[CEG Commentary] China’s Growing Weariness with Iranian Sanctions

Published: March 10th, 2010

By Andrew Carson

China and Iran are two countries separated by language and culture but united through oil exports and shared distrust in the West. As China’s importance on the world stage increases, current political international trends have been irritating this important relationship. Most notably, the US has been pressuring China, a permanent member of the UN Security Council, to pass new economic sanctions against Iran. These sanctions would be a direct response to Iran’s new uranium enrichments attempts, which Iran insists are purely for civilian interests. Although China does support the UN’s demand for Iran’s enrichment program in Qom to be halted because it violates rules of the IAEA, it will not easily agree to proposed sanctions. China’s expected inaction over the matter will only serve to reinforce its historical position that diplomacy should be favored over harsher solutions in Iran.

Relying on Iran for almost 10% of its petroleum imports, China does not wish to place a finger on one of its main economic arteries. When dealing with Iran, China has always favored to solve problems with minimal confrontation. While this does not always make for good and effective foreign policy, it has brought the two countries closer together economically and politically. Iran’s desire to fully join the Shanghai Cooperation Organization, for example, is well known. As of 2010, Iran only has an observer membership status with the organization; a full membership would mean closer economic ties with China and the rest of Asia, which would in turn undermine US foreign policy in the Middle East. While Tehran has been actively developing its relationship with Beijing, China has become more and more dependent on Iranian imports.

China is increasingly dependent on foreign natural resources and is projected to outstrip its domestic oil resources within the next 15 years. Although China does possess a large percent of the world’s coal supply it lacks the industry and technology required to unearth it, ironically making coal one of China’s biggest imports. Therefore, in 2004 China signed onto a 100 billion dollar deal, by which China will purchase petroleum from Iran and help develop Iran’s Yadavaran oil fields. In addition, China also pledged to spend over 20 billion dollars more over the next quarter-century in Iran.

To western dismay, China-Iran relations are not only presently strong, but they are also deeply tied to future economic and political interests. This relationship cannot be easily brushed aside as the west would have itself believe. Consequently, as China tries to impose stability in its Iranian investments, the west continues to push for renewed sanctions against Iran, in efforts to destabilize Iran’s ruling regime and its agenda.

China is still wary of using the preferred tool of ‘western hegemony’, as China itself has bared sanctions and knows the extent of their effectiveness. With vested interests in both parties involved, Iran and the US, China walks a narrow line and approaches the subject with split views. On one hand, explains Li Goufu a Middle East expert at the China Institute of International Studies, “If we persist in sanctioning Iran, isolating it and backing it into a corner, then we may end up with a result which nobody wants to see.” On the other hand, he explains on NPR, “Do western nations really want to resolve the Iranian nuclear issue through peaceful, diplomatic means?” he asks. “Or are they simply using the nuclear issue as an excuse to achieve other aims, such as overthrowing the Iranian government?” This circular thinking, which well embodies eastern thought, has been clearly labeled as ‘inaction’ by the west. As western patience grows thin, China is clearly deciding between the only two viable options that it sees: continue peace talks with Iran, or simply abstain from the vote in the UN Security Council.

China will most likely end up deciding to continue peace talks with Iran, as they are in China’s own best interest for several reasons. Firstly, China has either voted for or abstained from three other sanctions on Iran, all of which have proven fruitless. Despite all three sanctions, which China backed only after every other method was exhausted, Iran still managed to develop a secret nuclear facility. Sanctions have clearly done nothing to hold back Iran’s nuclear program, if anything they have served to increase Iran’s desire for one. Armed with this knowledge, China has even more disincentive to back future sanctions. More importantly, as China gets savvy to the methods of the west, it becomes more aware of their true intentions of sanctioning Iran. China sees sanctions as a smoke screen disguising the desire in the west to overthrow Iran. Future military action in Iran will most certainly threaten Chinese interests there, thus making the need for peaceful talks that much greater.

Secondly, China sees no immediate danger in the nuclear development of one its own allies. Indeed the road to uranium enrichment is long, and even if Iran manages to quickly enrich more than 90% of its uranium, which is more than civil uses require, why destabilize a 100 billion dollar petroleum import agreement? To the Chinese it’s a simple matter of timing; China is not in a rush to make a decision on this matter and is not likely to respond to western demands anytime soon as was demonstrated during the 2009 Copenhagen Climate Conference.

Thirdly, China believes its heavy investment in the Middle East will help stabilize the region. Iran is not the only Middle Eastern country that China has invested in; China has tried to diversify its imports. Investing in Saudi Arabia and even in Iraq, China’s blanket investments in the Middle East could create a new system of balance and control. When a country grows at the rate equivalent to one Brazilian economy every four years, such investment in resources might create an unparalleled centripetal force in the Middle East.

Lastly, recent events such as the new defense contracts with Taiwan and the highly publicized Obama-Dalai Lama meeting have only served to harm Sino-US relations, as the Chinese government has openly admitted. An embittered China will have no good reason to heed to western desires, when it feels that its own are being ignored.

All in all, a blunt and tooth-less sanction is just too narrow minded for the Chinese to agree to and will never address all the issues that China finds important. Whether China will follow suit with Russia and give into western powers is still up in the air. China however is most likely not going to vote for a fourth round of economic sanctions, not unless the west can scramble together a big incentive. Even then, the most that China could promise to deliver would be an abstaining vote on the UN Security Council.

For further reading, please visit:

China Unlikely to back new sanctions against Iran

Ai Yang and Zhang Haizhou for China Daily

January 18, 2010

As Iraq Stabilizes, China Bids on Its Oil Fields

Keith Bradsher for The New York Times

June 30, 2009

Iran’s new alliance with China could cost US leverage

Robin Wright for The Washington Post

November 17, 2004

China Forced to find balance between U.S., Iran

Anthony Kuhn for National Public Radio