Riyadh seals $13.5b China refinery deal

35 agreements inked during Crown Prince's visit; Xi urges joint efforts to fight extremism

Saudi Crown Prince Mohammed bin Salman, who is on an Asia tour, with Chinese President Xi Jinping during their meeting at the Great Hall of the People in Beijing yesterday.
Saudi Crown Prince Mohammed bin Salman, who is on an Asia tour, with Chinese President Xi Jinping during their meeting at the Great Hall of the People in Beijing yesterday. PHOTO: SPA

BEIJING • Saudi Crown Prince Mohammed bin Salman cemented a US$10 billion (S$13.5 billion) deal for a refining and petrochemical complex in China yesterday, and met Chinese President Xi Jinping who called for joint efforts to counter extremism and terror.

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 US$20 billion 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 US$28 billion at a joint investment forum during the visit, Saudi state news agency SPA said.

"China is a good friend and partner to Saudi Arabia,"Mr Xi told the crown prince in front of reporters.

"The special nature of our bilateral relationship reflects the efforts you have made," said Mr 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 noted Saudi Arabia's relations with China dated back "a very long time in the past".

"In the hundreds, even thousands, of years, the interactions between the two sides have been friendly," he said.

Crown Prince Mohammed, who has come under fire in the West following the murder of Saudi journalist Jamal Khashoggi at the kingdom's Istanbul consulate in October, 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, referring to Saudi Arabia's sweeping economic reform programme.

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

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

China is also wary of criticism from Muslim countries about its camps in the heavily Muslim western region of Xinjiang, where Uighurs are said to be undergoing "re-education" programmes.

Mr Xi told the crown prince the two countries must strengthen international cooperation on deradicalisation to "prevent the infiltration and spread of extremist thinking", Chinese state television said.

The crown prince told Mr Xi that Saudi Arabia supported China's rights to protect its own security and take counter-terror and deradicalisation steps, and was willing to increase cooperation.

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 in Liaoning province, saying the project was worth more than US$10 billion.

The investments could help Saudi Arabia regain its place as the top oil exporter to China, a position Russia has held for the last three years.

State Councillor Wang Yi, the Chinese government's top diplomat, said on Thursday that China sees "enormous potential" in Saudi Arabia's economy and wants more high-tech cooperation.

REUTERS

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A version of this article appeared in the print edition of The Straits Times on February 23, 2019, with the headline Riyadh seals $13.5b China refinery deal. Subscribe