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China pledges $20b to revive Middle East economy

| Updated: July 13, 2018 15:49:25

File Photo (Collected) File Photo (Collected)

Chinese President Xi Jinping has pledged a package of $20 billion (15.12 billion pounds) in loans, and about $106 million in financial aid, to Middle East nations.

The president on Tuesday pledged the loan as part of what he called an “oil and gas plus” model to revive economic growth in the region.

The East Asian country has ramped up engagement in the Middle East in recent years as Arab nations play an important role in Xi’s signature Belt and Road foreign policy plan for strong trade routes linking China with central and Southeast Asia, reports Reuters.

Development was the key to resolving many security problems in the Middle East, Xi told a gathering with representatives of 21 Arab nations in Chinese capital.

He said, “We should treat each other frankly, not fear differences, not avoid problems, and have ample discussion on each aspect of foreign policy and development strategy.”

The Chinese President said that they would offer aid worth $15 million to Palestine to support economic development, besides providing a further $91 million to Jordan, Lebanon, Syria and Yemen.

A consortium of banks from China and Arab nations, with a dedicated fund of $3 billion, will also be set up, he added.

It was unclear what the relationship between the bank consortium, financial aid and the overall loan package would be.

The loans will fund a plan of “economic reconstruction” and “industrial revival” that would include cooperation on oil and gas, nuclear and clean energy, Xi said.

He urged “relevant sides” to respect the international consensus in the Israel-Palestine dispute, and called for it to be handled in a just manner, so as to avoid regional disruption.

China despite its reliance on the region for energy supplies, has been trying to get more involved in resolving long-standing disputes.

The second largest economic country of the world says it sticks to a policy of “non-interference” when offering financial aid and deals to developing countries, which, coupled with development, can help resolve political, religious and cultural tension.

It applies this pattern of economic support, as well as a strict security regime, to its restive western region of Xinjiang.

But rights groups have criticised the approach, saying the clampdown has further stoked, not eased, tension between the Muslim Uighur minority and the ethnic Han majority.

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