April 9, 2021
On Tuesday, it was announced that the United States and Iran had agreed to establish working groups to attempt to get both sides back into compliance with the 2015 Joint Comprehensive Plan of Action (JCPOA). These working groups aim to achieve rollbacks of U.S. sanctions coupled with Iranian compliance with the accord’s limitations on nuclear enrichment and stockpiles of enriched uranium and uranium metal. This announcement comes on the heels of the March 27 report that the Chinese and Iranian Foreign Ministers agreed to a Comprehensive Strategic Partnership that could lead to up to $400 billion in Chinese investment in Iran over the next 25 years. In exchange, China would receive a large discount on an uninterrupted flow of Iranian oil. This could lead to an increase in Iranian oil exports to China, which have already increased from just over 200,000 barrels a day in 2018 to nearly 900,000 barrels per day as of the end of March 2021. Due to U.S. sanctions, the price of that oil from Iran is discounted from between $3-5 per barrel from the Brent crude benchmark, making it extraordinarily attractive to Chinese importers which bring in just over 11 million barrels a day in January and February of this year to satisfy domestic fuel consumption, which has mostly recovered from pandemic-related dips.
All of this is a long way of showing how the rise of China will have an impact on each and every one of the United States’ geopolitical challenges in the coming decade, specifically in regards to the U.S.’ other rivals. Whether it’s a deepening relationship with Russia in the Arctic, in Information Operations, or a lunar space station; or China’s past involvement in Iran’s ballistic missile program or their new investment agreement with Iran, the China challenge will be ever-present as the United States looks to protect and promote stability in Europe, the Middle East, the Indo-Pacific, and beyond. More accurately, the United States and its allies need to understand that one of the key elements of the China challenge will most likely not be direct competition in the waters of the South China Sea or the shores of Taiwan, but rather a constant, low-level push by China on every single pressure point in U.S. positions abroad. Indeed, the challenge in the coming decade will be to figure out how to avert a situation where China is able to complicate U.S. decision-making further than it already has when it comes to some of its more secondary, but still dangerous, rivals in Iran and Russia.
The China-Russia Working Relationship
To better understand the China-Russia relationship and its impact on U.S. foreign policy, it is important to understand the nature of the growing China-Russia relationship and the main areas in which that relationship has been progressing. The four main areas, as enumerated in the Center for New American Security report, “Navigating the Deepening Russia-China Partnership” are in the realms of defense, democracy and human rights, technology and cyberspace, and economy.
In terms of defense, Sino-Russian cooperation can be seen in a variety of areas. Predominantly, there is the fact that Russian arms account for approximately 70% of Chinese weapons purchases between 2014-2018. In addition, Russia has sold China six S-400 anti-air systems and 24 Su-35 fighters, both of which would be decisive in any combat scenario against the United States in the South China Sea or the Sea of Japan. The other main type of defense cooperation between the two can be seen in Chinese participation in Russian strategic military exercises such as the Vostok-2018 and Tsentr-2019
In the realm of democracy and human rights, both countries aim to weaken democracy and promote conditions for authoritarianism to take hold abroad. This type of malign influence can be seen, for instance, in the Balkans, with Russian efforts to weaken democratic and EU-accession progress in Serbia. Similarly, China has also attempted to increase their economic and political influence in the Balkans, with specific efforts made to also weaken the progress of democracy in Serbia.
In the areas of technology and cyber cooperation, Russia and China are both focused on the issues of innovation and cybersecurity and governance. In terms of innovation, the expanding Sino-Russian cooperation can be seen in the growth of joint science and technology parks, a $1 billion Technology Innovation Fund, or cooperation between Russia and Chinese telecommunications firm Huawei. In regards to cybersecurity and cyber governance issues, the two sides have worked together at multilateral organizations like the United Nations or the International Telecommunications Union to promote norms that emphasize individual countries’ “sovereignty” over online information that threatens regime stability.
Finally, in terms of economic ties, Russia and China have deepened cooperation on bilateral trade, energy, and finance. In terms of bilateral trade, this deeper cooperation can be seen in projects like the $5.2 billion in proposed Chinese funding for a Moscow-Kazan high-speed rail link. In terms of energy cooperation, in 2015, Russia became China’s largest source for crude oil, showing the depths of both China’s need for hydrocarbons as well as the key way in which Russia is a, currently, indispensable partner for China. Regarding finance cooperation, both countries have pushed for an alternative to the Society for Worldwide Interbank Financial Telecommunication (SWIFT), which would enable both countries to sidestep some of the more difficult consequences of U.S. and European sanctions.
The China-Iran Partnership – Real Worry or Paper Tiger?
As far as the China-Iran partnership goes, that relationship is far more limited than even the $400 billion Comprehensive Strategic Partnership would suggest. However, that is not to say that the relationship does not pose real obstacles for U.S. goals vis-à-vis Iran.
The China-Iran relationship primarily takes place in two areas: economic engagement and security cooperation. In terms of economic engagement, last year, the Wilson Center’s Lucille Greer and Esfandyar Batmanghelidj took a look at the China-Iran partnership and came to a number of interesting conclusions in their paper, “Last Among Equals: The China-Iran Partnership in a Regional Context.”
The first conclusion from the Wilson Center paper is that Iran has lagged behind other Middle Eastern countries when it comes to Chinese economic engagement. When seen through the lens of bilateral trade, stagnant foreign direct investment (FDI), external finance, and labor, the China-Iran economic relationship has stagnated over the past five years. The second conclusion is that, Iranian dependence on China is more a consequence of U.S., and overall Western policy towards China, than any distinct Chinese strategy towards Iran.
What’s past, however, may merely be prologue, as the Comprehensive Strategic Partnership, even if it only meets a fraction of its $400 billion in Chinese investment, will still give China a great deal more leverage in the region. The deal massively undercuts any Western attempts to isolate Iran through sanctions or even military pressure, as the investment agreement gives China the ability to respond to Western financial and military pressure by either increasing their investment in Iran to offset sanctions, or by increasing military ties to combat any U.S. or Western troop build-up in the region.
In terms of security cooperation, while the Wilson Center’s authors correctly point out that China has yet to sell Iran drones or unmanned aerial vehicles (UAVs), since 2000, Iran has imported 930 anti-ship missiles, 1,750 portable surface-to-air missiles, six surface-to-air missile systems, three air search radars, 150 armored personnel carriers (APCs) and nine catamaran missile boats. In terms of value alone, that outstrips every other Chinese partner in the Middle East. Further, as CSIS’ Anthony Cordesman states, “Even if [the Comprehensive Strategic Partnership] has no immediate military impact, it represents a major shift in strategic attitudes and lays the groundwork for such cooperation in the future.” Cordesman also points to Chinese Foreign Minister Wang Yi’s comments that, “China firmly supports Iran in safeguarding its state sovereignty and national dignity,” and that “some reports do indicate that the negotiations at least discussed the need for new forms of military cooperation in areas like military assistance, military training, and intelligence sharing.”
Why the China-Iran and China-Russia Partnerships Matter
As Dr.’s Andrea Kendall-Taylor and David Shullman stated in their report entitled, “Navigating the Deepening Russia-China Partnership”, “Russia and China are aligned in their efforts to weaken cohesion among U.S. allies and partners and dilute U.S. sway with countries and international institutions.” The two sides work together to reduce the efficacy of U.S. sanctions and their combined military threats, in Europe and the Indo-Pacific, threatens to stretch U.S. security commitments in both regions to their limit.
Similarly, increased Chinese investment and engagement with Iran poses challenges both in terms of returning Iran to compliance with the terms of JCPOA. It also gives China, “massive new strategic leverage in the Gulf region and in the area that controls 20% of the world’s petroleum supply” as the Center for Strategic and International Studies Anthony H. Cordesman put it recently. Additionally, Chinese investment reduces the economic pressure put upon Iran due to U.S. sanctions and thus could make it harder for the United States and Iran to come to some kind of deal limiting Iran’s ballistic missile program, as Iran would have less impetus to come to the table and deal away more of their strategic capabilities.
A key component of both of these deepening Chinese relationships, with Russia and with Iran, are that both of those relationships still remain short of a true alliance. However, despite this fact, the relationships are enough to cause major headaches for U.S. decision-makers. As it is, both Russia and China have a desire to counter U.S. global influence and democracy promotion; to work together on defense, arms sales, and military exercises; to create more permissive structures for autocracy in cyberspace; and expand bilateral trade and flows in the energy sector. It is strongly in the U.S.’ interests that these relationships do not progress any further.
As the Center for Strategic and International Studies commentary, “The Return of the Quad: Will Russia and China Form Their Own Bloc?” so eloquently put it:
“As the United States and its allies increase their military posture in the Indo-Pacific, Russia’s defense cooperation with Beijing will grow because China…enhances Russia’s standing globally, and in the Indo-Pacific region to a lesser extent…Russia’s goal will not be to engage the United States directly or contribute direct military support to China, but rather to extend the geographical scope of contestation in order to dilute U.S. power in the region and demonstrate its own value to China as a strategic partner.”
However, as those authors indicate, the two countries, “economic disparities are great, and their economic relations are negotiated on China’s terms, not Russia’s”, meaning that while Russia may have much to gain from further alignment with China, they are very much the junior partner in any current arrangement.
Pushing Back against the Sino-Russian Partnership
It is those disparities that provide an opening for U.S. policymakers to fight back against the growing Sino-Russian partnership, and there are various ways to achieve such a distancing. These range from changing Russia’s calculus regarding China, planning for growing Russia-China cooperation, reasserting U.S. global leadership in order to push back against authoritarian conceptions of global governance, and exploiting any available fissure between Russia and China.
To change Russia’s calculus regarding China, the U.S. needs to both publicly and privately message to Russia whenever it appears that Russia is becoming more subservient to China as well as cooperate with Russia where it is in U.S. interests, such as with the New START treaty’s extension, engaging on confidence-building measures like the Arctic Council members efforts to promote accident prevention and response, and cooperation on climate issues.
To plan for increasing Russia-China cooperation, the United States should increase intelligence collection and sharing on Russian-Chinese cooperation through the National Intelligence Priorities Framework and to increase war games to prepare for continued Russia-China military cooperation.
To reassert global U.S. leadership, the United States must work to resume leadership in multilateral institutions, strengthen European as well as Indo-Pacific alliances, and support democratic resilience at home and abroad.
Finally, to exploit fissures in the China-Russia relationship, the United States must be prepared to do things such as allow Russia to sell arms to India and Vietnam. The U.S. must also try to work with China to help them understand Russia’s destabilizing actions in the Middle East, the Arctic, and in Europe where China has continued economic investments.
Pushing Back against the China-Iran Partnership
A large degree of economic disparity is also present in the relationship with Iran. As the International Institute for Strategic Studies Camille Lons and Meia Nouwens have put it, “Far from being an all-weather partner, Beijing has repeatedly sacrificed its relationship with Tehran for the sake of bigger interest in Washington, such as during the negotiations of the trade deal with the US in early 2020.” Furthermore, the authors note that, referring to the new Comprehensive Strategic Partnership, “Beijing has, however, conveniently re-emphasised Middle East partnerships at times when it has needed to boost its standing on the international scene. This time is no different.”
Presently, the China-Iran partnership is more theoretical than practical, although the Comprehensive Strategic Partnership means that there is a greater possibility of their relationship deepening. While it may not be as strong a relationship as news reports may indicate, it is not to say that the relationship is unconcerning. On the contrary, of particular worry is the Strategic Partnership’s provisions giving China access to Iran’s new port and naval base at Jask, which as Cordesman states in his policy brief, “counters India’s efforts to develop Iran’s port and new petroleum pipeline and oil export facilities at Chabahar, and it hinders India’s role in helping Iran create better road and railroad access to Central Asia.” Furthermore, continued access to the naval base at Jask increases the strategic usefulness of China’s already negotiated military base in Djibouti.
As Cordesman states in his brief, unlike Russian and U.S. attempts to project power in the region, China’s “white area warfare” is allowing them to not only expand their influence around the world, but to do so at a profit. Furthermore, the Strategic Partnership not only enables China to gain from its investments in Iran and lower oil prices. The knock-on effect is that it sets up a scenario where China is able to exploit their strengthened ties with Iran to extract concessions from Iran’s Arab Gulf rivals like Saudi Arabia, by offering to limit military ties with Iran, but only in return for economic concessions. Thus, China could end up in a scenario where Iran’s rivals provide them with favorable economic terms in order to prevent deepening Chinese military ties with Iran that they may never have even intended. The mere threat of closer military ties between China and Iran may be enough to give China the leverage to extract such concessions.
Finally, there is the elephant in the room that four years of maximum pressure by the Trump administration has mostly likely enabled the circumstances for the singing of the Strategic Partnership between China and Iran. Years of economic sanctions under the Trump administration have had a crippling effect on the Iranian economy, and has slowed the development of its gas export sector, led to massive contractions in GDP and oil exports, and rendered them able to access only about $8 billion in hard currency assets held abroad. All of these effects have led Iran straight into the arms of China, in addition to doing little to reduce Iran’s ability to progress towards a nuclear weapon or realize the fantasy of imminent regime collapse.
All of this points to a need to reevaluate and reassess U.S. strategy towards Iran, as well as towards Russia. It is abundantly clear that maximum pressure has failed to bring about behavioral changes with Tehran or Moscow. Furthermore, U.S. sanctions continue to impede Iranian access to vital medicine and vaccines.
Luckily, the Biden administration appears to have come to this same conclusion, with both Iran and the U.S. working towards ways to bring both back into compliance with the 2015 nuclear deal. However, getting both sides back into compliance with the JCPOA is only a first step in fixing the failures that brought the U.S. to this stage with Iran. Future policy discussions regarding Iran (and Russia, to a lesser extent), need to factor in how good China has become at exploiting failures in U.S. policy, and a stronger focus on second- and third-order consequences to U.S. policy decisions really needs to be considered if the U.S. wants to avoid driving enemies further together in the future.
Final Thoughts
Nuclear weapons in Tehran. A Moscow that indiscriminately meddles in elections, engages in rampant cyber attacks, and is possibly continuing to escalate conflict in Ukraine. These are all things that run counter to U.S. national security interests, and all of them must be stridently pushed back on. However, when devising responses to these malign actions, U.S. policymakers need to more strongly consider the secondary and tertiary consequences to the global security environment. If China truly is the “pacing threat” that Marine Corps General David Berger described to Secretary of Defense Lloyd Austin, then all U.S. security decision-making needs to be viewed through that lens.
Therefore, if elements of American response to secondary (but still dangerous) threats like Iran and Russia require diving into the sanctions toolkit, then such economic coercion needs to be better calibrated to avoid driving those countries into the waiting arms of China. To do so will require policymakers to not only look at where sanctions are likely to fail, but to consider areas for cooperation and the rebuilding of mutual trust are possible.
With Russia, that means cooperating in the Arctic Council to avoid China obtaining a role in Arctic governance as well as working in groups such as the P5 to continue efforts at nuclear non-proliferation. It also means continuing to try to work with Russia on climate change, on Ukraine, and frankly, on any issue where the Putin government shows an interest. That could mean trying to work with Russia on issues ranging from non-proliferation to infrastructure projects in the Russian far-east. While continued occupation in Ukraine is clearly unacceptable, as is election interference and hacking, there is an ongoing need for sustained engagement with Russia, as the more they feel boxed-in and trapped, the more likely it is they will look to China for mutual defense. Vladimir Putin does not seem temperamentally willing to accept junior partner status in any relationship, but his instincts to counter the West at all costs make it all the more likely that he would formalize a China alliance if he felt that his options were so limited that he had no other choice. A pressure-relief-valve in the form of sustained cooperation in various international and bilateral forums is a vital offramp from the continued spiral of escalation the U.S. seems to be engaged in with Russia.
While this may seem, to some, as coddling Putin and only likely to encourage further aggression, one must realize that previous attempts at “strength” have not yielded the results that Americans wish to see. Merely doubling down on sanctions and aggressive behavior towards Russia risks repeating the same behavior over and over again, expecting different results. When it comes to Russia, strength must be paired with pragmatism and engagement if the U.S. is to truly succeed in reducing the overall threat level.
For Iran, this means recognizing that “maximum pressure” has only yielded a more recalcitrant Iran, that is closer to a nuclear breakout, and has driven them further into China’s arms. Returning to the JCPOA process is an excellent beginning, but the damage may have already been done with the Comprehensive Strategic Partnership. Time will tell, but it is already clear that the U.S.’ failure has already been China’s gain. It is imperative that U.S. policymakers recognize how American strategy has partially contributed to the state of affairs, and rectify it going forward.
Foreign Policy Reviews 