Saturday, Chinese ruler Xi Jinping completed his triumphal three-day state visit to Saudi Arabia.
As a result of the "pioneering trip"—Xi's characterization in his op-ed appearing in Saudi media—Beijing could eject America from the region, China might take over Washington's place there, and the renminbi appears set to end the dollar's reign as the world's reserve currency. The Chinese Communist Party could also rescue its quickly failing economy.
Xi's trip, in short, highlights what could end up being the most damaging setback for America's global standing in the three decades since the Cold War.
America on January 20, 2021 transitioned from perhaps the most successful Middle East policy to what is turning out to be the very worst. President Donald Trump's Abraham Accords stabilized much of the Middle East and parts of Africa—specifically, Sudan and Morocco—while undermining Iran's terrorist regime, which considers the U.S. its enemy. Washington's relations with the Saudi kingdom were especially warm during the Trump years.
Trump's successor, however, sharply reversed course. "President Biden walked away from the massive gains the U.S. had made with the Abraham Accords," Gregory Copley, the president of the International Strategic Studies Association, told Newsweek.
Biden in his early months in office tried to make Saudi Arabia a "pariah"—following a 2020 campaign promise—and worked to bolster the kingdom's archenemy, Iran. The resulting stress could end an eight-decade partnership that began in 1945, when President Franklin Delano Roosevelt and King Ibn Saud met on an American warship in the Suez Canal. "Our children and grandchildren will be paying the price for Biden's blunders for generations to come," Jonathan Bass of InfraGlobal Partners, an energy consultant, told this publication.
America is already paying a price. In early October, the Riyadh-led OPEC, working with Russia as a member of OPEC+, cut production by two million barrels per day—about 2% of global output. Biden wanted the organization to increase pumping, in part to undermine the Russian war effort in Ukraine. The cartel's flat rejection of the American president's request stood in stark contrast to Saudi help during the 1980s when the kingdom, at President Reagan's urging, ramped up energy production to reduce Soviet revenue.
During his trip, Xi Jinping met Saudi King Salman and participated in the China-Gulf Cooperation Council Summit and the first China-Arab States Summit. China signed 34 agreements and memoranda of understanding contemplating $29.3 billion in investment. Some of the deals are significant. For instance, Huawei Technologies, China's "national champion" telecom equipment maker, will provide cloud computing services and help build high-tech complexes in Saudi cities.
The two countries symbolically inked a comprehensive strategic partnership agreement.
The deals come at an especially important time for the Chinese Communist Party, which is failing to rescue a fast-contracting economy. The Arab states, therefore, can be saviors of Chinese communism.
The Arab states can also lift the Chinese currency from obscurity. During the trip, Xi said that China would soon be paying for oil and gas with renminbi, the largely nonconvertible Chinese currency that so far has not made much of a dent against the U.S. dollar. Currently, China, like other countries, pays for energy in greenbacks. Once the region starts accepting "redbacks," however, the dollar gets pushed from center stage.
"In the region, the Xi meeting was considered a phenomenal success," Bass, who just returned from a trip to the Sunni Gulf states, said. "The achievement is all the more spectacular because no one there really trusts Beijing. They much prefer America."
Why? First, on the most fundamental level, China is the primary backer of Iran, which funnels Beijing's cash to Saudi adversaries, such as Syria, Hezbollah, and Hamas. The relevant Sunni Arab players in the region all know their primary threats are largely funded by the Chinese government.
Second, Saudi Arabia and others feel they are already too dependent on China for goods and want to diversify their sources of supply.
Last week, however, Saudi Crown Prince Mohammed bin Salman, de facto leader of the kingdom, went out of his way to welcome Xi Jinping, giving the Chinese president a far better reception than the one he offered President Biden in July.
"They are saying to America, act and act quickly," Bass said. "They are hopeful that somebody in Washington will realize how bad the situation is."
In fact, many in America's foreign policy community—and even some in the Biden administration—are concerned by Biden's new course, which has, among other things, created a vacuum in the region for bad actors to fill.
Unfortunately, misguided policy is not the only American problem at the moment. Americans and Europeans are simply not focused on supporting the efforts of Saudi Arabia and the five other Gulf Cooperation Council countries to move away from energy extraction as the cores of their economies. Riyadh, for instance, needs tech and know-how to implement its "Vision 2030" economic plan. If American companies are not interested in helping, Chinese state enterprises, prodded by Beijing, will be. China is offering turn-key solutions to bring in everything the region needs.
A patient China was prepared for Biden's wrong turn. "Xi Jinping has made many missteps, but his consistent courting of Saudi Arabia is not one of them," said Copley, also editor-in-chief of Defense & Foreign Affairs Strategic Policy. "Xi, after a decade of steady diplomacy, has finally taken advantage of the situation."
"All of this was a show to get America to react," said Bass, referring to the Saudi kingdom's warm embrace of China's leader last week. "If America doesn't react, it becomes reality."
Gordon G. Chang is the author of The Coming Collapse of China. Follow him on Twitter: @GordonGChang.
The views expressed in this article are the writer's own.
Uncommon Knowledge
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
