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Iran sanctions: Which way will China go?

As the UN considers whether to impose more sanctions on Iran for its nuclear plans, China is a key player. China gets 11 percent of its oil from Iran, and sees a double standard in the US position toward Iran's nuclear program.

By Tom LasseterMcClatchy Newspapers / May 13, 2010

A petrol delivery vehicle drives past a PetroChina gas station in Beijing, March 25. China, the world’s second-largest consumer of oil, gets 11 percent of its oil from Iran, and sees a double standard in the US position toward Iran's nuclear program.

Jason Lee/Reuters/File



 As world powers wrangle this month at the United Nations about how to handle Iran’s nuclear plans, China is attempting to balance its thirst for Iranian oil and natural gas with its ambition to be a diplomatic heavyweight.

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 Tough sanctions against Iran could have serious economic consequences for China, one of the five veto-wielding permanent members of the UN Security Council. Any significant disruption of China’s oil and gas supplies, coupled with setbacks to the country’s development deals in those sectors, could hamper Beijing’s scramble to ensure that its booming economic growth keeps pace with the rising expectations of its people.

China, the world’s second-largest consumer of oil, gets about 11 percent of its oil imports from Iran and has signed billions of dollars in contracts for Iranian oil and gas projects. The Financial Times recently estimated that Beijing is now Tehran’s largest trading partner.

 However, China has left no doubt that it also wants to be considered a major player in crucial world issues such as stopping nuclear proliferation in Iran and elsewhere. Beijing’s rulers have signaled their willingness to juggle hot-button domestic concerns such as Taiwan and Tibet, which they sometimes use to stir anti-Western sentiment, with their growing attention to international strategy.

An indication of a shift in emphasis came earlier this year. At the end of January, the US government announced more than $6 billion in planned arms sales to independently ruled Taiwan, a move that infuriated Beijing, which considers the island as part of China. About three weeks later, President Obama gave the Dalai Lama – whom Beijing considers a separatist leader, if not an enemy of the state – a White House audience. The two moves upset the Chinese leadership and led to speculation that China would retaliate by not sending President Hu Jintao to a nuclear summit in Washington in April.

When the summit began, however, after a decision by the Obama administration to refrain from labeling China a currency manipulator, Mr. Hu was in attendance, ready to talk about Iran.

A global, not regional, player

“The Dalai Lama is a regional issue . . . whereas the Iranian nuclear issue can only be solved on the international stage,” said Yin Gang, a senior analyst at the government’s Chinese Academy of Social Sciences. “If (China) does not go to the nuclear summit only because of the Dalai Lama or weapons sales to Taiwan, the whole world would not be pleased with us. The Chinese image would not be of a big power, but a young boy.

It was a telling decision, said Kenneth Lieberthal, the director of the John L. Thornton China Center at The Brookings Institution, a center-left Washington policy research organization.