Considerably, President Xi has called upon the Arab countries to commence with negotiations for a free trade agreement between China and the Arab countries. Such negotiation is part of President Xi’s larger strategy of exerting its economic influence to negotiate “free trade” agreements with major regions around the globe.

In lieu of cooperating in OBOR projects countries receive preferential financing including grants, interest-free and concessional loans, and other forms of government funding. They also receive a full development package to strengthen their economy. For instance, UAE, which is China’s second largest trading partner in the region that handles 60 per cent of China’s reexports to Europe and Africa with an estimated value of $70 billion each year. China has signed a $300 million deal to develop a manufacturing operation in the free trade zone of Khalifa Port, on the heels of China’s COSCO shipping winning rights ($738 million) to develop and operate a new container terminal for 35 years. While most shipping companies own/ operate terminals and ports on foreign terrain as shipping-centric operations, China differs in that they open new ports and invest in adjoining free trade/ special economic zone and other development initiatives as well so that host countries get the entire development package24.

China is an old ally of Iran and has vested interests, along with Russia, in Iran’s oil and gas industry. China is financing the upgrading of the Tehran-Mashhad railway along with China’s Exim Bank lending US$1.5 billion for the lines electrification. The track of 2,300 km line will eventually link Urumqi, the capital of China’s western Xinjiang Province, to the Iranian capital Tehran, connecting Kazakhstan, Kyrgyzstan, Uzbekistan and Turkmenistan along the way25.

The proposed railway project is supposed to run from Tehran and join Iran’s east-west network leading west to Turkey and Eastern Europe. It is also expected to open a way to Europe by a developing rail route from the southern Iranian ports to Azerbaijan and Europe. Further linking with the Iran’s North-South Transport Corridor, this runs from Chabahar Port north to Azerbaijan. Towards the east, this links up with the also Chinese funded, low key Lapis Lazuli Corridor.

The rail project will extend from Tehran into Turkey and across the borders with the European Union. Additionally, Turkey is also being linked with rail freight lines running north through China and across Kazakhstan, to Baku in Azerbaijan. The Baku-Tbilisi-Kars Railway provides a direct link to Europe from China, via Turkey as it connects through a cross-Turkey. A high-speed rail service is being constructed by China, connecting Kars with Edirne, near Turkey’s border with Bulgaria and Greece. Bilateral trade between Turkey and China was recorded at US$26.3 billion in 2017. Turkey’s export to China was around US$3 billion while its imports from China exceeded US$23 billion.

China has extensively invested in Syria for developmental purpose. According to Ellis, this is «an opportunistic and geopolitical play; opportunistic as Chinese contractors are looking at reconstruction projects to rebuild the country after its devastating civil war, and geo-political as China recognizes that Syria can provide an alternative route to Europe than the Suez Canal»26. This region is being developed by the Chinese with a Special Economic Zone which is being built in Tripoli Port, and plans to rebuild the Tripoli-Homs Railway. The zone provides Chinese and other regional businesses with low tax options for consolidating and adding value to component parts sourced elsewhere to then be exported to Syria. As per the estimate of the United Nations, it will coast around US$250 billion to rebuild the region. As Syria is oil rich region, China can initiate with the infrastructure building and in return secure energy supplies. Meanwhile, develop a secondary route to the Mediterranean and southern Europe.