Chinese sovereign funds bolster tech ties with Saudi Arabia amid US sanctions

China Investment Corporation and Silk Road Fund held talks with Saudi Arabia’s information technology minister, underscoring growing China-Saudi cooperation.
Chinese sovereign funds bolster tech ties with Saudi Arabia amid US sanctions

China's sovereign wealth fund China Investment Corporation (CIC) and state-owned Silk Road Fund are seeking closer investment cooperation with Saudi Arabia on information technology. 

This was underscored by their leaders’ recent meetings with Saudi communications and information technology minister.

The meetings signal a growing appetite for China-Saudi partnerships in tech and digital sectors, as the two countries look to diversifying economic ties beyond energy and infrastructure.

On July 7, Ju Weimin, president of CIC, one of the world’s largest sovereign wealth funds, met with Abdullah Alswaha, minister of communications and information technology of Saudi Arabia to exchange views on China-Saudi investment cooperation.

On the same day, Alswaha also visited Zhu Jun, chairwoman of SRF to explore future cooperation.

Zhu Jun, chairwoman of China's Silk Road Fund meets Abdullah Alswaha,
minister of communications and information technology of Saudi Arabia on July 7, 2023.
(Source: Silk Road Fund)

SRF is China’s investment vehicle for the Belt and Road Initiative (BRI) supporting the country’s trade and economic cooperation across infrastructure, energy and resources, technology, and industrial development.

At the SRF’s latest annual meeting earlier this month, the fund said it would further increase direct investment in BRI countries and regions.

While continuing to invest in traditional sectors such as energy and infrastructure, SRF said it would also explore investment opportunities in sustainability, green, digital, and healthcare, and support small and medium-sized projects.

CIC and SRF’s meetings with the Saudi official followed the 10th China–Arab States Cooperation Forum and Arab-China Business Conference in Riyadh in mid-June. The latter conference saw the signing of 30 economic and trade agreements between China and Arab entities, worth more than Rmb70 billion ($9.8 billion).

Deals announced during the forum included agreements for Chinese companies to invest in copper mines and renewable energy in Saudi Arabia.

Among them was a $5.6 billion deal between the Saudi Ministry of Investment and Chinese electric vehicle company Human Horizons to establish a joint venture for research, manufacturing, and sales.

High-profile Chinese companies that participated in the conference included Huawei, genomics tech company BGI Group, and artificial intelligence unicorn SenseTime.

Amid ongoing Sino-US tensions, the three companies or their subsidiaries, are among Chinese tech firms sanctioned by the United States limiting their access to US technology. 

During the China–Arab event, BGI Group signed a memorandum of understanding with the Saudi Ministry of Environment, Water and Agriculture to work together in areas such as biological genetic resource conservation, agricultural modernisation, and environmental governance.

In February 2023, SenseTime joined a Hong Kong government delegation’s visit to Saudi Arabia and signed an MOU and letter of intent (LOI) with the King Abdullah Financial District in Riyadh, and Sela, a cultural tourism event management company in Saudi Arabia, respectively.

The agreements are aimed at strengthening existing cooperation in smart cities, digital tourism, entertainment, and AI education.

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