Tehran is turning east. Last week, Iran's foreign minister, Javad Zarif, disclosed to the country's parliament that the regime was in the final stages of negotiations with China on a mammoth new 25-year trade and cooperation accord. The agreement, a follow-on to a quarter-century roadmap for cooperation formulated four years ago, will reportedly tether the two countries closer together politically and militarily, and throw the ailing Islamic Republic a much-needed economic lifeline.
For Iran, now reeling under the growing pressure of U.S. sanctions, the deal is a much-needed shot in the arm. Since its start over a year-and-a-half ago, the Trump administration's campaign of "maximum pressure" has hit the Iranian regime hard. The country's once-robust oil exports have dwindled precipitously, taking with them the revenue that the regime desperately needs in order to stay afloat. Meanwhile, the country's national currency, the rial, has cratered and now stands at its lowest point in the Islamic Republic's forty-one year history. Against this backdrop, aid from Beijing has become nothing short of essential for Iran's ayatollahs.
But that support will be accompanied by what amounts to a massive erosion of Iranian sovereignty. The pact, a draft copy of which has been obtained by Iran Wire, will institute large scale military cooperation between the two countries (thereby forcing Iran to buy more Chinese arms), commit the Islamic Republic to exporting oil to China for at least a quarter-century, and tether Tehran to Beijing in technological terms.
For Beijing, the benefits of the new arrangement are clear. Through it, the People's Republic of China (PRC) will be able to cement its long-running strategic partnership with Iran, which has taken a giant leap forward since Chinese President Xi Jinping assumed power in 2013. The new dynamism now visible in Sino-Iranian ties is closely linked to Xi's signature foreign policy effort, known as the Belt and Road Initiative, through which China has dramatically expanded its presence in the Middle East. The latest bilateral deal reflects this priority; it reportedly offers China a major stake in future infrastructure construction and transportation projects in the Islamic Republic – projects that, if realized, would transform Iran into a critical hub along the Belt and Road.
Iran is important to China in terms of energy, too. Before the onset of "maximum pressure," Iran ranked as a major provider of crude to the PRC, accounting for some 6% of total Chinese oil imports. That figure has dropped dramatically (nearly 53%) over the past year-and-a-half, as China pared back its purchases of oil from Iran to avoid becoming a target of U.S. sanctions. But, as the new bilateral arrangement makes clear, officials in both countries are banking on a new U.S. administration in Washington in the near future – one that will take a more permissive attitude toward their energy trade with Iran and allow it to expand anew.
Yet if the benefits for Beijing are apparent, those for Tehran are decidedly less so. As Iran Wire notes, the concessions that Iran has agreed to are "unprecedented in the Islamic Republic's 41-year history." They bind Tehran more closely than ever before to the Chinese government, and do so at the expense of the country's independence.
Under the reported terms of the agreement, for instance, Iran will turn over the development of its 5G telecom network to the PRC at precisely the moment when other nations (like the United Kingdom) are rethinking their partnership with China's tech giants. The agreement – which is now expected to be approved by Iran's parliament in the near future – also transforms the Islamic Republic into an appendage to the PRC's plans for an expanded strategic presence in the Persian Gulf, and makes the Iranian regime more economically dependent than ever before on the very country that helped to worsen its current health crisis.
Why would the Iranian regime countenance such an arrangement? The answer has a great deal to do with regime survival. In the face of mounting pressure from the U.S. and amid declining domestic conditions, the Iranian leadership has been reminded of an unwelcome truth: that the Islamic Republic is not Iran, and that clerical rule isn't forever.
Iran's ayatollahs are simply trying to make the status quo last a while longer, no matter the cost.