China’s “project of the century” is undergoing some profound changes. Less than
a decade ago, Chinese President Xi Jinping unveiled the Belt and Road
Initiative to connect China to Eurasia through extensive maritime and overland
trade routes. Despite the grand rhetoric of the BRI physically linking the
global economy to Beijing, the initiative’s aims are straightforward.
اضافة اعلان
The BRI is a
Chinese investment platform that employs Chinese capital across infrastructure
projects in emerging markets for geopolitical gains. Remarkably, this
investment strategy is now turning away from traditional countries like Russia
and African nations to focus on Saudi Arabia and the Middle East.
Critics have
argued that the BRI is a form of debt trap diplomacy by another name. The
ongoing economic saga unfolding in Sri Lanka gives weight to these arguments.
Yet, this narrow focus misses the larger geopolitical dimensions of the BRI’s
true aims. Like many wealthy countries worldwide, China will always engage in
predatory lending. That is just how the global economy works. What is more
interesting is how the BRI has evolved into a vehicle of Chinese geopolitical
influence and how this influence has shifted to focus on the Middle East.
The countries
that make up the GCC have been on the official list of BRI countries since its
inception, but they have not been a primary focus of the initiative in its
earlier phases. This is partly because GCC countries do not need access to
cheap Chinese credit like some African and East Asian countries. Aside from
being vital nexus points for trade in emerging markets, the GCC’s role in the
BRI has traditionally been focused on regional partners, construction projects,
and energy.
From the Gulf’s
perspective, the BRI is a vital support link for allied countries such as
Pakistan and Egypt. China has played a pivotal role through the BRI in the
Gwadar port and pipeline project in Pakistan as well as Egypt’s Suez Canal Area
Development Project. In recent years, the Chinese have grown more aggressive in
their interest in the Middle East, specifically the Gulf. When Saudi Aramco was
exploring various ways to become a publicly traded company, Chinese investors
(some of which were backed by the government) were ready to buy large stakes in
the economy. We will come back to why this interest belied deeper goals.
BRI investment
has grown in Saudi Arabia recently as China has drawn down investment in other
countries like Russia. The Financial Times reported last month that BRI
spending in Russia dropped to zero, with no new deals taking place in the first
half of 2022. In the same period, Beijing struck $5.5 billion worth of deals in
Saudi Arabia. The full extent of what these deals include is unclear as not all
have been made public, but analysts believe that many are focused on energy
resources.
This shift
reveals how China will use the BRI in the future and the extent of Beijing’s
long-term ambitions in the Middle East.
The quick
reallocation away from Russia and into other parts of the world demonstrates
the flexibility of the BRI. This is not a monolith investment vehicle that is
resistant to change. Rather, BRI capital can be easily diverted based on
geopolitical considerations.
BRI investment has grown in Saudi Arabia recently as China has drawn down investment in other countries like Russia. The Financial Times reported last month that BRI spending in Russia dropped to zero, with no new deals taking place in the first half of 2022. In the same period, Beijing struck $5.5 billion worth of deals in Saudi Arabia.
In this case,
Russia is at the mercy of Western sanctions stemming from the Ukraine conflict.
At the same time, Saudi Arabia’s relationship with the US is anything but warm.
Sensing an opportunity to solidify its position in the region, Beijing has
shifted the funding focus of BRI to ride the geopolitical tides. Instead of
thinking about the BRI as a way of connecting the global economy to China,
perhaps we need to think of the BRI as a way for China exporting its
geopolitical will on to the rest of the world.
With the end of
its combat mission in Iraq and the complete withdrawal of forces from
Afghanistan, the US is pulling back its interests in the Middle East. US
president Joe Biden’s recent trip to Saudi Arabia and Israel revealed a tepid
American interest in the region. China has long sought a significant foothold
in the Middle East in its battle with the US for global hegemony.
The ultimate
realization of this goal will be upending the US dollar-dominated global oil
trade. That is one reason China took an early interest in a significant stake
in Saudi Aramco. While that bid was unsuccessful, China’s recent BRI investment
push at the precise time that America pivots away from the region will surely
bring Beijing’s goal one step closer. China’s long-term plans to replace the US
as the world’s superpower are not a secret. Just track BRI funding for clues of
what Beijing will do next.
Joseph Dana is the former senior editor of Exponential
View, a weekly newsletter about technology and its impact on society. He was
also the editor-in-chief of emerge85, a lab exploring change in emerging
markets and its global impact. Twitter: @ibnezra.
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