China Eyes Qatar in its Quest to Build a New Silk Road

[Kuwaiti Girl]

China Eyes Qatar in its Quest to Build a New Silk Road

http://nationalinterest.org/blog/the-buzz/china-eyes-qatar-its-quest-build-new-silk-road-16437

Last year, China decided to establish a Renminbi Clearing Centre in Doha, which was the first financial institution in the Middle East to offer access to Chinese currency and foreign exchange markets. This move is crucial as one of the most important steps taken by China to abet the Silk Road Initiatives is the establishment of the Asian Infrastructure Investment Bank (AIIB), which among its goals is to expand the use of Chinese currency.

Moreover, China and the Gulf Cooperation Council (GCC) countries are at the moment undertaking negotiations for a free-trade agreement, which will likely have positive implications for both Beijing and Doha. The most important of which is that it will abolish customs duties imposed on the two sides’ imports and increase their trade partnership.

With respect to China’s ambition to expand the use of its currency, Beijing hopes that through the RMB clearing centre and currency swap agreements, a growing share of its trade partnership with Qatar will be cleared in RMB. Ultimately, it also hopes that oil and energy exports can be priced in its own currency, lessening trading time and transaction cost. This would also enable Beijing to conduct business with Qatar, and other regional countries, on its own rules.

Yet like the other GCC states which have conducted foreign policies closely aligned to the United States, Qatar has embraced a “Look East” approach, taking stock of the global shift in economic prosperity from North America and Europe to the Far East.

 

[Beidou2020]

China Eyes Qatar in its Quest to Build a New Silk Road

http://nationalinterest.org/blog/the-buzz/china-eyes-qatar-its-quest-build-new-silk-road-16437

Great news