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China’s Active Role in Resumption of Iran-Saudi Relations and its Significance to Beijing

By Vidhya Vighasini K

Image Courtesy: Asia Times

Article: 20/2023


Introduction

The agreement between Iran and Saudi Arabia in March 2023 to resume bilateral relations severed in 2016 has elicited surprise and caution in the geopolitical arena, due to China’s active role in this development(1). The joint trilateral statement by China, Saudi Arabia, and Iran issued on March 10, 2023, that announced the resumption of relations between Tehran and Riyadh mentioned the “noble initiative” of Chinese President Xi Jinping and “China's support for developing good neighbourly relations” between Saudi Arabia and Iran. It also expressed “appreciation and gratitude” to PRC “for hosting and sponsoring the talks, and the efforts they placed towards its success.”(2)


Previously, China consciously refrained from directly involving in West Asian conflicts to pursue economic relations with all countries in the region. PRC feared that interfering in regional conflicts would affect its reputation as a neutral outsider, thus threatening its regional interests - connectivity, energy security, counterterrorism and building global stature.(3) Interestingly, in mediating the Iran-Saudi rivalry, Beijing has circumvented concerns of upsetting its balance of relations with West Asian states. This balance has been maintained through decades-long efforts to establish its neutrality, proclaimed win-win policy in bilateral relations, and its status as an important power indispensable to the region’s economic and political stability and security.(4) PRC’s direct involvement in the Iran-Saudi rapprochement signals that peace between the two West Asian nations is in its interests. This notion must be carefully analysed to understand its implications for China.


Iran-Saudi Rivalry

Relations between Shia-majority Iran and Sunni-dominant Saudi Arabia declined after the 1979 Iranian Revolution. The revolutionaries who overthrew the US-backed Iranian Monarchy to establish a fundamentalist Islamic Republic called for the abolition of all monarchies, thus threatening Saudi Arabia, an absolute monarchy. Sectarian and ethnic differences and Iran’s antagonism towards the USA, Saudi Arabia’s closest ally, have exacerbated tensions between the two nations. Iran and Saudi Arabia severed relations for the first time from 1987 to 1990, after the violent clashes between Iranian pilgrims and Saudi security forces at Mecca in 1987. In 2016, relations were suspended again following the attacks on the Saudi Embassy in Tehran after Saudi Arabia executed Shia cleric Nimr Al-Nimr.(3) Escalation of Iran-US hostilities after the collapse of the Iran nuclear deal and Iran-backed Houthi attacks on Saudi Arabia worsened tensions, until the China-brokered rapprochement of ties in 2023.


China’s interests in Iran-Saudi détente

The regional instability caused by the Iran-Saudi rivalry is not conducive to China’s interests in West Asia.(3) China is Saudi Arabia’s largest trading partner and has large investments in the Kingdom’s burgeoning technology and manufacturing industry. Saudi Arabia’s eminence in the Arab world is helpful to Chinese companies to access Arab markets. PRC has supported Iran through several sanctions and diplomatic crises. It has heavily invested in connectivity projects in Iran due to its geostrategic significance to access Europe through Central and West Asia.(7) Volatility in the region due to Iran-Saudi tensions is a roadblock to China’s Belt and Road Initiative (BRI) that encompasses parts of both nations.


China is highly dependent on imported oil from West Asia and Saudi Arabia is its largest oil exporter. China buys oil from Iran clandestinely due to sanctions imposed on Tehran following the collapse of the Iran nuclear deal in 2019.(7) PRC has invested heavily in oil exploration and refining projects in Iran and Saudi Arabia. In September 2019, Saudi Arabia’s state-owned Aramco oil company’s oil processing facility in Abaqiq was attacked by drones. Iran-backed Yemeni Houthi militants claimed to have carried out these attacks.(8)


This shut down half of the Kingdom’s oil production, causing repercussions for economies dependent on Saudi oil like China due to a 20% surge in crude oil prices, the highest since the 1990 Iraqi invasion of Kuwait.(9) In 2022, Houthis attacked the Yasref refinery in Saudi Arabia, a joint venture of the Kingdom’s Aramco and PRC’s Sinopec, disrupting the oil supply. Proxy wars fought by Iran and Saudi Arabia across West Asia threaten China’s energy security and economy. De-escalation in Iran-Saudi hostilities is therefore a necessity for China to protect its energy security.


Security Perspective

Stability in West Asia helps ease China’s concerns about the Islamic radicalisation of Uyghur Muslims. China’s security engagement in the region is not comparable to the USA and is not its priority. But PRC conducts joint naval drills with both Iran and Saudi Arabia under the label of antipiracy and counterterrorism exercises. Though China sells arms to both Iran and Saudi Arabia, regional stability is its larger interest. Facilitating a détente between the two nations is a strategic tightrope to walk for PRC to protect its interests. Saudi Arabia’s concerns regarding Iran’s nuclear program align with China’s policy of a nuclear-weapon-free Arabian Peninsula.(3) Iran-Saudi détente may reduce the fear of nuclear war in the region and is favourable to China’s attempts to sell civilian nuclear energy facilities to both states.


China’s New Role in West Asia

In conflict-prone West Asia, Western powers such as the USA have traditionally mediated conflicts and negotiations of truce. However, they are viewed as imperialistic, coercive, and biased by most West Asian states. In contrast, China has the advantage of being a non-western neutral power with no bitter history in the region. China’s brokering of the Iran-Saudi rapprochement has showcased an alternative, low-risk way of mediating West Asian conflicts.(11) This may lead to other West Asian states becoming more open to accepting China’s intervention in regional conflicts. In recent times, China has engaged in resolving conflicts such as the Yemeni and Syrian civil wars, signifying its assertiveness in protecting its interests in the region.


In Syria, the Iran-backed Al-Assad regime’s bid for normalisation of relations with the Gulf states that support the rebel forces has gained traction after the Iran-Saudi deal. However, amidst a fragile ceasefire with the rebels controlling large parts of territory, it is debatable if this will pave the way for stability in Syria.(12) Peace in Yemen depends not only on Iran ceasing to arm the increasingly uncontrollable Houthis against the Saudi-led coalition but also on domestic factors such as the separatist movement in Southern Yemen.(13)


The Arab world and especially Saudi Arabia which claims to be the leader of the Islamic world remains largely silent on China’s human rights abuses against Uyghur Muslims.(14) This silence is attributed to PRC’s close economic ties with West Asian states and its emphasis on mutual non-interference in internal affairs. This rhetoric helps China in minimising outrage from West Asia against the persecution of Uyghurs and is also a relief to many West Asian states which are notorious for human rights violations.(15) China offers an alternative platform for cooperation and development to West Asian states like Iran and Saudi Arabia which have political systems different from Western liberal democratic institutions that condemn and impose sanctions on such regimes over human rights issues.(16)


The rapprochement between Iran and Saudi Arabia following the Beijing deal is visible in recent goodwill gestures like Saudi Airforce evacuating Iranians from crisis-hit Sudan.(17) But it must be noted that this deal is the result of pragmatic compulsion rather than the desire for resolving deep-rooted differences between the two states that are primarily interested in economic and security incentives. The success of this agreement depends on factors that are beyond Beijing’s control. The determining factor is Iran and Saudi Arabia’s commitment to non-interference in the internal affairs of each other, which is an uphill task for the two rivals whose habitual meddling in each other's affairs and proxy wars have left a trail of destruction and instability across West Asia.(18)


Beijing’s growing influence in West Asia is not without challenges; USA’s shadow looms large in the region. China’s involvements in West Asian conflicts are strictly diplomatic and its interests are predominantly economic. Overcoming US dominance in West Asia is not possible without matching up to the USA’s deep military engagement in the region and its role as the “security guarantor” to major West Asian countries, especially Saudi Arabia.(3) However, West Asia does not rank high enough on China’s list of priorities to warrant Chinese military intervention in regional conflicts. PRC thereby remains faithful to its policy of non-alliance in the region.(19)


Yet, China’s involvement in the Saudi-Iran rapprochement is a significant event that might be the foundation for PRC to use diplomatic mediation of conflicts to further expand its regional influence that was originally built on economic ties. Beijing is likely to leverage this influence in future to play a dominant role in devising solutions to West Asian conflicts in ways that favour its national interest. This could be crucial to China’s ambitions of leading a multi-polar international system.


References:

1) Shine, S., Guzansky, Y., & Shavit, E. (2023). Iran and Saudi Arabia Renew Relations. Institute of National Security Studies. https://www.jstor.org/stable/resrep48440


2) China, M. o. (2023, March 10). Joint Trilateral Statement by the People’s Republic of China, the Kingdom of Saudi Arabia, and the Islamic Republic of Iran. https://www.fmprc.gov.cn/eng/wjdt_665385/2649_665393/202303/t20230311_11039241.html


3) Greer, L. (2022). Bridging the Gulf: China's Navigation of the Iran-Saudi Rivalry (1st ed.). Washington, D.C.: The Wilson Center. The Kissinger Institute on China and the United States.https://www.wilsoncenter.org/sites/default/files/media/uploads/documents/Bridging_the_Gulf_Lucille_Greer.pdf


4) China's Arab Policy Paper. (2016, January 14). http://www.china.org.cn/world/2016-01/14/content_37573547.htm


5) Guzansky, Y., & Orion, A. (2017). Slowly but Surely: Growing Relations between Saudi Arabia and China. The Institute for National Security Studies. https://www.jstor.org/stable/resrep08664


6) Moonakal, N. A. (2022, July 9). The Impact and Implications of China’s Growing Influence in the Middle East. The Diplomat. https://thediplomat.com/2022/07/the-impact-and-implications-of-chinas-growing-influence-in-the-middle-east/


7)Belal, K. (2020, January 1). China-Iran Relations: Prospects and Complexities. Policy Perspectives, 17(2), 47-61. doi: https://doi.org/10.13169/polipers.17.2.0047

8) Houthi drones hit Saudi Aramco oil facilities. (2019, September 14). Al Jazeera. https://www.aljazeera.com/economy/2019/9/14/houthi-drone-attacks-on-2-saudi-aramco-oil-facilities-spark-fires


9) Sheppard, R. &. (2019, September 17). Oil price spikes as fears mount over Saudi supply disruption. The Financial Times. https://www.ft.com/content/353bce38-d806-11e9-8f9b-77216ebe1f17


10) Yemen Houthis attack Saudi energy facilities, refinery output hit. (2022, March 20). Reuters. https://www.reuters.com/world/middle-east/saudi-led-coalition-says-four-houthi-attacks-hit-targets-kingdom-no-casualties-2022-03-19/


11) Fantappie, M., & Nasr, V. (2023, March 22). A New Order in the Middle East? Foreign Affairs. https://www.foreignaffairs.com/china/iran-saudi-arabia-middle-east-relations


12) Wimmen, H., Esfandiary, D., Jacobs, A., Wood, D., Nagi, A., Ali-Khan, V., & Waters, G. (2023, April 19). The Impact of the Saudi-Iranian Rapprochement on Middle East Conflicts | Crisis Group. https://www.crisisgroup.org/middle-east-north-africa/gulf-and-arabian-peninsula/iran-saudi-arabia/impact-saudi-iranian


13)Wintour, P. (2023, May 8). Saudi-Iranian detente is fragile but potential for the Middle East is huge. The Guardian. https://www.theguardian.com/world/2023/may/08/saudi-iranian-detente-is-fragile-but-potential-for-the-middle-east-is-huge


14) Jardine, B. (2022, March 24). The Arab World Isn't Just Silent on China’s Crackdown on Uighurs. It's Complicit. Time. https://time.com/6160282/arab-world-complicit-china-repression-uighurs/


15)Sekin, H. K. (2015). Arab States And The Unrest In China’s Xinjiang Province. World Affairs: The Journal of International Issues, 19(3), 118-133. https://www.jstor.org/stable/48505459


16)Mohan, G. (2023, March 30). Iran-Saudi Arabia pact: What China-brokered peace deal means for West Asia? India Today. Retrieved from https://www.indiatoday.in/news-analysis/story/iran-saudi-arabia-pact-china-brokered-peace-deal-means-west-asia-2353447-2023-03-30


17) Saudi-Iran rapprochement visible in Sudan evacuation effort. (2023, May 1). Reuters. https://www.reuters.com/world/saudi-iran-rapprochement-visible-sudan-evacuation-effort-2023-05-01/


18) Turak, N. (2023, June 21). “Things will just have to be accepted as tense”: Saudi-Iran relations have a long way to go despite rapprochement efforts. CNBC. https://www.cnbc.com/2023/06/21/saudi-iran-ties-have-a-long-way-to-go-despite-rapprochement-efforts.html


19) Ebrahim, N. (2023, March 31). China and Saudi Arabia are getting closer. Should the US be worried? CNN. https://edition.cnn.com/2023/03/31/middleeast/saudi-china-get-closer-mime-intl/index.html


(Ms. Vidhya Vighasini K is a research intern at C3S. The views expressed are those of the author and does not reflect the views of C3S.)

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