Saudi Arabia announced on Monday a steel manufacturing agreement with a Chinese company. The deal constitutes the latest example of growing cooperation between Saudi Arabia and China.
Saudi Arabia’s state-owned oil company, Aramco, and its sovereign wealth fund, the Public Investment Fund, signed a shareholders’ agreement with Baosteel to establish a steel plate manufacturing complex in eastern Saudi Arabia. The joint venture, which is subject to regulatory approval, will be located in the Ras al-Khair Industrial City. They plan to produce 1.5 million tons of steel per year via natural gas power, Aramco said in a press release.
Why it matters: Saudi Arabia and China are rapidly strengthening their relations. In March, China brokered the relations resumption agreement between Saudi Arabia and Iran. Later the same month, Saudi Arabia’s Cabinet approved the decision to join the China-led Shanghai Cooperation Organization alongside Russia and Iran.
The friendship between the two countries involves energy as well. Saudi Arabia was China’s second-largest oil producer in January and February of this year. The following are some notable energy developments between Saudi Arabia and China in the past year or so:
