The Middle Kingdom meets the Middle East

By Alan Wheatley, China Economics Editor

BEIJING (Reuters) - With no fanfare, a $5 billion (3.3 billion pounds) refinery in which Saudi Aramco has a 25 percent stake quietly began processing oil a couple of weeks ago in eastern China.

The start-up of the Fujian plant, half-owned by top state-owned refiner Sinopec (0386.HK), testifies to the thickening trade and investment ties between China and the Arab world.

China's exports to the 22 members of the Arab League jumped to $62.3 billion last year from just $7.2 billion in 2001, the year China joined the World Trade Organisation. The share in total Chinese exports rose to 4.4 percent from 2.7 percent.

Imports from the Arab world over the same period grew to $70.3 billion from $7.5 billion, doubling the share in total imports to 6.2 percent, according to official Chinese data.

With markets and media riveted by China's hunt for natural resources in Australia, Africa and Latin America, the Middle East story has perhaps been underplayed.

That's the view at least of Ben Simpfendorfer, an economist in Hong Kong for Royal Bank of Scotland, who seeks to redress the balance in his book "The New Silk Road. How a Rising Arab World is Turning Away from the West and Rediscovering China".

For Simpfendorfer, an Arabic and Chinese speaker, the world is witnessing nothing less than two historical powers simultaneously reclaiming their economic and cultural primacy in the world.

"The stories often appear unrelated, but they are in fact part of a larger global rebalancing that represents the rise of the East after centuries of Western dominance," he writes.