CHINA AND THE MIDDLE EAST: VENTURING INTO THE MAELSTROM (Part 1)

The RSIS Working Paper series presents papers in a preliminary form and serves to stimulate comment and discussion. The views expressed in this publication are entirely those of the author(s), and do not represent the official position of RSIS. This publication may be reproduced electronically or in print with prior written permission obtained from RSIS and due credit given to the author(s) and RSIS. Please email RSISPublications@ntu.edu.sg for further editorial queries.

 

NO. 296

CHINA AND THE MIDDLE EAST:

VENTURING INTO THE MAELSTROM

JAMES M. DORSEY

S. RAJARATNAM SCHOOL OF INTERNATIONAL STUDIES

SINGAPORE

18 MARCH 2016

About the S. Rajaratnam School of International Studies

The S. Rajaratnam School of International Studies (RSIS) was established in January 2007 as an autonomous school within the Nanyang Technological University. Known earlier as the Institute of Defence and Strategic Studies when it was established in July 1996, RSIS’ mission is to be a leading research and graduate teaching institution in strategic and international affairs in the Asia Pacific. To accomplish this mission, it will:

·       Provide a rigorous professional graduate education with a strong practical emphasis

·       Conduct policy-relevant research in defence, national security, international relations, strategic studies and diplomacy

·       Foster a global network of like-minded professional schools

Graduate Programmes

RSIS offers a challenging graduate education in international affairs, taught by an international faculty of leading thinkers and practitioners. The Master of Science degree programmes in Strategic Studies, International Relations, Asian Studies, and International Political Economy are distinguished by their focus on the Asia Pacific, the professional practice of international affairs, and the cultivation of academic depth. Thus far, students from 65 countries have successfully completed one of these programmes. In 2010, a Double Masters Programme with Warwick University was also launched, with students required to spend the first year at Warwick and the second year at RSIS.

A select Doctor of Philosophy programme caters to advanced students who are supervised by senior faculty members with matching interests.

Research

Research takes place within RSIS’ five components: the Institute of Defence and Strategic Studies (IDSS, 1996), the International Centre for Political Violence and Terrorism Research (ICPVTR, 2004), the Centre of Excellence for National Security (CENS, 2006), the Centre for Non-Traditional Security Studies (Centre for NTS Studies, 2008); and the Centre for Multilateralism Studies (CMS, 2011). Research is also conducted in RSIS’ Studies in Inter-Religious Relations in Plural Societies (SRP) Programme. The focus of research is on issues relating to the security and stability of the Asia Pacific region and their implications for Singapore and other countries in the region.

The School has five endowed professorships that bring distinguished scholars and practitioners to teach and to conduct research at the school. They are the S. Rajaratnam Professorship in Strategic Studies; the Ngee Ann Kongsi Professorship in International Relations; the NTUC Professorship in International Economic Relations; the Bakrie Professorship in Southeast Asia Policy; and the Peter Lim Professorship in Peace Studies.

International Collaboration

Collaboration with other professional schools of international affairs to form a global network of excellence is a RSIS priority. RSIS maintains links with other like-minded schools so as to enrich its research and teaching activities as well as learn from the best practices of successful schools.

Abstract

China’s increasingly significant economic and security interests in the Middle East have several impacts. It affects not only its energy security but also its regional posture, relations with regional powers as well as the United States, and efforts to pacify nationalist and Islamist Uighurs in its north-western province of Xinjiang. Those interests are considerably enhanced by China’s One Belt, One Road initiative that seeks to patch together a Eurasian land mass through inter-linked infrastructure, investment and expanded trade relations. Protecting its mushrooming interests is forcing China to realign its policies and relationships in the region.

As it takes stock of the Middle East and North Africa’s volatility and tumultuous, often violent political transitions, China feels the pressure to acknowledge that it no longer can remain aloof to the Middle East and North Africa’s multiple conflicts. China’s long-standing insistence on non-interference in the domestic affairs of others, refusal to envision a foreign military presence and its perseverance that its primary focus is the development of mutually beneficial economic and commercial relations, increasingly falls short of what it needs to do to safeguard its vital interests. Increasingly, China will have to become a regional player in competitive cooperation with the United States, the dominant external actor in the region for the foreseeable future.

The pressure to revisit long-standing foreign and defence policy principles is also driven by the fact that China’s key interests in the Middle East and North Africa have expanded significantly beyond the narrow focus of energy despite its dependence on the region for half of its oil imports.[i] Besides the need to protect its investments and nationals, China has a strategic stake in the stability of countries across the Eurasian landmass as a result of its One Belt, One Road initiative and the threat of blowback in Xinjiang of unrest in the Middle East, North Africa and Central Asia.

China has signalled its gradual recognition of these new realities with the publication in January 2016 of an Arab Policy Paper, the country’s first articulation of a policy towards the Middle East and North Africa. But, rather than spelling out specific policies, the paper reiterated the generalities of China’s core focus in its relations with the Arab world: economics, energy, counter-terrorism, security, technical cooperation and its One Belt, One Road initiative. Ultimately however, China will have to develop a strategic vision that outlines foreign and defence policies it needs to put in place to protect its expanding strategic, geopolitical, economic, and commercial interests in the Middle East and North Africa; its role and place in the region as a rising superpower in the region; and its relationship and cooperation with the United States in managing, if not resolving conflict.

*******************************

Dr James M. Dorsey is a senior fellow at the S. Rajaratnam School of International Studies, co-director of the University of Würzburg’s Institute for Fan Culture, and the author of The Turbulent World of Middle East Soccer blog, a forthcoming book with the same title, as well as a forthcoming book co-authored with Dr Teresita Cruz-Del Rosario, Comparative Political Transitions between Southeast Asia and the Middle East and North Africa. James is expanding this working paper into a book with the same title.

The U.S. and China: Seeking Complimentary Approaches

Formulation of Chinas emerging Middle East and North Africa strategy is shaped as much by contemporary U.S. predicaments in the region as it is by the fact that post-Cold War differences between major powers are about power, influence, geopolitics, and economic interests rather than a global ideological divide. China’s formulation of a policy towards the region is complicated by the fact that it occurs at a time that the United States and China are adjusting to one another in a world in which China is on the rise.

“U.S.-China relations will certainly be a, if not the, central pillar of any new post-Cold War international order,” noted Bilahari Kausikan, a prominent Singaporean diplomat and intellectual. The immediate problem, Kausikan argued, was that “U.S.-China relations are infused with deep strategic distrust” that underlies their current “groping towards a new modus vivendi with each other.” Kausikan’s assertion that “neither the U.S. nor China is looking for trouble or spoiling for a fight” is key to the formulation of a Chinese policy towards the Middle East and North Africa. “The essential priorities of both are internal not external. Of course, neither is going to roll over and let the other tickle its tummy. That is not how great powers behave. Both will not relent in the pursuit of their own interests, which sometimes will be incompatible. There will be frictions and tensions,” Kausikan predicted.[ii]

That is certainly true for the Middle East and North Africa given that China bases its positions on a set of foreign and defence policy principles that at least nominally contrast starkly with those of the United States and are intended to ensure that China does not repeat what it views as U.S. mistakes. While there appears to be broad consensus in China on this approach, China’s policy community is divided on a host of questions related to the complicated process of marrying their country’s foreign policy principles with a comprehensive policy towards the Middle East and North Africa that takes the region’s complexities and difficulties into account.

These questions involve issues like the posture China should adopt towards the region as a whole, its major powers and numerous conflicts, and the protection of Chinese interests. They range from the sustainability of the region’s autocracy to the rise of Islam as a political force, the emergence of violent strands of the faith, and the continued viability of the existing borders of the Middle East and North Africa’s nation states. Underlying the debate is the question whether China can afford to continuously respond to events as they occur rather than develop a coherent policy.

At the crux of the debate is ironically the same dilemma that stymies U.S. policy in the Middle East and North Africa: the clash between lofty principles and a harsh reality that produces perceptions of a policy that is riddled with contradictions and fails to live up to the values it enunciates. Increasingly, China is finding it difficult to paper over some of those dilemmas by harping on the principles of non-alignment and non-intervention and offering economic incentives.

The Chinese debate goes to the core of China’s vision of its role in world affairs. It is forcing China to revisit its view of itself as what China scholar David Shambaugh described as “a partial power that is “hesitant, risk adverse and narrowly self-interested” and that “often makes it known what it is against, but rarely what it is for.”[iii] Chinese officials and analysts who argue against moving away from adherence to their country’s established foreign policy and defence guidelines worry that a watering down of China’s principle will take it into more risky, uncharted territory or down a road that has gotten the United States at times tangled into knots.

Wu Jianmin, a member of the Chinese Foreign Ministry’s foreign policy advisory group, a senior research fellow with the State Council of China, and former ambassador to the United Nations and various European countries, argued as late as 2015 that abandoning long-standing principles would put China on a slippery slope. “If China aligned with others there would be a new cold war. It would create enemies. China today does not need enemies, we need partners,” Wu said.[iv]

Remaining aloof may however be easier said than done as China’s economic stake in the region increases and conflicts in the Middle East and North Africa escalate and potentially spill out of the region and closer to home. The significant expansion beyond energy of key Chinese interests in the region makes standing aside ever more difficult. Besides the need to protect its investments and nationals, China has a strategic stake in the stability of countries across the Eurasian landmass as a result of its One Belt, One Road initiative and the threat of blowback in Xinjiang of unrest in the Middle East, North Africa and Central Asia.

Figure 1: China’s Crude Oil Imports by source 2014

Source: U.S. Environment Information Agency[v]

For many in the Chinese policy community, this elevates the need for cooperation with the United States to the level of an imperative. The question however is: on whose terms? The answer is a subtle sidekick to the larger battle between the United States and China over who will write the rules for the international system and the global economy in the 21^st century global economy that is being fought out in the South China Sea and the creation of Chinese-led institutions like the Asian Infrastructure Investment Bank (AIIB) and the Shanghai Cooperation Organisation (SCO) that groups Central and South Asian states.

Middle Eastern and North African states have provided initial answers to the question in terms of their expectations. While realising that they are likely to remain dependent on the United States’ regional defence umbrella, Gulf States have begun to look towards Asia, and China specifically, as a power that can at least partially compensate for growing doubts about U.S. reliability. The late King Abdullah of Saudi Arabia already highlighted those expectations by making China the first country he visited after his coronation in 2006. In doing so, Abdullah, like other Middle Eastern leaders, also see relations with China as a way to pressure the United States to re-engage in the Middle East and North Africa and become more supportive of their often divisive policies.

The need for Middle Eastern and North African leaders to balance their relations with the United States and China is further fuelled by the fact that China’s record of living up to those expectations has been poor. Its backing of the regime of Syrian President Bashar al-Assad with its vetoes in the United Nations Security Council and support for Russia’s aggressive policy in Syria puts it at odds with most states in the region. Similarly, China, pointing to its principle of non-intervention has cold-shouldered the repeated calls by Gulf States for it to take a more active role in Middle Eastern affairs, including the Israeli-Palestinian conflict, Iraq, Yemen and Libya.[vi]

Nonetheless, the contours of what an updated policy would have to look like and the assumptions on which it would have to be based have begun to emerge from the Chinese debate as U.S. prestige fluctuates and its credibility lessens. The United States’ standing in the world has been weakened as a result of the Afghanistan and Iraq wars, U.S. waxing and waning in Syria and in its relations with Saudi Arabia, and its narrow regional focus on confronting IS, the jihadist group that controls a swath of Syria and Iraq. China is, however, not yet at the point at which it is willing and/or able to clearly articulate its strategic interests or intentions in the Middle East and North Africa beyond its drive to secure resources, investments and people and expand its influence through economic ties and its One Belt, One Road initiative. As a result, China’s strategic dialogues remain focussed on free trade agreements with the six-nation, Saudi-led Gulf Cooperation Council (GCC) and Israel rather than the forging of broader strategic partnerships that go beyond economics with any one country or group of countries in the Middle East and North Africa.

Chinese reluctance is further informed by a belief that U.S. support for political change in the Middle East and North Africa was misguided. Officials see subsequent U.S. reluctance to become embroiled in the region’s conflicts, foremost among which Syria, and its inability to nudge Israelis and Palestinians towards a resolution of their dispute, as indications of waning U.S. influence.

An Huihou of Shanghai International Studies University’s (SIIS) Middle East Institute, who served as Chinese ambassador in five Arab countries, pointed to the Russian negotiated resolution of the Syrian chemical weapons issue in the summer of 2014 after U.S. President Barack Obama shied away from acting militarily on what he had earlier described as a red line. “U.S. backing off on the Syrian chemical weapons issue signalled the end of U.S. hegemony,” An said.[vii]  

Doubts about U.S. reliability that are shared by China and the Gulf states were further fuelled by cuts in recent years in the U.S. defence budget and repeated statements by Obama that the United States would reduce its involvement in Middle Eastern affairs. During his 2012 re-election campaign, Obama noted that fracking technologies that enhance domestic U.S oil production make the U.S. “less dependent on what’s going on in the Middle East.”[viii]

At the same time, China recognised the increasing importance it attributes to the Middle East in a 2008 publication edited by Shanghai Institutes for International Studies president Chen Dongxiao. The publication noted that “West Asia (the Middle East) has become an extension of China’s neighbourhood. China’s major strategic target is to maintain sub-regional peace, participate in the process to solve hotspot issues there, ensure energy security, enhance economic and trade links, and develop its relations with relevant states and organisations in a balanced and all-round way.”[ix]

In doing so, both China and the Gulf are careful not to provoke the United States to a point at which it would consider playing games with the flow of oil from the region, something both believe has entered the realm of the possible as a result of America’s sharply reduced dependence on Gulf production. Both China and the Gulf rely on the fact that U.S. allies remain dependent on Gulf oil, U.S. dependence on Gulf investment has picked up since 9/11 when it tapered off for a while, and the U.S. has need for Arab allies in its fight with IS. China, moreover, realises that if predictions that the U.S. could become one of the world’s foremost oil exporters by 2030 prove correct, it eventually could find itself increasingly dependent on oil from the United States.[x]

As a result, Chinese reliance on the U.S. security umbrella in the Gulf has been a cornerstone of its approach towards the Middle East and North Africa. “China benefits a lot from the current world order… China will never rock the boat,” said Wu.[xi] China’s recognition of its need to work with the U.S. facilitated the establishment in 2012 of an annual senior level Middle East Dialogue to facilitate understanding and avoid misunderstandings and/or mishaps.[xii]

Ironically, the U.S. presence in the Middle East and North Africa benefits China not only in security terms. U.S. educational institutions act at times as a facilitator when it comes to expanding Chinese soft power in the Middle East and North Africa. In a region that has few of the linguistic links that the United States can command such as the influence of English or western music and cinema, New York University in Abu Dhabi teaches Chinese and encourages its students to attend summer programmes at its campuses in Shanghai and Beijing as well as courses on classical Chinese philosophy, Arab crossroads in China, education and nationalism in Modern China, and environmental history of China.[xiii]

At the same time, China is seeking to forge cultural links on its own steam with the opening in the Gulf of the first Confucius Institutes, China’s equivalent of Britain’s British Council or France’s Alliance Francaise, at the University of Dubai and Zayed University in Abu Dhabi.[xiv] China has further strengthened its soft power through retail. Dubai’s Dragon Mart, a 1.6 kilometre-long, mall in which some 4,000 Chinese vendors sell everything from basic goods to Qur’ans, attracts consumers from across the Gulf. China has also emerged as a major exporter of halal meat.[xv] The strategy has however not been an unmitigated success. Gulf scholar Sean Foley noted in 2015 with a series of pictures that the 150,000 square-metre China-Middle East Investment and Trade Promotion Center has been all but abandoned.[xvi]

All of this suggests that China and the U.S. could, for example, find common ground on the principle of adherence to international legality, a principle Obama emphasised when he was first elected and whose interpretation is driven as much by power politics and interests as it is by ideology.  Moreover, international relations scholar Jian Junbo suggested that if China can cooperate with the United States and other Western countries in countering terrorism, “they should also be able to help each other to protect their interests overseas.”[xvii] Cooperation has so far been complicated by major policy differences symbolised by the frequent blocking of resolutions regarding Syria by China and Russia that have largely rendered the United Nations Security Council impotent. Like Russia, China’s approach to the resolutions was rooted in a sense that the United States had abused a 2011 UN Security Council resolution authorising humanitarian intervention in Libya to pursue the toppling of Qaddafi.

China’s policy approach to the Middle East is reinforced by its conclusion from the U.S. predicament in the region that no one power can help the region restore stability and embark on a road of equitable and sustainable development. “Replacing the U.S. is a trap China should not fall into,” Wang Jian, director of the Shanghai Academy of Social Sciences’ (SIIS) West Asia and North Africa Research Centre, said. At the same time, he justified Chinese non-interference with the government’s conviction that the chaos in the region meant that this was not the time to intervene – an approach that many in the Chinese policy community believe allows China to let the U.S. stew in its own soup. Nevertheless, doubts about U.S. reliability and perceptions of waning U.S. influence are forcing China to prepare for the day when it will need or want to ensure its own energy security.

Avoiding the Pitfalls of Diverging Interests

The Chinese debate on the management of relations with the U.S. appears to have informed China’s first articulation of a Middle East policy with the publication in in January 2016 of an Arab Policy Paper[xviii] on the eve of President Xi’s visit to the Middle East and North African, the first by a Chinese head of state in seven years. The paper shied away from spelling out concrete policies. Instead, it reiterated long-standing principles of Chinese foreign policy like non-interference in the internal affairs of other states, dialogue, and win-win modes of cooperation as they applied to the Arab world and emphasised China’s key interests in the region: economics, energy, counter-terrorism, security, technical cooperation and its One Belt, One Road initiative.

In the process, the paper failed to answer influential Chinese blogger Ma Xialing’s question: “What’s China’s strategy in the Middle East?” Xialing argued two years earlier that China does not have a strategy. “Strategy, for one, depends on theory. In this regard, China still follows the general principle set out by Deng Xiaoping – we don’t really care too much about outside developments, for now we just make our economy stronger. In Zhongnanhai (the headquarters of the Chinese Communist Party), leaders don’t care much about Middle East, but about China’s domestic interest. Moreover, even in the times of (former president) Hu Jintao and Xi Jinping, China does not aim to develop strategy, but rather short-term policies. That is why China will not play an important role in the Middle East… China is hesitant to get deeply involved in the Middle East, as it is very complex and a troublesome place. China is not prepared for the risks that could be encountered there. Often, Chinese political leaders and scholars say that the Middle East is a graveyard for empires, as many big empires through history collapsed after getting involved and failing in the Middle East,” Xialing noted.[xix]

Hesitancy to become embroiled in the Middle East and North Africa’s pitfalls appears to still be the basic instinct of Chinese leaders even though facts on the ground inevitably push them towards greater engagement. And the stakes for China are rising as its interests in the region mushroom. Energy and resource security are key to China’s continued economic growth and rising standards of living on which the legitimacy of the Communist Party of China (CCP) rides. Add to that, the geo-strategic importance of Middle Eastern and North African states as hubs for access to African and European markets and their centrality to China’s One Belt, One Road strategy is obvious. Finally, as was evident in China’s complex compliance with international sanctions against Iran and Xi’s visit to the Middle East, balancing Chinese relations with rival Middle Eastern states as well as the United States as they relate to the region is increasingly resembling the act of a dancer on a tightrope.

In line with the sanctions, China’s diminished its oil imports from the Islamic republic. Chinese imports of Iranian oil dropped from 555,000 barrels a day in 2011 to 402,000 in the first quarter of 2013.[xx] Chinese compliance, however, came at a price. China repeatedly pushed the U.S. to grant it a sanctions waiver that allowed it to purchase additional amounts of Iranian oil. The International Energy Agency (IEA) reported that Iran by 2014 had increased exports to 1.32 million barrels per day.  The hike put Iranian exports at 32 per cent higher than the limit that had been agreed in November 2013 as of the U.S.-led negotiations to end the nuclear crisis.[xxi] Xi ensured that he became the first foreign leader to visit Iran after the lifting of the sanctions in January 2016. Xi’s visit and an agreement to raise trade 10-fold from US$60 billion in 2015 to US$600 billion over a 10-year period held out the prospect that Iran would be able to win back its lost share of the Chinese oil market.[xxii]

Increased oil purchases from Iran highlighted China’s dependency on Middle Eastern oil that had grown exponentially. In 2007, China imported 3.2 million barrels a day with 1.46 million barrels, or 46 per cent, coming from the Middle East.[xxiii] Seven years later, in 2014, China imported an average of 6.1 million barrels of oil a day. Of that, more than 52 per cent—or 3.2 million barrels—came from the Middle East with Saudi Arabia in the lead.[xxiv]

China has sought to enhance its energy security within the limitations of its inter-dependency with the United States and its continued reliance on the U.S. defence umbrella in the Gulf by investing significantly in resource-related sectors in Middle Eastern and North African states, including Saudi Arabia, Egypt, Yemen, Iraq, Qatar, Algeria, Iran, Kuwait, Libya, Mauritania, Morocco, Oman, Somalia, Syria, Tunisia and the United Arab Emirates or 15 of the 22 member states of the Arab League. At the same time, China has taken its first tacit step to shield its currency, the renminbi, against the fallout of U.S. dollar-linked crises by agreeing on a US$6 billion bilateral currency swap with Qatar and a similar US$24 billion deal with Russia.[xxv]

Similarly, the region’s increased economic and security importance to China is reflected in the fact that an estimated 60 per cent of Chinese exports travel through the Suez Canal. As a result, China has invested heavily in the channel’s ports. Investments include a US$186 million joint venture to operate a container terminal in Port Said, a US$219 million expansion of the port's quay and the construction of a US$1 billion quay and US$416 million container terminal in Al-Adabiyya.[xxvi]

China has also moved to ensure robustness by investing in a rail line that links the Israeli Red Sea port of Eilat with the Mediterranean Sea that would enable Chinese exports to circumvent the canal[xxvii] as well as Israeli ports. Shanghai International Port Group won in 2015 a tender for the management of Haifa port[xxviii] while China Harbour Engineering Co is building Israel’s first private port in Ashdod at a cost of US$876 million.[xxix]

The need for robustness symbolised by the Israeli backup to the Suez Canal was driven home when Suez Canal ports experienced backlogs and closures in the wake of the 2011 popular revolt that toppled Egyptian President Hosni Mubarak and again in 2013 when a vessel in the canal belonging to China Ocean Shipping Group Company was hit by rocket-propelled grenades. The al-Furqan Brigades, an Egyptian jihadist group, said in its claim of responsibility that it carried out the attack because the Suez Canal “has become a safe passageway for the Crusader aircraft carriers to strike the Muslims, and it is the artery of the commerce of the nations of disbelief and tyranny.”[xxx] Israeli economic reporter Dubi Ben-Gedalyahu argued that the risks involved in the Suez Canal explained why “the Chinese are entering Israel today via the roads, tunnels, ports, and train tracks that are under construction” and China’s intention to “build and manage transport projects totalling tens of billions of (Israeli) shekels.”[xxxi]

China’s footprint and associated interests is evident across the Eurasian landmass that it envisions as part of its One Belt, One Road initiative. In 2010, China overtook the EU as Iran’s largest trading partner,[xxxii] and has more recently agreed to press ahead with the construction of a natural gas pipeline linking Iran with Pakistan.[xxxiii] The pipeline is part of a US$46 billion infrastructure spending plan in Pakistan, China’s largest planned investment to date in any one single country.[xxxiv]

China’s plans to invest in an array of Pakistani projects, including a 1,700-mile trade ‎route to the Gulf illustrate the politics of its One Belt, One Road Initiative.  Xi Jinping believes that he can achieve Chinese dominance through investment and inter-connected infrastructure. In doing so, China is convinced that it can succeed where the United States has failed. It expects its massive investment will serve as an incentive for Pakistan to step up its crackdown on Pakistani militants and to end the support of the country's intelligence service, Inter-Services Intelligence (ISI), for radical Islamist groups. China hopes moreover that Chinese-built transport infrastructure could spur economic development in its troubled north-western province of Xinjiang where harsh measure‎s against the cultural practices of the Uighurs have fuelled Islamist violence. A job boom in Xinjiang would allow the government to further dilute Xinjiang's Uighur population through the immigration of non-Uighurs.

Sun Degang, the deputy director of Shanghai International Studies University’s Middle East Institute, argued that China could afford to adopt its economically focussed approach because of its insistence on non-alignment and non-interference and differences in definitions of national interest between the West and China. In contrast to the West, which sees terrorism, proliferation of weapons of mass destruction, and other great powers seeking political and military dominance in the Middle East as national security threats, China prioritises protection of its economic, trade, and energy interests.[xxxv]

Underlying the Chinese approach is the notion that rising living standards will enhance domestic stability and the security of the regime. These different definitions constitute the backbone of China’s One Belt, One Road initiative, described by Wu as “the most expansive Chinese initiative ever.”[xxxvi] Wu argued that the initiative was needed given that “the epi-centre of war and conflict is the Middle East and North Africa” and that “Iraq, Afghanistan and Libya prove that war does not solve problems.”[xxxvii]

Xi first gave a foretaste of Chinese priorities in the Middle East and North Africa when he outlined in June 2014 his country’s policy framework towards the region with the announcement of the One Belt, One Road initiative.[xxxviii] “The Silk Road is an important guide for China’s Middle East diplomacy,” said Wang Jian. “Arab countries are at the western intersection of One Road, One Belt,” added SIIS’s Ye Qing.

Figure 2: One Belt, One Road

Source: Xinhua

In effect, One Road, One Belt is the latest version of concepts to spread China’s influence westwards that date back to 138 B.C. when the Han dynasty first dispatched emissaries to establish economic and political relations with the Middle East which inaugurated the Silk Road that for more than a millennium has linked China by land to Persia and by sea to the Arabs. One Belt, One Road is driven by a logic similar to and traverses much of the territory covered by the ancient Silk Road. International relations expert Wang Jisi argued in 2012 that China should respond to the United States’ pivot towards Asia and the Pacific by filling diplomatic and economic by voids in central Asia, south Asia and the Middle East created by the U.S. withdrawals from Iraq and Afghanistan.

China’s vast investments across Eurasia are rooted in a belief that geopolitics and economics ultimately mitigate in its favour. The era of a primary economic focus of oil-rich Gulf states on the United States and Europe ended in 2013 with a shift in trading patterns that pushed the U.S. to second place in the Gulf and saw India moving Japan out of third place. “It’s a shift from the old industrialised powers to the newly industrialised powers,” said Tim Niblock`, a renowned expert on Gulf-Asian relations.[xxxix]

Figure 3: China’s envisioned Trans-Asia networks

Source: IDC Herzliya Rubin Center for Research in International Affairs [xl]

China has further been able to enhance its regional soft power with Arab rulers who marvel at China’s ability to achieve extraordinary economic growth while maintaining its autocratic political structures. The appeal of the Chinese model is magnified by surveys that show reduced faith in democracy among Arab youth.[xli]

Figure 4: Survey of Arab Youth (1)

Source: ASDA’A Burson-Marsteller[xlii]

Figure 5: Survey of Arab Youth (2)

Source: ASDA’A Burson-Marsteller[xliii]

Established in 2001, the SCO serves China’s aim of strengthening its soft and hard power. Two Middle Eastern states that are key to the One Road, One Belt initiative are associated with the SCO; Iran as an observer and Turkey as a dialogue partner.  China has said that it would back Iranian membership in the SCO. Filling the Eurasian void would put China in a position in which the U.S. would need Chinese support in stabilising the Middle East, Wang Jisi argued.[xliv]

If the U.S. approach is rooted in the Washington Consensus, a set of value-oriented free market economic ideas, supported by international organisations such as the IMF and the World Bank, China’s approach amounts in the words of political scientist Mojtaba Mahdavi to a non-ideological Beijing Consensus, a mercantilist policy that is “another form of neo-liberalism with Chinese characteristics”[xlv] focused not only on securing resources and global transportation routes but also on access to consumer export markets and access to innovative technologies.

Figure 6: Map of China’s One Belt, One Road Initiative

Source: Christina Lin, The New Silk Road[xlvi]

Leaving aside the sheer audacity and scope of Xi’s Silk Road project that focuses on integrating the enormous swath of territories between China and the Middle East by concentrating on infrastructure, transportation, energy, telecommunications, technology and security, applying China’s lofty principles is easier said than done and raises a host of unanswered questions. Its insistence on multi-polarity as opposed to U.S. dominance in the Middle East implicitly means that the status of the U.S. in the region would have to deteriorate further significantly before Washington, despite Obama’s inclination to consult with others, would be willing to entertain the Chinese approach.

Some Chinese scholars have moreover begun to question One Belt, One Road’s economic feasibility. China scholar Irene Chan noted that Chinese scholars were advising prudence in pursuing the development of infrastructure connectivity. Chan said the scholars were calling for in-depth studies on regional infrastructure development needs and political and economic risk analysis given that numerous Chinese infrastructure investments overseas were loss-making as a result of a lack of due diligence.[xlvii]

The Middle East: Testing the Boundaries of Non-interference

The extent of China’s policy debate as it relates to the Middle East and North Africa is further evident in the way Chinese officials, policy analysts and former ambassadors to the Middle East conceptualise China’s approach in discussions with their scholarly Western and Arab colleagues. The debate is coloured by what appear to be generational differences. Often older current and former Chinese officials appear to attribute greater importance to the formal aspects of political processes rather than political realities on the ground. One expression of that view is their emphasis on the outcomes of elections irrespective of whether they were free and fair and represent a voluntary expression of popular will. A case in point are Chinese official statements supporting the re-election in June 2014 of Syrian President Bashar al-Assad despite the fact that the vote lacked legitimacy or credibility in a country in which the government no longer is in control of all of its territory and has demonstrated a willingness to retain power irrespective of cost.

This approach camouflages Chinese support for autocratic regimes in the Middle East and North Africa behind a veil of declared non-interference in a country’s domestic affairs and recognition of a government legitimately constituted in nominal terms. It is, despite Chinese denials, a policy akin to the U.S. emphasis on stability in the region rather than adherence to liberal American values. It is a policy for which the United States, Europe and the international community have paid dearly given that it produced the violent and often brutal undercurrents of change that are sweeping the Middle East and North Africa as well as the emergence of jihadism, forces that increasingly also threaten Chinese interests.

Current and former Chinese officials often frame the debate by emphasising external rather than domestic drivers of crisis in the Middle East. To be sure, Chinese policymakers and politicians do not have to take into account powerful ethnic and national lobbies like the Israel, Gulf, Turkish, Armenian and Greek groupings that play an important role in the formulation of policy in the United States.

Yet, in the spirit of all foreign policy being a function of domestic policy, China is not void of domestic drivers that play an increasingly important role in its foreign policy making. Those drivers stem from evolving definitions of national interest and the increased number of players in China’s foreign policy debates as China’s global economic footprint expands.[xlviii] These players include major state-owned enterprises such as national oil companies whose interests in the Middle East and North Africa have mushroomed. The oil companies argue that China’s lack of engagement and insistence on non-intervention deprive the People’s Republic of leverage needed to negotiate pricing and supply in energy contracts in a market that is virtually inelastic.[xlix] China’s ambassador to Saudi Arabia, Li Chengwen, highlighted the scale of China’s stake in the Middle East and North Africa when he noted in 2013 that 140 Chinese companies were involved in contracts worth US$18 billion in Saudi Arabia’s construction, telecommunications, infrastructure and petrochemical sectors.[l]

Figure 7: Chinese Investments of More Than US$10 billion in the Middle East

Year of First Investment	Investor	Investment in millions (USD)	Partner/Target	Sector	Subsector	Country
2006	CITC and Chinalco	940		Metals	Aluminium	Egypt
2007	China Ocean Shipping	150		Transport	Shipping	Egypt
2007	Xhinalco	1,200	Bin Laden, MMC	Metals	Aluminium	Saudi Arabia
2007	Sinopec	2,010	National Iranian Oil Company	Energy	Oil	Iran
2008	Sinochem	470	SOCO	Energy	Oil	Yemen
2008	CNPC	3,020		Energy	Oil	Iraq
2009	CNPC	1,760	National Iranian Oil Company	Energy	Oil	Iran
2009	Tianjin Development	280		Real Estate	Property	Egypt
2009	CNOC	100	Qatar Petroleum	Energy	Gas	Qatar
2009	CNPC	2,250	National Iranian Oil Company	Energy	Oil	Iran
2009	CNPC	240	State Oil Marketing Organisation and South Oil Company	Energy	Oil	Iraq
2010	Sinochem	1,440	Makhteshim-Agan	Agriculture	Agriculture	Israel
2011	Sinopec	3,300	SABC	Energy	Oil	Saudi Arabia
2012	Jushi Group	230				Egypt
2013	FosuniPharma	240	Alma Lasers	Technology	Medical	Israel

Source: China the ‘Next U.S.” in the Middle East?  MEI NUS[li]

The domestic drivers of Chinese foreign policy further involve popular insistence that the government ensure the safety and security of the growing number of Chinese nationals and jobs in the region. Of the Chinese companies active in Saudi Arabia, 70 employ a total of 16,000 Chinese workers.[lii] Dubai boasts the Middle East’s largest Chinese expatriate community with 200,000 nationals and an estimated 3,000 companies.[liii] China has framed its need to protect its expatriate nationals as humanitarian aid and used it to project itself as a global power[liv] and justify its mushrooming military budget.[lv]

A further driver of Chinese policy towards the Middle East and North Africa is mounting concern that jihadist groups like the Islamic State (IS) could fuel unrest among Uighurs, a Turkic-speaking people that has long felt culturally more akin to the region’s Turkic trading partners than to the majority Han Chinese and Hui Muslims.[lvi]

These domestic drivers and the growing realisation that China will at the very least have to be opportunistic about adherence to its policy principles have helped to narrow the gap between hardliners and moderates. Hardliners favour a more assertive policy already visible since 2009 in China’s soft military approach to the Middle East and North Africa as opposed to proponents of a more conservative policy that harks back to former Chinese leader Deng Xiaoping’s maxim of keeping a low profile that would allow China to avoid challenging U.S. regional hegemony and benefit from conflicts sapping U.S. strength.[lvii] The gap is narrowed by the fact that China has de facto already let go of Deng Xiaoping’s maxim.

Sun Degang acknowledged this by arguing that “the further expansion of China’s soft military presence overseas is necessary to protect its growing foreign commercial investments and other interests, not to mention the safety of Chinese expatriate workers.” He was referring to China’s evacuation in 2011 of 35,000 workers from Libya with the help of Chinese naval vessels and Air Force aircraft diverted from anti-piracy operations off the Horn of Africa[lviii] as Col. Muammar Qaddafi’s efforts to repress mass-anti-government protests turned violent. Sun Degang was also making reference to subsequent kidnappings of Chinese nationals in Sudan and Egypt’s Sinai desert. The Libyan evacuation prompted President Hu in 2012 to identify the protection of nationals overseas as one of three new diplomatic priorities in his work report to the 18^th Party Congress.[lix] “You need to protect your overseas interests. We will do that in a cooperative way… It is not a zero-sum game,” added Wu Jianmen, the foreign ministry advisor.[lx]

Beyond Libya, China was forced to remove in 2011 Chinese students from war-torn Syria, in 2014 some 20,000 people from northern Iraq after IS conquered significant chunks of the region,[lxi] and a large number in 2015 from Yemen where a Chinese warship docked while special forces protected the boarding Chinese and other foreign nationals.

Figure 8: Chinese non-combatant evacuations across the globe, 2006 – 2014

Source: SIPRI[lxii]

The evacuations from Libya, Syria and Iraq helped China realise that populating its investments in the region with Chinese workers rather than helping to create jobs by employing local labour was fuelling resentment. “If one makes money in a country, one has to give some of it back. We learnt that in Libya…. German companies only had a German head. There were more jobs for locals. We paid attention and are doing better,” said Pan Guang, a prominent scholar at the Shanghai Center for International Studies and Institute of European & Asian Studies of the Shanghai Academy of Social Sciences.[lxiii] 

The Middle East and North Africa’s violent convolutions have persuaded some Chinese analysts that the region has become a testing ground for an inevitable adjustment of Chinese policy principles, including the notion of non-intervention. Their views are rooted in realities on the ground as well as Mao Zedong’s belief that the Middle East and North Africa was a key arena for the struggle against the hegemony of superpowers.[lxiv] Mao’s assessment like Chinese approaches to the region today was driven by China’s definition of its national security interests rather than a desire to resolve the Middle East and North Africa’s seemingly intractable problems.
Go to Part 2