Including the supply of US-approved Huawei equipment
Signed 34 investment agreements worth KRW 39 trillion
Clash between Korean companies and the Saudi market
Amid intensifying global competition between the US and China, China is stepping up its cooperation with Saudi Arabia, the “big brother of the Middle East.” It is an analysis that actively delves into the relationship between the United States and Saudi Arabia, which has recently opened. In particular, the possibility of realizing ‘petro yuan (payment of crude oil in yuan)’ is estimated to have increased as the method of paying crude oil prices in Chinese yuan instead of dollars has been discussed.
According to Saudi Arabia’s SPA news agency, on the 8th (local time), Chinese President Xi Jinping, King Salman bin Abdulaziz Al Saud and Prime Minister Mohammed bin Salman held talks at the Saudi Royal Palace and signed an agreement on a comprehensive strategic partnership between the two countries. In addition, the scope of economic cooperation between the two countries is expected to increase as they also agreed to enhance cooperation on China’s “One Belt, One Road” economic territorial expansion project and Saudi Arabia’s national project plan “Vision 2030”.
Notably, the Global Times, China’s English-language state-run newspaper, reported the same day: “As China-Saudi Arabia’s relations strengthen, the possibility of using the yuan in crude oil payments has increased.” Hong Kong’s Ming Press analyzed that “the signing of a large-scale investment agreement between the two countries laid the foundation for the Petro Yuan.”
Earlier on the 7th, the two countries’ delegations signed 34 investment agreements in the fields of green hydrogen, solar energy, information technology (IT), cloud technology, transportation and logistics. SPA news agency reported that the deal amount was 110 billion riyals (about 38.6 trillion won). This is similar to the 40 trillion won (MOU) investment memorandum of understanding Saudi Arabia signed with Korean companies when Crown Prince bin Salman visited Korea last month. Strong competition between Korean and Chinese companies is expected in the Saudi market.
“China sees Saudi Arabia as a major force in a multipolar world,” Xi said during his meeting with King Salman. King Salman also responded by saying, “China’s interest is Saudi Arabia’s interest,” adding, “Saudi Arabia is ready to deliver more benefits to the people of both countries.” Crown Prince bin Salman has supported the “One China” principle.
The investment deal is also known to include US-sanctioned telecommunications equipment maker Huawei. Bloomberg News analyzed: “The United States is asking its allies to stop doing business with Huawei, and Saudi Arabia’s involvement in a large-scale project is very symbolic (for the relationship between the United States and Saudi Arabia).” China and Saudi Arabia appear to be getting closer not only economically but also politically, with an agreement to hold a shuttle summit every two years. Saudi Arabia can strengthen cooperation with China and use it as leverage in relations with the United States. Cooperation with Middle Eastern countries is essential for China to build energy security.
President Xi had a series of meetings with leaders of Middle Eastern and Islamic countries such as Egypt, Palestine, Sudan and Kuwait, who were attending the Arab-Chinese summit at the Saudi royal palace in Riyadh that day.
Beijing = Correspondent Kim Ki-yong [email protected]
Paris = Correspondent Cho Eun-ah [email protected]
