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China

Why the Saudi–Iran agreement doesn’t herald an active role for China in the Gulf

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Iranian Foreign Minister Hossein Amir-Abdollahian and Saudi Arabia's Foreign Minister Prince Faisal bin Farhan Al Saud and Chinese Foreign Minister Qin Gang shake hands during a meeting in Beijing, China, 6 April 2023. (Photo:REUTERS)

Author: Guy Burton, Brussels School of Governance

In March 2023, Iran and Saudi Arabia agreed to re-establish diplomatic relations, with China playing a role as the host of the talks. This generated considerable discussion among policymakers and the scholarly community. Some believed this indicated a new change in China’s approach to the Middle East, which has primarily focused on commercial relations.

But the assumption that China is about to take on a more prominent and active role as a conflict mediator in the Gulf region is overstated. Although Beijing hosted the talks that led to the agreement, much of the substantive work had been done earlier, primarily by Iraq and Oman. China’s late involvement was also enabled because the United States does not have relations with Iran, making it difficult for the United States to broker a deal.

China’s participation was like its earlier efforts at regional conflict management. Between 2004–07 it tried to bridge the gap between the international community and the Sudanese regime during the Darfur crisis. Beijing then did something similar in 2013–15 between the West and Iran over the Iranian nuclear program, culminating in the Joint Comprehensive Plan of Action. In both cases, Chinese involvement was helped by a pre-established framework of dialogue and the willingness of each side to involve Beijing.

Discussion since the Saudi–Iran agreement has moved on to how China might guarantee relations between the two rivals. This makes too much of the agreement, which was limited to restarting diplomatic ties. Even if China had the will, it lacks the capacity to impose itself on the two signatories, not least because several grievances persist between them. They include Iran’s creeping nuclear militarisation and their contrary stances over the civil war in Yemen — though there are signs that the two sides may be starting to find some common ground.

Even if China cannot ensure future stability, there are sufficient incentives from within the region that might make this possible. Iran and Saudi Arabia had good reasons to reach an agreement with each other. On the Saudi side, there is a sense that Washington has become less reliable. At the same time, Riyadh realises that diversifying relations is no bad thing Saudi Arabia’s commercial ties have grown substantially with China over the past two decades. Between 2005 to 2022, Chinese investments in Saudi Arabia totalled US$12.78 billion compared to US$4.72 billion in Iran.

Meanwhile, Iran is struggling economically. Between 2012 and 2021 its GDP almost halved, from US$644 billion to US$360 billion, exacerbated by sanctions. It also faced widespread protests against the killing of Mahsa Amini in police custody in 2022, prompting it to crack down on protestors. Compared to the Saudis, Iran has fewer available alternatives. Although it signed an investment contract with China two years ago, there has been little sign that it has led to any substantial increase in resources. Having China host diplomatic talks with the Saudis may have been Iran’s way of staying in Beijing’s line of sight.

The agreement from both sides to involve China will potentially reduce part of the Gulf rivalry while also indicating that China may be becoming aware that its growing economic profile brings with it political implications. China has long sought to avoid becoming entangled in regional tensions and conflicts. But that is proving harder than it seems. Following the Gulf Cooperation Council (GCC) summit with China in December 2022, a joint declaration reiterated the GCC’s long-standing support for the United Arab Emirates’ claims over the Tunb and Abu Musa islands. Tehran also claims these islands and summoned the Chinese ambassador post-announcement.

The Chinese now appear more attentive towards tensions in the Gulf. On the eve of his visit to the Gulf in 2021, then foreign minister Wang Yi published China’s Five-Point Plan. It referred to the need for collective and regionally generated security in the Gulf. Wang pointed to the need for a ‘trust mechanism’ along with ‘safety for oil facilities and shipping lanes’.

While it is notable that China was involved in the final stages of the reestablishment of diplomatic relations between Saudi Arabia and Iran, it is important not to exaggerate either the nature of the agreement nor China’s role in the region. Other regional conflicts, like those in Syria, Israel–Palestine, Libya or Yemen are likely to remain beyond Chinese intervention.

So long as conflicting…

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Trends and Future Prospects of Bilateral Direct Investment between China and Germany

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China and Germany experienced a decline in direct investment in 2023 due to global economic uncertainty and policy changes. Despite this, China remains an attractive destination for German FDI. Key industries like automotive and advanced manufacturing continue to draw investors, although FDI outflows from Germany to China decreased by 30% in the first three quarters of 2023. Despite this, the actual use of foreign capital from Germany to China increased by 21% in the same period according to MOFCOM. The Deutsche Bundesbank’s FDI data and MOFCOM’s actual use of foreign capital provide different perspectives on the investment trends between the two countries.


Direct investment between China and Germany declined in 2023, due to a range of factors from global economic uncertainty to policy changes. However, China remains an important destination for German foreign direct investment (FDI), and key industries in both countries continue to excite investors. We look at the latest direct investment data between Germany and China to analyze the latest trends and discuss key factors that could shape future business and commercial ties.

Direct investment between China and Germany has undergone profound changes over the past decade. An increasingly complex investment environment for companies in both countries has led to falling two-way FDI figures in the first three quarters of 2023, in stark contrast to positive trends seen in 2022.

At the same time, industries with high growth potential, such as automotive and advanced manufacturing, continue to attract German companies to China, and high levels of reinvested earnings suggest established firms are doubling down on their commitments in the Chinese market. In Germany, the potential for electric vehicle (EV) sales is buoying otherwise low investment among Chinese companies.

According to data from Deutsche Bundesbank, Germany’s central bank, total FDI outflows from Germany to China fell in the first three quarters of 2023, declining by 30 percent to a total of EUR 7.98 billion.

This is a marked reversal of trends from 2022, when FDI flows from Germany to China reached a record EUR 11.4 billion, up 14.7 percent year-on-year.

However, according to China’s Ministry of Commerce (MOFCOM), the actual use of foreign capital from Germany to China increased by 21 percent year-on-year in the first eight months of 2023. The Deutsche Bundesbank’s FDI data, which follows standards set by the IMF, the OECD, and the European Central Bank (ECB), includes a broader scope of transactions within its direct investment data, including, broadly, direct investment positions, direct investment income flows, and direct investment financial flows.

Meanwhile, the actual use of foreign capital recorded by MOFCOM includes contracted foreign capital that has been concluded, including the registered and working capital paid by foreign investors, as well as the transaction consideration paid for the transferred equity of domestic investors.

This article is republished from China Briefing. Read the rest of the original article.

China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.

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Manila blasts China’s ‘unprovoked aggression’ in latest South China Sea incident

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China’s coast guard on Saturday fired a water cannon at a Philippine supply boat in disputed waters in the South China Sea, causing “significant damages to the vessel” and injuring its crew, the Philippine coast guard said.

Manila was attempting to resupply troops stationed on a ship at the Second Thomas Shoal, known locally as Ayungin Shoal, when the Chinese coast guard and maritime militia “harassed, blocked, deployed water cannons, and executed dangerous maneuvers against the routine RoRe (rotation and resupply) mission,” said the Philippine National Task Force for the West Philippine Sea.

The West Philippine Sea is the part of the South China Sea that Manila claims as its jurisdiction.

The Chinese coast guard also set up “a floating barrier” to block access to shoal where Manila ran aground an old warship, BRP Sierra Madre, to serve as a military outpost.

The Philippine task force condemned China’s “unprovoked aggression, coercion, and dangerous maneuvers.”

Philippines’ RoRe missions have been regularly blocked by China’s coast guard, but this is the first time a barrier was set up near the shoal. 

The Philippine coast guard nevertheless claimed that the mission on Saturday was accomplished.

Potential consequences

The Second Thomas Shoal lies within the country’s exclusive economic zone where Manila holds sovereign rights. 

China, however, claims historic rights over most of the South China Sea, including the Spratly archipelago, which the shoal forms a part of.

A Chinese foreign ministry’s spokesperson on Saturday said the Philippine supply vessel “intruded” into the waters near the shoal, called Ren’ai Jiao in Chinese, “without permission from the Chinese government.”

“China coast guard took necessary measures at sea in accordance with law to safeguard China’s rights, firmly obstructed the Philippines’ vessels, and foiled the Philippines’ attempt,” the ministry said.

“If the Philippines insists on going its own way, China will continue to adopt resolute measures,” the spokesperson said, warning that Manila “should be prepared to bear all potential consequences.”

Chinese Maritime Militia vessels near the Second Thomas Shoal in the South China Sea, March 5, 2024. (Adrian Portugal/Reuters)

U.S. Ambassador to the Philippines MaryKay Carlson wrote on social media platform X that her country “stands with the Philippines” against China’s maneuvers.

Beijing’s “interference with the Philippines’ freedom of navigation violates international law and threatens a free and open Indo-Pacific,” she wrote.

Australian Ambassador to the Philippines Hae Kyong Yu also said that Canberra shares the Philippines’ “serious concerns about dangerous conduct by China’s vessels adjacent to Second Thomas Shoal.” 

“This is part of a pattern of deeply concerning behavior,” Yu wrote on X.

Edited by Jim Snyder.

Read the rest of this article here >>> Manila blasts China’s ‘unprovoked aggression’ in latest South China Sea incident

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Foreigners in China: 2024 Living and Working Guidelines

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China’s Ministry of Commerce released updated guidelines for foreign businesspersons living and working in China in 2024. The guidelines cover accommodations, visas, work permits, and emergency protocols. It also outlines responsibilities regarding social security premiums and individual income tax obligations. prompt registration for temporary accommodation is required upon arrival.


The updated 2024 guidelines for foreign businesspersons living and working in China, released by the country’s Ministry of Commerce, outline essential procedures and considerations covering accommodations, visas, work permits, and emergency protocols.

On January 25, 2024, China’s Ministry of Commerce (MOFCOM) released the latest version of the Guidelines for Foreign Businessmen to Live and Work in China (hereinafter referred to as the “guidelines”).

The document is divided into four main sections, labeled as:

Furthermore, the guidelines elucidate the regulatory framework governing foreign businessperson’s responsibilities concerning social security premiums and individual income tax obligations.

This article provides a comprehensive overview of the guidelines, delving into their significance and implications for foreign businesspersons in China.

Upon arrival in China, prompt registration for temporary accommodation is required.

If staying in a hotel, registration can be facilitated by the hotel staff upon presentation of a valid passport or international travel documents.

This article is republished from China Briefing. Read the rest of the original article.

China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.

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