When a much hailed 25-year strategic pact is simply a mirage

The Chinese-Iranian 25-year strategic cooperation pact signed last month in Tehran has spurred an unlimited number of contradictory analyses pertaining to the objectives of the partnership, and the main reasons behind it.

While important for the geopolitics of the Middle East, the deal is probably closer to a negotiating card rather than a game changer for regional alliances among its influential stakeholders.

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China will not contradict its traditional policies towards the Middle East by taking sides, particularly amongst the Gulf states.
In foreign policy matters, over the decades China has signed Comprehensive Strategic Partnership Agreements (CSP) with several states around the globe. In the Middle East CSPs with Iraq (2015), Saudi Arabia (2016) and the UAE (2018) were signed.

Cooperation with Gulf states has been more expansive. Recently, the UAE became the regional manufacturer of China’s Sinophorm Covid-19 vaccine.

The deal with Iran falls within the parameters of where China is keen to keep its existing steady relationship with the region. Beijing has rarely immersed itself in the conflicts of the Middle East and it has no political reason to do so now.

With a deal value of a muted $400 billion to be invested over 25 years, there has been no official announcement made by either Beijing or Tehran.

If true, it means that China will invest almost $16 billion annually in Iran. Compare that to Chinese investments in the more diversified, industrialized and modernized Saudi economy, where the total does not exceed $5.1 billion annually.
The numbers linked to Iran are doubtful.

The ambiguity of the treaty says something further about the intents of the two signatories. After the return of the Chinese Foreign Minister Wang Yi from Tehran, his spokesperson Zhao Lijian, intentionally or unintentionally, undermined the growing speculation about the deal.

“The plan focuses on tapping the potentials in economic and cultural cooperation and charting course for long–term cooperation. It neither includes any quantitative, specific contracts and goals nor targets any third party, and will provide a general framework for China–Iran cooperation going forward,” Lijian said at a press conference held last month.

Similarly, the fact sheet published by the Iranian Foreign Ministry revealed that the deal is a roadmap with no particular or specific financial objectives.

While the negotiations started with Iran in 2016, they appear to have been ramped up, with the announcement following on the heels of the first summit between the United States, Japan, Australia and India which convened virtually last month hosted by US President Joe Biden. The Quadrilateral Security Dialogue represents a rope around Beijing’s geopolitical neck.

It appears both China and Iran are testing the waters with Washington, and the West via this agreement. The former has a negotiating card for leverage against the turbulent relations with the US, Tehran can hope to better position itself when discussing anything nuclear, and the lifting of sanctions.

If both countries can benefit economically through the relationship then it’s a bonus.

China was a signatory country of the Joint Comprehensive Plan of Action (JCPOA) to address Iran’s nuclear ambitions.
China’s President Xi Jinping only paid a visit to Tehran after the JCPOA was reached and not before.

The country’s Foreign Minister Wang Yi’s visit to Tehran to sign the latest deal happened after he visited Saudi Arabia and several Gulf states, again within the framework of preserving its traditional balanced policy between the various stakeholders. Yi had not stepped foot in Tehran since his President’s visit in 2016.

It is true that China is a powerful global player that does not agree with Washington on several international issues, but its priority remains to reach agreements that improves bi-lateral trade between the two nations.

If the deal with Iran jeopardizes this goal, Beijing will reduce the relationship to the bare minimum. With China, Tehran is no position to impose its own conditions.

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