China’s brokering a deal between arch rivals Iran and Saudi Arabia on March 10 was the result of converging economic interests, according to experts on the Middle East. The deal also helps each of the totalitarian nations to avoid any potential wave of democratic regime change.
“China, diplomatically, has always been at ease with unrepresentative, illiberal politics, whether a conservative monarchy as Saudi Arabia or a radical theocracy as Iran,” Middle-East expert Burzine Waghmar told The Epoch Times in an email. Waghmar is a Fellow at the Royal United Services Institute (RUSI), as well as at the Center for Iranian Studies at the University of London’s School of Oriental and African Studies (SOAS).
“Chinese regional interests, fundamentally, are to guarantee its stake in joint venture discoveries of hydrocarbons and their uninterrupted flows for its ever-increasing energy needs; to invest in infrastructure projects and promote Chinese companies; and to acquire markets for Chinese finished goods,” he said.
“De-escalation with Turkey, Qatar, and Assad in Syria, resumption of relations with Iran and de-facto relations with Israel are all linked to his 2030 vision,” Bahrami told The Epoch Times.
In brokering a deal between Iran and Saudi Arabia, China has aimed to reduce security threats in the Middle East, a situation most desirable for its economic interests, according to Waghmar. In doing so, China has also brought these rival regimes together to explore a yuan-based alternative to the dollar and Chinese-style norms of governance which do not, in any case, irk such undemocratic, Islamic polities, he said.
China’s transactional motives now extend to defense deals too. One example is a ballistic missile facility southwest of Riyadh that has been under construction since 2013, and the sale of restricted drone technology to the UAE, according to Waghmar.
“A surge in defense understanding by both [countries] with China occurred following the Iran nuclear deal in 2015. Tehran’s missile program, predicated on North Korean assistance, was not suspended despite signing the P5+1 [nuclear] deal. Gulf Cooperation Council (GCC) states were pointedly signaling to Washington their displeasure by moving closer to both China and Russia after 2015,” he said.
Iran’s economic interests are just as economically intertwined in this situation as that of the other two parties, according to the experts. Waghmar said that because Iran has been crippled by Trump’s sanctions and rocked by internal instability, the country needs some relief, so the deal was welcomed in Tehran.
The deal was “amplified out of proportion as a diplomatic triumph by a beleaguered Raisi administration which knows the nuclear deal is a dead duck—especially since the onset of the Ukraine war and Iran’s perverse support for Putin,” he said.
A reset of Tehran’s relations with its regional Muslim neighbors would enable it to revive bilateral relations both politically and economically, according to Waghmar.
A day after the deal was announced in Beijing, Iran’s oil minister said that the country had defined many economic contracts with China and had reached “good contracts and agreements with large Chinese companies, which will be announced in the future,” according to Khabar Online, an Iranian media outlet.
“As long as international sanctions and banking sanctions against Iran exist, such deals with China remain on paper. Iran was also blacklisted by the FATF (Financial Action Task Force). China is not in a position to take the risk of U.S. sanctions for dealing with Iran,” he said.
Keeping in mind the geo-economic circumstances, said Waghmar, it will be considerably more difficult for Iran to deviate from or betray this deal. This is because Iran can ill-afford to “upset and humiliate” the Chinese, on whom—given its sanction-ridden economy drowning under a 52.5 percent inflation rate, as of Feb. 2023, and an 11.4 percent unemployment rate—it is more dependent than even the Saudis.
Waghmar said both Iran and Saudi Arabia have also welcomed 5G networks from Huawei—a company notorious for serving as a front for Beijing’s security and intelligence set-up.
“Beijing sold arms worth US$4 billion to Riyadh at the Zhuhai Airshow, China’s chief defense bazaar, in Nov. 2022. Earlier, in April 2022, it signed a military cooperation pact with Iran,” said Waghmar.
By this military cooperation deal with Iran, China is seeking to create a balance between Iran and the Arab States, and also to strengthen Khamenei’s “look to the east” doctrine, Bahrami said.
Middle East Geo-politics
Democracy is alien to most of the Middle Eastern countries and the Arab world, while their geo-political and economic interests are sometimes aligned, but often at odds. The experts said only the future will show whether the China deal is tactical or strategic, as a lot will depend upon how the patched-up relations between Tehran and Riyadh evolve.“The situation is gray. The Saudi-Iran deal details are ambiguous. The implications depend on whether the Iranian and Saudi regimes’ moves are strategic or tactical,” said Bahrami.
If Iran’s move is strategic, Bahrami said it needs to end its financial and military support to the Houthi rebels in Yemen, and to force them to join peace talks.
“If Iran avoids such a policy, I recognize the Iranian move as tactical,” he said, adding that the first minimum implication of the deal will be the likely cooling of tensions between Saudi Arabia and Iran over Yemen, Iraq, Lebanon, and the Persian Gulf.
Therefore, the least the deal can currently indicate is that Iran and Saudi Arabia are moving from what he termed “offensive realism toward defensive realism,” Bahrami said.
“If Saudi Arabia and Iran move from offensive realism to defensive realism, this deal is highly likely to help stabilize the current order in the Middle East, but adds a new international actor—China,” he said.
For the deal to sustain, Tehran and Riyadh will both need to sacrifice something, he said.
“Iran will stop developing its missile arsenal and freeze [its] nuclear ambitions. In return, Iran expects Saudi Arabia to stop the media war against the theocracy, stop accumulating western weapons, and to encourage other Arab states and Western allies to end Iran’s isolation,” said Bahrami.
The Gulf Cooperation Countries also expect Tehran to soften its rhetorical support towards their own restive Shia minorities in Bahrain, Kuwait, and Saudi Arabia, according to Waghmar.
“After all, it was the execution of a Saudi Shi'ite cleric in Jan. 2016 which led to the assault on its Tehran embassy, tacitly encouraged by the regime, that led to the suspension of diplomatic relations with not just the GCC but also other Arab states, such as Jordan and Egypt,” he said.
However, Bahrami said there is one thing that neither Tehran nor Riyadh would want to occur. “Iran must not become a democracy. This is because Mohammed bin Salman knows the next one will be Saudi Arabia,” he said.
“Thus, considering the Iranian regime’s vulnerability inside the country, Saudi Arabia prefers to deal with such a regime in order to: One, impose what it wants; and two, avoid a wave of regime change in authoritarian countries across the Middle East.”
Amplified domestic problems have pushed the Iranian regime to decrease tensions with its neighbors, Bahrami said, and if the Iranian regime doesn’t undertake domestic reforms and doesn’t choose “defensive realism,” the resumption of relations with Saudi Arabia will turn out to be a mere tactical move, and won’t last long.
The United States’ Role
The two experts had divided impressions of the United States’ role in the emerging geo-political sea change.Bahrami blamed the United States for the emerging situation in the Middle East, and lamented that if not for American wrongdoings, China wouldn’t have been able to gain any leverage in the Middle East.
“Washington’s policy mistakes in Iran, Afghanistan, Iraq, Saudi Arabia, and Syria paved the way for China to show itself as a solution,” he said. “When the Iranian Islamic Revolutionary Guard Corps attacked Aramco, Donald Trump saw it as Riyadh’s own problem. America’s Arab allies gradually lost their trust, so that Bin Salman even left Biden’s phone call unanswered last year.”
The result, according to Bahrami, is that aspirations for democracy will suffer in the Middle East.
“Because democratic regimes would logically be closer to the West rather than China,” he said.
Waghmar pointed out that this resumption of diplomatic relations between Iran and Saudi Arabia was some two years in the making, with covert talks conducted between Saudi Arabian and Iranian intelligence, and with Omani and Iraqi mediation paving the way for a public patch up.
“Riyadh, for its part, had kept Washington in the loop,” he said.
“Washington, generally, and the Democrats particularly, need to focus on [their] core interests in the Middle East, some of which are shared by the GCC states—namely, preventing Iran from ‘breaking out.’”
Waghmar said he still believes that the GCC will continue to count primarily on Washington for bankrolling their security operations against their common regional and sectarian rival since 1979: Iran.
“All of them are merely hedging themselves by attracting Chinese trade and investment,” he said.
Bahrami said the United States should act fast, and make it clear to Saudi Arabia that close and strategic ties with China will impact Washington-Riyadh relations.
“Diplomacy still works if Biden changes his foreign policy team,” said Bahrami, adding that the United States shouldn’t revive JCPOA—because lifting sanctions will make it easy for China to swallow Iran.
Furthermore, the United States needs to regain Saudi Arabia’s trust, and convince them to prioritize their relationship with Washington, he said.
