China-Gulf Relations: 'More Than Just Oil'

Saudi Crown Prince Mohammed bin Salman and Chinese President Xi Jinping jointly chair the “Riyadh Gulf-Chinese Summit for Cooperation and Development” in December (SPA)
Saudi Crown Prince Mohammed bin Salman and Chinese President Xi Jinping jointly chair the “Riyadh Gulf-Chinese Summit for Cooperation and Development” in December (SPA)
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China-Gulf Relations: 'More Than Just Oil'

Saudi Crown Prince Mohammed bin Salman and Chinese President Xi Jinping jointly chair the “Riyadh Gulf-Chinese Summit for Cooperation and Development” in December (SPA)
Saudi Crown Prince Mohammed bin Salman and Chinese President Xi Jinping jointly chair the “Riyadh Gulf-Chinese Summit for Cooperation and Development” in December (SPA)

A recent report by the World Economic Forum (WEF) noted that the economic relations between the GCC countries and China go beyond oil and trade, but constitute a large proportion of the global GDP, which opens up great prospects for promising aspirations and opportunities.

According to the report, China and the Gulf countries together generate about 22 percent of the world’s GDP. This makes them two major drivers of global growth, especially in light of the deepening economic relations between them amid major geopolitical shifts.

The report stressed that technology, industries and electronic games represent great opportunities for future cooperation.

According to the report, major relations began with the rapid economic growth of China, which led to a significant increase in the demand for energy. Meanwhile, the Gulf’s imports of consumer goods from China have surged.

Total trade between China and the whole of the Middle East and North Africa reached $505 billion in 2022 – increasing 76% over 10 years. Total trade between China and the Gulf countries alone increased three times in the same period, the report underlined.

However, the report, which was prepared in cooperation with Oliver Wyman, confirmed at the same time that the economic ties between the two regions are “much more than just trade”.

Business leaders from Greater China and the GCC convened at the World Economic Forum’s Annual Meeting of the New Champions in Tianjin in June 2023 to explore how to enhance understanding of each other’s markets and build partnerships, the report said, pointing to three major takeaways from their discussions:

In addition to energy, technology, manufacturing and electronic games are priority sectors for both regions, providing great cooperation opportunities.

Following Chinese President Xi Jinping’s visit to Saudi Arabia in December 2022, the Kingdom signed 35 memorandums of understanding with Chinese firms, the majority of which with private companies. The report pointed to an agreement with Chinese technology giant Huawei, covering cloud computing and building high-tech complexes in Saudi cities.

In manufacturing, the WEF report stated that ongoing global shifts in manufacturing hubs and “friend shoring” initiatives offer opportunities to reshape supply chains. Enovate, a Chinese electric vehicle (EV) start-up, is illustrative of the shift towards new economy sectors with a planned $500 million investment in EV production in Saudi Arabia alongside a local partner.

On the third axis, the gaming sector is a great cross-border opportunity that reflects common preferences and consumer habits in both regions. This can be evidenced by the acquisition of a $265 million stake in Chinese e-gaming company VSPO earlier this year by Saudi Arabia’s public investment fund.

Finally, the report confirms that energy partnerships are about more than just oil and gas. Both regions are highly vulnerable to the impacts of climate change, and their shared challenges provide opportunities for transformative collaboration.

In this regard, the report pointed to a partnership between Dubai-based Mensha Ventures and Chinese partners to invest up to a $1 billion in clean technologies.

All these factors come at a time of increasing mutual trust between the two sides.

“Institutions for dialogue and trust-building are essential to build sustained commercial ties,” said Alexandre Raffoul, the World Economic Forum’s Head of Business Engagement for the Middle East and Africa and moderator of the Tianjin discussion.

In the end, the close ties between China and the Middle East - sometimes referred to as the “New Silk Road” - are about more than just oil and consumer goods... Maybe even more important are the flow of technologies, people, ideas and capital.

There are good signs of moving forward in this context, the report said, noting that an increasing number of Middle Eastern students are learning Mandarin, as are their peers in China who are studying Arabic.



China Exempts Some Goods from US Tariffs to Limit trade War Pain

TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT
TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT
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China Exempts Some Goods from US Tariffs to Limit trade War Pain

TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT
TOPSHOT - An aerial view shows cargo containers stacked at a port in Shanghai on April 20, 2025. (Photo by AFP) / China OUT

China has exempted some US imports from its 125% tariffs and is asking firms to identify critical goods they need levy-free, according to businesses notified, in the clearest sign yet of Beijing's concerns about the trade war's economic fallout.

The dispensation, which follows de-escalatory statements from Washington, signals that the world's two largest economies were prepared to rein in their conflict, which had frozen much of the trade between them, raising fears of a global recession.

Beijing's exemptions - which business groups hope would extend to dozens of industries - pushed the US dollar up slightly and lifted equity markets in Hong Kong and Japan.

“As a quid-pro-quo move, it could provide a potential way to de-escalate tensions," said Alfredo Montufar-Helu, a senior adviser to the Conference Board's China Center, a think tank.

But, he cautioned: "It’s clear that neither the US nor China want to be the first in reaching out for a deal."

China has not yet communicated publicly on any exemptions. A Friday statement by the Politburo, the Communist Party's elite decision-making body, focused on efforts to maintain stability at home by supporting firms and workers most affected by tariffs.

The readout, which followed the Politburo's regular monthly meeting, showed that Beijing was also ready to hunker down and fight a trade war of attrition if needed to outlast Washington in enduring the pain from the breakdown of their relationship.

A Ministry of Commerce taskforce is collecting lists of items that could be exempted from tariffs and is asking companies to submit their own requests, according to a person with knowledge of that outreach.

The ministry said on Thursday it had held a meeting with more than 80 foreign companies and business chambers in China to discuss the impact of US tariffs on investment and the operation of foreign firms in the country.

"The Chinese government, for example, has been asking our companies what sort of things are you importing to China from the US that you cannot find anywhere else and so would shut down your supply chain," American Chamber of Commerce in China President Michael Hart said.

Hart added some member pharmaceutical companies had reported being able to import drugs to China without tariffs. He believed the exemptions were drug-specific, not industry-wide.

The chief executive of French aircraft engine maker Safran said on Friday it had been informed last night that China had granted tariff exemptions on "a certain number of aerospace equipment parts" including engines and landing gear.

The tariff exemptions under consideration by Beijing could provide cost relief for companies in China and take pressure off US exports at a time when the Trump administration has shown signs of wanting to make a deal with Beijing.

The European Union Chamber of Commerce in China also said it had raised the issue of tariff exemptions with the commerce ministry and was awaiting a response.

"Many of our member companies are significantly impacted by the tariffs on critical components imported from the US," President Jens Eskelund said.

A list of 131 categories of products said to be under consideration for tariff exemptions was circulating on Chinese social media platforms and among some businesses and trade groups on Friday. Reuters could not verify the list, which included items ranging from vaccines and chemicals to jet engines.

Huatai Securities said the list corresponded to $45 billion worth of imports to China last year.

China's customs agency and Ministry of Commerce did not reply to requests for comment. China's foreign ministry said it was not familiar with tariff exemption plans, redirecting queries to "relevant authorities".