Schwarzman Scholars worked together to create an academic journal, reflecting their ability to think critically about the Middle Kingdom and the implications of its rise. These collections of thoughts come together to form "Xinmin Pinglun," our Journal dedicated to the publication of the informative and analytical essays of our scholars. As the application deadline for the class of 2019 is approaching and the arrival of the incoming class is on its way, we are sharing pieces from the second issue of Ximin Pinglun to give insight into the critical thinking and scholarship taking place at Schwarzman College. Here, Mostafa Allam, (Class of 2017) discusses the implications of the US-China relations on the Middle East.
“The relationship between the U.S. and China is the most important geopolitical issue of the 21st century,” Lee Kuan Yew said in one of his last speeches at the S. Rajaratnam Lecture series. This has certainly been the case in the Middle East, where the U.S. has been the dominant power since the fall of the British Empire, but China has recently increased its presence and influence. The third major foreign power in the Middle East is Russia, but despite its military presence, Moscow’s economic ties to the region are not of the same scale as those of the U.S. and China. I predict that the U.S. and China will be the two major powers in the region in the years to come, which leads to the question of whether they will clash or cooperate. Many international relations scholars speculate that the U.S. and China are headed for war. This speculation is especially relevant to the Middle East which, according to Henry Kissinger in World Order, is the “world’s most volatile region.” According to the Thucydides Trap theory, the tensions between a rising power and an established power typically escalate towards war. However, this need not be the case. As the same Lee Kuan Yew concluded in one of his speeches, between the U.S. and China, “competition is inevitable, but conflict is not.”
In the Middle East, while the prospect of China unseating the U.S. as the major power in the near future is slim, there is growing evidence that the balance of power between the two countries is shifting. As the U.S. adopts a more isolationist foreign policy under President Donald Trump and China becomes more economically involved in the region with President Xi Jinping’s Belt and Road Initiative (BRI), it is highly likely that the balance of power will shift from the U.S. to China. However, whether this shift will lead to conflict or cooperation is what this essay sets out to determine. A key determinant of the outcome is whether the U.S. and China’s roles in the region are compatible or not.
China's growing influence in the Middle East
China’s growing influence in the Middle East stems primarily from its expanding economic ties with the region. Today, China is the top net oil importer in the world, and Middle East’s biggest consumer of oil. Four of the top six sources of Chinese oil are Middle Eastern countries. Furthermore, China is the largest foreign investor in the oil and gas sectors of Iraq and Iran, two of the region’s main oil producers. Meanwhile, since the shale oil revolution, the United States’ need for Middle Eastern oil has declined. A study conducted by Chatham House in 2015 revealed that the United States’ commitment to the security and stability of Gulf oil producers might begin to wane as its reliance on Middle Eastern oil declines. China would be the most suitable candidate to fill a power vacuum left behind by an isolationist U.S. whose role in the Middle East begins to shrink.
The other major economic interest that China has in the Middle East is in maintaining the stability of its trade and investment with the region. China’s exports to the Middle East increased from $6.4 billion in 1999 to $121 billion in 2012. From 2005 to 2013, China has invested $20.3 billion in Iran, $15 billion in Saudi Arabia, $8.5 billion in Iraq, $4.7 billion in Qatar, $3.7 billion in Syria, and $2.7 billion in Egypt. The magnitude and diversity of its investments across the Middle East show that China has a vested interest in the region’s stability. China also sees the Middle East as the place where the overland and sea routes of its BRI meet, as Wang Yi, the Minister of Foreign Affairs said during his visit in the region in 2013. Furthermore, 9 of the 57 founding members of the Asian Infrastructure Investment Bank (AIIB) are from the Middle East, giving credence to the AIIB’s legitimacy on the international stage, and representing potential destinations for the bank’s infrastructure investments.
Aside from the need to secure its economic interests in the Middle East, China also has significant political interests in the region. Similar to the U.S., China has serious concerns about the spread of terrorism and extremism in the Middle East. China fears that the rhetoric of groups like the so-called Islamic State (ISIS) could stimulate homegrown radicalization of China’s Muslim minority groups, such as the Uyghurs in Xinjiang. The so-called ISIS has also directly threatened China by listing it as one of the 20 target countries where the terrorist organization intends to instigate instability. As a result of this threat, China offered to help the Iraqi government fight the so-called ISIS with the support of air strikes. Whether China will back its claims has yet to be seen, but Beijing has staged military interventions before, when its economic interests were at stake, as in the case of the pirates off the coast of Somalia.
Another major Middle Eastern issue where China has considerable influence is the Iranian nuclear crisis. In the face of international sanctions aimed at stopping further progress of its nuclear program, Iran has depended on China as its key ally in the face of pressure from the West. Not only has China helped Iran acquire the technology and expertise required to advance its nuclear program, but it is also the biggest foreign investor in Iran. Given that Iran’s economy depends heavily on Chinese imports, investments, and finances, China has various levers with which to influence the progress of Iran’s nuclear program that the U.S. does not have.
The shifting balance of power from the U.S. to China
China’s increasing influence in the Middle East has coincided with a shift in the balance of power from the U.S. to China. There is evidence to suggest that traditional U.S. allies are moving closer to China. For example, in 2014, China and Egypt, the most populous Arab country, updated their bilateral relationship to a “comprehensive strategic partnership,” which is the highest level of a relationship between China and another country. This move came at a time when a rift between the U.S. and Egypt began to occur with the ascendance of General Abdel Fattah El Sisi to the Egyptian presidency. Similarly, Saudi Arabia has moved closer to China after showing uneasiness with the U.S.’s foreign policy to “democratize” the Middle East. While Turkey and Israel remain close allies of the U.S., they too have developed closer political and economic ties to China. Another recent sign of the shifting balance of power from the U.S. to China is the former’s failure to dissuade its Middle Eastern allies from joining the AIIB.
Part of the reason for the shifting balance of power from the U.S. to China is the latter’s successful diplomacy towards the region. There seem to be two primary pillars of China’s foreign policy towards the Middle East. The first is the notion that China is a friend to all but an ally of none in the region. The fact that China does not have any formal alliance with any Middle Eastern state, as the U.S. does, means that it does not have to defend any state’s interests except its own. This is important because Middle Eastern countries cannot force China to “choose sides” as they have often done with the U.S. during regional crises, such as the Arab-Israeli conflict.
The second major pillar of China’s foreign policy in the Middle East is its selective engagement in only the issues that distinctly affect its economic and political interests. For example, China will remain highly engaged in the Iranian nuclear talks because it has an interest in Iran’s stability (given its high reliance on Iranian oil and its investments there). However, China might decide to engage less in an issue such as the Israeli-Palestinian conflict. In contrast, the U.S. is much more engaged in most of the pressing issues affecting the Middle East, which inevitably leads it to garner support and opposition from countries in the region.
Despite China’s growing influence in the region and the shifting balance of power, there is no evidence to suggest that China will challenge the U.S.’s position as the strongest military power in the region. This is because China does not have the experience nor the capabilities to engage in military confrontations in the Middle East on the scale that the U.S. does. Furthermore, military involvement in the Middle East does not even seem to be a part of China’s foreign policy towards the region.
Conflict or cooperation
The answer to the question of whether China and the U.S. will clash or cooperate in the Middle East depends mainly on whether their interests are contradictory or compatible. China’s main interest in the region is to secure its access to oil. On the other hand, while the U.S.’s interest in the region also stems from its need for oil, it also has commitments to protect its allies. As long as both powers’ interests are respected and protected, there will be no conflict between the two. As of today, China needs the U.S. in order to maintain its undisrupted access to oil in the Middle East. The U.S.’s naval presence in the Middle East, through the American Fifth Fleet in the Strait of Hormuz, is the main source of security for shipping oil out of the Middle East. China relies on the U.S. security architecture in the region to ensure the safe passage of its oil supplies. Another example of China’s need for U.S. security is the fact that ISIS militants would have seized Baghdad and put China’s oil interests at risk if they had not been stalled by U.S.-led airstrikes. Similarly, the U.S. needs China in order to ensure peace and stability in the region, as we have seen in the case of Iran’s nuclear program. In addition, both Washington and Beijing have a common enemy in the region: the so-called ISIS.
Given that it is in the best interest of both China and the U.S. to have economic and political stability in the Middle East, it is more likely that the two powers will cooperate rather than clash with one another in the region. Moreover, China has an incentive to cooperate with the U.S. in the Middle East in order to ensure U.S. support on issues closer to home, such as the territorial disputes in the South China Sea. However, as the U.S.’s dependence on Middle Eastern oil decreases due to the shale revolution, China will need to become more involved in defending its interests in the Middle East. This will especially be the case as U.S. foreign policy will likely become more isolationist under President Trump. Fortunately for China, President Xi seems eager to make China’s foreign policy more assertive than any of his predecessors. As U.S. influence in the Middle East declines and that of China’s rises, the two powers will need to frame their economic and security involvement in the region as complementary in order to ensure that their interests are safeguarded and that stability is maintained.
当美国正在试图减少在中东地区的参与度时，中国在该区域的存 在感却不断增强。在该种情况下，权力的制衡向中国偏移是非常 有可能的，但华盛顿与北京在该地区发生冲突的可能性却依然很 低。由于中东地区的经济和政治稳定符合两国人民的共同利益， 因此合作比冲突更有可能在该区域发生。
Mostafa Allam (Class of 2017) is from Egypt, and graduated from the University of Virginia for undergrad and holds advanced degrees from London Business School and INSEAD.