Breaking Analysis | July 5th, 2023
Scholar: Beijing doesn’t possess the economic leverage to revive the stalled peace process.
Despite Israeli Prime Minister Benjamin Netanyahu’s plan to visit China and the Palestinian leader’s forging of a “strategic partnership” with Beijing, we should not expect Chinese President Xi Jinping to have any greater influence than the United States over events like Israel’s recent military operation in the West Bank, an expert advises.
“China lacks the leverage and incentives to coax Israel to the negotiating table,” Mohmad Waseem Malla told Middle East Policy. “Tel Aviv, in contrast, prefers the United States to oversee the process, as it has shielded Israel from global scrutiny regarding its policies toward the occupied territories.”
On Wednesday, Israel conducted air strikes on Gaza in retaliation for what the military said was the launch of five rockets from Palestinian territory. This followed a two-day operation by the Israel Defense Forces in the West Bank city of Jenin—the largest such raid in that area in years. At least 12 Palestinians and one soldier were reportedly killed.
Just days before, Netanyahu announced that he had received an invitation for an official visit to Beijing—which some observers saw as a reaction to a supposed snub by President Joe Biden—though the Israeli government was vague about the time frame or any of the planning. Netanyahu reportedly told a classified session with Israeli lawmakers that bolstering ties with China will force the United States to remain active in the region.
The Netanyahu trip, if it occurs, will follow a similar visit by Mahmoud Abbas, the leader of the Palestinian Authority. At that meeting in June, Xi indicated that China could serve as a mediator in peace talks aimed at creating a Palestinian state.
Still, China does not have enough of a financial relationship to compel the Israelis to join peace talks, observed Malla, a research scholar at the Centre for West Asian Studies at Jawaharlal Nehru University in New Delhi.
“Even when considering the trade dynamics between Tel Aviv and Beijing, which amount to $18 billion (as of December 2021), with China enjoying a trade surplus of $13.2 billion in exports compared to $5.02 billion in imports, this does not grant Beijing the necessary leverage” to get Israel to the table, the scholar told Middle East Policy in an email interview.
China’s expanding infrastructure development across the Middle East, known as the Belt and Road Initiative (BRI), gives it a general interest in regional stability. “China sees value in resolving the Israel-Palestine conflict as it aligns with its vision for the BRI,” Malla said. “Its interest in playing a part would underscore its seriousness and dedication to the Middle Eastern political actors.”
However, Malla noted, China has far more sway with Saudi Arabia and Iran, whose normalization Beijing helped to broker earlier this year. The Chinese committed more than $5 billion in BRI investments to Saudi Arabia in 2022 alone, while also pumping billions into multiple Iranian oilfield developments since 2000.
Malla anticipated China’s involvement in regional diplomacy well before its recent moves, writing in a Spring 2022 Middle East Policy article that it was only “a matter of time before the results of the proxy wars between Iran and Saudi Arabia force Beijing to turn toward political engagement.”
But experts are skeptical about whether the Chinese are serious about spending political capital to wade into what is seen as the region’s most intractable issue. Chas W. Freeman Jr., the former US ambassador to Saudi Arabia who helmed the Middle East Policy Council for 12 years, believes the move was driven by “global public opinion.”
“There is a global majority that is fed up with this issue and the way it has been mishandled,” Freeman said in June. “You see this in the United Nations. Whether they’re sincere or not, I don’t know. They’re certainly taking a stance that they believe boosts their popularity globally. And I think that’s right; it does.”
Malla concurred. “The US has been perceived as implicitly favoring Tel Aviv and disregarding Israel’s international violations, such as the construction of illegal settlements on Palestinian territories in the West Bank and East Jerusalem, thus rendering the two-state solution largely unviable,” he argued. “This perceived American disinterest in pursuing a just resolution has led Palestinians to question the credibility of US involvement.”
Still, he told Middle East Policy, China’s offer to conduct peace talks “is primarily symbolic in nature.”
“China’s offer of mediation is part of its broader charm offensive in the region,” the scholar contended, “aimed at presenting itself as a viable alternative to the United States as the dominant player in the Middle East, thus bolstering its credentials for global leadership.”
Even if China does not throw its weight behind peace negotiations, Malla sees the “strategic partnership” as offering tangible benefits to the occupied territories. “It would be worthwhile to see whether Beijing follows its assurances and increases economic engagement with the Palestinian government,” he said in the interview. “The bilateral trade between the two has been, at best, nominal, with Chinese exports to the territories valued at no more than $248 million against $348,000 in imports.”
Malla foresees an increase in infrastructure and development aid flowing from China to Palestine, and he expects the economic ties between Tel Aviv and Beijing to remain strong. This requires a level of stability that could force China to exercise more diplomatic engagement, if not involvement in full-fledged talks designed to hammer out a two-state solution, the scholar noted.
Among the major takeaways readers can find in Malla’s Spring 2022 Middle East Policy article:
- Iran and Saudi Arabia have been in competition for dominance in the Middle East for decades, adversaries because of “diametrically opposite political systems and ideological orientations” and regional great-power competition.
- China-Iran relations date back centuries, as the two have long been connected via trade routes like the ancient Silk Road. Today, economic engagement remains central to their relationship.
- Non-energy trade volume has increased from less than $2 billion in the 1980s to $45 billion by 2011.
- China imported $19 billion worth of crude oil and other petrochemical products from Iran in 2013.
- China has also supplied Iran with military equipment and technology, including nuclear development, since the 1979 revolution and the subsequent arms embargo imposed by Western states.
- China-Saudi Arabia relations are far more recent, with Saudi only recognizing the People’s Republic of China (PRC) in 1990. The relationship is built primarily on energy cooperation:
- Riyadh has been the PRC’s largest supplier of crude oil since 2002, fulfilling about 20 percent of the state’s requirements.
- By 2013, the Kingdom was supplying Beijing with 1.3 million barrels per day and as of 2018, it is also Beijing's ninth-largest source of imported goods and services.
- China sees Saudi Arabia as an important ally as it seeks to expand its influence in the Gulf and Africa; it sees Iran as a necessary partner to build economic infrastructure across central Asia.
- The PRC’s lack of historical baggage in the region has been key in developing working relationships with the two rivals.
- This increased engagement, however, makes it difficult for Beijing to remain on the fringes of regional politics, where it has stayed so far.
You can read Mohmad Waseem Malla's article, "China's Approach to the Saudi-Iran Rivalry," in Middle East Policy, available through Wiley.