Saudi Arabia and China plan to launch a joint $20 billion investment fund.
Saudi Energy Minister Khalid al-Falih told reporters on Thursday that the kingdom will share the costs and split the profits from the fund with China 50:50, according to Reuters.
The energy minister went on to say that a venture will be formed between the Royal Commission for Jubail and Yanbu, Aramco and a Chinese company in an effort to attract Chinese investment in various sectors.
$60 billion in joint Chinese-Saudi projects will also move forward
In addition to the investment fund, Saudi Arabia, and China have agreed to some $60 billion in other joint ventures.
“Saudi Arabia aspires to be the biggest investor in the sector of refining petrochemicals in the Chinese market, and there will be a big development in this field," al-Falih said, according to Arab News.
"There is a strategic partnership between the two countries," he said.
These new ventures follow similar agreements made in March when King Salman traveled to China. At the time, $65 billion in business ventures were signed by both countries.
In 2015, bilateral commercial trade between the two nations reached nearly $50 billion.
Chinese partnership is key
Saudi Arabia is particularly keen on enhancing business relations with China, according to experts.
“The key thing in this is the increasing economic relations between Saudi Arabia and China, which is its main customer for oil,” Jason Tuvey, an economist at London-based Capital Economics, told Arab News.
"It sees China as its main growth engine at a time when demand for oil in many developed markets is falling. Saudi Aramco will want to make sure it remains the ‘go to’ oil producer for China," he said.