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Abu Dhabi, UAEMonday 16 July 2018

China pledges $20 billion in loans to Arab states at Beijing summit 

UAE stresses importance of Beijing's strategic importance to the region  

Chinese President Xi Jinping on Tuesday pledged a package of US$20 billion (Dh73.46bn) in loans, and about $106 million in financial aid, to Middle East nations, as part of what he called an "oil and gas-plus" model to spur economic growth in the region.

Beijing has ramped up engagement in the Middle East in recent years, as Arab nations play an important role in Mr Xi's signature Belt and Road foreign policy plan for strong trade routes linking China with central and South-East Asia.

Development was key to resolving many security problems in the Middle East, President Xi told a gathering of representatives of 21 Arab nations — including the UAE and Saudi Arabia — in the Chinese capital.

"We should treat each other frankly, not fear differences, not avoid problems, and have ample discussion on each aspect of foreign policy and development strategy," he said.

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The UAE's delegation, headed by Minister of State Dr Sultan Al Jaber, stressed the importance of having China as a strategic partner to the region.

"We meet today with regional and global challenges in our midst," he said, adding that the most prominent of which is the spread of terrorism and extremism.

Saudi Arabia's Foreign Minister, Adil Al Jubeir, echoed Dr Al Jaber's statement: "Beijing is a political, security and economic partner."

"The crises and challenges that China and the Arab world have experienced are identical," Mr Al Jubeir said, adding that "both the Arabs and the Chinese aspire to strengthen and intensify their cooperation in all fields."

President Xi Jinping said that Beijing would offer aid worth 100 million yuan ($15m) to Palestine to support economic development, besides providing a further 600m yuan to Jordan, Lebanon, Syria and Yemen.

A consortium of banks from China and Arab nations, with a dedicated fund of $3bn, will also be set up, he said.

It was unclear what the relationship between the bank consortium, financial aid and the overall loan package would be.

The loans will fund a plan of "economic reconstruction" and "industrial revival" that would include co-operation on oil and gas, nuclear and clean energy, Mr Xi said.

He urged "relevant sides" to respect the international consensus in the Israel-Palestine dispute, and called for it to be handled in a just manner, so as to avoid regional disruption.

China, which has traditionally played little role in the Middle East conflicts or diplomacy, despite its reliance on the region for energy supplies, has been trying to get more involved in resolving long-standing disputes.

China says it sticks to a policy of "non-interference" when offering financial aid and deals to developing countries, which, coupled with development, can help resolve political, religious and cultural tension.

On Monday, Mr Xi held talks with Kuwaiti Emir Sheikh Sabah, agreeing to establish a strategic partnership between the two countries. The countries said they planned to find areas where the Belt and Road initiative and Kuwait Vision 2035 can intersect.

They will also work to promote the establishment of a China-GCC free trade area.