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Does A Long-Term Contract With China Serve Iran's Interests?

Chinese President Xi Jinping, left, greets Iranian President Hassan Rouhani at the Shanghai Cooperation Organization (SCO) Summit in Qingdao in eastern China's Shandong Province, Sunday, June 10, 2018. FILE PHOTO

Will a long-term contract between the Islamic Republic of Iran and the People's Republic of China be consistent with Iran's national interests? What will Iran gain out of such a contract? How feasible it is? And what is wrong with the Iranian opposition's reaction to this contract?

Are bilateral cooperation contracts good for the age of globalization?

The fate of various countries are interwoven at the age of globalization. So, cooperation contracts can be good on the condition of legitimacy of the parties to the contract. In other words, such contracts are good if the parties involved represent their citizens and seek their interests in a win-win fashion.

Can Iran benefit from foreign investment?

At the globalization age, capital is stateless. Foreign investment can potentially bring technology and pave the way for development. Foreign investment can be good for Iran if there is a suitable environment for investment. But the Islamic Republic does not have such a potential and it has even wasted its own capitals needlessly.

Can Chinese investment serve Iranians' national interests?

Yes, but only if China acts transparently based on national interests within a win-win frameworks and if there are no unilateralism or exclusive link to China. Despite its non-democratic structure, China has taken long steps toward economic development, has dragged more than hundreds of million of Chinese out of poverty and is the world's second biggest economy. It can now export capital and transfer technology and in spite of what we see in China under Xi Jinping we can expect that economic development would lead to political liberties.

Can the Islamic Republic conclude a contract that serves Iran's interest?

It is highly unlikely. National interests are absent within the frameworks of the Islamic Republic. Its leaders prioritize their "revolution" and those it feeds over everything else. Furthermore, the regime is currently so desperate that that its only preoccupation is its survival. So, there is no likelihood for a good result for Iran. Besides, we are talking about two authoritarian regimes, that give way to corruption and bribery at different levels. Many of contracts between China and poor countries have been facilitated by corrupt rulers in those countries. The Islamic Republic is no exception.

From this perspective, even the 2015 nuclear deal was also the outcome of Iran's desperation as it handed over all the levers of pressure including the trigger mechanism to the other side.

So, why does Iran want a contract with China? Can China be a reliable partner?

Throughout its history, the Islamic Republic has paid the least attention to Iranians' national interests. It only wanted to exercise its supremacy over its people and create wealth to feed its supporters. Its foreign policy has led to a standoff against a large part of the powerful; world community that has a democratic structure and owns knowledge and technology. Chronic inefficiency, systemic corruption and the sanctions which are the outcome of Tehran's enmity with the United States and Israel have led to the Islamic Republic's isolation in the world community.

Entangled in the trap they have created themselves, Islamic Republic's leader are seeking a way out by turning to East in order to save the regime. The justification is that while the West is declining, Iran can rely on the East. The Islamic Republic would resort to anything for its survival and this is what makes us more suspicious. Iran desperately needs hard currency and China is not likely to be helpful in this regard in the short run. Investments on the infrastructure need a lot of time before they can create jobs for citizens.

However, because of the connectivity between Chinese and the Western economies, Iran's over-reliance on China can be a miscalculation. On the other hand, Iran's problem is simply not one of shortage of capitals. Only under President Ahmadinejad Iran sold around one billion dollars of oil and other products, but all that was wasted due to corruption and inefficiency.

What does China gain out if this contract?

China can find an ally through this contract. Xi's strategy is based on strengthening Chinese nationalism inside China and creating a bloc of authoritarian states outside the country in order to confront the Western bloc. Another possibility is that China can use its influence over countries such as Iran in its confrontation with the United States. Nevertheless, because of its intertwined dynamics with the West, China cannot be a reliable security support for Iran.

Is the Chinese model of authoritarian development useful for Iran?

It is neither ideal nor feasible for Iran. The Islamic Republic is haunted by backward ideological illusions. On the other hand it lacks the discipline that exists in the Chinese Communist Party.

Iranian opposition and the Iran - China contract

Although the controversy created by the opposition about this contract is understandable, yet its reliance on facts are questionable. For instance a statement by one opposition group wrongly suggested that the contract "commits" Iran to perform certain obligations while there is no such commitment mentioned for China in the contract.

On the other hand, some economists have accused China of using technologies belonging to others, but this cannot be true as China is a member of the World Trade Organization and is committed to respect others' intellectual property.


  • A contract between Iran and China under the current circumstances will not serve Iran's interests.
  • The Islamic Republic's objective in concluding this contract is political and is meant to ensure its survival. It can even be a move to threaten the West.
  • The contract has very little chance to be finalized particularly by China as the Islamic Republic is in a unstable situation.
  • Iran's interests call for impartiality in the conflict between China and the West.
The opinions expressed by the author do not necessarily reflect the views of Radio Farda