Beijing: China’s plans to set up a free trade zone for Arab countries in the province of Ningxia will be discussed at a five-day trade show starting today.
The China-Arab States Economic and Trade Forum will also look at issues relating to expanding China’s Halal food industry, trading in the yuan and joint financing of major construction projects in the Middle East region including in Egypt, Tunisia and Libya.
The event, which is being attended by national companies from the UAE such as Adnoc, Borouge and Julphar, will also look at cooperation between companies in China and the Gulf Cooperation Council (GCC) in the fields of technology and chemical production. The UAE delegation will be led by Abdullah Ahmad Al Saleh, under-secretary in the Ministry of Foreign Trade, who is also expected to address the forum.
Wang Zhengwei, Chairman of the People’s Government of Ningxia Hui Autonomous Region, told reporters that the turmoil in the Middle East and North Africa region will not affect the Forum attendance.
He said that Ningxia will provide preferential taxation policies to businesses from the Arab countries and take this opportunity to turn itself into a design, manufacturing, exposition and logistics hub to serve Arab and Muslim countries, he said. Though the forum organisers and the local government are not saying it explicitly, Chinese producers are expected to persuade Arab buyers to deal in yuan.
Beijing has been trying to get more countries on board for its drive to make the yuan an international currency, and persuade the International Monetary Fund to include it as a part of the basket of currencies for Special Drawing Rights.
The last few years have seen massive expansion of Chinese investments and export of labour to Arab countries. China is also trying to build an Islamic finance industry of its own through exchanges with financing companies in the Gulf region and other Muslim countries.
Balance of trade
But this has not satisfied Beijing, which wants a big increase in trade with the region to partly make up for the loss of markets Chinese exporters are suffering due to weakening economic situation in the US and Europe. The total trade between China and the six nations of the GCC reached $92.5 billion (Dh339.47 billion) in 2010 accounting for 63.6 per cent of the total Sino-Arab trade volume.
At the fair, the Chinese government will do its bit to encourage purchase of Arab goods to ensure that its relationship with the countries concerned do not get bogged down in disputes concerning the balance of trade, which is what has happened in the case of China’s links with the US and some countries in Europe and Asia.
Goods from the Arab world will be on display along with those from China at an exhibition that will run concurrent with the conference.
The writer is a journalist based in China.