Wed, Jul 11, 2018 - Page 10 News List

Xi pledges US$20bn loan to revitalize Middle East

‘INDUSTRIAL REVIVAL’:China is to offer aid worth US$150 million to Palestine, and set up a consortium of Chinese and Arab banks with a fund of US$3 billion

Reuters, BEIJING

Chinese President Xi Jinping (習近平) yesterday pledged a package of US$20 billion in loans and US$1.6 billion in financial aid to countries in the Middle East as part of what he called an “oil and gas plus” model to revive economic growth in the region.

The Chinese government has ramped up engagement in the Middle East in recent years as Arab nations play an important role in Xi’s signature Belt and Road foreign policy plan for strong trade routes linking China with central and southeast Asia.

Development was key to resolving many security problems in the Middle East, Xi told a gathering with representatives of 21 Arab nations in the Chinese capital.

“We should treat each other frankly, not fear differences, not avoid problems, and have ample discussion on each aspect of foreign policy and development strategy,” he said.

China would offer aid worth 1 billion yuan (US$150 million) to Palestine to support economic development, in addition to providing a further 600 million yuan to Jordan, Syria, Lebanon and Yemen, he added.

A consortium of banks from China and Arab nations, with a dedicated fund of US$3 billion, is also be set up, he said.

It was unclear what the relationship between the bank consortium, financial aid and the overall loan package would be.

The loans will fund a plan of “economic reconstruction” and “industrial revival” that would include cooperation on oil and gas, nuclear and clean energy, Xi said.

He urged “relevant sides” to respect the international consensus in the Israel-Palestine dispute and called for it to be handled in a just manner, so as to avoid regional disruption.

China, which traditionally played little role in Middle East conflicts or diplomacy, despite its reliance on the region for energy supplies, has been trying to get more involved in resolving long-standing disputes.

China has said it sticks to a policy of “non-interference” when offering financial aid and deals to developing countries, which, coupled with development, can help resolve political, religious and cultural tension.

It applies this pattern of economic support, as well as a strict security regime, to its restive western region of Xinjiang.

However, rights groups have criticized the approach, saying the clampdown has further stoked, not eased, tension between the Muslim Uighur minority and the ethnic Han majority.

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