The blossoming of Sino-Iranian partnership: how an emboldened South is beginning to expose the limits of American power

The blossoming of Sino-Iranian partnership: how an emboldened South is beginning to expose the limits of American power
by Javad Heydarian

It is undeniable that the year 2009 was a momentous year for People’s Republic of China, as it proved its centrality in the climate change talks, new global economic order, and ultimately in the international strategic-security arrangements. The year was also very important for Iran-China relations as energy investments soared, trade expanded and nuclear-diplomacy entered a new phase. On the other hand, Iran continued to defy western pressure and assert its interests in the highly strategic and vital region of Persian Gulf – where 40% of energy is transported everyday – as well as the Greater Middle East and Central Asia.

The Iranian regime has not only survived the U.S sanctions, isolation and threats but also managed to enhance its influence in the region. Iran with its vast influence and regional connections is now arguably the main key to the resolution of problems in the region — from the civil wars unfolding in Iraq and Lebanon to the security challenge of the Persian Gulf — and it is hard to imagine any of them being resolved without Iran’s cooperation if not blessing.

The growing Sino-Iranian relations is entering a critical stage and the west will have to face an emerging alliance between two revisionist powers in Asia-Pacific and the Middle East.

In recent years, China stepped-up its rhetoric as it yielded more political power – thanks to three decades of relentless economic growth and persistent military modernization – and openly challenged the
century-old liberal international order led by the west. While China positioned itself at the forefront of calls for re-structuring of the global economic system – especially after the financial crisis – it showed little reluctance in utilizing its newly gained clout for more security-oriented ends, such as
Iran’s nuclear program.

Unlike the western countries, China has been relatively absent in the politics of the Middle East, but as China’s reliance on energy imports grow there is little reason to remain silent on developments in the Persian Gulf.  In 2009 alone, China signed more than 8 billion dollars in energy investment deals in Iran. [i] 

If one visits Iran today, traces of a growing Sino-Iranian relations is all over the place. Chinese contractors, engineers and workers constitute the majority of visitors to the country and that will catch anyone’s attention as one flies towards Imam Khomeini International Airport. In the 1990’s up to early 2000’s, the Germans, French, Italians and later Koreans used to dominate Iran’s investment market, but as political ties deteriorated over time – mainly over the nuclear program – the Chinese have come to replace the traditional exogenous players in Iran’s economy. 

The beginning of the year 2010 was even more fateful for Sino-Iranian relations. China sabotaged the P5+1 talks (January) by opposing any new rounds of sanctions and sending a low-level representative to the discussions – signaling its disagreement with any serious agreements
on further isolating Iran – and later bluntly told Pres. Sarkozy that China sees diplomacy as the only way forward.[ii]
In the Munich conference (Feb), the Chinese Foreign Minister Yang Jiechi explicitly articulated his country’s intentions to block any sanctions against Iran and instead called for more diplomacy.[iii]
A week later, the US and even Russia rebuked Iran over the announcement that it is commencing and escalating its uranium enrichment process to 20% and above;
China again stepped in and called for more diplomacy (meaning no sanctions that could compromise its heavy investments in Iran). This might signal the
beginning of a new era in Chinese relations vis-à-vis the world powers, wherein China is willing to openly defy the cross-Atlantic alliance and signal its will
to protect its interests around the world at the displeasure of the US and others.

Undoubtedly, China’s investments in other developing countries grow, so does its interdependence with these countries and the need to influence and protect its interests in these nations. With a huge reservoir
of political capital and economic resources, China is more capable than ever to make its voice heard. 

There is a deep history behind this flourishing strategic partnership. Both China and Iran experienced their respective ‘centuries of humiliation’ at the hand of western powers and later thenon-western revisionist powers such as Japan and Russia. The ‘psychic wound’ left by such tumultuous history continuous to influence the policy-making paradigm of the two respective countries. The notion of “Asian identity” dominated both Iran and China’s post-revolution foreign policy mindset, which differentiated them from other developing countries that emphasized their relationship with western countries (i.e. Turkey and Korea).[iv] 

Even though both Iran and China continued to trade with major economies of Europe and the US, they both continued to expand and deepen ties with other developing countries in Asia, Latin America and Africa. The ‘Grand Strategy’ was founded on the bitter experience that, while they had more independence, leverage and room for maneuvering vis-à-vis other developing countries, their ties with the west were plagued with deception, submission,
humiliation and coerced compliance.

Iran’s vast
untapped resources: an energy-hungry China steps in to fill-up the investment vacuum

Iran represents a vital international player beyond the Middle East, mainly because of its geo-strategic position in the Persian Gulf (where 40% of world’s energy is transported daily) and Eurasia (the growing site for global gas and energy production and transport). Iran boast the second biggest reserves of natural gas in the world and the third biggest reserve of oil -although it ranks second if the Canadian reserves of unconventional oil are excluded – making Iran a potential energy superpower in the future. To fulfill such a prospect, Iran has actively been searching for big energy companies to invest in the world’s biggest gas project (the South Pars gas project situated in the Persian Gulf).[v]

In the 1990’s, western companies, such as Total and Shell, undertook majority of investments in Iran’s vast energy reserves. By the late 1990’sand 2000 things changed as the controversy over Iran’s nuclear program gradually resulted in political pressure – mainly by theUS and European allies – and eventually divestment and discouragement of oil
giants from investing in Iran.

Total Chinese investment targeted toward Iran’s energy sector could exceed a further $100 billion over 25 years. At the end of 2004, China became Iran’s top oil export market. Apart from the oil and natural gas delivery contracts, the massive investment being undertaken by China’s state-owned oil companies in Iran’s energy sector contravenes the US Iran-Libya Sanctions Act (the law penalizes foreign companies for investing more than $20 million in either Libya or Iran).

Based on the most current reports – especially during the past 3 years – China has been the major investor in Iran. In the face of the sanctions already in place, two-way trade between China and Iran grew 35% in 2008, to $27 billion.[vi]
More importantly, China has signed an estimated $120 billion worth of oil deals with Iran in the last five years to keep the world’s third-largest economy on a
rapid growth path..[vii]

Geo-strategic and military cooperation: ideological alignment and convergence of interests

Support for Iranian nuclear programs was a key element of Beijing’s effort to forge a partnership with Iran in the 1980s and 1990s. While China was not Iran’s only partner during that period (Pakistan’s Abdul Qadir Khan provided key technologies for uranium enrichment), it was by far the most important. During these years, Beijing turned a blind eye as Iran’s nuclear program large and covert military dimensions came into public view. In the 1990s, after the collapse of the Soviet Union and the emergence of a unipolar world, both China and Iran painstakingly tried to contain the US’ rise in their respective regions. As the interdependence between China and the US grew, China seemed to become more responsive to the US’ pressure. In 1997, under the intense US pressure, China abandoned its covert nuclear cooperation
with Iran. [viii] 

Currently, the threat of a surgical military strike
on Iran’s nuclear facilities is a central issue in Iran’s national security calculus. Israeli air force has constantly threatened to attack Iran’s nuclear
site – as it did in 1981 against Saddam’s Osirak nuclear site – if diplomatic pressure and sanction fail to prevent Iran from nuclear enrichment.
Iran’s strongest tactical response to Israeli threats was the purchase of S-300 air defense system from Russia, but Russia – under the US and Israeli
pressure – continued to send mixed signals on the delivery of the product.  In 2009, it was reported that Iran shifted its hopes from Russia to China, which owns a replica of the controversial Russian S-300. As a result, Tehran began to contemplate on the Chinese-made HQ-9 surface-to-air missile under the name FD-2000, which was finally put on the export market.[ix] 

The growing cooperation was not entirely opportunistic; the two countries had so much in common: they both resented western interference in their backyard and internal affairs while defending their revolutionary gains against growing pressure from both within and without. China is believed to have contemplated on the possibility of using Iran’s Persian Gulf territories as a host to Chinese naval-military ports in the future – if the alliance comes to full fruition – as to expand Chinese presence in the energy-rich region.[x] 

China was also believed to be producing several new types of guided anti-ship missiles for Iran in 2004. China and Russia’s sales of missiles and missile technology as well as missile development assistance contravene the US-Iran non-proliferation act of 2000.[xi] 

Although Iran has grown to become increasingly independent in terms of ballistic capabilities’ development, it is undeniable that China played a key role in many of major projects (from long-range Shahab missiles to the Omid satellite which was launched in 2009).

Conclusions

The spectacular growth in Sino-Iranian relations posses a clear challenge to the US and its super-power status in the world. The
combined strength and influence of both China and Iran has consistently exposed the limits of American power and the efforts to isolate Iran for defying
western pressure over Tehran’s nuclear program. While China is transforming into a superpower and a key player in Asia-Pacific, Iran is becoming the great
power in west Asia and Greater Middle East. In many ways, it is increasingly evident that the US is still grappling with these seismic shifts in global
politics and is yet to develop a coherent and comprehensive policy as to manage if not contain the growing ties between these two (ancient) Asian powers.

Currently, the US is struggling to contain Iranian influence in the Middle East – Iraq, Afghanistan, Persian Gulf, Lebanon, Palestine, Syria – while nervously managing China’s “peaceful” rise in
East Asia. Both Iran and China have strengthened their hard-power base in the previous decades – thanks to decades of military modernization and high GDP
growth – but more importantly honed their soft power through expanding trade, investment, cultural ties – bolstered by an increasing sophistication in
diplomacy – with their respective neighborhood and backyards as well as other emerging developing countries.

The growing Sino-Iranian cooperation posses a complex foreign policy riddle for the US, since it is tied to many other international issues such as US-Taiwan and US-Tibetan relations as well as US-China massive economic ties (bigger than Iran’ entire GDP). The dramatic growth in Sino-Iranian ties is by no means monolithic and inevitable. Both countries are developing nations in need of Western cutting-edge technology, massive capital and affluent market, if they would want to make a full transition to a ‘developed’ country status. The ties between these two powers developed within a specific context where problematic relations with the west as well as certain essential needs (China’s need for energy-resources and Iran’s need for security and capital) pushed both countries toward more intimate, comprehensive and intensified cooperation. Only when the US will understand the intricacies and complexity of the context within which Sino-Iranian relations developed, will the US be able to properly deal with its implications for the US’ foreign policy interests

The US has been more successful with regards to Russia-Iran ties, but Sino-Iranian emerging alliance has proved to be more difficult to influence. Iran is a great temptation for china’s long-term economic interests, but it is long before the two countries become inseparable allies in global politics. The interdependence – however asymmetrical – between the US and China has immensely developed over decades. As China rises
to the top of global hierarchy, it will have to develop a mutually
accommodating relationship with the other superpower (the US). This means that
if China is interested in a stable rise and strategic-partnership with the US,
it will have to constantly re-evaluate the trade-offs that come with its ties
with Iran (assuming Iran will not engage in its own grand bargain and
rapprochement with the west).

As China scholars like
Graver would argue, the Sino-Iranian relation could be best described as a
second-order relationship in the sense that both parties have periodically
subordinated that relationship to other objectives. In the 1970s Iran insisted
on subordinating its relation with China to Iran’s relation with the Soviet
Union, and used the rivalry between the two powers to its own advantage.
Similarly, in the 2000s Beijing tended to subordinate its relation with Iran to
China’s far more important relation with the United States, and used the
Iranian card both as leverage and as a hedge.[xii]
This conclusion is now under question as China continues to deepen its ties and
investments in Iran. The US-China relations will remain to be the single most
important bilateral relationship in the world but the clock is ticking fast for
the US to come up with coherent, effective and nuanced strategy vis-à-vis
Sino-Iranian relations.

Endnotes: 

[xii] Graver, J. (2006). China and Iran: Ancient Partners in a
Post-Imperial World. Seattle: Washington University Press.