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SBE, Vol.20, No.1, 2017
ISSN 1818-1228
THE NEW SILK ROAD: CHINA’ ENERGY
POLICYAND STRATEGY IN THE MENA
REGION
Hany Besada
Deputy Executive Director,
Diamond Development Initiative International, Ottawa, Canada
Justine Salam
PhD candidate at the Global Governance Program
at Balsillie School of International Affairs, University of Waterloo, Ontario
Abstract: China is in dire need of energy resources to sustain its growth. In
recent years, China has been turning more to Saudi Arabia and Iran in the Middle
East as well as Sudan in North Africa as trade partners to secure its energy supply
and fuel its increasing growth. This paper explores China’s energy policy in the
Middle East and North African (MENA) region by studying three cases: Sudan
in North Africa, and Saudi Arabia and Iran in the Middle East. Data was obtained
from review of relevant literature. It is found out that China’s oil policy is very
much driven by the Beijing Consensus. China has applied an equity ownership
strategy to have more control over oil flows as a shield against price fluctuations
and to reduce supply interruption. Civil unrest and conflicts in the MENA region
threatens to disrupt China’s energy supply channels, which implies that China
should work for peace in the MENA region to achieve its sustainable energy
supply.
Keywords: Chinese diplomacy, energy policy, Middle East, North Africa, oil
politics
I. INTRODUCTION
With more than 800 billion barrels of crude oil
reserves, the Middle East has already made a
name for itself. In NorthAfrica, Sudan, Algeria,
and Libya have also experienced increasing
number of oil discoveries in the recent decades.
As the second largest economy in the world,
China is in dire need of energy resources to
sustain its growth. Hence, China and MENA
countries encounter mutual interests. Trying to
secure its energy supply and fuel its increasing
growth, China turned to Saudi Arabia and Iran
in the Middle East as well as Sudan in North
Africa as trade partners. In 2013, China was a
dominant trade partner to Saudi Arabia, Iran,
and Sudan: China was the largest of Saudi
Arabia’s trade partners and the third largest
importer of Saudi crude oil; China was the
largest trade partner both of Sudan and Iran, as
well as the largest importer of Sudanese and
Iranian oil.
Since China’s ascension to the world’s top
economies, China’s energy needs have
been studied as part of a growing literature.