring a the countries (and subsequently between China definitive regional policy, taking a clear stand on and Iran and , in order to create a balance) issues of contention, and adopting a particular were upgraded to a “comprehensive strategic side in disputes. In this way, China avoids partnership”—a largely symbolic definition inviting pressure, especially from the United that implies a tightening of long term ties. States, on Beijing and its Arab partners in the Alongside its political and economic influence, Gulf. These countries, in line with the position of China is also investing resources to increase its the Arab League, support the One China policy cultural presence. For example, in June 2019, and at the same time have extensive economic the Confucius Institute was opened at King Saud and trade relations with Taiwan. University in Riyadh. The Institute will provide Similarly, Saudi Arabia, like other Arab Gulf Chinese language courses and promote cultural states, avoids public statements and positions communication between the countries. Yet on issues that may embarrass China and despite these positive developments, China’s generate international pressure, especially on involvement in Saudi Arabia can still be defined domestic issues. Saudi Arabia understands as “limited,” with Beijing marking its presence Chinese sensitivities and realizes that such through vague declarations and token attempts steps would harm the fabric of a relationship at mediation in times of crisis. that has a strategic importance for it. Thus it On the regional level, China is making an avoids statements on the human rights situation effort to maintain parallel relationships, and is in China and refrains from criticism of China’s doing its utmost to avoid the need to “choose treatment of the Uyghur Muslim minority in sides.” For example, China’s security ties with Province, which has worsened since Iran include the export of weapons that Tehran 2016, when about one million Uyghurs were sent could conceivably use against the Gulf states. to “re-education” camps. Furthermore, despite Beijing has called for an end to the fighting in the fact that Saudi Arabia, the “Custodian of and has expressed concern about the the Two Holy Mosques,” is active and shows humanitarian situation there, though without concern for Muslim minorities elsewhere in criticizing Saudi Arabia, which is fighting the 112 Strategic Assessment | Volume 23 | No. 2 | April 2020

Houthi forces allied with Iran. Moreover, Beijing environment, such as the South China Sea. At continues to sell attack drones to Saudi Arabia the present time, the extent of the US military and the (UAE) that are presence and its ability to project power, along in use in the fighting in Yemen, including in with the quality of its combat systems, the targeted attacks. Within the framework of this depth of military and political relations, and Chinese policy, increased tension in the Gulf its ability to act jointly with friendly militaries since May 2019, which saw Iranian attacks on are beyond China’s ability to compete, at least oil tankers and Saudi oil facilities that directly in the near and medium terms. Saudi Arabia hurt one of China’s important partners and understands that currently there is no substitute Chinese economic interests, passed without for the US presence in the Gulf to halt Iranian any public criticism from Beijing. It was only in expansion, even though Riyadh does not September 2019, following a direct hit on the want to find itself completely dependent on refineries, that China officially the United States. Thus relations with China condemned the attacks on the oil facilities, complement relations with the US and can but did not specify which country was behind provide Riyadh with leverage over Washington. them. Furthermore, the US proposal to form a This is aimed, inter alia, at signaling to the coalition to protect tankers in the Gulf was seen American administration, especially during in Beijing as a scheme to impose new sanctions periods of tension, that ignoring its demands on Iran, and an attempt to establish an “Arab can incur a price. NATO” in the Gulf. It is unclear how long China will be able to pursue its “balancing” policy, but Security Aspects for the moment there are no signs that would Over the years, China has stood in the shadow indicate that Beijing plans to deviate from it. of major Middle East arms suppliers, led by Regarding great power relations, Saudi Arabia the United States, Britain, and Russia. Its has so far been able to develop its economic volume of arms sales to the region is limited ties with China, without damaging ties with in comparison to these countries, with only 6.1 the United States. This is largely due to China’s percent of Chinese defense exports going to the consistent avoidance of taking clear positions on Middle East. Most weapons come from the West controversial issues, and from explicitly siding (mainly from the United States and the United with any party to disputes and public quarrels— Kingdom), and Arab armies in the Gulf are built this all within the framework of a policy full of around these weapon systems—including the contrasts and internal contradictions. China entire logistical and support systems, advisers, cannot and does not want to take the place of and training—which will make it difficult for the United States as a strategic guarantor for them to introduce Chinese systems in the future. the security of the Arab Gulf countries, with all However, China’s security needs (the increase the responsibilities involved. However, Beijing in the size of its army and the development of could take advantage of Saudi apprehensions its security industries) contribute to an increase with regard to its traditional ally, the US, to push in the export of unique platforms to the Middle a wedge between them, and try to fill the void East in general and to the Gulf in particular. At and strengthen its relations with Riyadh at the the same time, over the last decade the defense expense of the United States. budgets of Arab Gulf states have increased Overall, the Gulf arena represents a remote steadily in line with threats of reference faced, operating space for China that can be used despite the fall in oil prices. as leverage over the United States to obtain The close strategic ties between Saudi concessions in areas of greater importance Arabia and the United States determine the to Beijing that are closer to its strategic boundaries of its relations with China, out of Yoel Guzansky and Galia Lavi | Saudi Arabia-China Relations: A Brave Friendship or Useful Leverage? 113

an understanding that the US is its guarantor low cost of Chinese platforms (approximately and will remain so for at least the foreseeable one third of the cost of comparable Western future. However, Saudi Arabia’s arms purchases platforms), China is prepared to transfer its aim at tightening its relations with Beijing, in advanced platforms to its clients. In this context, an attempt to create leverage over the United Beijing has reportedly agreed to manufacture States—in part in response to the US refusal jointly with Riyadh CH-4 unmanned aerial to sell it certain systems—and to reduce its vehicles that Saudi Arabia already operates, and dependency on a single supplier. Purchasing to this end establish a factory in Saudi territory. weapons from various sources requires matching Overall, Riyadh and Beijing seem willing to parts, specialized training, and a specific expand military cooperation gradually. For maintenance system, and therefore imposes example, in October 2016, Chinese and Saudi a burden on armies. However, decentralization forces completed the first joint drill of its kind of procurement also reduces dependence on in counterterrorism, and in November 2019, the United States and strengthens the ability to conducted the joint naval exercise, the first pursue independent policies, a trend that may of its kind in the . Such collaborations strengthen if the question marks regarding US will allow both parties to gradually advance policy in the Middle East continue. their military ties on “soft” issues as a low risk In recent years, China has increased its support to their economic ties, in the service security footprint in and around the Gulf: of their mutual interests. Chinese naval forces were dispatched to the Gulf of Aden (to combat maritime piracy); Chinese ships have visited ports in the Gulf; A new field of cooperation between the countries a naval and aerial support base was opened is space. During his visit to China in 2017, King Salman signed a space research cooperation in Djibouti, China’s first outside of its borders; agreement between the countries: the Saudis China took over management of a sea port have decided to establish a satellite research, in Pakistan; and joint military exercises were development, and production infrastructure with conducted by China with Iran, Russia, and Saudi Chinese assistance in order to gain independence Arabia. Furthermore, new areas have joined in the field. In December 2018, it was reported that China-Saudi security cooperation. Riyadh’s two Saudi-designed earth observation satellites increasing interest in unmanned aerial vehicles were launched on a Chinese rocket and would be and the continued US refusal to provide certain operated from a research center in Riyadh. capabilities (with emphasis on offense vehicles) due to policy restrictions, export controls, and the need to consider Israel’s security needs Another aspect of cooperation between has led to its acquisition of these capabilities China and Saudi Arabia is the civilian nuclear from China. Although the Chinese platforms field. In response to Iran’s nuclear development are known to be of lower quality compared and due to considerations of prestige and to Western products, they seem sufficiently growing energy needs, Saudi Arabia has in satisfactory, and in any case it is evident that recent years begun to explore the nuclear path. this quality is constantly improving. The Kingdom recently declared that it plans It seems that China, at least at this stage, does to develop a nuclear program for electricity not seek to compete with the United States, but production and water desalination. Riyadh is rather to gain a foothold in this lucrative market already making preparations and has signed a and at the same time gain necessary combat number of cooperation agreements in the field experience for its platforms—an excellent with several countries. Since 2012, relations marketing tool. In addition to the relatively between Saudi Arabia and China in the nuclear 114 Strategic Assessment | Volume 23 | No. 2 | April 2020

field have tightened and a series of memoranda in economic activity in China, accelerated by of understanding have been signed, including the coronavirus outbreak in 2020, which could the opening of a branch of China National challenge its ability to continue investing in Nuclear Corporation (CNNC) in Riyadh. various projects in Saudi Arabia and the region A new field of cooperation between the to the same degree. In view of the fact that China countries is space. During his visit to China is the only country investing in mega-projects in 2017, King Salman signed a space research and building large scale infrastructure in the cooperation agreement between the countries: Gulf, economic slowdown in China could impair the Saudis have decided to establish a satellite its ability to realize some of its most ambitious research, development, and production projects in the Kingdom. infrastructure with Chinese assistance in order Increased Chinese economic interest in Saudi to gain independence in the field. In December Arabia could force Beijing to build up military 2018, it was reported that two Saudi-designed capabilities gradually to protect its interests, earth observation satellites were launched on and in order to do so increase its overall a Chinese rocket and would be operated from involvement in the Middle East. Israel will need a research center in Riyadh. to monitor the development of ties between China and Saudi Arabia and their implications Significance and Recommendations for Jerusalem, as well as the advancement of In a study published by the RAND Corporation, Riyadh’s nuclear program and the arrival of China was defined as being an “economic advanced weapon systems, which could affect heavyweight...a diplomatic lightweight and...a the military balance in the region and Israel’s military featherweight” in the Middle East. This qualitative military edge. In addition, while pattern remains true for China’s ties with Saudi the Saudi regime explores ways to advance Arabia, and Beijing has so far managed to “get its national power by establishing industries, along with everyone” and adopt a “selective Israel should monitor the growth of Chinese- policy” centered on certain countries and fields. assisted military industries in Saudi Arabia. However, as China’s political and security These topics should be discussed between weight increases in the Middle East in general the security establishments in Israel and the and in the Gulf in particular, Beijing will find it United States, as well as between the Israeli increasingly difficult to maintain this delicate government and the Chinese government, and, balance. Moreover, Washington would probably if possible, between Israel and Saudi Arabia. not hesitate to put pressure on Saudi Arabia too, if certain aspects of Riyadh’s cooperation Dr. Yoel Guzansky is a senior research fellow at with China were perceived by it as harmful. INSS. His most recent book, Fraternal Enemies: In addition to the American constraint, there Israel and the Gulf Monarchies, is co-authored may also be points of contention on other with Prof. Clive Jones and published by Oxford University Press. issues, most notably economics. Unlike other countries, especially in the developing world, Galia Lavi, a doctoral student at Tel Aviv University, Saudi Arabia has considerable leverage over is a research associate at INSS, where she is the Beijing given its oil resource. Another economic coordinator of the Israel-China program. aspect is related to the continued slowdown