x Abu Dhabi, UAEWednesday 17 January 2018

In efforts to contain Iran, the US and China square off

For the US and China, differences on how to deal with Iran's nuclear programme underscore the region's shifting power balance.

The proverbial "elephant in the room" of Washington's struggle over new sanctions against Iran may, in fact, be a dragon. US President Barack Obama finds himself in the unenviable position - for an incumbent running for reelection - of trying to dilute the impact of a raft of new sanctions overwhelmingly backed by both houses of the US Congress, and with strong support from the influential Israel lobby whose favours are assiduously courted during election season. So why is Mr Obama willing to take political heat in order to soften the blow of a new sanctions package?

He may see that a sanctions package whose stated goal, according to one of its sponsors, New York Democratic Representative Gary Ackerman, "is to inflict crippling, unendurable economic pain over there" could, in fact be a trigger for war.

But administration statements about the danger of undermining the international sanctions effort make clear that their immediate concern is actually China.

The US and its closest allies do very little business with Iran today, but have failed to persuade those who do to voluntarily cut ties. The BRIC countries of Brazil, Russia, India and China issued a statement last week reiterating their opposition to any new sanctions against Iran, saying these would be counterproductive and escalate tension. Instead, the BRICs are urging dialogue. It is against these countries that the new US sanctions are, in fact, directed, threatening to close access to the American banking system for any foreign bank that trades with Iran's central bank, for example, to pay for oil imports.

China is by far Iran's largest trading partner, and the new legislation effectively uses the central role of the US financial system in the world economy to strong-arm Beijing into complying with a US strategy it opposes. The law would allow Mr Obama to exempt China every three months by citing US national security interests, but that would force the president to publicly intercede three times before the election in a manner calculated to do him domestic political damage.

Still, Mr Obama's delicate sanctions dance highlights Washington's forced reckoning with China's growing influence.

Five years ago, I had occasion to ask then-Secretary of State Condoleezza Rice how the Bush administration planned to get China to support comprehensive sanctions against Iran, when doing so clearly contradicted China's national interests? Plainly offended at the question, she answered in a scolding voice that nobody believes Iran when it says its nuclear programme is peace, and that China won't want to be left out when the rest of the world takes action. Beijing, in other words, could be shamed into compliance. The assumption was that China didn't really have a foreign policy or strong set of interests of its own, and could be cajoled into following the pack.

Clearly, Washington no longer thinks of China as a feeble foreign policy player. Awareness of a growing Chinese assertiveness is clear in the recent pivot in US foreign policy priorities, declaring as a matter of policy that America's strategic priority is no longer the Middle East, but the contest with China for influence in the Pacific.

On a recent visit to the region, Mr Obama announced he was sending US troops to Australia, a symbolic move to signal a "containment" policy to allies in the region. The US has also intervened verbally in China's territorial conflicts with smaller neighbours such as Vietnam, and the opening to Burma announced last week indicates a willingness to treat with those among China's neighbours seeking to reinforce their independence by balancing relations with Beijing and its rivals.

The more openly declared strategic competition in the Pacific gives a nasty edge to Washington and Beijing's differences over Iran. China resents the US hegemony that has prevailed in the Middle East since the Second World War, and is fiercely critical of the clientelism it maintains with Arab autocrats, its bias towards Israel and its over-reliance on military force as a policy tool.

The slow and relatively stable collapse of Pax Americana suits China, evening the playing field and allowing Beijing to cultivate new economic and political ties. And, of course, it's been doing that in Iran for some years now, buying between 10 per cent and 15 per cent of its oil imports from Tehran, while providing tens of billions of dollars every year in foreign direct investment - even more so since the US began imposing sanctions.

But the Chinese approach to the Iran issue is nothing if not complex. While it doesn't share the alarmist Western view of Iran's nuclear activities and believes the US approach is exacerbating the crisis, it also blames Iran for failing to do more to reassure the IAEA of its peaceful intentions. (Hence its support for limited UN sanctions, but no more than that.) Beijing opposes Iran acquiring nuclear weapons, not because it feels directly threatened, but because it fears the consequences of a confrontation that could destabilise the region - and long-term energy supplies.

Until now, China has been reluctant to risk its relations with the US by directly challenging it in the Middle East, although that could change. Moreover, China is investing heavily in Iran's energy sector, recognising its vast oil reserves as the one source of supply from the Gulf that could be piped overland. The sometime US goal of regime-change in Iran is clearly anathema to Beijing, which will do whatever is in its power to prevent that.

Right now, of course, Beijing sees US hegemony collapsing as a result of having antagonized most of the region's citizenry. Hence, China's long game. "Sooner or later the United States will have to abandon its effort to reshape or dominate the Middle East," wrote former National Security Council staffers Flynt and Hillary Mann Leverett, with China expert John Garver. "China is positioning itself to pick up the pieces when that happens."


Tony Karon is a New York-based analyst. Follow on Twitter: @TonyKaron