China's and India's low-key but growing presence in the Maghreb

Dalia Ghanem

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INTRODUCTION

In 1999, China launched its ‘Go Out policy’, while from 2014, India pursued closer engagement with regions such as the Middle East via its ‘Look West policy’. Since that time Chinese and Indian companies have expanded overseas and dramatically stepped up their investment in the Arab World and Sub-Saharan Africa.

Nonetheless, China’s and India’s volume of trade with the Maghreb (here defined as Algeria, Morocco, and Tunisia), remains modest by comparison with their level of engagement with the Gulf Cooperation Council countries (GCC) or even with Sub-Saharan countries. The latter remain more important to both China and India than the three Maghreb nations. To give one example, in 1992, 31.3 % of China’s imports from Africa came from the Maghreb. By 2018, however, that amount had dropped to 7.76 % because China’s trade with Africa had grown (1). Moreover, while China remains a major source of imports for the three countries, it is not a major export market. Pre-Covid, China was Algeria’s and Morocco’s 11th biggest trading partner for exports while it ranked 15th for Tunisia (2). Although Indo- Moroccan trade is more substantial, India never features within the top ten export destinations for Tunisia or Algeria.

Yet both China and India recognise the significance of the three Maghreb nations as the gateway to the Mediterranean and a market of no less than 95 million people. For now, the locus of engagement of the two Asian giants has mainly been the economic sphere, where both countries face serious competition from a historical partner: the European Union (EU).

Although some analysts and policymakers are concerned about China’s involvement in the Maghreb, the EU remains far ahead of both China and India in trade and its influence extends beyond the economic sphere. The EU, which signed Association Agreements with Tunisia in 1995, with Morocco in 1996 and with Algeria in 2002, which entered into force in 1998, 2000 and 2005 respectively, remains the most important partner for the three nations, which are also part of the European Neighbourhood Policy (ENP).

The first section of this Brief shows how China’s and India’s footprint in the Maghreb is primarily economic. China specifically, in contrast to Russia’s hard power posture in the region, favours a soft power strategy based mostly on economic relationships. While China undoubtedly would like to see Western influence diminished in the Maghreb, it is unlikely that it wants to take over and become a hegemonic power (3). The second and third sections show how the Sino-Maghreb and Indo-Maghreb relationship delivers economic dividends mainly for the two Asian nations, and how their footprint in the region remains light in comparison to the EU. Finally, the Brief concludes with concrete policy considerations for the EU.

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