Posts Tagged ‘China-iran’

Have not been posting here for some time, keeping busy with projects elsewhere, so a few pieces to catch up on. First up, something for the South China Morning Post from all the way back in February looking at when Iranian President Raisi visited Beijing. As it turned out, a prelude to the Chinese supported Iran-Saudi deal.

Power imbalance in China-Iran relations on full display during Raisi’s Beijing trip

Sanctioned and isolated, Tehran has less to offer Beijing than Moscow, which can at least boast a powerful military and global presenceWithin Iran, there is also wariness of Chinese investment, and not even shared concerns about Afghanistan have helped to spur cooperation

There is a third leg in the alliance of powers against which the West is facing off that has always seemed a little wobblier than the other two. The China-Russia relationship is as tight as ever, and the Russia-Iran link is only hardening as Tehran steps up its military support to Moscow.

The China-Iran link, however, seems more troubled. Last week’s visit by Iranian President Ebrahim Raisi to Beijing has been sold as an opportunity to bolster cooperation, but even with a high-profile boost, it is unlikely to come anywhere close to the strength of the other two.

China needs Iran even less than it needs Russia. Moscow is, in fact, an important partner for Beijing. Putting to one side the complicated and often contradictory economic relationship, which is clearly shifting ever more firmly in China’s favour, Russia is a United Nations Security Council member and a nuclear power whose army is able to increasingly command global presence.

It may have made a major strategic blunder in its invasion of Ukraine, but it remains a significant player on the world stage and serves an important role for Beijing.

In contrast, Iran is a heavily sanctioned and isolated power that produces little that Beijing immediately needs. Its rich hydrocarbon supplies are of interest to China, as is its large consumer population and open market for outside infrastructure investors. But these are all things that China can also find elsewhere.

Iran does not sit at the heart of any international structures that are useful to China’s efforts to blunt the growing push by the West to isolate Beijing on the world stage. In fact, Iran is desperately keen to join Chinese structures – like the Shanghai Cooperation Organization (SCO) – to demonstrate that it still has important allies.

Nowhere has this relatively limited dependence been on greater display than after President Xi Jinping visited the China-Gulf Cooperation Council (GCC) summit in Riyadh late last year. A joint communique issued after the summit highlighted GCC members’ concerns about Iranian behaviour in shared waters.

The statement generated public rebukes of China by Tehran. At the same time, these were very carefully delivered by the Iranian government as the country still wants to develop a better relationship with China.

The much-vaunted 25-year strategic cooperation deal valued in the hundreds of billions that was signed between the two countries in 2021 was meant to lead to huge levels of investment, and while it has led to some reported projects, it is moving slowly. China continues to import Iranian oil – and not much else – though often reportedly routing the oil via United Arab Emirates or Malaysia to mask its origin.

Chinese firms are still hesitant to operate in Iran due to a fear of secondary sanctions. At the time of the visit, the Iranian press was reporting that Iranian companies had restarted work on the Yadavaran oilfield which had initially been awarded to Sinopec but which they had suspended work on six years ago.

There is considerable resistance to China on the ground in Iran as well. In the wake of the announcement of the 25-year strategic partnership deal, a version of the document was leaked online, leading to a number of senior figures speaking out against it.

Former president Mahmoud Ahmedinejad, previously an eager ally of China’s when in power, expressed concern as part of his lobbying to return to power, recognising the public sentiment against the deal, while other senior leaders highlighted the plight of Uygurs as something the authorities should focus on with China.

Even more recently, a prominent Iranian think tank close to the government published a report which outlined concerns about Chinese “debt trap” diplomacy, drawing on studies of Chinese-supported projects in other locations coming to conclusions which it specifically linked to potential projects signed under the 25-year deal.

Iran also fits awkwardly into a number of other Chinese relationships on the world stage. Xi’s visit to Riyadh was part of a much larger effort by Beijing in the Middle East, and part of a strong push by Saudi Arabia to expand its influence around Asia. Similarly, Israel is an important partner for Beijing – though one whose loyalties to Washington complicate things.

Both Israel and Saudi Arabia are implacable adversaries of Iran, and locked into confrontation with it in various locations around the world. Israel, in particular, has shown itself capable of reaching deep into Iran to go after specific individuals or targets.

Finally, there is the reality of Afghanistan, a country that physically separates China from Iran and is currently governed by the relatively unstable Taliban authorities. While the two countries have engaged on the topic and share very similar concerns, there is little evidence of cooperation between the two.

In fact, the Taliban is often keen to highlight Iranian firms as alternatives to Chinese ones in their pursuit of external investment in the country. In other words, the one place where Chinese and Iranian direct interests collide, the two are in competition.

The reality is that the China-Iran relationship is as unbalanced as the China-Russia one, though the dependency from Iran’s direction is far more substantial. Moscow is as needy of Beijing, but in many ways has more cards that are useful to China. This power dynamic was on prominent display during this week’s visit, which was high on rhetoric with the substance still to be delivered.

Raffaello Pantucci is a senior associate fellow at the Royal United Services Institute (RUSI) in London and a senior fellow at the S. Rajaratnam School of International Studies (RSIS) in Singapore

Have not been posting for a while, need to catch up. Been very busy with some longer projects some of which will eventually emerge. But for the time being, enjoy this comment for the South China Morning Post on Wang Yi’s Middle East tour following the blow-out in Anchorage.

How China’s Middle East charm offensive succeeded despite affecting little change

  • What Foreign Minister Wang Yi’s visit to the region may lack in material achievements, it makes up for in good optics. China is a major player in the region
  • In highlighting this, Wang has undermined the Western-driven condemnation of the week before and achieved China’s foreign policy goals
Iranian Foreign Minister Mohammad Javad Zarif (right) greets Chinese Foreign Minister Wang Yi after a document-signing ceremony in Tehran on March 27. Photo: EPA-EFE
Iranian Foreign Minister Mohammad Javad Zarif (right) greets Chinese Foreign Minister Wang Yi after a document-signing ceremony in Tehran on March 27. Photo: EPA-EFE

US-China tensions have continued seamlessly into the Biden administration. Beijing’s desire for a reset was bluntly rebuffed in Alaska, however China is trying to spin that story now. The sanctions dispute over Xinjiang will only further strengthen a transatlantic desire to confront China. 

Sensing this, Beijing has launched a diplomatic offensive, first hosting its traditional ally, Russia, followed by a Middle East roadshow by Foreign Minister Wang Yi.

But while the Middle East visit was largely a repeat of what we have heard before and showed the limits of China’s ability to change the region, it did highlight again the world’s desire to not get caught in the middle of a spat between Beijing and Washington – an outlook that strengthens China’s hand.

The one place in which change was delivered was Iran, a country that is struggling for options at the moment in the grip of Western sanctions. For Tehran, the relationship with Beijing is a window onto the world and an opportunity when it is running out of options.

But the 25-year cooperation agreement the two sides signed is not a cheque for US$400 billion as was widely reported but rather a list of areas in which China will engage with Iran during the next two decades.

Given China’s and Iran’s generally negative image and collective confrontation with the United States, there is clear utility to the imagery of striking a loud public deal like this for both countries. It does change Iran’s calculus and position, but the biggest benefits are likely to accrue to China, whose companies will be able to pick and choose the opportunities they want at prices they like, given Tehran’s lack of alternatives at the moment.

The other new – and very contemporary – aspect to this visit was the push on medical or vaccine diplomacy. While in the UAE, Wang oversaw the launch of a joint project between Sinopharm and local firm G42 Medications Trading in the Khalifa Industrial Zone of Abu Dhabi.

Intended to open later this year, the project aims to manufacture Covid-19 vaccines to help the region inoculate against the virus. The project builds on earlier engagement by the Chinese firm in the UAE, which hosted phase 3 trials of the vaccine last year. It is undoubtedly positive that more people will get access to the vaccine as a result.

But much of the rest of Wang’s visit was a repeat of what we have heard before. The overall five-point structure he proposed, advocating mutual respect, upholding equality and justice,  non-proliferation, fostering collective security and accelerating development cooperation are a fairly predictable roster of declarations by a Chinese leader. They are not anything one can disagree with, but it is difficult to see China achieving some of those goals in the region.

Wang proposed China would try to help broker peace between Palestine and Israel. Beijing has declared this goal before and it has always been warmly welcomed, but it seems unlikely that China will be able to deliver. The offer to host another meeting between the two sides is unlikely to break that deadlock.

Additionally, China said it was going to work with Russia to unlock the Joint Comprehensive Plan of Action with Iran. This is not going to move ahead unless the Western partners are all on board.

The more interesting chasm which Beijing instead managed to navigate is the clash between Iran and Saudi Arabia. Wang did not offer any new ideas here, but more intriguing is that both countries were equally eager to engage notwithstanding the tensions they share.

This is the confusing magic of China’s Middle Eastern relations – its ability to float between adversaries in ways which others cannot.

The extent of Wang’s demands on the visit appeared to be having good optics and statements supporting China’s treatment of its own people at home. Even during his stop in Turkey, where he was confronted with protesting Uygurs, the Turkish government offered no strong criticism and instead, President Recep Tayyip Erdogan praised the Sinovac vaccine his country has received.

Little materially changed in the region as a result of the visit, and it is unlikely anyone expected much to. Even so, the world was reminded once again that China is a major player and has the red carpet rolled out for it wherever it goes.

Wang also sought to ensure that the visit focused on positive aspects – connecting national development strategies, taking advantage of the region’s natural resources and helping the region develop new health care industries. While there was some discussion about Xinjiang, it was largely kept to Chinese talking points and controlled protests in Turkey, a contrast to the sanctions and tone coming out of Western capitals.

The difficulty for Western countries is not so much that China is displacing the United States – it still lacks the means, experience or interest to try to untangle the tangled complexities of the Middle East – or that anyone in the region changed their strategic positions towards the West. Instead, the visit reflects a region that follows China’s brutally realist view of the world, where values come second to interests. In highlighting this, Wang has undermined the Western-driven condemnation of the week before and achieved his foreign policy goals.

Raffaello Pantucci is a Senior Associate Fellow at the Royal United Services Institute in London

New piece for the South China Morning Post, exploring the shifting Eurasian dynamics around China. My manuscript looking at China across this space is now with the publisher, so should be landing sometime in the near future.

There is no new cold war, the West is just losing influence in Eurasia

Is there a new axis between China, Russia and Iran against the West? Not quite. Beneath the surface of the anti-US alliance, there are undercurrents of hostility and scepticism. Across Eurasia, there is also a reluctance to take sides

Raffaello Pantucci

Published: 1:00am, 31 Jul, 2020

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A global conflict like the Cold War needs two sides. To the West, a new axis between Beijing, Moscow and Tehran appears to be taking shape. Drawing on the common thread of anti-Americanism, this alignment strengthens the sphere of influence that China has been building across Eurasia.

But in these very places where China has been most actively cultivating allies, underlying fears and concerns consistently undermine Beijing’s approach. Still, the arc of these relationships continues to bend in Beijing’s favour, and little the West offers by way of confrontation has been able to entirely break it. We are seeing less a new bifurcation than a gradual freezing out of Western influence.

The China-Iran-Russia coalition has been a long time in the making. Most recently, it has been expressed in attempts by Moscow and Beijing to protect Tehran from American sanctions. Bilaterally, China and Iran are in the process of signing a 25-year strategic agreement, while China and Russia are parroting each other’s narratives of the United States and advancing similar conspiracy theories about the source of Covid-19.

The three recently established, with Pakistan, a new grouping to focus on Afghanistan after the withdrawal of US troops. None of this is especially new, as it builds on a long history of cooperation between the three. According to some reports, they may have shared intelligence to take down US intelligence networks within their countries; late last year they held joint naval exercises.

Military sales between the three are substantial, and they have cooperated diplomatically at the UN to stymie Western goals. Yet this coalition masks deep tensions at the official and public levels. Chinese companies may seem willing to step into contracts abandoned by European firms in Iran, but until recently they were more fearful of US secondary sanctions than the importance of China’s relationship with Iran.

As for Russia, its detention of a prominent Arctic academic on accusations of spying for China hints at an undercurrent of hostility in the countries’ hard-power relations.

Iranian officials have complained publicly about China’s Covid-19 information, while Russian officials have targeted ethnic Chinese for racial profiling amid coronavirus fears. And while Russia and Iran might be fighting on the same side in Syria, neither trusts the other’s long-term intentions in the Middle East.

At the public level, scepticism about China is prevalent in both Russia and Iran. With conspiratorially minded audiences, it does not take long to find voices wary of Chinese economic influence. Former Iranian president Mahmoud Ahmedinejad is trying to ride this wave, ahead of next year’s presidential election.

This translates more widely into other geopolitical relationships that cut across the loose coalition. Both Moscow and Beijing have close relationships with Saudi Arabia, which theoretically contradict their alliance with Tehran. And both Moscow and Tehran have close relationships with India, China’s foil in Asia with whom it is currently locked in an aggressive land confrontation.

But there is a ruthless pragmatism at work across the three countries and the broader region. The heart of Eurasia is increasingly a Chinese-dominated space in which the cold logic of realism reigns supreme. The idealism advanced by liberal Western democratic powers is being crowded out by China’s pursuit of economic prosperity above all else.

And it is striking to see how this logic applies even to relationships in which China seems more bent on confrontation. In Kazakhstan, there appears to be a low-level information war with China, with instances of nationalistic Chinese reporting on Kazakhstan causing friction at an official level. Yet, the two countries continue to want to work closely together.

In India, Prime Minister Narendra Modi still seems uncertain as to how far he can push tensions with China. His decision to ban Chinese mobile apps seems toothless at best, even as his officials continue to actively participate alongside Beijing in multilateral forums like the Shanghai Cooperation Organisation or the Russia-India-China grouping.

And while he may have rhetorically moved towards the so-called Quad and Washington, his long-term future remains bound to Beijing, a reality he can hardly change, notwithstanding the current Indian media narrative.

And even if India did shift dramatically and aggressively against China, it is not clear that this would create a Western democratic bulwark within the region. Quite aside from India’s historical hedging strategy with regard to the West, Russia and China, there are concerns about India’s treatment of its Muslim minorities.

Some of India’s Muslim-majority neighbours have escalated these concerns, though they have a habit of doing so only when it suits their interests – much like how the issue of Xinjiang is raised selectively.

This is the reality of the situation in the heart of Eurasia – a complicated mess where idealism is in the rear-view mirror. There is a continuing narrative of a new cold war, but this time, the non-Western bloc is not a clearly unified structure.

Although Russia and Iran are close enough to be willing to overlook their differences in favour of China, theirs remains a skin-deep alliance. In the region, even among the like-minded powers that would more naturally fall on the American-led side, there is a confused picture – and no one really wants bifurcation.

We are not entering a new cold war, just seeing the gradual freezing out of the West in the Eurasian heartland.

Raffaello Pantucci is senior associate fellow at the Royal United Services Institute (RUSI) in London

And now finally up to date with my latest piece for the South China Morning Post, this time looking at some of the geopolitical questions flowing around China, broader geopolitics and the COVID-19 mess. Covers ground not dissimilar to my earlier piece for the Telegraph though focused in a different direction. Has already received some anger online and was reproduced in a Singaporean local Today. In other media work, earlier piece for ORF on Kashmir and the UK and my last RSIS piece on the Maldives were both picked up and reproduced by Eurasia Review, while spoke to the Independent about recent UK terrorism numbers release and last interview in CTC Sentinel with Lord Evans was written up by the paper.

How China’s coronavirus medical diplomacy is failing to win over the world

Forget Pax Sinica, China’s medical outreach is struggling to attract new friends. And even though Russia and Iran, its closest allies, may be on the same page, underlying tensions remain. There is a global leadership gap but Beijing is not filling it

Raffaello Pantucci

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The world is grasping for an understanding of how the geopolitics of the coronavirus will play out. One dominant theme is that China is mendaciously riding the media waves to paint itself as a saviour dispensing medical equipment.

Yet, it is hard to see how Beijing is benefiting from its medical diplomacy, with opprobrium from every direction. Even given China’s close alliances with Iran and Russia, it is possible to see tensions emerging.

It is not at all clear that China will come out of the virus crisis as the rhetoric winner, notwithstanding the frantic narrative seeking to paint it that way.

Given the energy that China appears to be putting into promoting and pushing its medical diplomacy, it is surprisingly hard to uncover much evidence of a positive reception. While news stories speak of Chinese doctors and equipment arriving in stricken European states, it is difficult to find many news stories trumpeting China’s magnanimity.

Those who do speak of it positively tend to be the ones who already hold a positive view of China. The bigger narrative that seems to have caught on of late, however, is that much of the Chinese equipment appears to be faulty. It certainly does not seem that China is winning many new friends with its medical diplomacy.

Where China is finding resonance is in the predictable places, but even this is with caveats. The almost comical conspiracy theory that Covid-19 was a US military weapon has, unsurprisingly, found resonance in both Tehran and Moscow.

Ayatollah Ali Khamenei referred to the theory on his Twitter feed, while Russia’s foreign affairs spokeswoman, Maria Zakharova, defended China’s work on the virus and helped to propagate narratives espoused by Beijing.

Yet, singing from the same hymn sheet about the virus has not swept away the underlying tensions. For example, Sinochem is refusing to buy oil from Russia’s Rosneft after the US warned of sanctions if it did so.

At the same time, Chinese purchasers have bought record volumes of Russian oil from other suppliers, taking advantage of record low prices to fill strategic reserves.

Iran may still be supplying energy to China, but some calculations have concluded that Tehran is doing this for zero income, given that it is paying off earlier Chinese investments. This is hardly magnanimous action on Beijing’s part to strategic allies in difficult positions.

The coronavirus has caused tensions between the three nations. Russia was one of the first countries to close its borders to China (doing so at the same time as Italy and before the United States), while reports from Iran suggest that its outbreak, which started in Qom, may have come either from businessmen travelling back from China or Chinese workers.

In Russia, there have been reports of East Asians being attacked, while Moscow bus drivers were told to report it to the police if they found a Chinese person on board.

We are seeing a classic dance play out here, with all three powers playing the same game of rhetoric (deriding Europe and attacking America), while the realist dynamics churn on relentlessly below the surface.

There is little evidence that the coronavirus has changed the dynamics between the three, nor that it has bolstered China and its axis of convenience on the world stage.

Some fear that in some ways Beijing’s displays of medical diplomacy will permanently reshape the international order. Yet, the reality is that the most damaging impact to the international order comes from the absence of leadership in Washington.

Some European capitals have been slow to respond to the pandemic and walked when they should have run, but the truth is that few expected the European Union to lead the world in responding to this crisis. The EU remains confounded by its fundamental governance contradictions.

But none of this means that China can credibly fill the vacuum. Rather, a vacuum continues to exist, and is only being made larger by the fumbling response from US President Donald Trump and his administration. This is the acceleration that is happening in international geopolitics. Power is ebbing away while others desperately thrash around for influence.

Yet no one is able to fill it, creating a confusing order where rules and behaviour are increasingly incomprehensible, where state leaders and their spokespeople lie, and we refuse to acknowledge goodwill and impressive gestures for what they are. The cynicism is obvious, but the absence of something better means such narratives are gaining greater attention.

China has undoubtedly used its medical aid politically, but ultimately this is not going to shape the new world order. We may not be seeing an end to an American-led order in favour of Pax Sinica, but we are witnessing a rebalancing of the two.

Raffaello Pantucci is senior associate fellow at the Royal United Services Institute (RUSI) in London

And finally in this catch-up blast, a longer op-ed for the South China Morning Post looking at some of the recent machinations between China and Iran. Had a few comments back that this was an obvious point to make, but it feels like it needs to be all considered against the broader backdrop of China’s growing influence and power in its own backyard. More on this topic to come.

All of these posts aside, spoke to the Sunday Times about Chinese investment and influence in Ireland, spoke to CNBC about China-Russia (which was translated into Hungarian), The National about the far right in Germany, to Samaa TV about ISIS in Khorasan, to The National again about bounties being put on ISIS leaders heads, an old interview was used again in this fantastic Portuguese piece in Sabato by Nuno Tiago Pinto about important Portuguese foreign fighter Nero Saraiva who lived for a while in the UK, an earlier comment to the Telegraph about Hamza bin Laden’s death was picked up again, and another earlier piece in the Sunday Times was picked up by VoA.

Why Iran has got China wrong: Beijing will follow its own playbook in countering the US-led West

  • While regional players like Iran seek to bring China into the conversation as an ally, Beijing continues to rely on the rhetoric of non-interference
  • China is focused single-mindedly on its own interests and set to get stronger as a result

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The first-ever Chinese goods train to Iran arrives in Tehran on February 15, 2016, after a 14-day journey hailed as a revival of the Silk Raod under China’s Belt and Road Initiative. China is emerging as the central power in its immediate and expanding neighbourhood, while the West tears at itself and old alliances. Photo: EPA

Buried among last week’s news of confrontation with Iran was a story that China was on the cusp of investing US$400 billion into the country’s hydrocarbon industry. This was followed late in the week by the news that Iran was going to be joining China and Russia in new naval exercises, an announcement that came a week after the Iranian Armed Forces Chief of Staff, Major General Mohammad Baqeri, visited a naval base in Shanghai.

The clear suggestion was that Iran was showing it had a strong ally in Beijing. The axis of convenience against the West was bringing Tehran firmly into its bosom.

Yet, in the face of all of this noise from Iran, Beijing was largely silent. A foreign ministry spokesman denied any knowledge when confronted with a question about the investment during a regular press briefing. The Chinese commentariat seemed mostly focused on downplaying Iran’s role in the strike on the Abqaiq and Khurais facilities in Saudi Arabia, and President Xi Jinping had a phone call with King Salman.

Reported in similar terms by both the Saudi and Chinese state media (the Belt and Road was only mentioned in Xinhua’s read-out and the Saudi statement was far more aggressive), the phone call was a decorative effort highlighting the importance of the bilateral relationship and China’s desire for events not to escalate.

And, while Beijing seemed eager to not engage, Iranian sources appeared to deny the existence of the supersized investment. On Friday, an interview emerged with the head of money and capital markets at the Tehran Chamber of Commerce stating that he had not heard anything about it.

Furthermore, Iran’s oil minister Bijan Namdar Zanganeh denied the rumours, bluntly saying, “I have not heard such a thing.” In fact, the discussion in Tehran at the moment around China is about how long the Bank of Kunlun will be able to continue to be a lifeline of sorts for the country.

Owned mostly by the China National Petroleum Corporation, the bank is a Xinjiang institution that has long served as a conduit for financial relations between China and Iran. As the rest of the world severed its links to Tehran, Kunlun has kept a connection going. The bank has faced some pressure, falling into the US Treasury Department’s sights, leading the bank to try to downplay its relations for fear of damaging repercussions for parent institution CNPC.

The result has been a paring back of financial relations between the bank and Iran, with the maintenance of only a few lines of credit focused specifically on non-sanctioned goods.

Rather, the Iranian announcements have the ring of similarity to previous announcements to have emerged from Moscow, as its relations with the West went downhill.

Back in 2014, as the West’s condemnation of Russia’s redrawing of Ukraine’s borders reached fever pitch, President Vladimir Putin headed to Shanghai where he oversaw the signing alongside President Xi of a US$400 billion energy deal between China and Russia. The deal was one which had been announced and signed a few times before, but it landed in Shanghai at a convenient moment for the Russian leader.

Again, this was not a moment without some irritation for Beijing. While China never condemned Russia’s actions in Ukraine, it was not best pleased, keeping its comments sparse. China is not keen on major disruptions to international affairs, like the attack in Saudi Arabia, especially ones which might have repercussions for Beijing.

The precedent that Russia set in redrawing borders in Ukraine was not one that China wanted widely adopted –
fearing the loss of its own restive regions. And disruptions to international energy supplies result in higher prices, something China could do without.

The question, then, is whether China is hostage to disruptive powers like Iran and Russia, or whether Beijing is, in fact, gaining the upper hand.

To better understand this, it is important to note another event over the weekend that ties the three countries together – the Taliban negotiating team’s visit to Beijing after stops in Moscow and Tehran.

Organised after the dramatic failure of the American-led talks, the whistle-stop regional tour appears to be an effort by the Taliban to understand better where things now stand. With Afghan elections around the corner and the conflict showing little evidence of concluding, all three surrounding powers have begun to worry about how they will manage the long-term instability with which Afghanistan seems cursed.

From China’s perspective, however, this is all reflective of the fact that everyone appears to want to show that Beijing is on their side. In each of these situations, the regional players have all sought to bring China into the conversation and show that Beijing is backing them.

China is judicious in avoiding apportioning blame, and at best uses the opportunity to make digs at the United States. The net result is that China emerges as the central power in its immediate and expanding neighbourhood, while the West tears at itself and old alliances.

For Beijing, there is some danger in assuming this position. First, it reinforces the image of China as the central power in a new axis of convenience against the US-led West. And second, it places China in a position of potential responsibility between some of the world’s most intractable conflicts.

Yet, it is equally possible that Beijing has factored both of these realities in and is actually happy to bolster alliances against the US.

In terms of China’s unavoidable responsibilities, this is something that has been on the cards for some time, and yet Beijing has yet to really demonstrate a requirement to have to step in.

Instead, China continues to call on the rhetoric of non-interference to simply let things play themselves out, focused single-mindedly on its own interests. Rather than taking on the activist West at its own game, China appears to be crafting its own playbook.

And while Tehran may think that it is hustling Beijing into showing its hand in its favour, the reality is that it is China that is most likely to emerge strengthened from this geopolitical dance.

Raffaello Pantucci is director of international security studies at the Royal United Services Institute in London

Belatedly posting a piece for the Financial Times excellent Beyond BRICS blog which focuses on the reality of the Chinese relationship with Iran and Russia. More complicated than is often assumed. A topic that I would like to focus on more in the future, both in terms of the reality and complexity of China’s relations with Iran and Russia, as well as broader Eurasian geopolitics. On that particular note, please check back into the China in Central Asia website which  I am hoping to awaken soon.

Separately, spoke to the Guardian about the UK’s disengagement and desistance programme, to the BBC about the extreme right wing, to the LA Times about a Uighur fighting extradition from Turkey, to De Trouw about the role of mainstream political discourse in dragging the extreme right forwards, to AFP about ISIS (which was translated into Spanish), to the Independent about a plot that was uncovered to target Europe by some Sunday Times reporters, and finally a Press Association interview was used in the MetroDaily Star, and Al Banaba. Beyond this, my recent Observer piece was picked up and translated in digest into Spanish by El Mundo.

Russia and Iran cannot always count on China

In response to US sanctions, Beijing’s own interests come first

Presidents Vladimir Putin and Xi Jinping at a friendly ice hockey match between Russian and Chinese youth teams in Taijin last year © Getty

Beijing is seen by some as the financial backstop that countries can call on to bail them out when they fall foul of US displeasure and face sanctions. Yet a close examination of the cases of Russia and Iran instead shows that China is reactive to US sanctions policy, to the detriment of its supposed strategic allies.

This reflects the attractiveness of the US market, the reach of extraterritorial sanctions and the independence of some Chinese institutions from Beijing’s geopolitical interests.

It also highlights the existence of fissures between powers that are often painted as members of an anti-western alliance. They may talk with the rhetoric of allies, but their relationships are more complicated. Understanding how this will play out will be key for policymakers seeking to navigate today’s dangerous waters.

At a geostrategic level, China, Russia and Iran appear to be in lockstep. Yet notwithstanding their proximity, expressed in public shows of affection between their leaders (in particular between presidents Xi Jinping and Vladimir Putin), the reality is that there are deep tensions in Beijing’s bilateral relationships with Moscow and Tehran. Nowhere are these expressed more substantially than in the economic sphere, where Russia and Iran have consistently been disappointed by the willingness of Chinese entities and institutions to invest in their countries.

Most recently, China has been hesitant in its support of Russia’s de-dollarisation policy, through a cross-border system of bilateral settlements, for fear of angering the US. The two powers failed to conclude an agreement as planned by the end of last year, with one Russian source close to the talks telling Kommersant: “From Washington’s standpoint, China’s agreement with Russia would look like it was helping Moscow evade sanctions.”

This came after reports that Moscow was ready to bet heavily on China, diversifying its foreign reserves so that 15 per cent ($67bn) were held in renminbi, leaving the Russian central bank with a quarter of the world’s renminbi holdings. This was after it had sold about $100bn of its US dollar reserves while purchasing $44bn worth of renminbi in the second quarter of 2018.

The two countries already settle 14 per cent of bilateral payments in renminbi and 7 to 8 per cent in roubles, but were seeking to increase this, and to enshrine cross-border use of the Chinese Union Pay and Russian Mir credit card systems in each other’s countries.

A similar story can be seen in Tehran, where eagerness by authorities to use Beijing to circumvent a newly hardening US sanctions policy has been met with hesitation by Chinese institutions.

This was most publicly expressed in December, when it emerged that Kunlun Bank, which is majority owned by China National Petroleum Corp, was only going to clear Iranian payments, in full compliance with US sanctions policy, until the end of April, when China’s “significant reduction exemption” for the import of Iranian oil expires. Cutting this major lifeline for the Iranian economy was believed to be the product of CNPC’s concerns about the impact of its Iranian activities on its interests in the US.

Tehran has also seen a drop in imports from China, with an analysis by Bourse & Bazaar suggesting a 70 per cent drop from October to December last year after two months of tightened US sanctions. Like Moscow, Tehran has sought to increase the volume of transactions in local currencies but its central bank does not publish the composition of its foreign reserves, so it is not clear whether this has changed.

Frustration can also be seen in the supposed benefits that Russia and Iran have sought through investments under the Belt and Road Initiative, Beijing’s global infrastructure programme.

When Total, the French oil company, withdrew from Iran’s South Pars gasfield in response to President Donald Trump’s overturning of the agreement to lift sanctions on Iran, CNPC initially stepped forward. But it has not developed the field it at the pace Tehran had hoped, and reports this year suggested CNPC may have suspended its activities. The Financial Times has reported that Iran’s Revolutionary Guards are ready to take its place.

Similarly, Ali Akbar Salehi, head of Iran’s Atomic Energy Organization, expressed concern that Chinese developers were taking their time in redesigning the Arak heavy water reactor according to the terms laid out in the 2015 nuclear deal. He attributed this to fears of US sanctions.

While it is hard to draw a straight line between US sanctions and Chinese reticence, it is also clear that Moscow does not always find Beijing a useful infrastructure partner. In reported comments in December about the Moscow-Kazan High Speed Rail (HSR) train line, Anton Siluanov, deputy prime minister and finance minister, said he did not see the line’s economic benefits and questioned its viability. The project was proposed and signed in 2015 when China was on a global HSR push, and questions always hung over its practicability (and indeed of other HSR projects around the world). Its seeming jettisoning reflects the reality that not all Chinese infrastructure projects work out, even in countries that are supposedly strategic allies of Beijing.

There are a number of explanations for these trends. First; Chinese banks, companies and other institutions may sometimes act in ways that contradict Beijing’s view, driven by specific concerns of their own. The assumption that all of China works in lockstep to advance Beijing’s geopolitical world view does not always match up with facts on the ground. It may be hard to divine whether a Chinese institution is responding to sanctions pressure, fear of losing access to the US market or some central Beijing command, but their behaviour does not always match policy declarations.

Second, Chinese institutions drive hard bargains. In the context of Iran and Russia, China is the funder and their local counterparts the supplicants. This puts Chinese institutions in the driving seat — something they are aware of and will exploit. Commenting on Beijing’s reticence to sign a bilateral memorandum with Moscow, one source told Kommersant that in addition to concerns about the US, “China needs time to tweak the final document more to its benefit”.

Third, countries like Iran and Russia are fearful of becoming overly dependent on Beijing. They realise that opening too much to China risks flooding local markets and potentially curtailing their own development.

In Tehran, the government has gone further, with reports of authorities advising against buying Chinese goods because it amounted to “exporting jobs”.

It is clear that China’s alliance with Russia and Iran is more complicated than sometimes realised. It is also clear that US sanctions continue to have a deterrent effect on Chinese institutions.

Yet it is hard to project such complications into the future. While Beijing may have tensions with Moscow and Tehran, the three continue to be willing to support each other at a geopolitical level. If the aggression with which US economic sanctions are employed continues, alternative global economic structures will develop.

Their beginnings are already visible. Moscow is taking the firmest steps in this direction through its de-dollarisation policy. Tehran may find itself obliged to follow if it is unable to find a way out of its current impasse.

While it is clear that US sanctions may have an effect on their economies, it is not clear that they are generating the change in behaviour that Washington desires. In this context, Beijing will sense an opportunity.

This article has been modified since publication to correct the statement on Iran’s imports from China, previously stated as exports to China.

Raffaello Pantucci is director of International Security Studies at the Royal United Services Institute (Rusi)

And now another (very short piece) for the South China Morning Post, this time looking at the implications to Russia of the opening up of Iran and what this means for the Silk Road Economic Belt vision.

China’s new silk road is designed to cut Russia out of Eurasian trade

Raffaello Pantucci says the ‘One Belt, One Road’ trade initiative is likely to sideline Moscow and give Beijing the upper hand in their awkward relationship

PUBLISHED : Tuesday, 16 February, 2016, 2:00pm
UPDATED : Tuesday, 16 February, 2016, 2:00pm

China Tehran train

The first Chinese cargo train, following Iran-China efforts to revive the Silk Road, arrives in Tehran on February 15. The 32-container train arrived after a 14-day journey from northwestern China. Photo: EPA

President Xi Jinping’s ( 習近平 ) visit to Tehran – the first by a foreign leader since the lifting of sanctions – highlights the potential centrality of Iran to China’s broader regional foreign policy. The opening up of Iran, a country in which China has long maintained substantial interests, means Xi’s “One Belt, One Road” vision can now go cleanly across Eurasia without ever going through Russia. Moscow can be cut out.

Rouhani XJP

Iranian President Hassan Rouhani (left) shakes hands with President Xi Jinping in Tehran in January. Photo: Reuters

Visiting Tashkent, one can see the ancient routes laid out by the Timurid empire that constituted the ancient silk road. Rather than track through Russia, most would go below the Caspian and Black seas to reach Turkey and Europe. An iron silk road has been established that will track the old silk routes

Soon after Xi visited Tehran, a train laden with goods left Yiwu, Zhejiang province (浙江), headed to Tehran following this route. On February 10, it crossed the border from Turkmenistan and arrived in Iran this week. The Ukrainian minister of infrastructure announced at the same time that, by the end of the month, a direct rail line would open between Ukraine and China, cutting across Georgia, Azerbaijan, the Caspian Sea and Kazakhstan. An iron silk road has been established that will track the old silk routes.

Train carriage Tehran China

The first Chinese cargo train arrives in Tehran after passing through Kazakhstan and Turkmenistan. Photo: EPA

Moscow has long been an awkward partner for Beijing and the question of how Russia fits into the belt and road vision was always unclear. Some incorrectly saw the Eurasian Economic Union as an effort by Moscow to push back on China’s dominance in Central Asia. This misinterprets both powers’ interests: Moscow is aiming to recreate a former space of control, while China is building trade corridors. For China, the existence of a common economic space with a single tariff barrier from its borders to the edges of Europe is a benefit to trade.

Putin and XJP Sochi

Russian President Vladimir Putin (right) and Xi Jinping meet in the Russian Black Sea resort of Sochi. Photo: AFP

The reality is that cutting a path across Russia is a long rail route that is only going to be attractive to high-value small objects which are still fairly limited in production volume in Xinjiang – and can now instead go along the route to Ukraine. Mass-produced, high-volume goods for which China is famous are much better placed going by sea to Europe. Unless, that is, the ultimate market is in the heart of the Eurasian continent. And this is where the route across Iran is interesting – connecting China’s markets directly to the bustling bazaars of the Middle East.

In paving an iron silk road, China is gradually reducing Moscow’s importance. This will further strengthen Beijing’s hand in their bilateral relationship and reduce Russia’s power on the international stage. Isolated by the West and increasingly sidelined by China, Moscow’s decline will only be highlighted by the opening of these new routes across Eurasia.

Raffaello Pantucci is director of international security studies at the Royal United Services Institute

A slight sideways step for me, though if you read it you will see there is some links to other stuff I have done, this is a paper commissioned by the Europe-China Research and Advice Network (ECRAN), an EU vehicle that funds research on China for European policymakers. I have written other papers for them in the past. This one was written late last year and focuses on China’s relations with the Middle East in the wake of the ‘Arab Spring’ and looks in particular at the cases of Libya, Syria, Egypt and Iran. The full paper can be found behind this link. I have pasted the introduction below.

Beyond this, I spoke to the Financial Times about jihadists in Syria and potential blowback in Europe, and to Bloomberg about Boko Haram.

Short Term Policy Brief 79

China and the Middle East

November 2013

Author: Raffaello Pantucci

Introduction

What are China’s key strategic interests in the Middle East and what is the status of its relations with key countries in the region?

During his opening speech at the first China-Arab Expo (an event that had been upgraded from the previous Ningxia International Investment and Trade Fair and the China-Arab States Economic and Trade Forum), Yu Zhengsheng, Standing Committee of the Politburo member and fourth most powerful man in China, highlighted trade and energy as the two main pillars of Chinese-Arab cooperation.Delivered in September 2013, this speech crystallized a policy which has been abundantly clear for some time with China and the Middle East, where the policy priority and focusis on securing energy and developing trade partnerships, while remaining as detached as possible from the intransigent regional politics.

As prominent Qinghua academic in international affairs Yan Xuetong has put it, ‘China can strengthen cooperation economically with countries in the Middle East, but politically, it had better stick with declaring its stand…the complexity of the Middle East politics is far beyond our comprehension.’ With ample domestic turmoil and local difficulties to manage, Chinese
leaders have little appetite to be dragged into a region that has challenged western policymakers’ capabilities for decades.

Nevertheless, events in the wake of the Arab Spring have challenged China in a number of different ways, forcing it to re-evaluate long-held positions and think more deeply about the implications of its growing international footprint. Questions around citizen security were highlighted in the wake of the rushed evacuation of some 35,860 nationals as Libya collapsed, while the decision to abstain from the vote to impose a no-fly zone meant that resolution 1973 was passed. This led to questions about this possibly being a signal that Beijing might be adapting its position on Responsibility to Protect– something it had previously treated as anathema to its sacred ‘non-interference’ principle in international affairs. Particularly raised during the Libya crisis, both issues have hung heavy both over China’s considerations of other aspects of the fall-out from the Arab Spring in the broader Middle East. It remains, however, unclear that they have signalled a dramatic shift, rather than a course adjustment that means such issues are now a higher priority for Beijing policymakers.

Adjacent to these considerations are other larger questions about China’s geopolitical position. For example, the hawkish line often advanced that the current conflict in Syria is part of a larger trajectory of regime change that flows from Damascus, through Tehran to Moscow and Beijing is one that resonates amongst a certain (predominantly nationalist and military) community. This perspective is one that is echoed in Moscow, and is often touted as a reason why the two vote in lock-step with regards to the events of the Arab Spring, Syria and Iran. Chinese foreign policy thinkers who adhere to this perspective often see the world through a binary US versus China lens. For them, the Middle East is an ideological battleground where the US is seeking to upturn the table in favor of a new chaotic order that it controls, and one that will ultimately undermine Chinese national interests. Found amongst academics at prominent think tanks like CASS, it is unclear the degree to which such perspectives dominate senior levels of Chinese foreign policy thinking.

At the same time, China continues to be concerned about the spread of jihadist ideas (with little clear understanding of what motivates them or nurtures their growth) and the possibility that these might filter back into the Xinjiang autonomous region of northwest China still dominated by the Muslim Uighur ethnic group. There have been reports that Chinese nationals – both Uighur and non-Uighur – have participated in the fighting in Syria, and China has grown concerned by the growing appearance of jihadist videos and materials during investigations into violence in Xinjiang from the unrest there in July 2009 until today. China has also increasingly featured as a potential target in a growing array of jihadist material. Most recently, al Shabaab’s al Kataib media published a video in which they discussed the Uighur’s plight, while in May 2013 (though likely produced substantially before his reported death in December 2012) al Qaeda ideologue Abu Zaid al-Kuwaiti released a video through the Turkestan Islamic Party’s media wing, Islam Awazi, in which he provided ‘advice for the Muslims of East Turkestan.’ For China, the potential danger of becoming too involved in Middle Eastern politics is that the eyes of violent Islamists who have thus far focused on the west, might eventually turn to China and portray it as a target– a situation Beijing has thus far managed to avoid thanks to careful diplomacy and the fact that Islamists remain focused on the west as the principle ‘far enemy’. However, Beijing’s concerns remain heightened in the wake of a number of incidents. For example, the suicide attack in Tiananmen Square Beijing in early November 2013 was linked to a Uighur Muslim protester, and was subsequently praised, but not claimed, in a video by TIP. That particular incident came in the wake of110 detentions in Xinjiang of people accused of ‘disseminating religious extremism and material. Highlighting the ongoing violence in the province, in December there was another incident at a police station in Bachu County outside Kashgar that led to 11 deaths (the same county saw 21 killed in another incident in April 2013). All of these examples help underline how nervous the central leadership in Beijing are about this issue.

But these worrying local concerns remain secondary to more large-scale energy concerns, something that reflects a long-standing pragmatism in Chinese foreign policy towards the Middle East. Back in 1994, leader Jiang Zemin highlighted that China should oppose ‘hegemony’ by helping dissident states in the Middle East like Iran, but at the same time should ensure that international stability remains sound in order to facilitate China’s ongoing growth and development. This approach is one that resonates today, where, for example, China is clearly supportive of Moscow’s approach towards Syria and Iran through
measures in the UNSC, but at the same time takes a secondary seat to Russia’s willingness to take a more prominent position in making its point.

For example, in the wake of the use of chemical weapons in Ghouta, east Damascus, Syria on August 21, 2013, the Russian government took the lead in countering the western push to define this as the red line that justified intervention against the Assad regime and instead worked to develop a way for Syria to give up its chemical weapons. Russia’s public interventions culminated in an opinion editorial in the New York Times on September 11, 2013 by President Vladimir Putin. In contrast, throughout this period China made regular statements through the Foreign Ministry, but avoided much further publicity. At the regular MFA briefings, Hong Lei offered support for the Russian efforts: ‘the Russian proposal offers an important opportunity to ease the current tension and properly address the international community’s concerns about Syria’s chemical weapons.’ They later offered Chinese experts to participate in the disarmament assurance group, but otherwise remained relatively low profile. China is publicly supportive of Russia’s positions on Syria, but is not as eager to attract the sort of confrontation that Russia seems to prefer. This Quietist approach to foreign policy is something that can be found across China’s foreign policy agenda.Ultimately, China does not seek to upset the international order that is allowing it to slowly grow into the world’s largest power.

This brief paper touches upon Syria, Egypt, Libya and Iran. This is not a comprehensive overview of China’s relations in the region, but highlights the priority ones as requested by ECRAN. Amongst the important relationships omitted, China continues to be willing to cultivate close relationships with both Israeli and Palestinian authorities, but beyond proposing general suggestions about peace processes, has not engaged in the minutiae of the conversation (nor is it likely to want to). On Iraq, China has profited quite effectively from the toppling of the old regime to get its firms in to develop Iraqi fields (something it has been able to do in part thanks to western firms’ concerns about going in to the country), while Saudi Arabia remains one of China’s biggest energy partners, notwithstanding the mute background of Saudi-style wahhabbist ideology slowly filtering in through Gulf money into Xinjiang. Thus far, Chinese officials have not chosen to acknowledge this linkage too publicly, although some academics discuss the growing spread of such ideas and suggest Saudi Arabia as one of the possible origins. None of these relationships currently seem in any sort of dramatic shift and therefore are placed to one side.