“China’s economic ties with Iran have to some extent been made easier by Western divestment,” said An Baojun, a researcher at the Chinese Academy of International Trade and Economic Co-operation, which is under the Ministry of Commerce. An spent several years in Iran studying Middle Eastern issues.
The volume of Iran-China bilateral trade has increased more than tenfold over the last decade, from $2.5 billion in 2000 to $29.3 billion last year, according to China Customs trade figures collected by the Global Trade Atlas, a Geneva-based company that provides trade data to the private sector, the UN and the World Bank.
“As some countries retreat from the Iranian market,” An told the South China Morning Post, “it actually creates more opportunities for some Chinese companies.”
In 2008, Iran’s Pars Oil and Gas Company reached a deal with the China National Offshore Oil Corp. (CNOOC) to develop the North Pars gas field. The pact was signed after Royal Dutch Shell and Spain’s Repsol withdrew from Iran.
“The [UN] sanctions won’t cripple bilateral trade [between Iran and China],” said Yin Gang, a researcher at the Chinese Academy of Social Sciences’ Institution of West Asia and Africa Studies. Most of the bilateral trade in recent years has not involved weapons and other banned goods, such as battle tanks, large-caliber artillery and combat aircraft.
In fact, officials in China and Iran have expressed optimism about boosting trade relations.
“We are doing our best to increase the level of bilateral economic co-operation,” said Yu Hongyang, China’s ambassador to Iran, during a commerce meeting with Iranian officials last month. Trade is expected to hit $50 billion by 2015, said Asadollah Asgaroladi, chairman of the Sino-Iranian Chamber of Commerce, during a meeting in Beijing last month.
China is Iran’s second-largest trading partner, behind the European Union, which traded $32.3 billion in goods with Iran last year, according to Eurostat trade figures collected by Global Trade Atlas.
For comparison’s sake, two-way Iran-American trade last year totaled a mere $305 million. So China’s trade is 96 times higher, and the EU trade total is 106 times higher.
Already, China is the world’s largest importer of Iranian goods—last year, the volume was $18.2 billion, according to China Customs figures. China exported $11.1 billion in goods to Iran last year. So the trade balance is very much in China’s favor.
The total trade figures between China and Iran might actually be larger, because much transshipment goes through the United Arab Emirates. “An estimated 30 per cent to 40 per cent of trade with Iran is channeled through its neighbors,” An said.
In the late 1990s, China supplied cars, tracks, signals and other parts to Tehran’s first Metro lines.
Oil and mineral fuel are by far China’s biggest imports from Iran, totaling $13 billion last year. Iran was China’s third-largest oil supplier last year, after Saudi Arabia and Angola, delivering 7 percent of China’s crude oil imports.
Under a trade agreement in 2007, China’s state-owned oil giant, Sinopec, gained a 51 per cent stake in developing Iran’s Yadavaran oil field, and Iran agreed to supply China with 150,000 barrels of oil a day for 25 years at market price.
Iranian exports of minerals and chemicals to China have increased steadily in the past decade, to $2 billion worth of minerals last year, from $60 million in 2000. Organic chemical exports, such as methanol and solvents, amounted to $1.5 billion last year, up from $36 million in 2000.
Among Chinese exports to Iran, parts for nuclear reactors, boilers and machinery such as air conditioners ranked first or second for more than a decade, according to China Customs figures. These parts totaled $2.3 billion last year—or 20 per cent of all Chinese exports to Iran, making up by far the largest share of goods.
