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K Andy is seriously concerned about the worsening of the trade war with the United States, but the escalation between Washington and Iran offers an opportunity to bolster Beijing's interests.
Among China's many strategic partnerships in the Middle East, relations with Iran are the most comprehensive and the most important. Beijing has similar agreements with Saudi Arabia and the United Arab Emirates – two of Iran's most hostile countries – but the Iranians are a good bet for Chinese interests and a vital investment for China.
One of the reasons why relations with Iran are so important is the fact that China plays a bigger role here and that the deal does not concern such powerful countries. China is Iran's largest trading partner, supplying and consuming more than 30% of imports and exports. In contrast, the situation is different: trade with Iran represents less than a percentage of Chinese exports. Tehran needs Beijing, but for the Iranian leaders, the Iranians are a substitute partner. It is for this reason that Iran's value for China is now increasing because of the escalation with the United States and the emergence of a conflict situation.
Analysts see at least four reasons why China is currently interested in Iran.
First of allIran is the only major oil exporter in the Middle East whose Chinese believe it will continue to deliver oil if US pressures rise. The Americans are closely linked to the Gulf Cooperation Council – to the local unification of the Gulf Arab States, also in contact with China – and, Washington providing arms and military power to these countries, they are forced to switch to United States. Iran is not bound by such relations.
On this one, I agree with Xi. "China Xi warns against the" disaster "clash of civilizations" stupid "https://t.co/Spy7VO4ADe via @politico
– Michael McFaul (@McFaul) May 16, 2019
Secondly, China intends to win a lot of Iran. The country represents a major investment opportunity for Chinese companies. Many countries have avoided a serious commitment because of US pressure, which has aggravated Tehran's isolation. However, Chinese investors see potential, particularly because of Iran's mineral resources, its highly educated population and its strategic location in West Asia. It is needless to mention that the country is an essential post for the construction of the new Chinese Silk Road in Europe. The decline in the local currency also makes investments attractive to China.
Ironically, the Iranian agreements between China and Saudi Arabia will also earn money in the Gulf of Saudi Arabia and the United Arab Emirates, which are trying to limit Beijing's relations with Tehran. The Saudis are exporting more oil to China than Iran. Any strengthening of the Chinese presence in Iran will lead to more partnership efforts with Beijing in other Middle Eastern countries.
Thirdly, rising tensions with Iran are diverting attention from the United States of the Pacific. While the United States fought in Iraq and Afghanistan in the 2000s, China expanded its military operations to the South China Sea. China's trade and diplomatic relations have covered every corner of Asia. The US command's desire to maintain carrier planes in the Persian Gulf means that Washington will be less focused on China.
Fourth, but perhaps more importantly, tensions between the United States and Iran have led to the creation of a gap between the Americans and their allies. The British Army has engaged in a controversial dispute with its American counterparts about the need for an escalation in the Persian Gulf. With the release of the nuclear deal, Trump has hurt the Western Alliance, reinforced in 2015, by efforts to stop the Iranian nuclear program. This situation is a very good opportunity for Beijing, which will try to strengthen its ties with anyone who does not believe in Trump administration policy.
China and America are locked in a new type of cold war. This one could leave no winner. Our cover this week https://t.co/EzBoaffaTB pic.twitter.com/qb6NjYbwxX
– The Economist (@TheEconomist) May 16, 2019
However, it should be emphasized that not everything is rosy for China. The outbreak of a conflict between the United States and Iran would drive up oil prices and, as the largest importer of oil, would be a blow to the Chinese economy. Military actions will also prompt the United States to undermine Beijing's ties to Iran, jeopardizing investment.
For now, US-Iran relations are exactly what China would like to be. They not only increase the value of Iran for China, but also strengthen China's long-term interests and in the context of competition with the United States.
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Author:
Ruslan Trad
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