ASPI - The Strategist China’s growing influence in the Middle East 29 Jul 2024| Gedaliah Afterman and Allie Weinberger

 ASPI - The Strategist 

China’s growing influence in the Middle East

29 Jul 2024|

Gedaliah Afterman and Allie Weinberger

China’s economic and political engagement in the Middle East has surged over the past decade, particularly in the aftermath of the Arab Spring and amid growing perceptions of the United States’ withdrawal from the region.

China has traditionally tried to maintain a balancing act in the Middle East, developing relationships with all sides while steering clear of the region’s multiple conflicts. With China’s standing strengthening among developing countries, and superpower competition intensifying, it has adopted a more proactive approach to position itself as a potential alternative and a counterbalance to the United States.

China’s Belt and Road Initiative (BRI), initiated in 2013, has significantly increased China’s involvement in the region and propelled Beijing to become, since 2016, the primary foreign investor there. Initially focused on energy-sector trade and investment, Beijing has broadened the scope of its regional engagement to encompass infrastructure, technologically advanced smart-city projects, innovation hubs and 5G mobile networks.

As Beijing’s economic clout in the Middle East has grown, so has the recognition by regional powers   of China’s strategic value. Middle Eastern leaders, increasingly disillusioned with policies of the United States—including its invasion of Iraq in 2003, support for the Arab Spring in 2011, hurried exit from Afghanistan and withdrawal from nuclear negotiations with Iran—have turned towards China as a potentially more reliable partner. For Gulf Cooperation Council (GCC) countries especially, the relationship with China has become strategic rather than opportunistic. China’s ability and willingness to cooperate with regional players without imposing political or human rights ideals align with the visions of Middle Eastern leaders. This strategic approach suggests a reorientation of regional relationships and positions, in which China is gaining prominence as a key economic and developmental partner.

The Western perspective on China’s role in the Middle East has shifted over time, too. Initially seen as a non-threatening free-rider benefiting from US security infrastructure, China is now viewed as a significant challenger to US and Western interests in the region. This shift reflects Beijing’s growing economic and strategic influence, especially as the United States has reduced its energy imports from the Middle East, allowing China to fill the gap. China’s trade with the six-member GCC bloc has drastically surged, increasing from $10 billion in 2000 to more than $230 billion in 2021, further contributing to the erosion of Western influence in the region. China’s increasing interest in technology and its aspiration for technological autonomy have also significantly affected its relationship with the Middle East.

Apart from the GCC countries, in recent years, China has developed a partnership with Israel that has expanded across various domains, from infrastructure to agriculture and education. Trade between the two reached a record $21 billion in 2022, and Chinese firms have been engaged in about 500 investment deals in Israel over the past decade, predominantly in the technology sector, focusing on areas such as telecommunications, artificial intelligence and cloud computing.

As a result of Chinese investment in Israel’s high-tech industry, which peaked in 2018, and evolving US perceptions of China, Washington applied pressure on Israel to limit its interactions with Beijing. In response, Israel established a foreign investments advisory committee in 2019 and rejected several Chinese bids on security-sensitive infrastructure projects. In recent years, Washington’s influence has significantly limited the scope of Israeli-Chinese trade, especially in sensitive sectors.

Diversifying cooperation

From the perspective of the Gulf states, China’s emergence as a technological powerhouse, especially its Digital Silk Road, fits well with their aspirations to emerge as global leaders in technology and innovation. Collaboration in domains such as artificial intelligence, telecommunications and space exploration can bring about mutual long-term advantages.

More recently, another factor influencing China’s approach to the Middle East has been Russia’s invasion of Ukraine. Concerns about potential Western economic sanctions and the ambivalence of Middle East partners of the US  towards the Russia–Ukraine conflict have prompted and allowed China to expand the use of its currency in transactions with oil-rich Gulf countries. For instance, collaborations with the UAE and Saudi Arabia on digital yuan transactions and the initiation of international transaction platforms such as mBridge demonstrate China’s efforts to deepen its economic ties in the region.

Moreover, China has also been gradually making progress in the Middle Eastern market for defence equipment. With the United States refusing to sell its latest weapon-carrying drones to some countries due to such conflicts as the war in Yemen, the UAE, Saudi Arabia and others have turned to China for alternatives. Such events as the UAE’s suspension of talks with the US over an F-35 deal and subsequent orders for Chinese jet trainers emphasise China’s increasing influence on the region’s defence sector. Reports of Riyadh developing ballistic missiles with Chinese assistance further illustrate this evolving dynamic.

In the diplomatic sphere, China’s facilitation of the diplomatic breakthrough between Saudi Arabia and Iran in March 2023 exemplified its efforts to expand political engagement in the Middle East. The rapprochement not only showcased China’s growing diplomatic weight but also underscored its broader strategic interests in the Middle East, including securing energy supplies and promoting Chinese global initiatives such as the BRI, the Digital Silk Road and the Global Security Initiative.

China’s response to the Gaza war

China has become even more active in the Middle East since the Biden administration began ramping up pressure on it in the Asia-Pacific. This intensifying superpower dynamic has been on display since the outbreak of the Gaza war on 7 October 2023.

Despite China’s efforts to position itself as a regional mediator, its initial response to the Hamas attack on Israel was subdued. Beijing notably refrained from directly condemning Hamas for the atrocities committed on 7 October, avoiding any specific mention of the group by name. Disappointment and anger arose in Israel because of China’s lack of empathy, vocal one-sided criticism, and targeting of the United States as an enabler of Israeli military actions in Gaza. A significant step in Beijing’s evolving position occurred in February 2024, when China’s representation at the International Court of Justice asserted Palestinians’ right to self-determination, including the use of armed struggle, signalling more explicit support for Hamas.

China’s support for the Palestinians historically stems from its role as a champion of the developing world and its backing of the Non-Aligned Movement. Today, it is more about growing superpower competition in the Middle East.

For Beijing, the Israeli-Palestinian conflict is less about the Palestinians or the Israelis and more about its own standing in the region, its interests in relation to Arab countries and Iran and the global south, and its strategic position regarding the United States. Recently, and particularly during the Gaza war, China has been using the conflict as an instrument in its superpower competition with the United States. China has been leveraging the conflict to discredit the United States while strengthening its own position. An important goal for China has also been to secure Arab and Muslim support for its policies in Xinjiang while dismissing Western and especially US criticism of Beijing’s human rights policies as hypocritical. As such, China’s strategy throughout the Gaza war has been one of aligning with the interests of the Arab world while differentiating its stance from that of the US.

Moreover, China’s clear and calculated shift towards a more assertive and pro-Palestinian stance in the Israel–Hamas conflict also reflects its evolving priorities and strategic interests in the Middle East. This has shown that Israel does not rank highly in Beijing’s strategic calculations, and any damage to its relationship with Israel is considered manageable in the broader regional and geopolitical game.

Furthermore, China’s decision to host the Palestinian reconciliation talks between Fatah and Hamas in late April 2023 was less about promoting Palestinian unity and more about establishing itself as a political player and, supposedly, as a mediator in the Middle East. In fact, China’s role in the talks is primarily that of a facilitator rather than a mediator. While both parties may perceive China as an impartial broker, Beijing lacks the necessary expertise, deep relationships and leverage to actively mediate between them. By holding the talks, China is seeking to align with Arab nations that view Palestinian unity as essential for moving closer towards a Palestinian state and as a key to achieving a stable Middle East.

Amid criticism of the United States’ support for Israel, China is positioning itself as an alternative, emphasising support for the Palestinian side. For Beijing, this is about narrative. This move serves as a strategic, low-cost method for China to enhance its regional influence and present itself as a counterbalance to the United States. While China has taken a passive approach to the war so far, as it clearly cannot stop it, this move enables it to present itself as a player in the post-conflict scenario.

China and the United States: competing regional strategies

With tensions between the United States and China growing, Beijing has leveraged the war in Gaza to challenge the United States in the region and the developing world more broadly.

Recent polling data suggests that China’s approach has been positively received by the Arab public amid growing criticism of the United States. Respondents in Egypt, Iraq, Tunisia and Turkey view Xi Jinping and Vladimir Putin more favourably than they see Joe Biden: the figures show 33.8 percent support for Xi Jinping and 21.7 percent for Biden.

The narrative war between China and the United States over the conflict in Gaza underscores the broader power struggle between the superpowers for global and regional influence: positions on Israel and the Gaza war serve as a strategic pawn in the larger game of influence and control.

Although China can still benefit from investments and partnerships in Israel’s advanced tech sector and critical infrastructure, Beijing understands that Israel’s alliance with the United States limits the relationship. Beijing appears to have calculated that it stands to gain more by criticising Israel and the U.S. and aligning with the Arab and developing world public opinion, even at the expense of its relationship with Israel.

As the Biden administration grapples with growing criticism of its support for Israel, China is trying to capitalise on the situation. While this seems to have worked on the public-relations level, it remains to be seen whether it will have a real impact on its regional position. Although many in the Arab world agree with China’s criticism of the United States over the war in Gaza, China’s effort to counter the US by offering support for Iran’s use of proxies and violence to stabilise the region, including for its 13 April direct attack against Israel, may be seen less favourably across the region.

Beyond narratives, regional leaders believe that only the United States can bring a solution to the Gaza war and that China is not a relevant political actor in this regard. China’s decision to facilitate discussions between competing Palestinian factions in Beijing should be understood as an effort by Beijing to carve out a relevant role for itself in the conflict, especially once the fighting subsides.

Washington’s efforts to end the fighting in Gaza and promote regional normalisation are part of a broader US strategy aimed at stabilising the Middle East and launching a US-led economic strategy for the region that could counter China’s growing influence.

Looking ahead, while China’s strategic manoeuvres in the Middle East have garnered public support and challenged the United States, their long-term impact remains uncertain. The region’s complex dynamics and the critical role of US political and military power suggest that China’s influence may face significant limitations. As the geopolitical landscape evolves, and the region becomes ever more important, the interplay between Chinese ambitions and American responses will continue to shape the future of the Middle East.

AUTHOR

Gedaliah Afterman is the head and Allie Weinberger a research intern at the Asia Policy Program at the Abba Eban Institute for Diplomacy and Foreign Relations, Reichman University. Image of  United Arab Emirates President Sheikh Mohammed bin Zayed Al Nahyan and Chinese President Xi Jinping following a signing ceremony in Beijing in May 2024: Tingshu Wang/pool/Getty Images.