On Monday, Chinese President Xi Jinping visited the Sultanate of Brunei. The sultanate is looking for investment opportunities in China in order to help its slowing economy. Many analysts have also pointed out that Brunei is heavily reliant on oil, a problem that the sultanate aims to solve with various deals or loans from China.
President Xi arrived in Brunei on Nov. 19 following a tense summit in Papua New Guinea where a handful of leaders criticized some of China's policies. Most notable of this is the criticism from the United States, which, coincidentally the country is embroiled in a bitter trade war.
Regardless of the tensions during the summit in Papua New Guinea, President Xi has warmly welcomed the Sultan of Brunei Hassanal Bolkiah. President Xi was welcomed at the Sultan's enormous palace.
Like most regions of Asia, several Chinese companies are investing huge amounts of projects into Brunei. Most of these investments are targeted towards the country's infrastructure, a key element to China's Belt and Road Initiative. While most of these projects are done transparently, some critics have pointed out that China is extending its economic and geopolitical powers through these projects.
Among the massive Chinese investments toward Brunei area dam and a highway project. A Chinese company is also building a multi-billion dollar oil refinery which stands as the largest foreign investment project in Brunei's history.
Brunei, which is geologically surrounded by Malaysia, has been heavily reliant on its abundant oil deposits. However, the country's economy took a dive and went into recession when oil prices severely dropped several years ago. Additionally, crude reserves are also showing a continued decline.
In a study published by Murray Hiebert, he said that Brunei will experience a further decline in its exports in the coming years. This is one of the reasons why the tiny nation is looking for alternative economic help through China. Mr. Hiebert is a Southeast Asia expert working for the Center for Strategic and International Studies.
President Xi is the first Chinese president to visit Brunei in the last 13 years. Following the President's meeting with the Sultan, a joint statement was released. The statement said that Brunei "will continue to support and jointly promote cooperation in the Belt and Road Initiative."
It is important to note that Brunei is one of the many countries that lay claim to the highly disputed South China Sea region. Nevertheless, Brunei's claim has been widely muted, many believe in order to gain a favorable ground in its trade negotiations with the Asian superpower.
