Saudi Arabia strikes $10bn deal with China

BEIJING: Saudi Crown Prince Mohammad bin Salman cemented a $10 billion deal for a refining and petrochemical complex in China on Friday, after meeting Chinese President Xi Jinping.

The Saudi delegation, including top executives from state-owned oil company Saudi Aramco, arrived on Thursday on an Asia tour that has already seen the kingdom pledge investment of $20bn in Pakistan and seek to make additional investments in India’s refining industry.

Saudi Arabia signed 35 economic cooperation agreements with China worth a total of $28bn at a joint investment forum during the visit, Saudi state news agency SPA said.

“China is a good friend and partner to Saudi Arabia,” Pre­sident Xi Jinping told the crown prince in front of reporters.

“The special nature of our bilateral relationship reflects the efforts you have made,” added Xi, who has made stepping up China’s presence in the Middle East a key foreign policy objective, despite its traditional low-key role there.

The crown prince said Saudi Arabia’s relations with China dated back “a very long time in the past”.

Read More: Saudi Arabia agrees for $10 billion China refinery deal

“In the hundreds, even thousands, of years, the interactions between the sides have been friendly. Over such a long period of exchanges with China, we have never experienced any problems with China,” he said.

The crown prince said Saudi Arabia saw great opportunities with China.

“The Silk Road initiative and China’s strategic orientation are very much in line with the kingdom’s Vision 2030,” he said, according to SPA, referring to Saudi Arabia’s sweeping economic reform programme.

“The Silk Road initiative and China’s strategic orientation are very much in line with the kingdom’s Vision 2030,” the Saudi crown prince said

Trade between the countries increased by 32 per cent last year, he said.

China has had to step carefully in relations with Riyadh, since Beijing also has close ties with Saudi Arabia’s regional foe, Iran.

Xi told the crown prince the two countries must strengthen international cooperation on de-radicalisation to “prevent the infiltration and spread of extremist thinking”, Chinese state television said.

Saudi Arabia respected and supported China’s right to protect its own security and take counter-terror and de-radicalisation steps, the crown prince told Xi.

Meeting the crown prince earlier on Friday, Chinese Vice Premier Han Zheng said the two countries should enhance exchanges on their experiences in de-radicalisation, China’s official Xinhua news agency said in a separate report.

Chinese state media made no direct mention of Xinjiang in their stories on the crown prince’s meetings.

Aramco agreed to form a joint venture with Chinese defence conglomerate Norinco to develop a refining and petrochemical complex in the north-eastern Chinese city of Panjin, saying the project was worth more than $10bn.

The partners would form a company called Huajin Aramco Petrochemical Co as part of a project that would include a 300,000-barrels per day refinery with a 1.5-million-metric tonnes per year ethylene cracker, Aramco said. Aramco will supply up to 70 per cent of the crude feedstock for the complex, which is expected to start operations in 2024.