Iran-China accord ushers in major geopolitical shift

The 25-year comprehensive strategic cooperation agreement between China and Iran, which was signed in Tehran on Saturday, is a major breakthrough for the two countries and will have long-term effects on the geopolitical balance of the Gulf and the region as a whole. After five years of negotiations, the inking of the deal, which covers various economic, political and security issues, comes at a time when relations between Beijing and Washington are at their worst. It also puts Tehran in a strong bargaining position in relation to the shaky nuclear deal and the West’s attempt to renegotiate and expand it.

The agreement, parts of which remain undisclosed, will release $400 billion of Chinese investments over 25 years in return for a regular supply of low-cost Iranian oil. The impact of the deal on the struggling Iranian economy will be enormous and will lessen the effects of US-imposed economic sanctions. The proposal for a strategic alliance between China and Iran was made by Chinese leader Xi Jinping in 2016, but Iranian leaders hesitated to embrace it for fear that it would affect the newly signed nuclear deal. But this week’s signing of what amounts to a treaty testifies to the failure of the Trump administration’s policy of “maximum pressure” on Iran. It leaves Donald Trump’s successor, Joe Biden, in a difficult position vis-a-vis rejoining the nuclear agreement unconditionally, as Tehran demands.

The pact, which will allow China to put 5,000 security and military personnel on Iranian soil, is a regional game changer

Osama Al-Sharif

The pact, which will allow China to put 5,000 security and military personnel on Iranian soil, is a regional game changer. Before China, Tehran had signed a 10-year cooperation agreement, especially in the nuclear field, with Moscow in 2001 that has since been extended by five years twice. Two years ago, Iran joined naval exercises with Russia and China. The latest accord will allow China to have a presence in the Gulf region, as well as Central Asia. In return, Iran will have access to Chinese technology and investments in its poor infrastructure. The two parties will invest in a free industrial zone close to the Strait of Hormuz.

The Chinese have been strengthening their economic ties with other Gulf countries for years. Beijing has signed cooperation agreements with the UAE and Kuwait and has good working relations with Saudi Arabia. The latest accord will raise red flags in Arab Gulf capitals. Iran continues to be a major source of instability in the region and its alliance with Beijing will only embolden the hard-liners in Tehran and Qom.

Israel too will be feeling uneasy about the Chinese move. Both Russia and China, co-signatories to the nuclear deal, have supported Tehran’s position and openly violated US sanctions. The deal is a major step in China’s ambitious multibillion-dollar Belt and Road Initiative, which is expected to allow it to become the largest global economy in a few years.

So far there has been no reaction from Washington. The signing of the accord will put the Americans and Europeans in a difficult position diplomatically. The Iranians are likely to stay firm in their rejection of any proposal to renegotiate the nuclear deal or expand it to cover Tehran’s long-range missile program and its regional behavior.

The signing of the deal came just days after a failed US-China meeting in Alaska, which saw a bitter war of words break out between the two nations. Biden appears to be following in Trump’s footsteps by taking a hard stand against Beijing.

The Iran-China deal has been attacked by the Iranian opposition for violating the country’s sovereignty. It is not clear whether Iran will allow China to have a permanent military base on its territory. Beijing has shown an interest in getting involved in regional issues, such as by offering to host preliminary talks between Israel and the Palestinians. The recent accord will be seen as another attempt by a foreign nation to fill the vacuum left by the US in the region. Already, Russia has established a number of military and naval bases in Syria and is active in Libya. Turkey, which has a military base in Qatar, is also not shy about its territorial ambitions in northern Syria and Iraqi Kurdistan.

Unlike the US, China continues to be dependent on Gulf oil. It is certain we will see increasing Chinese activity in the region as America reduces its presence. Beijing has made it clear that its alliance with Iran will not affect its ties with the Gulf countries.

Countries in the region will be under pressure, primarily from the US, not to get closer to China. The region, like in the 1950s, will be caught in a new cold war between China and Russia on the one hand and the US and its European allies on the other. This requires a careful diplomatic balancing act by countries in the region as we witness major geopolitical aftershocks.

Osama Al-Sharif is a journalist and political commentator based in Amman. Twitter: @plato010