By Giancarlo Elia Valori*
Historically, the Silk Road was established during the Han dynasty, between 206 B.C and 220 A.D., after the long Chinese exploration of Southern and Western Asia which had started at least two thousand years before.
As the original myth of Eurasia’s foundation has it, it was in those areas – among nomadic and warring populations – that the Son of Heaven became, for the first time, a shepherd of sheep flocks, and escaped the wild beasts which wanted to kill him and then devour the whole Han dinasty.
President Xi Jinping, the new Son of Heaven, embodying positive forces both at political and mythical levels, followed again the Silk Road and hence returned to the Middle East, by visiting Iran, Saudi Arabia and Egypt. This was meant to rebuild the original strategic projection of China’s First Red Empire – hence to make China regain its ancient role based on the philosophical principle of “All under Heaven”.
The visit to the three Middle East countries was paid by the CCP Secretary on January 19-22, 2016, on the occasion of the sixtieth anniversary of the mutual recognition between China and the Arab League. Until 2015 Saudi Arabia was the most important China’s crude oil supplier – a position currently held by Russia as primary seller.
The travel to these three Arab and Islamic countries is the first visit paid by the CCP Secretary in 2016 and this makes us understand the special importance that Xi Jinping and his China attaches to the commercial, political and strategic relationship between China and Iran, Egypt and Saudi Arabia. As is well-known, Xi Jinping’ strategic project is the new Silk Road, which he called “One Belt One Road”.
Xi Jinping’s project was made public in October 2013. It is divided into a maritime part and a land part, which will both connect China with Central and Western Asia, the Middle East and finally Europe.
To put it in a metaphor of the Taoist sages – and Mao Zedong was so – the void (of power) of the United States and of the European Union itself, completely devoid of a real foreign policy, will be “filled” by a link with China and Eurasia on the part of the Sunni and Shi’ite Islamic world.
In Asia, where it originates, the new Silk Road will be connected with the China-Pakistan Economic Corridor (CPEC) and with the Bangladesh-China-India-Myanmar Corridor (BCIM). After the globalization which was an Americanization, the Chinese-style globalization will prevail, which will unite all the losers of the first globalization by tying them at first to Eurasia and later to China itself.
Since the diplomatic recognition between Russia and Saudi Arabia in 1990, trade has increased by 230 times, up to 70 billion US dollars in 2014. Currently, in Saudi Arabia, 160 Chinese companies operate not only in the oil sector but also in the logistics, transport and electronics sectors. China wants to support the Arab world with a stimulus to the domestic production differentiation and the reduction of those economies’ oil dependence.
For China, the relationship with Saudi Arabia is the strategic link with the Sunni country closest to the United States which, however, does not want to be tied hand and foot to the United States.
Saudi Arabia has every interest in dealing with China so as to avoid having only North America as counterpart – a relationship and a situation which, devoid of any counterbalance, would obviously be less favourable to Saudi Arabia.
The most important project binding China and Saudi Arabia is the Yarseef refinery which is worth 10 billion US dollars, 62.5% of which funded by the Chinese Sinopec.
President Xi Jinping has defined Yanbu – the Red Sea port where the Yarseef refinery is located – as the regional point of arrival of the Silk Road and, at the same time, the axis of the new Saudi industrialization. Another essential aspect of Xi Jinping’s visit to Saudi Arabia is the idea of establishing, by 2017, a Free Trade Zone together with the Gulf Cooperation Council, another component of the “Silk Road” which, in these areas, connects its maritime way and its land stretch.
Later, in his visit to Egypt, the CCP Secretary followed up the themes already developed during the visit paid by the Egyptian President, Al Sisi, to Beijing in December 2014. The idea is to implement a “comprehensive strategic partnership” based on 15 major projects, to the tune of 15 billion US dollars.
These projects are related to infrastructure and transport, considering that Cairo and the Egyptian coast will be the Mediterranean point of arrival of the new maritime Silk Road.
Other investments in the “comprehensive strategic partnership” regard the Egyptian energy sector while, during Xi Jinping’s visit, additional 21 new investment projects were defined with an additional soft loan to this country equal to 1.7 billion US dollars, managed by some Egyptian banks.
A geopolitical level, Xi Jinping’s attention is mainly focused on the Egyptian and Shi’ite region, with a probable mediation between Iran and Saudi Arabia which has materialized during the Chinese leader’s visit.
This means that China fears the expansionism of the Isis/Daesh “Caliphate” and, above all, the return of hundreds of Uighur foreign fighters living in Xingkiang.
At diplomatic – and probably at operational – level, China has supported Egypt in its fight against the Qaedist jihadist area, at first, and later against the Caliphate jihadist aera in the Sinai. It will certainly distribute its investments across the Middle East, based on the each country’s ability to fight against the jihad.
If Europe and the West will not be able to support the new autonomous development of the Middle East – and we can currently perceive all their limits in this regard – this region will become – between Russia and China – the Southern and maritime part of Eurasia.
This will be the new Sino-Russian Heartland which will hegemonize the Mediterranean region and much of the “great European plain”, as the French philosopher Raymond Aron called it.
Another significant geopolitical sign is that Xi Jinping urged Al Sisi’s Egypt to participate, as observer, in the next G20 Summit to be held in Beijing next September. The last Middle East country visited by the Chinese leader, was the Shi’ite and not Arab nation of Iran. Xi Jinping was the first leader of a world power to visit Iran after the lifting of sanctions, to which the Chinese and Russian activity within the P5+1 contributed significantly.
It is a very important symbolic fact.
Certainly China has never taken the sanctions against Iran into account. In fact, as early as 2014, China has replaced Germany as first business partner of the Shi’ite country, with a bilateral turnover exceeding 70 billion US dollars.
Obviously Xi Jimping came to preserve the Chinese position reached in Iran, but also to support Iran in its strategic differentiating from Europe and NATO, as demonstrated by the open support he showed during some interviews in Iran for the presence of Shi’ite forces in Syria.
Unlike many naïve Western experts and the even more childish leaders of a gutless Europe believe, the Syrian issue is not the fight against a “tyrant” such as Bashar al-Assad so as to restore a very unlikely “democracy”.
In the Middle East democracy is imposed to make a country strategically “viable”, which means devoid of reactions to the operations carried out by other players on the field.
Therefore the real Syrian issue is the fight against those hegemonizing the Greater Middle East in the future.
It may be Turkey, which wants to conquer Syria’s vast Sunni area for its mad neo-Ottoman dream.
Or the Russian Federation along with Iran, which will annex the Shi’ite and Alawite Syria to the corridor stretching from Ukraine to the coast towards the Black Sea and the Eastern Mediterranean basin.
Or finally Saudi Arabia, which wants to manage its own “Sunni and Wahhabi International” so as to dominate the whole Middle East region and its oil, without the constraints of OPEC, which is now a residual cartel.
Xi Jinping, however, proposes to Iran a greater Chinese presence in the local banking and financial sector, the building of seven fast railway lines to be connected, in the future, with the networks already existing in China and, of course, a greater Chinese presence in the Iranian oil and gas sector.
According to Chinese analysts, trade between China and Iran is expected to increase tenfold, up to reaching 700 billions a year by 2017.
Hence, considering all the actions undertaken in the three Middle East countries he visited late January, the core of Xi Jinping’s operation is the creation of a joint Free Trade Zone between the three countries with China’s support – a topic we have already raised at the beginning of this article.
This is a move intended to rebalance the free trade agreement between the United States and other 11 Pacific countries, as well as to fill Western Europe’s “void” throughout the Middle East.
China has reached the free trade agreement with all the six Persian Gulf countries, namely Saudi Arabia, the United Arab Emirates, Bahrain, Qatar, Kuwait and Oman.
China wants to put enemy countries together so as to mediate in a credible way.
The agreement is supposed to be signed by the end of 2016.
Hence the “void” of the United States and of an ever weaker and inward-lookingWest, obsessed by the idea of “exporting democracy” or by a naïve, self-defeating and self-destructive “geopolitics of values”, is “filled” by a China exporting economic support, political influence and credible skills and abilities to mediate between all regional players.
About the author:
* Professor Giancarlo Elia Valori is an eminent Italian economist and businessman. He holds prestigious academic distinctions and national orders. Mr Valori has lectured on international affairs and economics at the world’s leading universities such as Peking University, the Hebrew University of Jerusalem and the Yeshiva University in New York. He currently chairs “La Centrale Finanziaria Generale Spa”, he is also the honorary president of Huawei Italy, economic adviser to the Chinese giant HNA Group and Khashoggi Holding’s advisor. In 1992 he was appointed Officier de la Légion d’Honneur de la République Francaise, with this motivation: “A man who can see across borders to understand the world” and in 2002 he received the title of “Honorable” of the Académie des Sciences de l’Institut de France.
This article was published by Modern Diplomacy.