Is China Negotiating Arms Deals with Saudi Arabia and Egypt?

China is reportedly in talks with Saudi Arabia and Egypt to finalize major arms deals, as these countries try to diversify their arms supplies so as to be less dependent on the United States and Russia.

According to Tactical Report, a Beirut-based intelligence service specializing in the Middle East, Saudi Arabian Military Industries (SAMI) is in talks with China North Industries Group Corporation (Norinco), a state defense company, to buy weapons ranging from drones for reconnaissance to air defense systems.

Weapons involved in the potential deal include the Sky Saker FX80 unmanned aerial vehicle (UAV), the CR500 vertical takeoff and landing (VTOL) UAV, the Cruise Dragon 5 and 10 – two types of reconnaissance munitions, better known as suicide drones – and the HQ-17AE Short Range Air Defense (SHORAD) system, the service reported last week.

The SHORAD HQ-17AE is the latest addition to the deal, which has been under negotiation for close to a year, and talks have “reached an advanced stage,” according to Tactical Report, citing unnamed sources close to the situation.

Is China Negotiating Arms Deals with Saudi Arabia and Egypt?

According to the report, negotiations are expected to continue until the end of this year or early next year, which added that there were rumors that the entire deal would be financed in Chinese yuan.

In another report, Tactical Report claimed that Egypt was in talks with China to purchase the Chengdu J-10C multi-role fighter.

Continuing the talks that started late last year, a delegation from the Egyptian Air Force is expected to meet the Chengdu Aircraft Industry Group representatives on the sidelines of the Langkawi International Maritime & Aerospace Exhibition in Malaysia this week.

During the meeting, the Chinese company will reveal the latest improvements to the J-10C, including its advanced electronic warfare system and Active Electronically Scanned Radar (AESA), as Egypt is interested in 12 of these fighters, according to the report, which cites anonymous sources.

Although the United States remains the world’s leading arms exporter, analysts say China has emerged as an alternative supplier because it offers affordable advanced weapons without political strings attached.

“China is willing to sell high-tech weapons equipment to friendly nations without any political conditions, which I think is the main attraction for the Middle East,” said Song Zhongping, a former instructor with the People’s Liberation Army (PLA).

Saudi Arabia, which is the world’s biggest defense spender, has sourced weapons from various countries, though mainly from the United States.

But Riyadh is seeking to diversify its sources of weapons amid rising tensions with Washington following the death of journalist Jamal Khashoggi in 2018 and in light of last year’s Opec+ oil dispute.

Chinese media reported last year that Saudi Arabia bought $4 billion worth of weapons from China – far more than its previous arms deals – following the Zhuhai air show in November.

“Funding the deal with the Chinese yuan could help remove the influence of the US dollar, preventing the US from using the currency as a suppression and restraint tool,” Song said.

According to Stockholm International Institute for Peace Research data, the top five arms exporters in 2018-22 were the United States, Russia, France, China and Germany. Together they supplied 76% of world arms exports.

During the five-year period, the United States supplied 40% of world arms exports, with Saudi Arabia, Japan and Australia being the main recipients. China accounted for 5.2% of global arms exports, with Pakistan, Bangladesh and Serbia being the main recipients.

Egypt, amid an eastern Mediterranean maritime dispute with neighboring Libya, ranked sixth by share of global arms imports for 2018-22 after India, Saudi Arabia, Qatar, Australia and China.

Egypt has mainly sourced weapons from Russia, France and Germany but is looking to China as the war in Ukraine has restricted Moscow’s ability to make military hardware for customers, analysts say.

Jane Cai