In the Middle East, America’s security stick is no match for China’s carrots

In December, Chinese President Xi Jinping visited Saudi Arabia to meet with the royal family and the leaders of the members of the Gulf Cooperation Council as Washington-Riyadh relations were at their lowest point since the killing of Washington Post journalist Jamal Khashoggi. 

The Biden administration had publicly expressed its discontent with the Saudi administration, both on the killing of Khashoggi and the administration’s position on the production of crude that was more in line with Russia than with the United States proposal.   

Saudi officials in coordination with the Organization of the Petroleum Exporting Companies decided to cut oil production by 2 million barrels per day to prevent a crash in oil prices. However, this was seen by Washington as undercutting its sanctions toward Russia. 

As cracks emerge in what was considered the most infrangible partnership of the U.S., Xi’s visit may have heralded a new era of relations between the two countries.  

Xi’s visit comes against the backdrop of Saudi Arabia expressing interest in joining the Brazil, Russia, India, China and South Africa (BRICS) grouping earlier in the year along with several other countries. As a result of the Russia-Ukraine conflict, and the subsequent economic turmoil, multi-polarity has found a resurgence, and nations, especially in the Global South, have sought alliances that will economically benefit them. Notably, the last few iterations of the BRICS meetings have focused on energy and food security, and floated alternatives to the U.S. dollar and increase in reserves of commodities.  

The China-Arab and China-GCC summits touched upon those topics as well. However, unlike the BRICS meetings, China had a clear mandate to promote its own currency at these bilateral meetings and secure markets and investments for its enterprises. President Xi urged his counterparts to make use of the Shanghai Petrol and Gas Exchange to conduct oil and gas sales, essentially challenging the dominance of the petro-dollar. 

As the Biden administration continues the Trump era mandate of looking inward and investing within its own borders through the revival of industrial policies such as the CHIPS and Science Act and Inflation Reduction Act, allies and partners may not simply join the bandwagon without any rancor. In light of this development, it will not be treaty allies or partners in East Asia and Europe, but ones in the Middle East who’d consider alternative economic arrangements as these relationships were not entirely anchored on values of democracy and the rules-based international order, but simply on security and trade reliances and dependencies.

This limited scope of relations, however, does not benefit countries such as Saudi Arabia that have ambitious plans for diversification. Riyadh’s 2030 plan requires billions in greenfield investments and China offers the much-needed capital and market for its exports (China is the top Arabian crude importer). 

Understandably, Saudi Arabia and China signed agreements covering a swath of industries in the fields of green energy, green hydrogen, photovoltaic energy, information technology, cloud services, transportation, logistics, medical industries, housing and construction factories. Most notably, the Saudi government signed a memorandum of understanding with Huawei — the Chinese technology giant sanctioned by the U.S.

Furthermore, in the almost 4000-word readout of the meeting between Xi and King Mohammed bin Salman, it was emphasized that the relationship will not meander to interfere in the internal affairs of either country, taking an indirect jab at the West’s practice of doing the opposite. Promotion of human rights and democracy has been a major plank of American foreign policy and yet ironically, over the years, America fostered partnerships with nations antithetical to those same values, such as Saudi Arabia.

With a slight cracking of the whip by the Biden administration, the kingdom is already eyeing other partners. Riyadh’s bonhomie with Beijing will finally convey to Washington that, after all, “birds of a feather flock together.” Values such as non-interference in domestic issues (including human rights violations) and economic ties make China and Saudi Arabia natural partners.

While the U.S. adopts a zero-sum “us versus them” model to conduct its statecraft — pressuring and some would say strong-arming its very own allies, China’s approach of bringing unlike-minded countries such as Iran and Saudi Arabia to the room may just be what the doctor ordered to coalesce historical nemesis’s and as a consequence achieve peace.  

However, Iranian President Ebrahim Raisi’s comments to the deputy prime minister of China that ”some positions raised during the recent visit of the president of China to the region have caused dissatisfaction and complaints of the nation and the government, and Iran seriously demands compensation for these positions,” indicate that peace may not be easily realized.  

Through the Belt and Road Initiative, China is among the few countries that have made investments and trade possible with Iran, Saudi Arabia and Israel. Mohammed Soliman, director of the Middle East Institute’s Strategic Technologies and Cyber Security Program, described this strategy to me as “maintaining friendships with competing regional powers, and those powers — Arab states, Israel and Iran — have adjusted their expectations accordingly.” 

With Raisi’s comments, it becomes evident that as long as the discussion revolves around economics, there is mutual understanding. Once the topic veers into politics — especially regional politics — differences begin to creep in.  

Nevertheless, in a fractured world, China’s message of unification may find more takers than the “us vs them” and “democracy vs autocracy” binary approach of the U.S. Time will tell if Beijing’s recent overtures to the region will consequently act as bridges between historical rivals or if it will be shooting itself in the foot in that ambitious attempt. 

In 2023, if the U.S. keeps up pressure on its allies without offering a strong economic value proposition, outside of the silo of the beltway, the U.S. will be the one to look like the belligerent power and not China.  

Akhil Ramesh is a fellow with the Pacific Forum. He has worked with governments, risk consulting firms and think tanks in the United States and India. Follow him on Twitter: Akhil_oldsoul.