With Iran penalised by sanctions over its foreign and nuclear policies, China profits. In a few years, it has increased its trade with the Islamic Republic tenfold, with oil topping the list. Beijing has close trading relationships with many dictatorial regimes.

Beijing (AsiaNews/Agencies) – Sino-Iranian trade jumped tenfold in ten years, going from US$ 2.5 billion in 2000 to US$ 29.3 billion last year. Iran is now China’s second trading partner after the European Union. This was made possible by sanctions against Iran, which have created more opportunities for trade with China.

“China’s economic ties with Iran have to some extent been made easier by Western divestment,” said An Baojun, a researcher at the Chinese Academy of International Trade and Economic Co-operation.

Many democracies have in fact curtailed or ceased trading with Iran to protest against Tehran’s policies, especially its nuclear programme. Although the Iranians claim the latter is for peaceful purposes, they have failed to live up to their obligations in terms of controls and inspections. This has given Chinese companies an opportunity to fill the gap left by Western firms.

For example, the China National Offshore Oil Corp reached a lucrative deal to develop the North Pars gas fields. SINOPEC gained a 51 per cent stake in developing Iran’s Yadavaran oil field, and Iran agreed to supply China with 150,000 barrels of oil a day for 25 years at market price.

More recently, Japan's unilateral sanctions, passed in September, banned financial activity with 15 designated Iranian banks that could contribute to nuclear activities.

In September, South Korea temporarily closed 102 companies believed to be helping Iran’s nuclear programme, including the Seoul branch of Bank Mellat, an Iranian bank that handles about 70 per cent of South Korean exports to Iran.

Since international sanctions affect primarily weapons or nuclear-related matters, most of bilateral trade between China and Iran is not covered. Thus, Western disengagement has benefitted the mainland immensely.

Trade is expected to hit US$ 50 billion by 2015, said Asadollah Asgaroladi, chairman of the Sino-Iranian Chamber of Commerce, during a meeting in Beijing last month.

Already, China is the largest importer of Iranian goods—last year, the volume was US$ 18.2 billion (US$ 13 billion in oil and mineral fuel).

What is more, “An estimated 30 per cent to 40 per cent of trade with Iran is channelled through its neighbours,” An told the South China Morning Post, countries like the United Arab Emirates.

In June, the UN Security Council issued more sanctions against Iran with the support of China. The United States, EU, Japan and Australia followed with even harsher sanctions. Yet, Beijing continued to boost trade with Iran, selling nuclear technology for example.

Under the present circumstances, Ahmadinejad said, the world needed a “new, humanitarian and fair order which could be defined and established with the help of Iran and China.”

For China, this means mutual respect for independence, national sovereignty and non-interference in the domestic affairs of other nations. Hence, Beijing is prepared to trade with any dictatorship ostracised by democratic states, from Sudan to Zimbabwe and Angola.

Chinese companies are present everywhere, developing  energy resources and building infrastructures in countries like Libya, where 36,000 Chinese worked until forced to flee by a popular uprising with major losses for Chinese firms (see “Heavy losses for Chinese companies operating in Libya,” in AsiaNews, 26 February 2011).

• iran
• china
• trade
• nuclear
• programme
• weapons
• oil
• development