By Yochai Guiski

Iran has come to the conclusion that a deal with the United States and Europe over its nuclear capabilities (JCPOA) no longer meets its cost-benefit analysis. The decarbonizing West may no longer serve as a destination for Iran’s oil and gas,  and, in Tehran’s view, cannot be trusted to adhere to a deal (even though the same clearly goes for Iran), while the Western economy and political system are no longer viewed favorably in the wake of the Covid-19 economic crisis.

China on the other hand has emerged as a favorable alternative for Iran:

1.      China has shown its appetite for Iran’s oil and gas over the years, and its growing economy will maintain demand for decades. China has maintained its thirst for Iranian oil even under sanctions, and even assisted Tehran in skirting them.

2.    China has a centralized political system more in line with Iran’s and would not pressure Tehran to change its regime or internal policies   – and may even provide it with better tools to control and monitor the Iranian population.

3.     China seems to view Iran favorably and is willing to invest in the country as part of the “Belt and Road” initiative (B&R). Beijing has signed a comprehensive strategic cooperation deal with Tehran, and has broadened its military ties with it (conducting joint military exercises).

4.   Both countries view the U.S. as their chief strategic rival/threat. They are both pursuing policies to weaken Washington’s power, standing and influence in their respective regions, and develop military capabilities to deny and disrupt the U.S. armed force’s ability to project power into these regions.

Despite the rosy outlook from Tehran, China seems to take a more nuanced approach toward Iran:

1.     China still views Saudi Arabia and the United Arab Emirates as strong partners in the Middle East and does not want to sour the relations with them by embracing Iran.  

2.     The amount of Chinese investment in Iran is still limited even though Iran is part of the B&R.

3.     China is still careful not to anger the U.S. by overtly and comprehensively defying sanctions.

4.      It seems that China is content to let the JCPOA negotiations drag out and has been leveraging it to criticize the U.S. and point out Washington’s failures in the Middle East.

5.      As the U.S. intends to drawdown from the Middle East in order to focus on the “Indo-Pacific” China might find Iran useful in disrupting Washington’s plans.

Whether China likes it or not, it now seems to own the Iran issue:

1.      China’s singular importance to Iran’s current and future economy lends it significant influence over Tehran to limit its nuclear actions and regional behavior.

2.     The Iranian strategic bet on China plays a major part in the failure to return the JCPOA, their ability to sustain their economy under sanctions, and in Iran’s pursuit of a “resistance economy”.

3.     Should China continue with its current policy regarding the nuclear negotiations, Iran may use the space and time to advance its nuclear plans and may even view it as a tacit approval to develop a nuclear weapon, much like North Korea did. If this scenario comes to pass it would impact China’s image as a willing backer of such regimes, and an ally to an emboldened enemy of many in the Middle East.

It is therefore important that:

1.      China recognizes its unique position and plays a responsible and prominent role in addressing Iran’s behavior and preventing it from further destabilizing the region.

2.     China understands that if Iran is left unchecked, even before it reaches a nuclear weapon, it would destabilize a region which is critical to China’s energy needs, and might foment ill will toward Beijing in an area that is a willing economic partner.  

3.      Middle Eastern nations wary of Iran’s regional and nuclear aspirations seek to influence Beijing’s policies towards Iran. They should try and encourage China to view the situation not as a “zero sum game” with the U.S., seek initiatives that help stabilize the region, and show that both great powers can work together, even in competition.

4.      The U.S. and Israel (separately and jointly) should devise a China-Iran policy that:

a.     Engages China on Iran and shared interests in maintaining stability in the Middle East  – especially the Persian Gulf  –  and even develop a joint understanding on the goals, ways and means, to do so.

b.     Seeks to enhance Beijing’s role in the nuclear negotiations, as it holds the relevant leverages to prod and cajole Tehran to return to a nuclear deal and to possibly commit to a more comprehensive deal down the line.

c.     Seeks to reduce the viability of Iran’s strategy of dependence on China, and impose increasing costs on such policies if engaging China fails.  

LT. Col. Yochai Guiski is a 23 year veteran of the IDF. He retired in 2020 as a Lieutenant Colonel after serving in the Israeli Military Intelligence. Yochai served in various roles including: Coordination of Government Activities in the Territories (C.O.G.A.T.), Strategic Planning Division and the Ministry of Defense (politico-military directorate). Read full bio here.