Global Risk Insights

Assessing China’s strategy in the Middle East

President Xi Jinping’s tour of the Middle East reveals China’s willingness to expand its role in the region in order protect vital strategic interests in its quest to becoming a major global power. However, China appears hesitant to seize the opportunity to fully consolidate its position. 

China in the Middle East: building strategic ties

On Tuesday, December 19th, President Xi Jinping visited Saudi Arabia, prior to meeting his counterparts in Egypt and Iran as part of an important tour of the region, aiming to strengthen China’s presence in the region. Protecting vital access to the Gulf’s oil while maintaining the status quo in an area deeply affected by political turmoil remains one of most evident challenges for Beijing.

Instability in the region caused by deep geopolitical shifts such as the rise of the ISIS and the frictions between two of China’s most relevant economic partners, Iran and Saudi Arabia, could easily jeopardize Beijing’s energy access. Chinese business interests in the region are massive, and the main reason behind Xi’s visit was to secure its strategic partnership with important partners such as Saudi Arabia and Iran.

China is experiencing a huge demand for oil that is expected to grow alongside its economic growth. China’s demand for fossil fuel has risen dramatically, transforming the country from a net oil exporter to the world’s second largest consumer in 2009. In 2015, China’s crude oil imports reached 29.49 million tons, surpassing the U.S. in annual net oil imports.

For these reasons energy security remains an abiding concern for the Chinese Communist Party (CCP) and President Xi’s visit represents an evident attempt to reassure Beijing’s partners over China’a strategic commitment to the region.

President Xi Jinping has made expanding ties in the Middle East an important goal in order to fulfill China’s ambitious aims of not only building an extensive infrastructure network able to facilitate trade but also of building new oil and gas pipelines in order to bypass the Malacca Straits, the Achilles’ heel of the Middle Kingdom. Under this ambitious project, China has inaugurated a new strategy based on a new and more dynamic approach in the Middle East, the main pillar of the Chinese Energy Security Strategy. Chinese companies have a consolidated presence in Iran and have played a pivotal role in the expansion of the level of infrastructure required for a the strategic integration of Tehran into Beijing’s energy supply line, already inaugurated with the creation of the China-Pakistan Economic Corridor (CPEC).

The Middle East has become the epicenter of all major, global strategic shifts; the falling apart of Syria, the expansion of ISIS in the region, and the entrance of Russia to protect its vital strategic interests at the expense of Washington have marked an interesting evolution in the geopolitics of the region.

In addition, Washington’s reluctance to become further embroiled in the Syrian crisis after the quagmire represented by the wars in Afghanistan and Iraq have marked a new phase in which major powers but also new actors are adjusting the level of their engagement.

Political instability in the Gulf, responsible for the oil supply of half of China’s domestic demand is a source of constant concern for Beijing. China watchers have constantly argued that in order to achieve an increased power status, China needs to secure its presence in strategic areas around the globe, such as the Middle East, where its has major assets with a central role in Beijing’s energy security strategy.

Until recently, China has relied on its traditional non-interference policy based on the Five Principles of Peaceful Coexistence developed during the Mao Era. However, more recently CCP leadership has increasingly used a more assertive foreign policy attitude aligned with China’s peaceful rise discourse, given the new role of Beijing as a responsible power.

Since Xi’s inauguration in November 2012, the discourse over the rejuvenation of the China has become the official doctrine of the CCP. This new political vision, based on the idea that China is entitled to lead regional nations in prosperity and development, has been strongly advocated by the new leadership, representing a marked shift from a dated foreign policy tradition elaborated under the influence of the Cold War order.

While China is experiencing a marked change in its foreign policy strategy, China’s intervention in regions of political turmoil where Beijing’s core interests are strong, such as the Middle East, has been the topic of vibrant debate inside the Party.

President Xi’s dilemma

Given China’s growing role in the region, Beijing seems ready to capitalize on long-term relations with relevant oil suppliers such as Saudi Arabia and Iran that would be valuable partners in terms of developing a more extensive infrastructure network.

The recent meeting between Rouhani and Xi has unveiled important opportunities for Beijing, especially after the implementation of the Joint Comprehensive Plan of Action that will open the Iranian market to important investors after nearly three decades of economic sanctions. China’s long dated strategic partnership with Tehran has secured Beijing to important projects, aiming to restore Iranian crude oil production capacity and accelerate the Silk Road’s infrastructure able to connect Asia to Europe.

Moreover, China will support Tehran’s succession to full membership to the Shanghai Cooperation Organization (SCO) as the main step to establish and develop a comprehensive strategic framework to contain Washington’s influence in Central Asia.

Despite China’s energy security strategy strongly connected to Middle East political stability, Beijing has shown reluctance to take a leading role in the resolution of regional disputes. Chinese leadership is extremely concerned that a stronger presence in the Middle East could lead to the rise of terrorist threats inside its national borders.

The spread of terrorist organizations close to ISIS in Xinjiang, a region that has a strategic importance for China’s energy supply, has been deeply affected by the presence of separatist groups recently involved in attacks against important facilities. Increased terrorist activity could jeopardize Xi Jinping’s power consolidation strategy, awaited in the upcoming 19th CCP National Party Congress in 2017.

Overall, China’s balanced approach to regional issues reveals Beijing’s willingness to pursue a very cautious path based on expanding economic and strategic relations with both Iran and Saudi Arabia in order to boost its own power ambitions. Beijing will continue prove to the international community its ability to project power beyond its borders rather than maintaining a free-rider approach to global security, a feature that has characterized its foreign policy up until now.