China and the United Arab Emirates signed a raft of financial, business and trade agreements on Friday during a visit by President Xi Jinping to the UAE that signaled energy-hungry Beijing’s rapidly growing interest in the Middle East.
Xi made the first visit by a Chinese leader to the Gulf state in 29 years, meeting two of its most powerful leaders, Sheikh Mohammed bin Rashid Al Maktoum, ruler of Dubai, and Sheikh Mohammed bin Zayed Al Nahyan, crown prince of Abu Dhabi.
They announced 13 agreements and memoranda of understanding, including approval for the first Chinese state-owned financial services firm to set up in Abu Dhabi’s AGDM financial center. The Abu Dhabi National Oil Company (ADNOC) and the China National Petroleum Corporation (CNPC) agreed to explore joint business opportunities.
“We have many areas of political and economic agreement and a solid base of projects in the energy, technology and infrastructure sectors. More importantly (we have) a strong political will to start a greater phase of cooperation and integration,” Sheikh Mohammed bin Rashid wrote in a Twitter post in Arabic on Friday.
“Today, we have exemplary relations with China and a Chinese leadership that sees the UAE as main strategic partner in the region,” he added.
As both a major energy exporter and a hub for international trade, the UAE is an important part of Xi’s “Belt and Road” initiative to invest in infrastructure linking China by both sea and land to markets in Asia and Europe.
China is the UAE’s second largest trading partner and biggest source of imports. The UAE is the gateway for about 60 percent of China’s exports to the Middle East, and on its own accounts for around a quarter of total Arab trade with China.
Trade reached nearly 200 billion dirhams ($54.5 billion) in 2017, and more than 1 million Chinese visited the UAE. The UAE aims to double these numbers over the coming period, according to a tweet by Sheikh Mohammed bin Rashid on Thursday.
In 2013, Xi outlined the Belt and Road initiative which involves billions of dollars of infrastructure investment to reinvigorate the ancient overland silk road trade route and develop a new sea equivalent. The UAE sits close to both routes.
China has traditionally played little role in Middle East conflicts or diplomacy despite its reliance on the region for oil, but has stepped up its involvement since Xi came to power six years ago. Beijing has had to tread carefully, though, with Gulf Arab states like Saudi Arabia and the UAE, as China also has close ties with their rival Iran.