Will China buy Saudi Arabia ?

Reuters Nov 27, 2006Saudi Alignment with China? by A.HammondThis new alignment has also seen China boosting ties with six booming Gulf Arab states, including oil producers Qatar, Kuwait and the United Arab Emirates.China National Offshore Oil Co. (CNOOC) is in talks with Qatar for liquefied natural gas supplies, PetroChina is studying plans with Kuwait to build a refinery and petrochemical complex in South China, and Aramco is negotiating refinery joint ventures in China.China's economic thrust has coincided with a time when U.S. prestige in the Arab world is at a low ebb due to the Iraq war and U.S. support for Israel.In addition, once-cosy U.S.-Saudi ties have not fully recovered from the shock of the September 11 attacks in which 15 of the 19 suicide hijackers were Saudis.This has hit the oil-for-security "special relationship" long based on the role of U.S. military forces as guarantor of Saudi Arabia's safety, largely to protect huge Saudi oilfields.Saudi Aramco was the largest supplier of oil to China for the last four years, in addition to being the biggest supplier to India, Japan, South Korea and Singapore.China has even started discussions with Aramco to provide it with a strategic oil reserve, opening up the possibility of future tension over global access to Saudi crude oil.Chietigj Bajpaee, research associate at the Center for Strategic and International Studies in Washington, D.C., said China risks being seen as trying to "lock up" Saudi oil at the expense of Washington, or India, another Asian tiger economy with a billion-plus population and a voracious appetite for oil."(China and the United States) have an increasingly symbiotic relationship," Bajpaee said. "This has led to fears in the United States that China is encroaching into its 'sphere of influence' and undermining relations with its traditional allies."NO POLITICS REQUIREDTies with China come with the added advantage of no political expectations, unlike those with Western countries which periodically pursue a rights agenda with Saudi Arabia.Despite Beijing's atheist communist ideology and Saudi Arabia's status as the birthplace of Islam, both governments are authoritarian and brook no dissent.Chinese labor could become more common in the Gulf, as governments tire of Indian and Pakistani workers becoming vocal about their lack of rights in countries they helped to build.Yet analysts say the Gulf still needs the United States."Trade relations between China and the GCC (Gulf Cooperation Council) countries are expected to grow and go beyond the current $32 billion dollar estimate that they reached in 2005 in various commodities and services," Younsi said, pointing to a possible free trade deal."But the problem for GCC monarchies is they know they cannot rely on China for their security and this is why they still want to maintain a close relationship with Washington," he said.Saudi government adviser Nawaf Obaid agreed."Realistically, it will be very hard for China to compete with the United States politically and militarily in the region, especially when it comes to the vital U.S.-Saudi 'special relationship'," he said.