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1 [1] (August 4, 2023)

handle is hein.crs/govemkp0001 and id is 1 raw text is: Congressional Research Service Informing the IegisIative diebate since 1914 0 August 4, 2023 China and the Middle East and North Africa (MENA) The People's Republic of China (PRC or China) has been expanding its diplomatic, economic, and security ties with countries in the Middle East and North Africa (MENA) region since the late 1990s. As in other regions, closer political relationships have accompanied the development of commercial ties between the PRC and MENA countries. For their part, some MENA governments are exploring and embracing China's potential as an addition or alternative to the United States as a partner in some sectors, especially energy and trade. China's growing role in the region, involving both allies and adversaries of the United States, has prompted U.S. policymakers and some Members of Congress to consider how the United States should respond to these shifting relationships. For a more detailed examination of this topic, see CRS Report R47482, Middle East and North Africa-China Relations. Diplomatic Relations The PRC maintains robust bilateral ties with numerous countries in the MENA region, including comprehensive strategic partnerships with Egypt, the United Arab Emirates (UAE), Algeria, Iran, and Saudi Arabia. China also engages several of the region's multilateral groups, including the League of Arab States (LAS) and the Gulf Cooperation Council (GCC). China engages the LAS through the China-Arab States Cooperation Forum, which holds biannual ministerial meetings, annual senior official committee meetings, and several affiliated exchanges. In December 2022, China's top leader, Xi Jinping, traveled to Riyadh to participate in the inaugural China-Arab States Summit and the first China-Gulf Cooperation Council Summit, effectively raising PRC's regular engagement with the LAS and the GCC to the head-of-state level. China has also sought to position itself as a potential peacemaker in the region through an active diplomatic presence. In March 2023, China hosted the signing of an agreement between Iran and Saudi Arabia to reestablish diplomatic relations between the two countries. Some analysts point out that the groundwork for an agreement was laid prior to China's involvement; other commentators have interpreted the move as a sign of China's greater willingness and capacity to engage politically in the MENA region and reap the resulting recognition. In June 2023, Xi Jinping received Palestinian Authority President Mahmoud Abbas in Beijing and put forward a three-point proposal to resolve the Palestinian question. The PRC officially supports and is party to the Joint Comprehensive Plan of Action (JCPOA, a.k.a. the Iran nuclear agreement). Since the United States' withdrawal from the JCPOA in 2018, the PRC has worked hard to help cement the consensus of all parties to safeguard the deal and sought to get the U.S. and Iran to full and effective implementation of JCPOA, according to one PRC diplomat. The PRC has reportedly been the principal purchaser of Iranian crude oil during since 2018, undermining U.S. sanctions policy. In June 2023, the U.S. Department of the Treasury sanctioned 13 Iranian and PRC entities and individuals for facilitating procurement of sensitive parts and technology for actors involved in Iran's ballistic missile program. Economic Relations According to the International Monetary Fund's Direction of Trade Statistics, China's total annual bilateral goods trade volume with countries in the MENA region reached approximately $368.4 billion in 2022, up from $284.3 billion in 2021 and the previous high of $264.6 billion in 2014. For comparison, U.S. trade with the region in 2022 was valued at approximately $144 billion. While the top categories of goods China trades with each country varies, the region's exports to China are concentrated in the energy, mineral, and chemical sectors. The region's imports from China include consumer electronics, advanced machinery, steel, and pharmaceutical products. Unlike the United States, China currently does not have any bilateral free trade agreements with countries in the MENA region. However, the PRC government has pursued a series of initiatives to boost trade with the region on a multilateral basis. China's accession to the World Trade Organization (WTO) in 2001 created market access opportunities by reducing tariffs imposed on PRC imports among WTO countries in the MENA region. To reach non-WTO countries in the region, China has pursued market access opportunities through alternative fora including the Belt and Road Initiative (BRI) and via bilateral agreements such as the Iran-China 25-Year Cooperation Program. Figure I. PRC Investment and Construction Projects $3~O$in millins 20t3 2015 2Oii 2029 2CM1 Source: Created by CRS with data from the China Global Investment Tracker, the American Enterprise Institute, and the Heritage Foundation. Estimates of the total size of China's investment and financing in the region vary. According to the American Enterprise Institute's China Global Investment Tracker, MENA countries received approximately $152.4 billion in investment and construction financing from China between 2013 and 2021 (see Figure 1). The BRI has expanded

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