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2/2/16

Iran - China: Iran's New Best Friend

As Iran celebrates the lifting of sanctions and cranks up its oil production, the biggest winner may be China, Iran’s new best friend. Chinese President Xi Jinping paid a visit to Tehran in January, meeting Iranian President Hassan Rouhani and signing a 25-year economic, political and military cooperation pact.

The two leaders announced the signing of 17 deals—including agreements on oil drilling, nuclear energy and a vast infrastructure project linking China to the Mediterranean, known as One Belt, One Road. Rouhani predicted the deals would boost bilateral trade tenfold to an annual $600 billion in the next decade.

“The end of the sanctions will serve first and foremost to help Chinese energy firms—that is why President Xi Jinping is paying a sudden official visit to Tehran,” says Jean-Christophe Iseux, Baron von Pfetten, a French senior adviser to the Chinese government. (He convened a series of back-channel meetings among top Iranian, Chinese and Israeli officials in the run-up to July’s grand deal in Vienna, where Iran agreed to suspend its nuclear program in exchange for the lifting of sanctions.) “The [nuclear] deal would not have been possible without the active involvement of Iran’s sole trusted foreign friend—China,” von Pfetten says.

Iran has been close to China for years—it has been Iran’s largest trading partner since 2009. During the last (and most draconian) sanctions period, China helped keep Tehran afloat by buying its oil, using Iranian banks in a way that did not technically violate sanctions. China also invested heavily in Iranian roads, factories and infrastructure at the time. High-profile Chinese projects include the 5-kilometer Niayesh tunnel in Tehran, one of the longest in the world, and the city’s Chinese-designed metro system. The two countries have also found common ground in their opposition to U.S. interventions in Iraq and Afghanistan.

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