China Is Not on Board for Serious Sanctions against Iran

In the midst of its Nuclear Security Summit and in the wake of President Obama’s bilateral meeting with China’s President Hu yesterday, the Obama Administration is vigorously spinning the U.S. and Western media that it has won Chinese support for new sanctions against the Islamic Republic over its nuclear activities.  To say the least, this is an exaggeration on the Obama Administration’s part, and wholly unreflective reporting on the part of those journalists who repeated the exaggeration without question or context.

In fact, China had agreed — even before President Hu arrived in Washington for the Nuclear Security Summit — to participate in discussions with other United Nations Security Council members about potential new sanctions against Iran.  However, China is already indicating that some of the tougher measures still included in the U.S.-supported draft resolution are unacceptable, from Beijing’s perspective.  In particular, China has explicitly rejected a proposed ban on new investments in the Islamic Republic’s energy sector.  Official Chinese press reports indicate that, in his meeting with President Obama, President Hu maintained Beijing’s position that the Iranian nuclear issue should be resolved “through dialogue and negotiations.”  In terms of specific commitments, according to these reports, Hu said only that China “stands ready to maintain consultation and coordination with the United States and other parties.”

China’s fundamental calculus about the Iranian nuclear issue has not changed because of representations from senior Obama Administration officials, or even from President Obama himself.  We have written frequently and extensively about this, both on and elsewhere.  Given trends in the Western media coverage of the Obama-Hu meeting yesterday, two key points bear reiteration here.

  • Beijing may ultimately acquiesce (perhaps by abstaining, rather than through an affirmative vote) to a new sanctions resolution in the Security Council — among other reasons, to keep the Iranian nuclear issue in the Council, where, as a permanent member, China has considerable influence and to maintain comity in Sino-American relations.  Considerations of this sort explain China’s repeated decisions ultimately to participate directly in discussions with other Security Council members about potential new sanctions against Iran.
  • At the same time, though, Beijing will not acquiesce to sanctions against the Islamic Republic that would harm what Chinese leaders see as fundamental economic, energy, and strategic interests.  Since 2006, Beijing has supported three sanctions resolutions against Iran.  But, it has worked in the Security Council (as has Russia) to ensure that any sanctions actually authorized by the Council would not impede China’s pursuit of its most important interests in Iran.  This explains China’s opposition to a ban on new investments in Iran’s energy sector — which is also not new, but has been a consistent element in China’s position regarding anti-Iranian sanctions.

According to David Sanger of The New York Times, Administration officials say that, in order to win China’s support, “Mr. Obama assured Mr. Hu that he was ‘sensitive to China’s energy needs’ and would work to make sure that Beijing had a steady supply of oil if Iran cut China off in retaliation for joining in severe sanctions.”  But, as we have been arguing since the Administration first broached this idea over a year ago, China’s interests are not simplistically focused on assuring some aggregate volume of oil imports.  China’s interests vis-à-vis Iran include diversifying its oil suppliers (in the Persian Gulf and in other regions), securing upstream equity positions for Chinese energy companies (something that can happen in Iran but virtually nowhere else in the Gulf), and strategic cooperation with Tehran on a range of issues.  Beijing is not about to abandon those interests just because Washington wants it to do so.

Diplomats from a number of countries have told us that the Obama Administration may ultimately settle for language in a new sanctions resolution that would not require states to adhere to a ban on new investments in Iran’s energy sector or to other relatively “tough” measures, but would provide sufficient legal foundation for individual states to decide, on their own, to implement such measures.  The Administration calculates that, on this basis, it could assemble a largely Western “coalition of like-minded” nations to impose “crippling” sanctions on Iran, without having to include more reluctant powers such as China and Russia.

Let’s see if we’ve gotten this straight:  China is the only major economic power in the world that is willing to undertake major new investments in Iran right now.  The Obama Administration wants all of the Western countries that might, at least in theory, compete with China for investment opportunities in Iran’s energy sector to sign up to legally binding restrictions on their pursuit of such opportunities.  And, if this scenario plays out, the Obama Administration will claim it as a great “victory” for American diplomacy — even though this victory will mean nothing except that China is effectively guaranteed a monopoly on large-scale investment opportunities for foreign companies in Iran’s energy sector for the foreseeable future.

Flynt Leverett directs the Iran Project at the New America Foundation, where he is also a Senior Research Fellow.  Additionally, he teaches at Pennsylvania State University’s School of International Affairs.  Hillary Mann Leverett is CEO of Strategic Energy and Global Analysis (STRATEGA), a political risk consultancy.  In September 2010, she will also take up an appointment as Senior Lecturer and Senior Research Fellow at Yale University’s Jackson Institute for Global Affairs.  This article was first published in The Race for Iran on 13 April 2010 under a Creative Commons license.

| Print