Despite reservations, Egypt aspires for more cooperation with China and moving away from the West

Chinese Prime Minister Li Qiang has concluded a two-day visit to Egypt, one on which Cairo and Beijing place a great deal of hope, believing it will serve their economic interests and advance their political visions in an international landscape undergoing rapid change.

In Cairo, the Chinese PM met his Egyptian counterpart, Moustafa Madbouli, on Wednesday, and Egyptian President, Abdel Fattah al-Sisi, on Thursday.

At the centre of discussions between the Chinese premier and the Egyptian officials he met during his two-day visit were economic, investment, and trade relations, as well as political developments in the region.

Premier Li's visit to Cairo coincided with the Egyptian capital and Beijing's preparations to mark 70 years of diplomatic relations next year.

According to Egyptian observers, this anniversary should propel these two countries into even greater cooperation in the coming period.

"China pays a lot of attention to its relations with African countries, in general, and with Egypt, in particular," Chinese affairs specialist Rasha Kamal told The New Arab.

"Egypt also has a good chance to use China's Belt and Road initiative in serving its development goals, especially given the fact that Egypt has what it takes to become an important partner for China," she added.

Relations between the two countries have witnessed noticeable progress in the past decade, with China significantly increasing its investments here and Egypt looking to China as a partner in implementing an ambitious vision for transforming a world largely dominated by the West.

Egypt and China signed a strategic partnership in 2014. The two countries are fellow members of BRICS, an aspiring grouping of emerging economies.

Egypt is also a significant point on China's Belt and Road Initiative, a trade and development route through Chinese investment, linking China to other countries. This initiative is being dramatically challenged by an alternative trade route masterminded by the US, which puts India at its centre, and—of course—excludes Egypt and the Suez Canal.

Means of escape

Premier Li arrived in Egypt from Rio de Janeiro, Brazil, where he and his Egyptian counterpart participated in the 17th annual BRICS summit on behalf of their two countries' presidents.

Topping the summit's agenda were discussions on enhancing trade between the bloc's member states through the use of national currencies.

Egypt and China apparently want to brook no delay in this. On Thursday, the governors of the central banks of the two countries' met in Cairo to discuss the same issue.

They also discussed boosting the presence of Chinese banks in Egypt and Egyptian banks in China, a step necessary for enhancing trade exchange and capital movement between the two countries, economists in Cairo said.

"The presence of Chinese banks in Egypt and Egyptian banks in China is necessary for the stimulation of trade exchange that relies on national currencies," Alia al-Mahdi, the former dean of the College of Economics and Political Science at Cairo University, told TNA.

"The presence of these banks will also help increase investment cooperation between the two countries," she added.

Nevertheless, Egypt appears to strive for more than just an enhancement of trade and investment cooperation with China, likely viewing the Asian economic giant as a life preserver during a time of acute financial crisis.

During his meeting with premier Li, President Sisi called for implementing a previous agreement between Cairo and Beijing on a debt swap, one that copies others Egypt has signed with other countries in the past period, which can offer relief for the economically struggling Arab country from its surging debts.

Egypt, which owes approximately $8 billion to China, signed a memorandum of understanding on debt swap with the Asian country in October 2023, becoming the first country to do so.

The Egyptian leader also expressed hopes that China would invest in priority sectors for Egypt at present, including renewable energy and electric vehicle manufacturing.

Sisi also expressed hopes that more Chinese tourists would visit his country in the coming years to further boost the prospects of the Egyptian tourism sector, a primary source of revenue and a vital lifeline for the Egyptian economy.

Thousands of Chinese companies invest in various sectors of the Egyptian economy, infusing tens of billions of dollars into the economy.

Around 300,000 Chinese tourists visited Egypt in 2023, according to the Egyptian Tourism Authority, an executive arm of the Egyptian Ministry of Tourism and Antiquities.

In 2024, tourism accounted for 8.1 percent of Egypt's GDP. Around 1.6 million Egyptians also work directly in tourism, which makes about 17.9 percent of the country's total workforce.

Expanding Chinese influence

China's efforts to strengthen its relations with Egypt also come as Beijing seeks to expand its regional influence, which pits it against other world powers vying for control in a region with most of the world's energy reserves.

During his meeting with the Egyptian president, Premier Li said his country was ready to join Egypt in alleviating the humanitarian crisis in the Gaza Strip and preventing the conflict in the Palestinian territory from escalating.

China, he added, is also ready to make efforts for a comprehensive settlement of the Palestinian issue.

Chinese political involvement in the region, analysts in Cairo say, may seem unusual for a country that has traditionally shied away from entanglement in global political conflicts and has favoured an economic and investment approach to its relations with other countries.

"China has always followed a quiet diplomacy, not only in the region, but also around the world," Kamal said.

"Nevertheless, in the past ten years, it started following a proactive diplomacy that also included involvement in almost all hotspots to protect its trade relations and economic interests," she added.

Together with Qatar, Egypt has been working hard to put an end to the conflict in Gaza since it began in October 2023.

The two countries—and the US—now sponsor indirect ceasefire/hostage release talks between Israel and Hamas, hoping to help the two sides reach a deal by next week.

China's political involvement in the region was most evident in March 2023, when it brokered a reconciliation deal between Saudi Arabia and Iran.

It also tried to unite Palestinian factions on the road to ending inter-Palestinian rifts, which is believed to be an essential step on the road to settling the Palestinian-Israeli conflict.

Some of the remarks the Chinese premier made during his meeting with the Egyptian president, meanwhile, offered insight into his country's view of Egypt as a valuable tool for expanding its regional influence.

China, he said, will work with Egypt to promote an equal and orderly multipolar world and a universally beneficial and inclusive economic globalisation, and push for the steady and long-term development of China-Arab and China-Africa cooperation.

Win-win?

Chinese involvement has become omnipresent in almost all sectors of the Egyptian economy.

Chinese companies implement a sizeable number of infrastructure projects in Egypt, including in the New Administrative Capital, a sprawling new city almost the size of Singapore that Egypt constructs in the desert, invest heavily in the Egyptian industrial sector and produce a sizeable amount of goods that travel to the international market, using the 'Made in Egypt' label.

A branching Chinese industrial city in the Suez Canal region has become a symbol of the expanding partnership between the two countries, bringing together dozens of Chinese industrial companies that produce a wide range of high-quality products.

The Chinese have also now become part of industries that were the preserve of Egyptians for many decades in the past, raising concern among ordinary people that they are coming here to compete unfairly with them.

This can be seen clearly in the marble-making hub in southern Cairo, where Chinese investors are driving their Egyptian peers out of business.

An Egyptian economist has recently called for the presence of what he described as "serious" Chinese investments in Egypt.

"Chinese investments around the world raise numerous questions," economist Youssri al-Sharqawi told Egyptian state television three days ahead of the visit of the Chinese premier to Cairo.

"China goes to African states, bringing with it all investment tools, including equipment and labour, which benefits these states nothing," he said.

He called for formulating an investment equation with China that benefits China and also helps Egypt achieve its economic goals.