Until now, China has never shown much interest in Middle Eastern investment. If it is able to establish a relationship with the Middle East, it can take advantage of arguably one of the most volatile areas in the world. In an area where westerners have long feared to go, China seems very interested in the diplomacy, economics, soft power and security. Upon helping in the war in the Middle East, China has begun to fully immerse themselves in the Middle East in an effort to increase their involvement in the area.
China has began increasing their financial involvement in China as over half of its imported oil comes from the Middle East, while back in 2011 they only accounted for two percent of the total foreign direct investment in the Middle East. China already has large investments in Australian, Brazilian, Canadian, and US energy. As a large, rapidly expanding country, China is looking for energy resources to acquire internationally and the oil-rich Middle East has drawn their attention. The Middle Eastern states that investors are mostly interested in include UAE, Saudi Arabia and Qatar.
China’s emerging markets with energy in the Middle East has raised safety concerns for Beijing and other Chinese cities. More and more countries are decreasing their military involvement in the Middle East, and falling victim to the fears that have been scaring off other investors from getting involved. It is a gamble for China due to the safety and risk of investment, but for a stable China economy it will be a gamble they are willing to take. Do you think the Chinese should go through with Middle Eastern investment? What are other areas they could invest in?