China’s recent achievement in restoring diplomatic relations between Iran and Saudi Arabia has taken the world by surprise. This action has provided Beijing with new opportunities to expand its influence in the Middle East and advance its global initiatives. The agreement was disclosed on 10 March 2023 following four days of secret talks in Beijing. Analysts view China’s efforts to mediate this agreement as indicators of a shifting global order. The agreement is a diplomatic victory for China, which seeks to present an alternative vision to the U.S.-led international order. It is Beijing’s first foray into Middle East mediation, a field that Washington has dominated for the past four decades. This development has regional and global implications and merits in-depth examination.
A brief overview of the History of Saudi Arabia and Iran’s Rivalry
Several decades of religious differences, political ambitions, economic interests, and geopolitical considerations have contributed to the rivalry between Saudi Arabia and Iran. In 1979, when Ayatollah Khomeini converted Iran from a monarchy to an Islamic republic, Saudi Arabia’s political orientation shifted. During the Iran-Iraq War, Saudi Arabia provided Iraq with military and financial support. At the same time, Iran accused Saudi Arabia of conspiring with the United States and Israel to undermine Iran’s position. Since the US-led invasion of Iraq in 2003, the rivalry has continued to intensify. In 2016, Saudi Arabia severed diplomatic ties in response to an assault on the Saudi embassy in Tehran. As a result, relations between the two countries deteriorated, with Saudi Arabia accusing Iran of supporting terrorism and destabilizing the region.
The Saudi Arabia-Iran rivalry is a complex and multifaceted issue that various factors, including oil production, economic sanctions, economic partnerships, military expenditures, and foreign investments, have shaped. The antagonism between the two nations has significantly affected the region, including the escalation of sectarian tensions and conflicts in Syria, Yemen, and Iraq. Iran is a regional power with considerable military and economic capabilities, and Saudi Arabia is a major oil exporter and a vital ally of the United States. Economic and geopolitical considerations and a shared political opposition to US hegemony have influenced the relationship between Saudi Arabia and Iran.
The Chinese approach to the rivalry
China has invested in infrastructure projects in Iran, such as the building of ports, railways, highways, petrochemical plants, and other industrial facilities. The two nations have endeavoured to strengthen their economic ties in recent years through a comprehensive strategic partnership that includes investments in various sectors, such as trade, energy, investment, and security. Multiple factors, including economic and geopolitical implications, have influenced the strategic economic relationship between Iran and China.
On the other hand, China and Saudi Arabia have sought to strengthen their economic and diplomatic ties, concentrating on energy and infrastructure projects. In this process, China has invested in infrastructure projects in Saudi Arabia, such as the building of ports, railways, and highways. Saudi Arabia is pursuing Chinese investment in its Vision 2030 economic transformation program. Due to economic, geopolitical, and geocultural factors, the Saudi Arabia-China relationship has evolved significantly in recent years. Parallelly, Saudi Arabia attempts to balance its relationship with China and its alliance with the United States. China has shown as a successful mediator that it can enhance economic and diplomatic ties with Iran and Saudi Arabia to defuse the rivalry and expand its geoeconomic influence.
Foreseeable consequences for the Chinese approach
The West has been declining due to the shift in economic power from the West to the East, with China becoming a significant participant in the global economy. Regionally and globally, the expanding Iran-China-Saudi bloc in the Middle East has both positive and negative implications. It could increase trade and investment between the three countries, diversify the economy away from oil, support the Vision 2030 program, and provide access to new markets and investment opportunities. However, there are also significant challenges and potential risks associated with the bloc, such as the alignment of Iran and Saudi Arabia, which could cause further instability in the region, and the growing perception of China by other regional powers as a threat.
The Iran-China Comprehensive Strategic Partnership agreement, signed in 2021, stipulates China’s 25-year investment of $400 billion in Iran’s energy, infrastructure, and transportation sectors. The project has strategic and economic significance because it offers an alternative trade route to Afghanistan and Central Asia that circumvents Pakistan. A joint venture between Iran and China, the South Pars gas field project seeks to develop the world’s largest gas field, which Iran and Qatar share. The Yanbu Aramco Sinopec Refining Company project and the Jazan Economic City project are two Saudi Arabia-China joint ventures with significant economic and socio-political significance in Saudi Arabia. The initiatives help Saudi Arabia diversify its economy away from oil, create new economic zones, and attract foreign investment. China has also invested in several significant projects with varying economic and societal values in both Iran and Saudi Arabia, supporting their efforts to secure access to energy resources, expand their economic and political influence, and diversify their markets.
Responses from the West
The West and Israel may employ various tactics to counter the shift in geopolitical influence in the Middle East. This includes expanding economic ties, countering Chinese propaganda, and forming coalitions with other actors. The West can provide military assistance to its regional allies, increase financial aid, and provide grants, loans, and technical assistance to support economic reforms and infrastructure development. With its Middle Eastern partners, the West can increase diplomatic engagement, strengthen people-to-people ties, enhance intelligence cooperation, and strengthen trade and investment ties. These activities are essential for establishing trust with regional partners, preserving relevance and credibility, and altering regional dynamics.
How will the other regional actors react?
Egypt and Syria play a complex and multifaceted role in the Middle East’s geoeconomic rivalry between China and the West. Both nations have historically aligned themselves with Russia and other non-Western powers but have also sought to balance their relationships with multiple global authorities to maximize their strategic leverage. Iran-China and Saudi Arabia may be attracted to the economic opportunities and potential benefits of increased Chinese investment and regional involvement. This could result in a shift away from traditional Western allies and closer ties with China. However, both nations may also be wary of the potential risks and difficulties posed by a more significant Chinese presence in the region, especially if this leads to heightened competition with Western powers or exacerbates existing regional tensions.
Rising Tensions of Big Powerplay in the Middle East
China’s expanding presence in the Middle East may result in economic adjustments, cultural exchange, political realignments, and security implications. These factors could contribute to competition between the West and China and the imposition of new restrictions and coercive measures. All regional and global actors must closely consider the potential consequences of China’s rising influence in the region. Infrastructure and military presence have been heavily invested in the Middle East, with the United States and its allies maintaining a solid presence and China establishing its first overseas military base in Djibouti. Trade agreements between the West and China have been pursuing agreements with Middle Eastern nations, such as the EU-GCC Free Trade Agreement and the China-Iran Comprehensive Strategic Partnership, which could lead to tensions and possible coercion if either side perceives the other as gaining an excessive amount of influence over key geoeconomic elements.
A post-constructivism approach towards defusing tension
Building mutual trust, establishing regular diplomatic channels, and promoting people-to-people exchanges, cultural events, and educational programs that cultivate mutual understanding and respect are solutions to China-West rivalry in the middle east from a post-constructivist viewpoint. Particularly, to promote cooperation and reduce coercion between the West and China in the Middle East, the post-constructivist theory emphasizes the significance of shared interests, inclusive governance, and strengthened international norms and institutions. Track 1.5/2 diplomacy, commercial partnerships, and cultural exchange programs are examples of contemporary means of establishing mutual trust. Collaboration between the West and China in science and technology can foster mutual trust and create new opportunities for engagement.
The rivalry between the West and China could result in a global economic recession, disruption of crude supplies, a breakdown in communication and cooperation between the two countries, and the collapse of the international order. This could substantially impact the global population and undermine international organizations’ capacity to resolve global challenges. Therefore, it is essential that all parties engage in constructive dialogue and pursue peaceful resolutions to these problems.
Written By Rajeev Ahmed
Illustration: Midjourney AI