China and the 2009 Round of the Iran Nuclear Question

China continued its traditional approach of balancing between Washington and Tehran as the diplomatic confrontation over Iran’s nuclear activities escalated during 2009. Seeking to alienate neither the United States nor the Islamic Republic of Iran (IRI), Beijing broadly endorsed efforts to reach a negotiated solution with both sides showing flexibility in order to reach an agreement that upholds the Nuclear Non-proliferation Treaty (NPT). This formulation implicitly criticizes both Washington and Tehran --- Washington for trying to abridge Iran’s “right” as a signatory of the NPT to the “peaceful use of nuclear energy,” and Tehran for not adequately demonstrating to the “international community” that it is not attempting to make nuclear weapons. China is unlikely to thwart a new push by Washington, Paris and London (Berlin seems unlikely to go along) to have the Security Council endorse a new and broader – “punishing” is the word used by US representatives – set of sanctions. But China’s words suggest that at the end of the day, it will not permit the Security Council to endorse, or itself participate in, tough economic sanctions against Iran. Beijing rather is likely to water down any sanctions to allow its rapidly expanding economic relations with Iran to grow unimpeded.

Chinese analysts were deeply sceptical about the Obama Administration’s policies toward Iran. Efforts by the new Administration to improve relations with the IRI had had some effect. An August article in China Daily by the director of Jiangsu’s Institute of International Relations opined that in spite of a few moderate words and gestures by the Obama Administration, Washington was likely to revert soon to a hard line approach, which would fail. “The long strained Iranian-US ties have improved to some extent after Barack Obama assumed the office of the US President,” the article noted. But once “the world’s largest economy bottoms out the Obama administration will [resume] its attack on Iran’s nuclear program once again, increasing the pressure on Tehran.” US policies toward Iran continued to be “prejudiced.” “An improvement in US-Iranian ties depends more on the length Washington is ready to go to engage Tehran in a dialogue.”

Another China Daily article reviewing the demonstrations in Tehran protesting irregularities in the June 2009 Iranian presidential election was implicitly critical of US “interference in Iranian internal affairs.” The “international community” should not “add fuel to an already burning issue” by interfering in Iran’s internal affairs, the article warned. An “Attempt to push the so-called colour revolution toward change will prove very dangerous” because “A destabilized Iran is in nobody’s interest if we want to maintain peace and stability in the Middle East and the world beyond.” President Obama had indicated, the article said, in his speech at Cairo University and in comments made while meeting South Korean President Lee Myung Bak, that the US would not intervene in Iran’s current post-election turmoil. The crux of the issue, the article implied, was whether or not the United States would adhere to these promises.

China’s opposition to efforts to accomplish regime change in Iran dovetails with China’s own interests --- or actually, with the interests of the Chinese Communist Party that has ruled China since 1949. The CCP leaders well understand that the United States and other Western democratic countries believe that values of individual freedom are universal and give unique legitimacy to institutions of liberal democracy. Marxist-Leninist, Communist values and political systems are fundamentally illegitimate, according to this Western perspective, and Western governments are often tempted to apply these ethnocentric prejudices (in the CCP’s view) to China. These Western prejudices, “Cold War mentality” in the CCP’s preferred nomenclature, were directed against China during 1989-1994, culminating in US threats to withdraw China’s Most Favoured Nation status (and thus severely restricting China’s exports to the US) unless China implemented major improvements in its “human rights.” China’s tough stance defeated that earlier US effort, but events in Tibet, Xinjiang, or elsewhere in China pose perennial opportunities for renewed US and Western “interference in China’s internal affairs.” The CCP rule of China will be safer and more secure if Western countries abandon universalistic ethno-centricism and accept the reality of diverse political systems around the world.

Beijing has consistently opposed imposition of sanctions against the IRI over the nuclear issue or any other issue, for that matter. It eventually voted in the Security Council for sanctions resolutions:  Resolution 1696 in July 2006, Resolution 1737 in December 2006, Resolution 1747 in March 2007, Resolution 1803 in March 2008 and Resolution 1835 in September 2008. The sanctions authorized under these resolutions were limited to a 28 or so individuals and entities involved in Iran’s nuclear or ballistic missiles activities. China, together with Russia and Germany, worked to ensure that those sanctions did not have much bite. Agreeing to vote for sanctions placated Washington, but watering those sanctions down ensured that Washington’s quarrels with Tehran would not too adversely affect the Sino-Iranian ties.

As the Obama Administration began to lay the groundwork for tough Security Council-sponsored sanctions should the October negotiations with Tehran fail, Beijing made it clear that it thought such sanctions were a bad idea. A Xinhua “International Observer” article made clear that sanctions were a Western idea. “Western countries led by the US have asserted that the real intent of Iran’s nuclear program is to possess nuclear weapons” and “the Western countries have applied pressure on Iran in all forms in an attempt to force Iran to stop its nuclear programs.” Iran had rejected all such pressure. Once again, in 2009, it was likely that “the United States and the EU” will “press for a new round of sanctions against Iran. “However, because every country proceeds from its own interests, it will not be easy [to secure] the adoption by the UN Security Council of a resolution on imposing substantive sanctions on Iran.”  

Speaking on 24 September, a spokesperson of the Chinese Ministry of Foreign Affairs said that imposing sanctions and exerting pressure would not be “conducive to diplomatic efforts” to resolve the Iranian nuclear issue. “We hope that all relevant parties seize the current favourable period, step up diplomatic efforts and push forward the achievement of positive results,” the spokesman said.   The proper path was one of talks, dialogue, and negotiations, without a background of threatened force or sanctions.
As Western companies pulled out from Iran because of greater political risk in servicing that market, Chinese companies seized the opportunities to expand. In July 2009, the IRI embassy in Beijing announced that China had become Iran’s number one trading partner.  When the Iranian revolution occurred in 1978, China accounted for about one percent of Iran’s trade. By seizing the opportunities created by Western problems with the IRI, China pushed its way into a very large, lucrative, and growing market.

An embargo of gasoline was one “tough sanction” widely discussed in Western media. Perhaps in response, British Petroleum (BP) and Reliance of India stopped selling refined petroleum products to Iran in mid-2009. Total of France indicated a willingness to follow suit, should the Security Council so mandate. Chinese firms stepped in to meet Iran’s shortfall. Chinese officials denied that China sold gasoline to Iran, but foreign analysts concluded that between 30 and 40 thousand barrels a day of Chinese refined petrol was reaching Iran via third parties.  

Iran supplies large amounts of oil to China --- typically ranking among the top three suppliers to China. China’s energy security strategy stresses involvement in upstream foreign oil production, and Western sanctions against involvement in Iranian oil development projects make Chinese participation attractive to Tehran. Iran also produces lots of mineral ores that China needs: copper, sulphur, zinc, chromium, iron, lead, and aluminium. Iran also offers excellent opportunities for Chinese exporters of transportation, construction, mining, manufacturing, and power generation equipment and machinery. Iran has ambitious development objectives and adequate financial resources to pursue those objectives. Chinese machinery is not as technologically sophisticated as Western or East Asian (Japanese or South Korean) goods, but Chinese goods are typically substantially cheaper and quite good enough for Iran. Iranian engineers and manufacturers might, ceteris paribus, prefer Western or Japanese goods. But low political risk associated with Chinese goods in contrast to the risk of interruption or interference associated with Western goods, (along with low Chinese prices) often trumps those Western advantages. Iran is a very big market and Western sanctions offer Chinese firms an opportunity to expand into that market.

China’s balancing act in the Security Council reflects two important but contradictory sets of interests that Beijing must accommodate. Economic interests weigh heavily in China’s calculus, but strategic calculations are important too. China’s interests would not be injured if US efforts to lock Iran into a militarily inferior position (that is, without nuclear weapons) collapses. The US prestige would thereby be substantially diminished. China’s security against a possible hostile cut-off of China’s sea-borne oil imports (either by the United States or India) would also be enhanced by having a friendly, militarily powerful and confident Iran willing to work with China to counter such hostile moves. China’s leverage with Washington would also benefit from Washington finding itself in a long term political- military confrontation with Iran. The United States --- and for that matter, Iran --- would need China’s assistance on various matters, while the US would be less inclined to focus on East Asian affairs closer to China’s own vital interests.

In the dominant view among China’s Middle East specialists, the root cause of the clash between the IRI and the West has been the arrogant, bullying, and ethnocentric policies of Washington over the administrations of half-a-dozen Presidents. It is American policies of sanctions, military strikes (during the “tanker war” of the 1980s), threats, subversions and absence of diplomatic relations that have, in Beijing’s view, created the current morass and possibly pushed the IRI toward nuclear weapons to defend itself. The United States is now stewing in the mess it has itself made. Why should China ignore its own interests by aligning with the United States against the IRI? Even if, in extremis, the IRI acquires nuclear weapons, China has no allies or military forces in the region that would be threatened by those weapons. Nor has China undertaken (unlike the United States) to guarantee the flow of oil through the Strait of Hormuz. China’s general, and genuine, interest in limiting the number of nuclear weapons states is balanced against these multiple and major strategic interests.

But China must pursue these strategic and economic interests without injuring an even more important interest in maintaining cordial relations with the United States. Since 1978, China’s drive for economic development has been underpinned by the imperative of maintaining cordial relations with the United States and, thus, a generally supportive American attitude toward China’s development. This imperative continues to operate. It has been paralleled since 1997 by a US push for increased strategic partnership with China in managing the affairs of the post-Cold War world. This US policy creates a very favourable environment for the growth of Chinese influence, and Chinese leaders recognize many advantages from accepting US invitations for strategic partnership and cooperation. This means that Beijing will not block US moves regarding Iran in the Security Council and will cooperate with Washington at least to the degree judged necessary to keep Washington from viewing Beijing as a rival, competitor, much less a hostile power. Exactly what that degree entails will be determined by the estimates of Beijing’s diplomats and analysts about the intensity of US demands and the correlation of forces balanced behind and against Washington’s moves. Beijing will probably cooperate with Germany and Russia to water down further sanctions. But Beijing will be loath to take the lead in opposing US policy thrusts.

Professor of International Relations at the Sam Nunn School of International Affairs, Georgia Institute of Technology, Atlanta, US.

The views expressed here are those of the author and do not necessarily reflect the views/positions of the MEI@ND.

Editor, MEI India Speaks:  P R Kumaraswamy