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China’s One Belt, One Road Initiative And The Middle East Is A Crossroads, Part 3, Oman, Palestine, Qatar, Saudi Arabia And Syria

ArmchairTechInvestor, May 26, 2018, by Brad Peery

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Below are summaries of the OBOR initiatives in the countries covered in the Middle East Part 3.

Oman

*Oman is located “in the Gulf of Oman, the Arabian Sea and the Strait of Hormuz, a major transit point for crude oil and a trade route connecting the Middle East, India, Africa and Europe. Oman ranks the fourth out of the six members in the Gulf Co-operation Council (GCC) by population, after Saudi Arabia, the UAE and Kuwait.” The deep-sea SOHAR Port is “located at the centre of global trade routes between Europe and Asia, making it an ideal business location.”
*The Belt and Road Initiative: Country Profiles, Hong Kong Trade Development Council, May 17, 2018

“New Chinese investments are working to transform a small fishing village in Oman into the country’s new industrial center, according to a new report by Reuters. The city receiving all of the industrial attention is located 345 miles south of Muscat. The project promises an overall surge in Chinese investment in the country if it shows any indications of a success.”

**Oman is central to China’s OBOR Initiative, with oil being a prime driver, at least for the next few years. However, longer term, China could ban fossil fuel cars in China, with them being replaced by electric vehicles. This could happen by about 2030.
**Oman To Become A Key Part Of China’s Silk Road, Oilprice.com, By Zainab Calcuttawala, September 7, 2017

Palestine

One Belt, One Road Network
ArmchairTechInvestor, May 25, 2018, by Brad Peery

* “Palestine is located on the eastern coast of the Mediterranean Sea. It comprises two non contiguous areas – the Gaza Strip and the West Bank. Gaza, the smaller of the two, is bordered by Egypt and Israel, while the West Bank is surrounded by Jordan and Israel.”

The overall unemployment rate in Gaza was 44% while that in West Bank was lower at 18% in 2017.”

Palestinian president Mahmoud Abbas visited China in July 2017. Four agreements were signed including promoting tourist destinations and economic cooperation. Also, “China will support the building of Palestine’s Tarqomia Industrial Zone, west of Israeli city Hebron.”

***China’s peace initiative for the Israeli-Palestinian conflict was announced on July 31, 2017. Few new ideas were included in the plan, and this was not the first time China has proposed a plan, with the last one being in 2013. This proposal is even more vague. It omits Palestinian demands to establish an independent Palestinian state that enjoys full sovereignty, as well acknowledging Israel’s right to exist while addressing its legitimate security concerns.

“The 2017 proposal is the first to be made in the context of the One Belt, One Road (OBOR) vision. This vision has unprecedentedly advanced China’s interest in the Middle East, and its stake in regional stability has grown significantly. Concomitantly, OBOR provides China with unprecedented means to influence regional processes in ways that it finds acceptable under its “business first” approach to the Middle East. As for similarities, both proposals are finely balanced in their requirements from the involved parties.”
***China Has a New Middle East Peace Plan, What’s new in Beijing’s latest proposal and what does it tell us about China’s views and intentions concerning the region?, The Diplomat, By Yoram Evron, August 14, 2017

Qatar

One Belt, One Road Network
ArmchairTechInvestor, May 25, 2018, by Brad Peery

Qatar is one of the wealthiest countries in the world in terms of GDP per capita. Qatar’s economy is highly dependent on oil and gas, which accounts for over 50% of GDP, 85% of export earnings, and 70% of government revenues. The government has been making efforts to diversify the economy into a sustainable long-term income model. This includes investments in the petrochemical sector, promotion of business tourism, and financial sector improvements.

*“Qatar’s real GDP growth expanded by 2.5% YOY in Q1 2017 on the strength of its non-oil sector. The country is projected to expand by 3.4% in 2017 due to massive infrastructure investment and further economic diversification.”

Oil and gas rich Qatar is viewed as an important staging point for the OBOR Initiative. China is the world’s leading buyer of oil and gas.

***“Professor Wang Yiwei of the People’s University in China believes that even though Chinese investments will not be directly affected by the current conflict, the growing instability in the region could still have a negative impact on China’s economic cooperation with the Gulf States.”

Bahrain, Saudi Arabia, Egypt and the United Arab Emirates have severed diplomatic ties with Qatar. They accused Qatar of supporting terrorist groups and of interfering in other states’ internal affairs. Libya also severed ties, as did Yemen, the Maldives and Mauritania.

“Despite some temporary problems, China has nothing to worry [about the present row],” Bian Yongzu, an expert at Chungyang Financial Research Center said.”
*** How Qatar Row Could Impact China’s One Belt, One Road Project
Sputnik International, Aleksey Nikolskyi, August 6, 2017

Saudi Arabia

One Belt, One Road Network
ArmchairTechInvestor, May 25, 2018, by Brad Peery

*“Saudi Arabia is part of the Greater Arab Free Trade Area Agreement (GAFTA). Under the GAFTA, the country enjoys free trade with Algeria, Bahrain, Egypt, Iraq, Kuwait, Lebanon, Libya, Morocco, Oman, Palestine, Qatar, Sudan, Syria, Tunisia , the UAE and Yemen. As member of the GCC, Saudi Arabia also has free trade agreements (FTAs) with Singapore, New Zealand and the European Free Trade Association (EFTA) comprising Switzerland, Norway, Iceland, and the Principality of Liechtenstein.”

There are negotiations underway on the establishment of FTAs with the EU, Japan, China, India, Pakistan, Turkey, Australia, Korea and the Group of Mercosur (Brazil, Argentina, Uruguay Paraguay, and Venezuela).

****China’s “One Belt and One Road” initiative is expected to make “creative” contributions to helping Saudi Arabia realize its “Saudi Vision 2030” plan, Saudi Ambassador to China Turki Bin Mohamed Al-Mady said. To diversify its heavily oil-dependent economy, Saudi Arabia announced a “Saudi Vision 2030” growth strategy in 2016, which includes privatizing some state-owned companies.”

Chinese President Xi Jinping visited Saudi Arabia in January 2016. Both countries agreed to form a comprehensive strategic partnership. The areas of cooperation could include technology, security and defense, which would be addressed in separate agreements.

“Saudi Arabia was one of the first countries to respond positively to the [Belt and Road] initiative,” he said. “In terms of strategic location, Saudi Arabia serves as the central hub connecting three continents – Asia, Africa and Europe, and has been an important part of the initiative.”

Al-Mady said that he hopes Saudi Arabia can play a more central and positive role in promoting the initiative to strengthen the in-depth integration of the initiative and the “Saudi Vision 2030.”
****Belt, Road initiative will help Saudi Arabia realize 2030 vision, ambassador says, ChinaGoAbroad, Xinhua, May 25, 2018

Syria

One Belt, One Road Network
ArmchairTechInvestor, May 25, 2018, by Brad Peery

*”Syria is a Middle East country at the eastern end of the Mediterranean Sea, bordered by Iraq, Israel, Jordan, Lebanon and Turkey. Damascus is the capital, while Aleppo is the largest city. Syria has a young population, with more than 50% of its citizens aged below 25.”

Sanctions were imposed on Syria by the U.S., the EU, the Arab League, Turkey and Canada. Since then Syria has traded heavily with Iraq. Most Chinese companies have discontinued their operations, but indicated in 2017 that they looked forward to reconstruction projects following the war in Syria. The China Petrochemical Corporation and China National Petroleum Corporation have previously invested in Syria’s hydrocarbon sector.

*****“By working through what is still the internationally recognized government of Syria, Beijing will be able to claim that it has avoided taking sides in a civil war (now nearly over) but is now engaging with a sovereign state…While relying on Middle Eastern oil supplies, China has traditionally avoided diplomatic entanglements there, so this support for Assad marks a shift in regional diplomacy that Chinese diplomats will undoubtedly try to conceal behind the language of non-intervention.”
*****Is China coming into Syria for its “One Belt, One Road”?
Informed Comment, By Neil Thompson, January 1, 2018

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