Alwaght – The Iranian President Hasan Rouhani traveled to China on Friday, starting a three-day visit to join the Shanghai Cooperation Organization (SCO) summit hosted by the Chinese province of Qingdao.
SCO was founded in 2001 by Russia, China, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. Iran was one of the primary accession bidders. It was accepted as an observer state at the significant economic bloc after Mongolia was accepted a couple of years earlier.
It is the world’s biggest regional organization geographically and demographically, as it is one of the strongest organizations economically. In 2017, the SCO states’ population accounted for nearly 50 percent of the globe’s population, their economies accounted for one-fourth of the global GDP, and their territories 80 percent of Eurasia.
Iran is shifting to the East
The US President Donald Trump pulled out of the Iranian nuclear deal on May 8 and announced economic sanctions on Tehran, which were lifted after the 2015 accord, will be re-imposed within three months. Trump even threatened with more pressures on the Islamic Republic in the upcoming months. The Iranian President trips’ goals go far beyond the simple summit participation. He seeks to garner the Eastern powers’ support to stymie Trump’s anti-Tehran economic strains.
After US pullout, the question rose that will the international companies stay in Iran if Iran adheres to its nuclear commitments? Iran hopes that after the Western companies’ exodus from its projects after Washington abandoned the seven-party agreement, it can fill the vacuum with the expansion of the partnership with the SCO states, mainly China, Russia, and India.
President Rouhani met with his Chinese counterpart Xi Jinping and discussed ways to boost Tehran-Beijing’s political and business ties. After Iran and six world powers– The US, China, Russia, Britain, France, and Germany– signed the nuclear agreement in June 2015, President Xi headed a large economic delegation to Iran in January 2016. Both sides pledged to bolster trade exchange to $60 billion by 2025. In 2017, the couple’s trade went beyond $37.2 billion, showing a 20 percent growth compared to 2016. China’s lender, CITIC Group, signed a deal with Tehran last year, providing the Islamic Republic with $10 billion in loans. Moreover, China Development Bank signed preliminary deals with Iran for $15 billion in infrastructure and production projects, Iran’s Central Bank Governor Valiollah Seif told the media last year.
Certainly, the shored-up Chinese-Iranian ties will grant Beijing a scope to enlarge its political and economic weight in West Asia region. Xi’s China seeks to unseat the US as the largest global power within a decade. China’s plan New Silk Road, covering 68 countries with 65 percent of the global population and 40 percent of global GDP and the world history’s largest infrastructure and investment project, is designed to meet this objective. The main goal is to revive the ancient Silk Road, the old time’s longest trade route linking China to the West. One of the New Silk Road’s six-line land routes passes through Iran.
Talking to the Global Times news outlet, Chinese Foreign Ministry spokeswoman Hua Chunying on June 6 said that Rouhani’s visit to China will help a motion of Chinese-Iranian relations to a strategic level. Asked by the Iranian IRNA news agency about China’s view about the exit of Western companies from Iran due to US pressure, she answered on Saturday Beijing has always objected to any imposition of unilateral sanctions against other nations based on domestic laws, adding that Chin and Iran has always maintained their economic and trade ties, and will continue such relations based on international rules and regulations.
China’s resolve to do business in Iran was exhibited even before Iran president’s trip. When in May France’s energy giant Total said it was withdrawing from an oil and gas venture in Iran due to the renewed US sanctions, China National Petroleum Corporation (CNPC) immediately promised major Total’s Iran share acquisition. Responding to Total’s announcement, Iran gave the French firm 60 days to obtain US ban exemptions or transfer share to CNPC.
In addition to China, India, another giant power in the bloc, eyes relations boost with the Islamic Republic of Iran as a need for its own growth without showing a willingness to bow to US pressures to isolate Tehran. Iran’s Foreign Minister Javad Zarif visited India on May 28 and met in New Delhi with his counterpart Sushma Swaraj. The bilateral focused on oil supply and India-financed Iran’s Chabahar Port development project. She told the media at a news conference with Zarif “India follows only UN sanctions, and not unilateral sanctions by any country”, in a blatant rejection of US sanctions. New Delhi severely fears falling behind its regional rival China in a battle of influence in energy-rich West Asia. It finds Iran a perfect energy supplier owing to its geographical closeness.
Road to accession
Iran is a seeker of official SCO membership. To this end, Iran needs all members’ permission before. Russia ties Iran’s entry to the bloc to all international sanctions lifting. The 2015 UN ban relief paved the way for Iran accession. Despite official Russian, Indian, and Pakistani agreement with Iran to be a member, this year’s SCO’s summit declined to put Iran membership on its agenda. Many suggest Beijing’s opposition stands behind the decline.
China’s main drive to oppose is West-Tehran’s profound strategic and ideological rifts which Beijing is afraid could rock the deep-rooted and huge Chinese business ties with the West amid already burgeoning Trump trade war against China. Beijing’s trade volume with the US and EU altogether goes beyond $1.5 trillion.
However, Iran is optimistic that its potentials, involving its energy, natural, human resources, geopolitical position, and 80-million consumer market, provide it with play cards to overcome challenges and make it to the SCO membership.