As each year passes, China’s economic interest in the Gulf strengthens. Over the last decade, it has become one of the GCC’s most significant economic partners, impacting many industries, including energy, ports, technology and real estate. Much of this activity has emerged from China’s Belt and Road Initiative (BRI), which has supercharged Chinese investment and involvement in the Gulf. In fact, in 2024, the Middle East was the top recipient of investments from China. That year, the total deals were valued at almost USD 40 billion, and two of the three Middle Eastern countries securing the most investment were in the GCC: Saudi Arabia and the UAE.
Movement between China and our region continues at a pace, with officials from Dubai and Abu Dhabi regularly visiting Chinese cities, trips which often result in multiple deals. These agreements are increasingly focused on AI, advanced technology, and smart cities – areas where Chinese expertise and GCC national ambitions align.
So, as Gulf economies leverage Chinese capital and expertise, what does this mean for entrepreneurs and investors? And as the region looks forward to the next ten years, why is understanding the implications of this partnership so critical for those seeking to harness the potential of the Gulf’s markets?
China-GCC ties and mutual benefits
China’s involvement in the Gulf has grown significantly in recent years, with BRI serving as the primary driver behind Chinese businesses’ foreign investment decisions for over a decade. The BRI initiative was founded around five key areas: proposed by China but designed to serve the whole world; to pave the way for shared development and prosperity; promote connectivity across multiple fields; to inject positive energy into global peace and development; and to pursue long-term progress.
Today, China’s investments span multiple sectors, from oil and gas (the original draw to the region) to infrastructure, high-tech logistics and smart city projects. The GCC’s strategic location and growing consumer markets have been a further incentive. Meanwhile, for GCC-based businesses, access to Chinese capital, new technology, and assistance in expanding into markets beyond the region are just some of the potential opportunities.
What does this mean for entrepreneurs? When there is interest from one of the world’s great superpowers, it signals clearly that this is a thriving business ecosystem. Startups in logistics, construction, energy and more are all finding ways to collaborate with Chinese investors. Entrepreneurs in the Gulf benefit when a Chinese company expands into the region, as they bring with them a new network of suppliers as well as fresh technical expertise. Entrepreneurs can leverage this to scale their own businesses.
Sharing technology and knowledge
This relationship is not just one-way. For companies in the GCC, it opens up opportunities in China as well. For example, UAE investments in China rose by 120% in the first nine months of 2024. Meanwhile, the UAE is seeing a large spike in Chinese tourism.
Meanwhile, China has made significant GCC investments and partnerships in the development of EVs, robotaxis, AI, as well as high-speed rail, advanced manufacturing and fintech. What Chinese firms bring are innovations that can help elevate local capabilities, creating an environment where entrepreneurs can seek collaboration and explore how to tailor products to regional markets.
China has clearly positioned itself as a global technology leader, and Gulf governments are increasingly focused on technology as one of the ways to move away from reliance on oil revenues. So there is great alignment here. China has fully understood the stated national ambitions of the GCC countries and ensures that it aligns with them when it comes to investments. The UAE, Saudi Arabia, Qatar, and others are actively seeking foreign investment as a way to complement domestic entrepreneurship, creating a space where Chinese capital and local innovation can intersect.
From infrastructure to investment
Infrastructure is one of the most visible aspects of China’s investments in the Gulf. From ports to industrial zones to logistics hubs, Chinese investment and expertise are playing a major role. Entrepreneurs who position themselves early in these ecosystems have the potential to gain significant benefits.
For investors, the combination of Chinese capital and Gulf growth presents unique opportunities for joint ventures, co-investments and partnerships. These enable local market expansion and integration into broader Chinese supply chains.
As Chinese capital flows into the Gulf, it creates niches where early-stage investors can support innovative startups before markets mature. Entrepreneurs need to be one step ahead and ensure they are aware of the trends that have the potential to attract funding.
Market access and consumer trends
Chinese companies often bring with them networks that extend far beyond the GCC and link Gulf businesses to global supply chains as well as new consumer markets.
For local entrepreneurs, this creates the opportunity to scale beyond borders, something which is particularly important for startups that need strong logistics and distribution channels. This allows them to enter regions which were previously difficult to access.
Chinese brands and products are increasingly present in Gulf markets and in the process are shaping customer expectations. Entrepreneurs who understand these trends can position themselves as competitive players, whether that’s using Chinese e-commerce models or integrating new mobile payment solutions.
Taking a pause: Challenges and considerations
In any partnership, it’s crucial to evaluate the potential challenges and risks alongside the opportunities. For entrepreneurs looking to benefit from China’s presence in the Gulf, the opportunities are significant, but so are the potential hurdles.
The competition is currently intense, with Chinese firms bringing economies of scale and significant experience. Additionally, navigating the regulatory environment is challenging for foreign-linked businesses. Entrepreneurs in the Gulf Cooperation Council (GCC) must understand these legal frameworks and standards, as they may differ significantly from traditional practices in the region.
Awareness of cultural considerations is also essential. Successful partnerships usually depend on a strong mutual understanding and alignment of business practices, so entrepreneurs who invest time in building strong networks with Chinese counterparts are better positioned to secure meaningful collaborations.
Getting ready for the next decade
Looking ahead, the integration between China and the Gulf is likely to deepen over the next ten years. In many of the areas discussed in this article – from massive infrastructure projects to air taxis – investment will continue to grow. For entrepreneurs, this means an increasingly sophisticated market environment with more opportunities than ever before.
Understanding market trends, regulatory frameworks and partnership dynamics will be crucial. Those who can bridge local knowledge with a strong understanding of Chinese strategy stand to gain a competitive edge that will pay dividends over the next decade.
