MUSCAT: China has provided US$540mn to Oman for investment in different infrastructure projects as part of its Belt and Road Initiative, said H E Li Lingbing, China’s Ambassador to Oman at a briefing on Tuesday.

The briefing was held to detail the Second Belt and Road Forum (BRF) for International Cooperation in Beijing recently.

H E Li said, “China signed an MoU with Oman in the year 2018 as part of the Belt and Road Initiative. Now, Oman is the most important partner of China with regard to the co-operation in Belt and Road Forum. It is not only because of BRF but otherwise as Oman is also one of the important partners of China in the entire Gulf region.”

Regarding the China-Oman co-operation, H E Li said, “In 2016, China provided two loans to Oman to undertake two different projects. One is US$265mn provided by the Asian Infrastructure Investment Bank (AIIB) for construction of the Duqm port. Second was US$36mn for road construction in the country.”

“In 2017, the AIIB provided loans to the tune of US$239mn for laying broadband service in Oman which means we have provided a loan of US$540mn to Oman. “With the co-operation going on in different sectors I believe there is a bright future for both the countries,” she said.

With $300 million in financial support from the Asian Infrastructure Investment Bank (AIIB), several Chinese companies have been involved in the construction of Duqm Port and in railway infrastructure projects in Oman.

This investment can be viewed as grounded in Chinese President Xi’s strategic calculation to lay down an efficient and effective sea route for China’s trade and investments in the region. The project’s official document, published by the AIIB, further outlines its importance. Related, the Chinese railway projects in Oman are intended to expedite the flow of energy from other Gulf producers and possibly the wider Middle East.

Meanwhile, the Duqm port is expected to be a vital hub for energy transport between China and the Gulf.

The various projects presently being built in Duqm include a refinery capable of processing 235,000 bp/d and a petrochemical complex, the $2.3 billion methanol-to-olefins (MTO) plant, and a greenfield methanol complex. The integrated natural gas-fed methanol and MTO complex is expected to have a capacity of 10 million tons/year and would count among the largest petrochemical schemes in the region.

With the BRI serving partly as “oil roads,” the flow of energy resources between China and the Gulf can be expected to be expedited and expanded as needed. By the end of 2015, 110 million tons of crude oil were shipped from the Gulf, accounting for 75% of China’s imports from the Arab countries while by 2017, Qatar became the largest LNG supplier to China, satisfying about 35% of its LNG needs. With the expected increase in energy deals and the completion of large-scale energy projects under the Belt and Road Initiative, many of which are still under construction or yet to be built, the BRI can ameliorate China’s energy anxieties, in turn helping sustain the country’s economic growth.