A potential bid from China to construct a nuclear power plant in Saudi Arabia is reportedly under consideration.

The China National Nuclear Corp. (CNNC), a state-owned company, has proposed to build a nuclear plant in Saudi Arabia's Eastern Province. This move could underscore a geopolitical shift in favor of China, marking a deviation from Saudi Arabia's traditional alignment with the U.S.

See Also: China’s Rate Change Causes Market Panic; Big Dive In Hong Kong Stocks

Officials from the kingdom have admitted that discussions with China are part of a strategy to persuade the U.S. administration to compromise on its nonproliferation requirements. The officials also revealed that Saudi Crown Prince Mohammed bin Salman is prepared to proceed with the Chinese company if negotiations with the U.S. are unsuccessful.

The U.S. officials are reportedly not overly concerned about Saudi Arabia's outreach to China for assistance with its nuclear program. However, they have urged Riyadh to limit its military cooperation with China.

Why It Matters: The Chinese bid is reported to be at least 20% cheaper than offers received from two competitors, making it attractive to the Saudis. Nonetheless, Saudi Arabia desires to remain firmly under the American security umbrella, as it is the largest buyer of U.S. weapons.

Read Next: China’s Xi Makes It ‘Next To Impossible’ To Do Business, Hedge Funder Protests

Photo by adznano3 on Shutterstock