LONDON: When Haytham Zamzami began studying Chinese, the rising superpower had only just begun to register on the horizon for Saudi Arabia. Eight years later China is all the rage.
China’s insatiable demand for oil -- and Saudi Arabia’s position as the world’s top exporter -- have become the basis for a trade partnership that analysts say could upset Riyadh’s decades-old oil-for-security relationship with Washington.
“We were the pioneers, the first group,” says Zamzami, a chemical engineer with state oil firm Saudi Aramco, which this month opened an office in the Chinese business hub of Shanghai.
“The Chinese are a proud people, with a long history and glorious civilisation behind them. Understanding them well will bring benefit to both sides,” he said.
Saudi Arabia has become the key regional player as China quietly moves onto traditional US turf in the Middle East.
This new alignment has also seen China boosting ties with six booming Gulf Arab states, including oil producers Qatar, Kuwait and the United Arab Emirates.
China National Offshore Oil Co (CNOOC) is in talks with Qatar for liquefied natural gas supplies, PetroChina is studying plans with Kuwait to build a refinery and petrochemical complex in South China, and Aramco is negotiating refinery joint ventures in China.
China’s economic thrust has coincided with a time when US prestige in the Arab world is at a low ebb due to the Iraq war and US support for Israel.
In addition, once-cosy US-Saudi ties have not fully recovered from the shock of the Sept 11 attacks in which 15 of the 19 suicide hijackers were believed to be Saudis.
This has hit the oil-for-security `special relationship’ long based on the role of US military forces as guarantor of Saudi Arabia’s safety, largely to protect huge Saudi oilfields.
TRADE AT $20 BLN: Bilateral trade is expected to hit $20 billion for this year -- a 30 per cent rise on the previous year, said Li Yanlin, China’s trade attache in the Saudi capital Riyadh.
“The economy is booming in both countries and Chinese production is getting cheaper and better,” he said, adding that in the last two years Chinese firms have won some four billion dollars in construction contracts.
Saudi Aramco was the largest supplier of oil to China for the last four years, in addition to being the biggest supplier to India, Japan, South Korea and Singapore.
China has even started discussions with Aramco to provide it with a strategic oil reserve, opening up the possibility of future tension over global access to Saudi crude oil.
Chietigj Bajpaee, research associate at the Centre for Strategic and International Studies in Washington, said China risks being seen as trying to `lock up’ Saudi oil at the expense of Washington, or India.
“(China and the United States) have an increasingly symbiotic relationship,” Bajpaee said. “This has led to fears in the United States that China is encroaching into its 'sphere of influence' and undermining relations with its traditional allies.”
NO POLITICS REQUIRED: Ties with China come with the added advantage of no political expectations, unlike those with Western countries which periodically pursue a rights agenda with Saudi Arabia.
Despite Beijing’s atheist communist ideology and Saudi Arabia’s status as the birthplace of Islam, both governments have one thing in common: they brook no dissent.
Chinese President Hu Jintao went out of his way to press the right buttons during a trip to Riyadh in April, said analyst Rochdi Younsi.
“He touched many Saudi officials by praising them for resisting outside pressure for reforms, clearly hinting at the US That message resonated with many conservatives in the region,” Younsi said.
Chinese labour could become more common in the Gulf, as governments tire of Indian and Pakistani workers becoming vocal about their lack of rights in countries they helped to build.
Yet analysts say the Gulf still needs the United States.
“Trade relations between China and the GCC countries are expected to grow and go beyond the current $32 billion dollar estimate that they reached last year in various commodities and services,” Younsi said, pointing to a possible free trade deal.
“But the problem for GCC monarchies is they know they cannot rely on China for their security and this is why they still want to maintain a close relationship with Washington,” he said.
Saudi government adviser Nawaf Obaid agreed.
“Realistically, it will be very hard for China to compete with the United States politically and militarily in the region, especially when it comes to the vital US-Saudi 'special relationship',” he said.—Reuters
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