China eyes closer ties as Saudi Arabia diversifies

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China aims to deepen ties with Saudi Arabia as the Middle Eastern kingdom attempts to diversify its economy away from oil, Chinese Vice Premier Zhang Gaoli said on Thursday.

The International Monetary Fund slashed its 2017 growth forecast for Saudi Arabia to “close to zero” in January, primarily due to lower oil revenue and the restructuring of the country's economy.

Saudi Vision 2030 – a growth strategy to diversify the kingdom’s heavily oil-dependent economy – was put forward last year, and Zhang told King Salman bin Abdulaziz Al Saud during talks in Jeddah that China was keen to work in partnership with Saudi Arabia.

Saudi Arabia's King Salman bin Abdulaziz Al Saud (R) meets with Chinese Vice Premier Zhang Gaoli in Jeddah, Saudi Arabia, August 24, 2017. /Reuters Photo

He also welcomed Saudi Arabia’s active participation in the Belt and Road Initiative, adding that the two sides are negotiating a plan to merge the China-led program and the 2030 Vision.

Zhang stressed China’s desire for Saudi Arabia to be a global partner in the initiative, which is focused on boosting trade through infrastructure improvements.

"We also support Saudi Arabia in making its 2030 vision a reality, and would like to be a partner as the country diversifies its economy," said Zhang.

Energy, finance, industrial capacity

Later on Thursday, the countries agreed to set up a package of bilateral energy cooperation mechanisms.

During talks between Zhang and Saudi Crown Prince Mohammed bin Salman, a broad consensus was reached on cooperation in the fields of energy, finance and industrial capacity.

They vowed to push forward a sea water desalination project using high temperature gas-cooled reactors, as well as a Chinese industry park in Saudi Arabia's southern border region of Jizan, and support the construction of a power plant in the western Saudi coastal town of Rabigh.

Deepening ties

Chinese President Xi Jinping visited Saudi Arabia in January 2016, during which the two countries upgraded bilateral ties to a comprehensive strategic partnership.

King Salman led a large delegation of government and business leaders to Beijing in March this year. Economic and trade deals involving 35 projects worth a total of 65 billion US dollars were signed.

China's President Xi Jinping (R) shakes hands with Saudi King Salman bin Abdulaziz during a signing ceremony at the Great Hall of the People in Beijing on March 16, 2017. /AFP Photo‍

"My visit this time is to implement the important consensus reached between President Xi and King Salman so as to continuously deepen the Chinese-Saudi comprehensive strategic partnership," Zhang said.

King Salman told Zhang that Saudi Arabia values its friendship with China, and is willing to deepen bilateral cooperation in energy, trade, investment, and security.

Saudi Arabia is the second leg of Zhang's four-nation tour which has already taken him to Kuwait. He will also visit Sudan and Namibia.

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