Transcript
0:03
the United States has been applying
0:04
considerable pressure on Saudi Arabia to
0:06
distance itself from China and other
0:08
brics nations due to concerns over
0:10
geopolitical and economic issues the US
0:13
is particularly focused on preventing
0:15
the transfer of crucial technology
0:17
infrastructure and data to China which
0:19
could potentially threaten US National
0:21
Security and economic
0:25
interests nonetheless Saudi Arabia's
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recent actions including the signing of
0:29
$50 billion in memorandums of
0:32
understanding with Chinese financial
0:33
institutions suggest a clear intent to
0:36
strengthen its relationship with China
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this development is part of Saudi
0:40
Arabia's broader strategy to diversify
0:42
its economic Partnerships and reduce its
0:44
dependence on oil aligning with its
0:46
Vision 2030 initiative the agreements
0:49
with Chinese Banks aim to enhance
0:51
two-way Capital flows covering both debt
0:54
and Equity Investments thereby promoting
0:56
deeper economic integration between the
0:58
two Nations specifically speically Saudi
1:00
Arabia's investments in China saw
1:02
substantial growth highlighted by the
1:04
pf's move to sign six major agreements
1:07
worth 50 billion with leading Chinese
1:10
financial institutions these deals were
1:12
aimed at enhancing bilateral Capital
1:14
flows supporting investments in various
1:17
sectors including technology and
1:19
infrastructure this follows the previous
1:21
year's surge where Investments by Gulf
1:23
funds in China increased from a modest
1:25
$100 million to $2.3 billion in 202 23
1:30
underscoring the rapid intensification
1:33
of economic ties Saudi aramco has
1:36
significantly expanded its investments
1:37
in China further demonstrating its
1:40
strategic alignment with Beijing in 2024
1:43
aramco finalized two major deals aimed
1:46
at bolstering its role as a key crude
1:48
supplier to China the first deal
1:50
involved acquiring a 10% stake in Rong
1:52
Shang petrochemical Company Limited for
1:55
approximately $3.6 billion ensuring a
1:58
long-term Supply agreement of 480,000
2:01
barrels per day to Jiang prochemical
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Corp one of China's largest refining and
2:06
chemicals complexes in addition to this
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aramco in partnership with North wajen
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chemical and pangin shin Chung
2:13
industrial group announced the
2:15
construction of a large-scale Refinery
2:16
and petrochemical complex in leing
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Province expected to be operational by
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2026 this 12.2 billion doll project an
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upgrade from earlier plans will include
2:27
a 300,000 barrels per day oil Refinery
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and significant petrochemical production
2:32
capabilities despite US Secretary of
2:35
State Anthony blinken's claims that
2:37
Washington is not asking Saudi Arabia to
2:39
choose between the US and China the
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Kingdom's actions suggest a clear
2:43
preference for deepening economic ties
2:45
with China this trend underscores Saudi
2:48
Arabia's pragmatic approach to
2:50
international relations seizing
2:52
opportunities without being constrained
2:54
by traditional
2:57
alliances in 2023 three the trade volume
3:01
between China and Saudi Arabia reached a
3:03
significant Milestone reflecting their
3:05
increasingly close economic ties in the
3:08
first quarter alone the bilateral trade
3:11
totaled approximately $24.3 billion with
3:14
Saudi exports to China primarily crude
3:17
oil accounting for $1 13.7 billion while
3:21
Chinese Imports to Saudi Arabia mainly
3:23
electronic Goods total $10.7 billion by
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the end of 2023 China's imports from
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Saudi Arabia amounted to a remarkable
3:32
64.3 billion the trade relationship
3:35
continued to grow in 2024 by May 2024
3:40
China's exports to Saudi Arabia had
3:42
increased by 11.8% compared to the same
3:45
period in the previous year while Saudi
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Imports saw a more modest rise of
3:50
3.51% this sustained growth highlights
3:52
the robustness of their economic
3:54
partnership underpinned by significant
3:57
cooperation in sectors such as
3:59
technology Logistics and Manufacturing
4:02
moreover Saudi Arabia is set to increase
4:04
its crude oil supplies to China in 2024
4:07
to meet the demands of new and expanding
4:09
refineries further solidifying its role
4:11
as a key supplier to
4:15
China before delving into the topic of
4:18
Saudi Arabia and China trading in their
4:20
local currencies instead of the US
4:21
dollar let's take a quick pause could
4:24
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thoughts and feedback in the comments
4:31
your engagement helps us grow thank
4:35
you China and Saudi Arabia have
4:37
intensified their efforts to reduce
4:39
Reliance on the US dollar in
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international trade by implementing a
4:43
significant currency swap agreement this
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deal estimated at approximately $7
4:48
billion permits the two Nations to
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conduct trade transactions using their
4:52
respective local currencies the Chinese
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Juan and the Saudi Rial the agreement
4:57
which is designed to last for 3 years
4:59
with the option for extension enables up
5:01
to 50 billion when or 26 billion RS to
5:05
be exchanged directly without the need
5:06
to convert to US Dollars this move is
5:09
part of a broader dollarization strategy
5:12
aimed at decreasing the dominance of the
5:14
US dollar in global trade China has been
5:17
actively promoting the
5:18
internationalization of the Yuan and
5:20
this agreement with Saudi Arabia marks a
5:22
significant step in that direction the
5:24
swap deal is particularly noteworthy
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given Saudi Arabia's position as the
5:28
world's largest oil EXP quar and China's
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role as the largest energy consumer by
5:33
facilitating direct currency exchange
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the deal enhances Financial cooperation
5:37
and reflects a mutual interest in
5:39
diversifying away from traditional us
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dollar-based transactions moreover this
5:44
agreement is a key element of the
5:46
expanding Financial partnership between
5:48
China and Saudi Arabia which has seen
5:50
substantial growth in recent years it is
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expected to support Saudi Arabia's
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Vision 2030 a strategic initiative aimed
5:57
at reducing the Kingdom's economic
5:59
dependence on oil by developing other
6:01
sectors such as technology and
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tourism historical interactions between
6:08
ancient Chinese dynasties and the
6:09
Arabian Peninsula were limited primarily
6:12
occurring through the Silk Road which
6:14
served as a trade route connecting the
6:15
two regions formal diplomatic relations
6:18
between Saudi Arabia and China were
6:20
established on July 21st 1990 marking a
6:24
pivotal shift in Saudi Arabia's foreign
6:26
policy this move allowed Saudi Arabia to
6:28
diversify its International alliances
6:31
moving beyond its traditional Western
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Partners during the 1990s trade between
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the two countries began to grow
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gradually initially focusing on basic
6:40
Commodities by the early 2000s bilateral
6:44
trade had expanded significantly in 2004
6:48
the trade volume between Saudi Arabia
6:49
and China was around $3
6:52
billion by 2008 this figure had surged
6:55
to $25.4 billion reflecting an
6:58
impressive compound ual growth rate of
7:00
nearly 40% the relationship between the
7:03
two Nations continued to strengthen
7:05
throughout the 2010s driven largely by
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China's increasing energy needs by 2015
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China had become Saudi Arabia's largest
7:13
trading partner in 2018 bilateral trade
7:16
reached $ 42.362667
7:29
ship deepened even further with the
7:31
trade volume reaching 87.3 billion in
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2021 in the first quarter of 20123 alone
7:38
bilateral trade amounted to$
7:40
24.3 billion with Saudi exports to China
7:44
totaling $13.7 billion and Chinese
7:47
Imports at $10.7 billion the energy
7:51
sector remains a critical component of
7:53
the relationship with Saudi aramco
7:55
engaging in numerous joint ventures with
7:57
Chinese firms including refineries and
8:00
prochemical plants for instance in 2019
8:03
Saudi aramco signed a $1 billion deal to
8:06
build a refining and prochemical complex
8:09
in China moreover Saudi Arabia has
8:12
become a key partner in China's belt and
8:14
Road initiative or BR this partnership
8:18
has led to substantial Chinese
8:19
investments in Saudi infrastructure
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Logistics and Manufacturing sectors a
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notable example is the Red Sea
8:26
industrial aluminium company's 101
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billion invest m in Saudi Arabia
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highlighting the deepening economic ties
8:33
between the two
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Nations the political relationship
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between China and Saudi Arabia has been
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characterized by significant highlevel
8:43
engagements a pivotal moment occurred
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during Chinese president XI jinping's
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visit to Saudi Arabia in December 2022
8:50
which culminated in the signing of 35
8:52
agreements across various sectors
8:54
collectively valued at $50 billion these
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agreements spanned multiple areas
8:59
including energy infrastructure and
9:01
Technology marking a deepening of ties
9:04
between the two Nations China's role in
9:06
Regional politics has also been
9:08
increasingly prominent particularly
9:09
highlighted by its facilitation of the
9:11
Diplomatic approachment between Saudi
9:13
Arabia and Iran in
9:15
2023 this mediation effort underscored
9:18
China's growing influence in the Middle
9:19
East showcasing its ability to act as a
9:22
significant diplomatic player in a
9:24
region traditionally influenced by
9:26
Western Powers cultural exchanges
9:29
between the two countries have also seen
9:30
steady growth thousands of Saudi
9:33
students are studying in China
9:34
reflecting a strong educational
9:36
partnership additionally efforts are
9:39
underway to attract Chinese tourists to
9:41
Saudi Arabia as part of the Kingdom's
9:43
Vision 2030 strategy which aims to
9:45
diversify the economy and boost the
9:47
tourism sector in the realm of media and
9:50
Technology cooperation has been
9:52
particularly notable Chinese technology
9:55
Giants such as Huawei are playing a
9:57
crucial role in Saudi Arabia's digital
9:59
transformation contributing to the
10:01
Kingdom's Ambitions to modernize its
10:03
economy and
10:07
infrastructure the Petro dollar
10:08
agreement between the United States and
10:10
Saudi Arabia which had anchored the
10:12
global oil trade for 50 years officially
10:15
ended on June 9th
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2024 this agreement established in 1974
10:21
had required Saudi Arabia to sell its
10:23
oil exclusively in US Dollars and invest
10:26
the Surplus oil revenues in US Treasury
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bonds in exchange the US provided
10:31
military support and economic aid to
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Saudi Arabia this Arrangement played a
10:35
crucial role in cementing the US dollar
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dominance as the world's primary Reserve
10:40
currency with the expiration of this
10:42
agreement Saudi Arabia now has the
10:44
flexibility to sell its oil in multiple
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currencies including the Chinese un
10:49
Euros Yen and even digital currencies
10:52
such as Bitcoin this significant shift
10:54
could potentially weaken the US Dollar's
10:56
dominance in global markets as more
10:58
trans actions occur in other currencies
11:01
the global demand for the dollar May
11:02
decrease which could lead to higher
11:04
inflation increased interest rates and
11:07
instability in the US bond market this
11:09
move by Saudi Arabia reflects broader
11:12
Global shifts as emerging economies gain
11:14
more influence and the world
11:16
increasingly adopts alternative energy
11:18
sources reducing Reliance on oil
11:20
additionally Saudi Arabia's recent
11:22
involvement with bricks and other
11:24
International alliances underscores its
11:26
intent to diversify its economic and
11:28
geopolitic iCal Partnerships beyond the
11:30
traditional Western sphere potentially
11:33
reshaping Global power
11:37
dynamics that's all for this video thank
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