America Bombs Iran, China Recalculates

The U.S.- Israeli strike on Iran and the killing of Supreme Leader Ali Khamenei is a blow to Chinese influence in the Middle East.

China finds itself with few tools immediately available to push back against the U.S., much less protect what’s left of the Iranian regime. The attack, following the fall of its ally Nicolas Maduro in Venezuela in January, exposed the limitations of any so-called Axis of Resistance.

The leader of this group of authoritarian states has so far resorted to rhetorical sallies this weekend. In the harshest language deployed by China so far, Foreign Minister Wang Yi on Sunday called the bombing campaign “unacceptable,” condemned what he described as the “blatant killing of a sovereign leader,” and urged an immediate ceasefire and a return to talks.

Going forward, China faces a tricky diplomatic and economic balancing act.

Beyond the blow to perceptions of Chinese global power, the conflict in the Middle East carries economic risks. Iran accounts for 10-15 percent of China’s sea-borne oil imports. If oil traffic through the Straits of Hormuz were to be disrupted, that would pinch China further, given China’s energy dependence on the region as a whole.

As much as China may protest the attack on a cleric-led Iran, it has other important primarily economic relationships in the region it wants to maintain and could leverage. According to MBN’s China Tracker, a new data-driven tool mapping China’s growing footprint in the Middle East and North Africa, the U.S. has by far the deepest military ties across the region. Yet China is the region’s  biggest trading partner and buyer of energy. Its regional investment is highly concentrated in Saudi Arabia and the United Arab Emirates, both close U.S. partners.

Beijing’s relationships with all regional states to advance its geopolitical and economic interests could be upended by any ongoing instability, particularly should Iranian retaliation continue against Gulf neighbors hosting U.S. bases.

But there might be room for some creative diplomacy from China, as long as it is grounded in shared commercial interests, for example to maintain the flow of energy through the Straits of Hormuz. The Chinese have worked closely with countries across the region in multilateral organizations and meetings, building out their soft political and trade appeals (of which China had plenty) over their hard power (whose limits are clear), according to the MBN China Tracker.

On domestic Iranian affairs, Beijing is likely to stay careful and practical. It does not want to be seen as supporting the current regime over the Iranian people, as reflected in its statements to date that speak of process — dialogue, negotiations, end to military action, opposition to unilateralism — rather than outcomes. Ultimately its focus will be less on who prevails inside the country than on protecting its commercial interests, preventing shocks to energy flows, and preventing overweening U.S. influence in any outcome.

A new government in Tehran that leans West and takes enhanced interest, for instance, in the Uyghurs of Xinjiang would be a nightmare for Beijing. Conversely, an Iran in chaos would run counter to China’s interest in a stable and predictable political, economic and security environment in the region.

In strategic terms, as Minister Wang made clear this weekend, China will likely seize the opportunity to reaffirm its longstanding narrative of a “rogue” United States that is a threat to global stability, order and international law. Undermining U.S. legitimacy and reinforcing its own by contrast remains a long-term Chinese strategic goal.

Chinese leader Xi Jinping will have a chance to discuss Iran with President Donald Trump in a month when he hosts the U.S. president for a long-awaited summit in Beijing from March 31-April 2. The meeting agenda will be full: trade, Taiwan, technology, fentanyl, etc. The two may have many common interests in the Middle East, such as the maintenance of free trade, open sea lanes, uninhibited resource flows, stability, etc. But based on the evidence so far, Beijing’s role will remain reactive, focused on hedging and protecting its interests, and still limited in its ability to shape what comes next in Iran or contain the region-wide aftershocks.