China, Iran Sign 25-Year Agreement Hoping to Reduce U.S. Influence in Middle East

BEIJING, CHINA - DECEMBER 31: China's Foreign Minister Wang Yi shakes hands with Iran's Foreign Minister Mohammad Javad Zarif during a meeting at the Diaoyutai state guest house on December 31, 2019 in Beijing, China. (Photo by Noel Celis - Pool/Getty Images)
Noel Celis - Pool/Getty Images

Iranian state media reported Saturday that Iran and China have signed a 25-year “Comprehensive Strategic Partnership” agreement covering oil, mining, agriculture, heavy industry, and transportation — plus joint research, intelligence-sharing, and military cooperation.

The deal reportedly involves $400 billion in Chinese investment for Iran in exchange for oil shipments.

“The deal could deepen China’s influence in the Middle East and undercut American efforts to keep Iran isolated. But it was not immediately clear how much of the agreement can be implemented while the U.S. dispute with Iran over its nuclear program remains unresolved,” the New York Times (NYT) noted Saturday.

Chinese Foreign Minister Wang Yi and Iranian Foreign Minister Mohammad Javad Zarif signed the deal at the Iranian foreign ministry office in Tehran on Saturday, following two days of talks between Wang and Zarif. Precise details of the agreement have not been made public, but the NYT cited analysts who doubted it would differ much from the draft agreement leaked in July 2020.

The Chinese Foreign Ministry declared the agreement would help the Middle East “emerge from chaos and enjoy stability” by breaking free from “the shadows of big-power geopolitical rivalry” and becoming “impervious to external pressure and interference.” 

Zarif saluted China on Saturday as a “friend for hard times.” The Wall Street Journal (WSJ) quoted Iranian media reports that said Beijing’s friendship includes setting up a special Iran-China bank that “could help Tehran evade U.S. sanctions that have effectively barred it from global banking systems.”

“It allows Iran to be a little bit more intransigent. I think it will make Europe and the U.S. a little more nervous because it looks like Iran may have a way out of economic strangulation,” Dina Esfandiary of the International Crisis Group told the WSJ.

Esfandiary added China will likely “back Iran when it suits it, and it will ignore Iran when it suits it,” throwing a dash of cold water on the Iranian regime’s hopes that China plans to realign its entire Middle Eastern strategy around its partnership with Tehran.

The NYT mentioned some criticism of the deal from within Iran, where opposition leaders worry China is effectively turning Iran into an imperial possession, much as it has done with heavily indebted Third World nations through its Belt and Road Initiative (BRI).

China’s state-run Global Times pushed back against such interpretations of the deal Monday, accusing Western media of unfairly portraying the Iran-China deal as “a challenge against the U.S.” with coverage designed to “exaggerate Iran’s threat amid the deadlock of the nuclear issue and drive a wedge between Iran and other countries in the region.”

“Unlike the Western addiction to instigating geopolitical competition among Middle East countries, China is committed to a greater engagement in efforts to address the region’s security issues, either through participation in existing mechanisms or the push for new platforms such as a multilateral dialogue platform for the Persian Gulf region,” the Global Times insisted.

The Chinese state paper suggested other Middle Eastern countries might be inspired to “ink longer-term partnerships with China that fit their development needs, as they seek to diversify their economies in the post-COVID [coronavirus] era and as the Chinese government has showed more reliability and stability than the see-saw US government, whose policies concerning the region continue to swing every time it changes administration.”

The Times of Israel (TOI) noted Saturday that Iran has not signed such a “lengthy agreement with a major world power” before. The closest it came was a ten-year cooperation agreement with Russia focused on nuclear technology signed in 2001 and subsequently extended for ten years.

TOI hinted Iran might use its China deal as leverage to extract further concessions from the European signatories to the nuclear deal, formally known as the Joint Comprehensive Plan of Action (JCPOA):

Reportedly, Iran and China have done some $20 billion in trade annually in recent years. That’s down from nearly $52 billion in 2014, however, because of a decline in oil prices and US sanctions imposed in 2018 after Trump pulled the US unilaterally out of Iran’s nuclear deal with world powers.

Iran has since pulled away from restrictions imposed under the deal under those sanctions in order to put pressure on the other signatories — Germany, France, Britain, Russia and China — to provide new economic incentives to offset US sanctions. Iran is also believed to be maneuvering for leverage ahead of expected negotiations with the Biden administration.

Conversely, the NYT expressed a little skepticism that all of the grandiose promises of cooperation made by Wang and Zarif will come to pass, especially if the JCPOA collapses under repeated Iranian violations and China finds itself facing tough secondary sanctions from the U.S. and Europe. 

China’s former ambassador to Iran, Hua Liming, told the South China Morning Post (SCMP) on Sunday that the strategic agreement marks “a momentous change in China’s relations with Iran and the region,” and perhaps a signal that Beijing has become much less concerned with alarming or alienating a weakened United States.

Hua said China’s oil imports from Iran have increased steadily despite U.S. sanctions, and Iran needs a strong superpower patron more desperately than ever in the wake of the Wuhan coronavirus pandemic.

“Both China and Iran are interested in promoting their close ties publicly, which has reflected a changed reality. As China cares much less about what the US thinks, we will no longer be restrained by those largely self-imposed restrictions on fostering close ties with Iran,” he said.

The SCMP quoted Chinese Foreign Minister Wang Yi telling Iranian President Hassan Rouhani that it was time to “seriously reflect on the bad consequences inflicted on the region by external interference, and work together to explore effective ways to maintain long-term regional security and stability.” The Iran-China agreement is a clear statement of China’s bid for hegemonic status as the superpower that doesn’t care about human rights abuses, and doesn’t have to worry about shifting public opinion changing its foreign policy via democratic elections.


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