China just made another audacious bid to challenge the US as a key Middle East power broker

• China has helped broker a truce between Hamas and Fatah.
• It's positioning itself as a champion of Palestinian autonomy amid the Israel-Hamas war.
• China's diplomatic efforts are becoming a bigger way for it to challenge US power, an expert said.

In the nine-month war between Israel and Hamas, an unlikely nation has emerged as a key power broker in the Middle East: China.

Hamas and Fatah, the two most powerful Palestinian political groups, announced a truce on Monday brokered in Beijing, at the end of discussions between 14 Palestinian political factions, which culminated in the commitment to form an interim unity government once the war between Israel and Hamas is over, Reuters reported.

China's foreign minister Wang Yi hailed the agreement "on post-Gaza war governance and the establishment of a provisional national reconciliation government" as "dedicated to the great reconciliation and unity of all 14 factions," state media reported.

It's an audacious move that places China at the center of negotiations in a conflict where the US has long been the main mediator.

China flexes new diplomatic power

In 2007, Hamas, an Islamist group classified as a terrorist group by the US, seized control of the Gaza Strip from Fatah.

Hamas is battling for for survival in the Gaza Strip, after its attack on Israel on October 7 prompted an Israeli military offensive in the Gaza Strip. Fatah has long been the biggest group in the PLO, which rules the West Bank.

Reconciling the groups with an eye to building a postwar Palestinian government is a diplomatic coup for Beijing, after years of trying to position itself as a power broker in the Middle East.

Though Beijing is not part of the US diplomatic push to broker a cease-fire between Israel and Hamas, analysts say it is establishing itself as an important player in any postwar settlement.

"China seeks to burnish its credentials as a diplomatic intermediary. Previous efforts to unify Hamas and Fatah have failed, but Beijing hopes to demonstrate that, at least in principle, it can bridge intractable divides and de-escalate long-standing conflicts that Washington cannot," Ali Wyne, an analyst with the Crisis Group, told Business Insider.

China challenges US might in the Middle East

In the last few years, China has challenged US influence in the Middle East. In 2023, it helped broker a restoration of diplomatic relations between Iran and Saudi Arabia after decades of proxy conflict. It also brokered closer ties with the Gulf states that have long been US allies.

Deals like the Iran-Saudi rapprochement and the truce between Palestinian factions would likely have been impossible for the US, which has had adversarial relations with Iran and its regional proxies for decades.

"The United States can't be a credible mediator because it has played favorites in both the Iran-Saudi rivalry and in the competition between Israel and Iran," Middle East analyst Aaron David Miller wrote in Foreign Policy in 2023.

Wyne said that, while the world sees US-China rivalry through the prism of economics and military power, "the diplomatic component will grow more salient as Beijing aims to become a more holistic great power."

China has not condemned the October 7 attacks and has championed Palestinian sovereignty, something Israel has refused to do.

It's part of China's wider strategy of positioning itself as the leader of developing nations, many of which are angered by Western support for Israel's campaign, which has killed tens of thousands of civilians, according to Hamas-run health authorities.

But though China is likely seeking political gains from the Israel-Hamas conflict, there are limits to how much Beijing is prepared to put on the line to influence the outcome, say some analysts.

The US has helped shoot down Iranian missiles heading to Israel in April. It also deployed two carrier strike groups to the region to deter attacks by Iran and its proxies in the weeks after October 7. China, meanwhile, has confined itself to diplomatic initiatives.

"China also doesn't want to sacrifice much to advance any of its interests in the Middle East," Jon Alterman, an analyst with the Center for Strategic and International Studies, told the US Congress in April.

"Where it invests, it does so deliberately," he added.