On April 6, parties to the Iran nuclear deal met in Vienna to identify “needed actions,” including lifting sanctions and imposing implementation measures, for a resumption of the agreement by all parties. The meeting took place less than two weeks after China and Iran signed a “strategic cooperation agreement” that is set to last 25 years. However, the Vienna talks – which included China – are unlikely to affect the Beijing-Tehran agreement, about which speculations remain rife. Indeed, it is this agreement that ought for now to pique more interest. Does it, for example, presage a formal alliance between China and Iran? Is it an example of China flexing more muscle in the Middle East? The short answer is that it is an example of the continued strategic sparring between China and the US and the fact that it is happening in the Middle East is mere coincidence. (Though the Chinese are not shy about trying to advance their interest if the opportunity is available.)
First, contrary to the claim that the Beijing-Tehran agreement was formulated only last year, it has in fact been more than five years in the making. A joint statement was first issued in January 2016, when China’s President Xi Jinping visited Iran. The statement committed the two countries to working toward “a 25-year comprehensive cooperation agreement given their mutual desire to advance bilateral relations, the complementarity of their economies and their cooperation in energy, infrastructure, industry and technologies.”
What is surprising, then, is not the agreement itself, but why now?
Xi was in Tehran five years ago, exactly a week after the Iran nuclear deal – officially the Joint Comprehensive Plan of Action – came into effect and sanctions on Tehran were lifted. That made Iran a more appealing prospect for foreign investment. But China was only one of many countries seeking business opportunities. That year, Iran struck trade, energy and infrastructure deals with France, Italy and Spain, to name but a few. With many multinationals eager to do business, China’s offering was seen as less appealing by Iran.
Then, when the Trump administration pulled out of the JCPOA in 2018, it was the Chinese who were hesitant about cooperation with Iran, deterred by the possible consequences of sanctions. But three years is a long time, and the tone of Sino-American relations has altered dramatically – and continues to do so even in the Biden White House.
The impact of the Beijing-Tehran agreement will only be felt if and when it results in actual projects, as many Chinese observers have pointed out. They are right to temper enthusiasm for the deal with caution; after all, given the many rounds of negotiations, the Chinese are all too familiar with Iranian capriciousness and the “two steps forward, one step back” approach Tehran takes to bilateral cooperation. Indeed, it is probably safe to say that Chinese companies are not as sanguine as they might have been in 2016.
The future of the JCPOA is another factor, but not in such a straightforward manner as one might imagine. First, it’s true that China has urged the Biden administration to recommit to the deal, arguing that it will bring stability to the region. It will also ease Iran’s isolation – which will, of course, give China more latitude to engage with Tehran.
But until the JCPOA is fully restored, Beijing reckons it can exploit its new agreement with Tehran. In this respect, it has an advantage, one it is loudly messaging to Washington: Beijing today is willing to ignore any threat of US sanctions. After withstanding four years of Trump’s hard-edge policy, Beijing calculates it can resist any further onslaught from Biden’s Washington.
Still, despite all that, a question remains as to whether the Beijing-Tehran agreement can survive Iranian politics. The agreement is not popular with Iranians, who suspect China of exploiting Iran’s current lack of options. When a draft of the agreement was leaked last summer, there was a public outcry. Tellingly, neither Beijing nor Tehran has yet officially disclosed details of whaat it contains. Public opposition could well affect how the agreement is implemented, particularly after elections in June. But in truth, Beijing is unlikely to be concerned.
For on balance, while the agreement may serve China’s interest, Beijing may not necessarily be too attached to it, per se.
In fact, the impact of the agreement as conceived by Beijing is meant to fall into the arena of China’s Great Power competition with America. It is always a calculated, calibrated decision when countries make a big show of their relationship. Thus, it is no coincidence that the signing of the agreement in Tehran by Chinese Foreign Minister Wang Yi, the visit to China by Russia’s foreign minister and President Xi’s highly publicized exchange of messages with North Korea’s Kim Jong-un, should all have happened just a week after the fiasco of the US-China talks in Alaska – the first face-to-face meeting between US Secretary of State Antony Blinken and Wang.
By forging the agreement with Iran, Beijing is defying American pressure, undermining US policy and consolidating China’s credibility as leader of the non-Western bloc. At the very least, the aim is to neutralize America’s China policy.
Washington, meanwhile, cannot ignore the fact that China is expanding its influence throughout the Middle East, from economics to politics to social issues. Indeed, China perhaps is the only Great Power with a clear strategy for doing so and has shown both consistency and purpose, as demonstrated by the success of its “vaccine diplomacy” in the Covid-19 pandemic. By contrast, US policy in the Middle East looks confused, inconsistent and full of contradictions. Having “pivoted” east to head off China, it has, ironically, little capacity to counter China in West Asia.
China’s interests in the Middle East until recently have been narrowly focused on energy security. Being a latecomer to the region, Beijing has been happy enough to free-ride on the US security presence in the Gulf. To that extent, it has no intention of usurping America’s historic role in the Middle East. But it is in the Middle East, at the moment, where China is serving notice to Washington to lay off Beijing’s interests across the wider world.
Yun Sun is director of the China program and co-director of the East Asia program at the Stimson Center in Washington, DC.