China's Belt and Road Initiative (BRI) has shown resilience and growth, signing record contracts worth $124bn despite ongoing global economic challenges during the first half of 2025.

According to a recently published report by GlobalData, the increased activity, with 176 construction contracts and investment deals, marks a significant increase from the previous year's total of $122bn.

As geopolitical dynamics shift, particularly with the imposition of tariffs by the US, China's strategic investments across the Middle East signal a robust commitment to regional collaboration and infrastructure development.

The Middle East has emerged as a pivotal region in China's BRI strategy, with construction engagement reaching $19.4bn in the first half of 2025. This positions the region as a key player in the broader BRI framework, particularly in sectors such as digital infrastructure and energy transition. The Middle East's strategic location as a crossroads for trade routes enhances its significance in China's vision of global connectivity.

Saudi Arabia and the UAE are leading the charge, with Saudi Arabia securing $7.2bn in construction contracts and the UAE following closely with $7bn. These investments reflect China's commitment to fostering strong bilateral ties and supporting the region's ambitious development goals, particularly in renewable energy and technological innovation.

The energy sector remains a focal point of BRI investments in the Middle East, with China directing substantial resources towards both traditional and renewable energy projects. The region's oil and gas sector continues to attract significant Chinese investment, with a notable emphasis on enhancing energy security and diversifying energy sources. This aligns with China's broader strategy to secure energy supplies while supporting the region's transition towards greener alternatives.

In addition to energy, the Middle East has seen a surge in investments in digital infrastructure, reflecting the region's growing emphasis on technological advancement. As countries in the Middle East seek to modernise their economies and improve connectivity, China's expertise in infrastructure development positions it as a valuable partner.

The trend is particularly evident in projects aimed at enhancing telecommunications and digital services, which are crucial for economic diversification and growth.

Private sector

The first half of 2025 also marked a significant increase in participation from private sector companies in BRI projects within the Middle East. Major players such as Sinopec and Longi Green Energy are leading investments, particularly in renewable energy and technology sectors. This shift towards private capital underscores the growing importance of collaboration between Chinese firms and local businesses, fostering innovation and knowledge transfer.

The BRI's engagement in the Middle East is not just about infrastructure; it also encompasses cultural and educational exchanges, further strengthening ties between China and the region. As both sides deepen their cooperation, the potential for joint ventures and partnerships in emerging sectors such as green technology and digital innovation is vast.

Looking ahead, the second half of 2025 is expected to see a stabilisation of BRI engagements in the Middle East, with a continued focus on energy, technology, and infrastructure development. The volatility in global trade and investment, exacerbated by US tariffs, is likely to further incentivise Chinese companies to seek opportunities in the Middle East as they look to diversify their markets and strengthen supply chains.

Additionally, both public and private sector investments in green energy infrastructure are anticipated to rise, creating opportunities in the electric vehicle (EV) and battery manufacturing industries, as well as in mining and minerals processing.