Iran-China Visit and Growing Economic Engagement

On Tuesday, February 14, Iranian President Ebrahim Raisi arrived in China for a three-day trip, marking the first visit of an Iranian president to the PRC in two decades. President Raisi was accompanied by Iran’s central bank chief, minister of oil, and minister of industry, mine, and trade. This trip sought to progress the implementation of the Iran-China 25-year Comprehensive Strategic Partnership which, in addition to other collaboration, drives discounted Iranian oil to China. As Iran advances its relationship with the east’s economic powerhouse, it has identified a new way to develop its economy amid Western sanctions. 

As Iran faces enduring political dissent from its domestic population and the international community, Chinese President  Xi Jinping backed the Islamic Republic. Highlighted in Israel National News, “‘China supports Iran in maintaining its national sovereignty and opposing unilateralism and bullying,’ Xi said during the Iranian president's visit to his country.”

President Raisi also expressed enthusiasm towards Iran’s growing economic and cultural relationship with China. Written in PRC’s Press Release, “Iran hopes to work with China to strengthen exchanges at all levels, well implement the comprehensive cooperation plan between Iran and China, and deepen practical cooperation in such fields as trade and infrastructure development. It welcomes Chinese businesses’ investment in Iran, and looks forward to more Chinese tourists coming to Iran.”

Iranian Minister of Industry, Mine, and Trade Fatemi Amin emphasized the importance of partnering with China via trade. In an official Islamic Republic Press Agency report, Amin explains that Chinese economic ideology is in alignment with Iran’s priorities and beliefs: “China considers itself to have an independent position and they are obviously focused on the Chinese civilization, and they do not follow the European, Western and American countries.”

Bilateral agreements expanded across a plethora of sectors. Cited in Tehran Times, “Tehran and Beijing signed a number of bilateral cooperation documents in the fields of agriculture, trade, tourism, environmental protection, health, disaster relief, culture, and sports.The documents include agreements in the field of transportation and industry worth $12 billion and $3.5 billion, respectively, the agreements cover various joint projects like the high-speed rail link between Tehran and Mashhad, and investment in the Imam Khomeini Airport City.”

China and Iran, who sit opposite Western nations on many global disputes, mutually benefit from this deepening partnership. Explained in Al Jazeera, “both countries face pressure from Western nations over their positions on Russia’s invasion of Ukraine, while Iran is already under strict US sanctions due to its nuclear programme. ‘China is Iran’s biggest trading partner and the only customer of its heavily-sanctioned oil exports,’ said Al Jazeera’s Katrina Yu. ‘US-led sanctions have left Iran in its toughest economic situation in more than 40 years.’

Both President Raisi and President Jinping reiterated their ambition for sanctions, particularly those against Iran, to be lifted. Written in Al Arabiya, “‘all relevant sanctions should be fully lifted in a verifiable manner to promote the full and effective implementation,’ Xi and Raisi said. China and Iran emphasized that lifting sanctions and ensuring Iran economic benefits were important components of the agreement, they said. ‘China firmly opposes interference by external forces in Iran’s internal affairs and undermining Iran’s security and stability.’”

According to Al Monitor, Iranian-eastern collaboration is, above all, economically driven. Iran's shift towards China has “everything to do with realizing economic goals from an Eastern ally as investment and trade with Western countries have continued to diminish over the near full collapse of the Joint Comprehensive Plan of Action due to the US exit in 2018. Raisi’s three-day visit, according to government supporters, was aimed to help implement the Iran-China 25-year Comprehensive Strategic Partnership, an ambitious plan that would bring in hundreds of billions of dollars of investments into Iran with Iranian oil going to China at a discount. Iran’s overall trade with China in 2020 was close to $15 billion, while US-China trade in 2020 was $615 billion.”