On the surface, Chinese President Hu Jintao's invitation to Yemeni President Ali Abdullah Saleh for his historic six-day long visit to China in April represents a natural extension of Beijing's efforts to increase its energy security amidst tightening global energy supplies. Beijing's goal of expanding trade relations and seeking additional consumer markets for Chinese goods was another theme in the talks with Sanaa.
China's stake in Yemen, however, goes far beyond the energy and trade spheres; Beijing is determined to strengthen its role as an emerging political and diplomatic player in the Middle East. Beijing's diplomatic and economic overtures to Yemen provide a glimpse into China's grand strategy in the region.
Beijing Courts Sanaa
Oil topped the agenda of President Hu's recent visits to Morocco, Nigeria, Kenya and Saudi Arabia, as the world's second-leading importer of crude strives to ensure a steady stream of supplies to satisfy Chinese demand (al-Jazeera, April 22). Compared to its neighbors, however, Yemen's yield of approximately 400,000 barrels per day makes it a modest player on the international oil markets (U.S. EIA, Statistics 2006). A lack of investment over the years has also stymied further export potential for crude. Nevertheless, increasing Chinese and global demand for crude are raising the profile and importance of all oil producers, including marginal producers such as Yemen. Yemen is also seeking investment to exploit its potential as a major exporter of Liquefied Natural Gas, another area of growing Chinese interest (Yemen Times, April 5, 2003).
To this end, the recent talks culminated in a series of lucrative trade and commercial agreements to include an array of joint ventures between Chinese and Yemeni businesses, particularly in the area of oil and gas exploration and improving the productivity of old oil wells and refining capabilities. China's oil giant Sinopec will expand its growing presence in the Yemeni oil market. Sinopec already signed a US$72 million contract in January 2005 to expand its oil prospection and production operations in Yemen's eastern region. With a $120 million investment, Beijing has also agreed to finance the modernization of a cement factory. Two major investments in the electricity sector totaling approximately $186 million were also finalized (Lebanon's Daily Star, March 24). Other deals included Chinese ventures in Yemen's telecommunications and mineral sectors and an agreement to enhance technology cooperation and transfer (Yemen Times, April 9; Xinhua, April 7).
In a move characteristic of Chinese public diplomacy elsewhere in the Middle East, Hu emphasized the ancient tradition of commerce linking China and Yemen, which stems back to the sixth century through the silk trade and the Port of Aden's historic role as a commercial hub in the region. Hu went on to praise Yemen for being one of the first countries to establish relations with the People's Republic of China (PRC) and emphasized growing trade ties between the two countries, which topped $3.4 billion in 2005, up from approximately $800 million in 2004 (Yemen Times, April 9; Arab News, September 10, 2004).
Beijing's Middle East diplomacy highlights converging interests on a host of vital issues affecting China and Yemen. Among other things, China has traditionally been vocal in its support of the Yemeni and Arab position on the conflict between the Israelis and Palestinians—namely, Beijing's criticism of Israel's continued occupation of Palestinian land as a key impediment to a lasting peace. China will host a Palestinian delegation, including a senior representative from Hamas, during the upcoming Arab-China Cooperation forum in Beijing (al-Jazeera, May 17).
Likewise, Sanaa supports the "One China" principle and regards Taiwan as a sovereign part of Chinese territory. A key facet of Chinese diplomacy in the Middle East and elsewhere is securing support for the principle of "One China" in order to sideline Taiwan diplomatically in the international arena. Yemen also sides with Beijing in its dispute with the international community regarding Tibet and China's human rights record. During a five-day visit to Sanaa in March by a delegation led by Wang Jiarui, head of the International Department of the Communist Party of China (CPC), Chinese dignitaries thanked Yemen for its loyal support for China on the issue of Taiwan, Tibet and human rights (Xinhua, March 8).
Yemen's Strategic Significance
China's growing interest in Yemen is not only related to its strategy of strengthening its economic and energy ties to the oil-rich countries of the Arabian Peninsula and the greater Middle East; given Yemen's location, it is also part of Beijing's efforts to project power in the Horn of Africa. China's strong economic and military ties to Sudan and expanding relations with Kenya are a critical component of this strategy.
Yemen occupies a vital strategic position because of its location on the southwestern side of the Arabian Peninsula and across the shore from the Horn of Africa, adjacent to the Red Sea chokepoint known as the Bab al-Mandab and busy shipping lanes connecting the Suez Canal in the north stretching to the Arabian Sea and Indian Ocean. As it has demonstrated by its presence in the Panama Canal Zone and the Egyptian Suez Canal, China places a premium on establishing footholds in or near strategic communication and commercial chokepoints across the globe. Yemen's position adjacent to the Bab al-Mandab fits this larger pattern of Chinese strategic thinking.
Yemen and the Horn of Africa have also become areas of vital concern for U.S. planners since the September 11 attacks. Countries such as Djibouti are already home to a sizeable U.S. military presence that is likely to grow as Washington looks to reduce its footprint in areas where force deployments pose political burdens to allied host governments amidst popular opposition to U.S. troops and policies in the region. In this context, China's inroads into Yemen must be seen as an attempt by Beijing to diplomatically offset growing U.S. influence in the region. Ongoing violence and instability in Sudan and Somalia, and the region's history as a base of operations for terrorist organizations such as al-Qaeda and maritime piracy, have also raised its profile. Yemen, the ancestral home of Osama bin Laden, is also regarded as a hotbed of radical Islamists and al-Qaeda activity.
Yemen Looks to China
Sanaa has been quick to realize the economic benefits of expanding relations with Beijing. Yemen sees a potential for greater Chinese investment, which would provide a needed boost to its fledgling economy. China is now Yemen's largest trading partner. According to Jazim al-Najar, Yemen's foreign trade director general, trade between both countries has been growing at an annual rate of 20.7 percent since 1999. This includes a 100 percent increase in Yemeni exports to China and an over 400 percent increase in Chinese exports to Yemen (Yemen Observer, April 4).
During meetings with Chinese businessmen in Beijing and Hong Kong, President Saleh offered free land to investors willing to invest at least $10 million in the local economy. Yemen also secured Chinese assurances that it will provide millions in economic development aid and a series of low interest loans. Yemeni businessmen accompanying Saleh during the trip were also promised greater access to the Chinese market (Yemen Times, April 10).
There is a geopolitical component to Yemen's stake in closer ties to China. Yemen sees an emerging China as a counterweight to U.S. bilateral pressure and overall involvement in the region. According to a recent report issued by Yemen's Ministry of Production and Commerce, U.S. security support far outweighs its economic assistance, which is predicated on Sanaa meeting a number of criteria, including expanding political reforms (NewsYemen, April 6).
The United States broke off ties with Yemen between 1991 and 1996 in retaliation for Sanaa's position in the Gulf War. Both countries have since established close relations. Despite its strong ties with Washington, which include close military and intelligence cooperation, Sanaa often faces criticism from the Bush administration for allegedly failing to do enough in the war on terrorism. The February escape of convicted members of al-Qaeda—implicated in the October 2000 attack against the USS Cole in the Port of Aden and the October 2002 strike against the French oil supertanker Limburg off the southeast coast of the country—from a prison in the capital has shed light on what many in the Bush administration see as Yemen's inability to deal with a dangerous radical element within its borders. The United States is also critical of Yemen's reported lack of progress toward greater political reform, another sore point in relations between the two countries.
Yemenis harbor deep resentment toward the United States for its longstanding policies in the Middle East, especially for Washington's staunch support of Israel and for the invasions of Afghanistan and Iraq. Sanaa hopes that China will eventually challenge the United States on issues such as the Palestine-Israel conflict and Iraq, which would help defuse tensions at home. Yemen also sees China as a positive example to emulate in terms of political and economic development. Some Yemenis are even calling for the establishment of a "Yemen-China Center" in Yemen to encourage a greater Chinese role in the country (Yemen Times, March 10, 2005).
These geopolitical and domestic factors make it difficult for Sanaa to maneuver between its commitments to Washington and the growing disenchantment and frustration among Yemenis for its unpopular pro-U.S. stance. In this sense, Beijing sees a window of opportunity to enhance its position, while Sanaa hopes to decrease dependence on Washington. Sanaa also welcomes China's apparent disregard for developments in Yemen's political reform process and internal affairs more generally.
By all accounts, the burgeoning relationship between China and Yemen will continue to flourish. Without providing further details, Yemeni sources even hinted at the potential for greater security cooperation (Lebanon's Daily Star, March 24). Although it is unlikely that ties between China and Yemen will expand dramatically in the security sphere in the foreseeable future, Beijing will continue to see Sanaa as a useful strategic partner in furthering its regional agenda.