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POLITICS: What Will China Do With Its Veto?

Mohammed A. Salih and Eli Clifton

WASHINGTON, Feb 23 2010 (IPS) - With relations between China and the U.S. taking some bitter turns in recent months, how China responds to mounting pressure from the U.S. and its European allies for tougher sanctions on Iran is being viewed as a major test of the current relations and a determinant of the future shape of bilateral ties between Washington and Beijing.

A series of actions and statements in recent months have given rise to tensions between the U.S. and China. The U.S. recently sold 6.4 billion dollars worth of arms to Taiwan, slammed the Chinese government over internet censorship and hacking, imposed tariffs on Chinese tyres and has called on Beijing to readjust its currency.

In addition, President Barack Obama received the Tibetan spiritual leader Dalai Lama in the White House last week.

In turn, China has threatened retaliatory tariffs on U.S. products and sanctions against companies that participated in the Taiwan arms sale. Moreover, Beijing has begun to shift its balance of payments surplus away from U.S. dollars and decried U.S. condemnation of internet censorship as “information imperialism”.

With domestic pressure mounting for the White House to take action against Iran’s nuclear activities, the administration’s top officials have engaged in an intensive diplomatic campaign to convince key players, in particular China, to get on board with plans for harsher sanctions.

Thus far, China has adamantly opposed attempts by the U.S. and its western European allies to impose tougher sanctions on Iran and advocates diplomacy to forge an agreement. In early February, Chinese Foreign Minister Yang Jiechi said during a conference in Europe that “to talk about sanctions at the moment will complicate the situation and might stand in the way of finding a diplomatic solution.”

Many analysts attribute Beijing’s position to its traditional opposition to sanctions and its growing trade relationship with Iran.

“Philosophically they don’t like sanctions and don’t think they work so there’s not much good about this from China’s point of view,” Chas Freeman, co-chair of the U.S.-China Policy Foundation and a former U.S. ambassador to Saudi Arabia, told IPS. “So the only reason to do it is to please the Americans. And we haven’t exactly gone out of our way to make them feel kindly about us.”

A Financial Times report earlier this month said China is now Iran’s leading trade partner, overtaking the European Union (EU).

The volume of Iran’s commerce with China totaled 36.5 billion dollars in 2008, according to the FT, while the EU’s trade with Iran stood at 35 billion dollars for the same year. Iran is now the third major oil supplier to China. According to the Iran-China Chamber of Commerce, Iran provides 11 percent of China’s energy needs.

Recognising the importance of Tehran to Beijing’s soaring energy needs, U.S. Secretary of State Hillary Clinton visited the Gulf region recently, urging Iran’s Arab neighbours to provide oil to China in the event of sanctions. Washington hopes that with Arab states supplying China’s energy needs, Beijing will drop its opposition to Western plans for more sanctions. As of now, it is not clear yet whether the Gulf’s Arab countries will go along with the U.S. proposal.

“Relations with Iran fit into the larger picture of China’s burgeoning international energy diplomacy. With soaring energy needs, it cannot be too choosy in the partners it keeps,” wrote Kerry Brown, a senior fellow at the London-based think tank Chatham House, in an article for the forthcoming issue of The World Today, a Chatham House monthly magazine.

“With a government which places economic growth at the centre of its legitimacy, and which needs to pump out eight percent gross domestic product increases at least for the next five years, having the energy to achieve this is crucial. The Communist Party will be finished if it fails to improve the economic lot of its people,” Brown wrote.

Earlier on the 31st anniversary of Iran’s 1979 Revolution, President Mahmoud Ahmadinejad boasted that his country is now a nuclear power, saying Iranian scientists had succeeded in enriching uranium to 20 percent. Western officials have disputed the claim, and say Iran could not have made such rapid progress.

Iran needs 20 percent-enriched uranium to operate a medical research reactor in Tehran.

As the U.S. and its allies increasingly lose patience with Iran, an important trump card in their hands to leverage China to comply with their demands is the threat of Israeli strikes on Iran’s nuclear facilities.

The West hopes the prospect of instability in the centre of world’s energy resources could persuade a reluctant China to join them, something that Freeman describes as a “blackmail or a protection racket.” But it is not clear how serious Beijing takes Israel’s repeated threats to bomb Iran’s nuclear installations.

Many doubt if Israel will be able to attack Iran given the high costs of such an action. In an analysis, a group of experts at the Carnegie Endowment for International Peace wrote that any Israeli assault on Iran will push up oil prices to heights that will plunge the world economy into a new recession.

Israeli officials will head to Beijing in late February to convince Chinese leadership to get in line with Western plans for more sanctions. But the Israelis apparently had little success in convincing Russia to support tougher sanctions, even though Moscow until recently was deemed to have a softer stance toward sanctions on Iran.

But Russia also appears to have introduced some degree of change to its position. Following a visit by Israeli Prime Minister Benjamin Netanyahu to Moscow in early February to demand “crippling sanctions” on Iran, statements by top Russian officials showed the Kremlin has serious disagreements with the West over the severity of potential sanctions.

“The term ‘crippling sanctions’ on Iran is totally unacceptable to us…We certainly cannot talk about sanctions that could be interpreted as punishment on the whole country and its people for some actions or inaction,” Sergei Ryabkov, Russia’s deputy foreign minister, told Interfax news agency last Friday.

The strong message out of Moscow may bring some relief to officials in Beijing as a Russian refusal to back strong sanctions would take some of the pressure off China. But as a permanent veto-wielding member of the United Nations Security Council, China will have to make a difficult decision if Russia chooses not to veto sanctions on the floor of the Council.

“What they (Chinese) have always tried to do in the past is hide behind the Russians. If the Russians are non-cooperative [in sanctions] then the Chinese are off the hook and can avoid taking sides,” Freeman said. “To use [the Chinese saying], they can sit on the mountain and watch the tigers fight. But this time the Chinese may not be able to play this game and may have to make a decision.”

Although sanctions politics appear to be popular among politicians both in the Obama administration and Congress, some doubt if they can really bring about any change in Iran’s behaviour. They see it only as a move to satisfy the “have-to-do-something itch” in Washington in the face of increasing Iranian defiance.

Steve Clemons, an expert at the New America Foundation, argued during a discussion on Blogsheadtv.com that sanctions are “more designed to be about the West’s emotional and political needs rather than a strategy that would really move Iran to a new course.”