Saudi Arabia And China Enhance Industrial Cooperation To Boost Economic Growth

Saudi Arabia and China have enjoyed a robust relationship for over 75 years, formalising their political ties in 1990. This partnership reached new heights in December 2022 when President Xi Jinping attended the China-Arab States Summit in Saudi Arabia. The summit resulted in a Comprehensive Strategic Partnership Agreement (CSP) and $30 billion in deals, focusing on cooperation across various sectors.

Currently, Minister of Industry and Mineral Resources Bandar Al Khorayef is leading a high-level delegation to China. This visit aims to strengthen trade relations and economic partnerships with Chinese leaders, highlighting the depth of their alliance. Emphasis is placed on trade, industry, and investment during this engagement.

In recent years, bilateral trade between Saudi Arabia and China has seen significant growth. It increased from $42 billion in 2016 to $107.5 billion in 2024. China has become Saudi Arabia's largest trading partner due to its demand for Saudi crude oil and petrochemical products. Meanwhile, Saudi Arabia imports Chinese machinery, electronics, transport equipment, and industrial inputs.

The alignment of national agendas further drives this trajectory. China's Belt and Road Initiative and Saudi Arabia’s Vision 2030 provide frameworks for cooperation in areas like advanced manufacturing, clean energy, technology transfer, and mining. These strategies foster collaboration opportunities that benefit both nations.

The rise of Chinese investment in Saudi Arabia underscores the strength of their partnership. Over 750 Chinese companies operate within the Kingdom across sectors such as construction, technology, industrial manufacturing, and natural resources. In 2024 alone, Chinese investment increased by 29%, reaching $8.26 billion.

This investment growth reflects China's confidence in Saudi Arabia's market—the largest in the Middle East—and highlights the Kingdom's stable economy and ambitious diversification plan under Vision 2030. Major projects like NEOM also attract Chinese contributions.

Jazan City: A Hub for Industrial Cooperation

A key element of their cooperation is Jazan City for Primary and Downstream Industries on the Red Sea coast. This industrial hub aligns with China's Belt and Road Initiative and hosts a dedicated Chinese Enterprise Special Development Zone for steel, petrochemical, silicon, and shipbuilding services.

Jazan's strategic location near Africa, Europe, and the MENA region makes it vital for global supply chains. It provides a secure base for industrial operations while facilitating product exports to regional markets. This enhances both nations' commercial reach.

Showcasing Opportunities at Shanghai Event

The current visit serves multiple purposes: reinforcing Saudi Arabia’s role as a trusted economic partner while encouraging further Chinese investment in industrial sectors. Al Khorayef will attend the Industrial Automation Show in Shanghai to showcase Saudi Arabia's vast industrial opportunities.

He will inaugurate the Saudi Pavilion to highlight the Kingdom’s National Industrial Strategy, advanced manufacturing ecosystem, and growing mining sector. This positions Saudi Arabia as a global hub for innovation and critical minerals to international investors.

Despite global economic pressures over the years, Saudi Arabia and China have maintained positive bilateral relations. As they look ahead, their focus shifts towards innovation, sustainable growth, and integrated industrial sectors. The Minister of Industry's engagement reaffirms Saudi Arabia’s commitment to nurturing its relationship with China for long-term prosperity.

With inputs from SPA