Middle East looks Far East

Middle East looks Far East

China’s energy dependency is predicted to skyrocket over the next two decades; the GCC is ideally placed to reap the benefits.

May 16, 2010 1:46 by Katherine Azmeh

China is betting on oil field ownership as their best guarantee of supply, the analysts contend. The country is bullish on Iraqi contracts, for instance. China’s CNPC oil company was part of the BP-led consortium to win a $15 billion contract for the Rumaila oil field development project in Iraq. And a year earlier, China secured a $3billion deal to develop the Ahdab field.

“Two other Chinese firms just closed a deal on a large oil field in eastern Iraq,” Newsweek reported last week.

But for the nation termed “exporter to the world,” oil is only part of the equation. Alongside issues of energy dependence is China’s enormous export volume to the region. China became the world’s biggest exporter to the Mideast region in 2009, providing an estimated $60 billion worth of goods to the region. And as a major re-export hub, Chinese goods make their way through Dubai’s free trade zones, destined for the global markets.

Inexpensive consumer goods remain a popular draw for Arab traders visiting China, and the country welcomed Arab visitors with easy visas during the post 9-11 years when other nations did not.

Cultural and religious ties boost the commonalities between regions. A reported 200,000 Chinese live in Dubai, and China has a Muslim population of around 20 million.

When two Chinese naval vessels visited the UAE in March for refueling, their visit generated little fanfare. But the unlikely spectacle of Chinese warships docked in Abu Dhabi underline the increasing size of China’s footprint in the region and the country’s key presence in Mideast trade, politics, and policy.

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Tags: business, China, gcc, IEA, Iraq, Middle East, oil, oil fields, Silk Road, trade