Relations between the United States and China appear to be cooling again, one month before the two countries' leaders are set to meet next month. The Chinese government signaled a firm response to U.S. President Donald Trump's threat of sanctions targeting its economic ties with Iran. The signal came just hours after Trump announced sanctions on Chinese companies.
According to Bloomberg on the 25th, Chinese Foreign Ministry spokesperson Lin Jian warned that China's relationship with Iran "must not be undermined or infringed upon," and said Beijing would take "all necessary measures" to defend its interests. Analysts say the risk of another clash between the two powers has grown as Trump steps up economic pressure to force Iran to the negotiating table.
China is the largest buyer of Iranian crude oil and has effectively served as a lifeline for Iran's economy. Bloomberg's analysis suggests President Xi Jinping has little reason to rush to end a dispute that could strengthen his bargaining position ahead of next month's summit. Washington could face a greater backlash if it actually sanctions the large Chinese banks that support Iran.
"China would prefer the dispute not spread, but it has little reason to help Trump end it for free," said Jesse Marks, founder of Riehl Research and Advisory.
A security vacuum in Asia is another variable. The United States this month redeployed the only aircraft carrier stationed in Asia to the Middle East, and U.S. forces subsequently canceled joint exercises with South Korea, citing a shortage of forces stemming from the deployment near Iran. Observers say this vacuum could give China more room to press its territorial claims in the South China Sea and around Taiwan.
Still, China will find it hard to disregard the United States entirely just weeks before the Washington talks on September 24. The meeting was arranged to preserve the two countries' trade truce. China is already cutting purchases of Iranian crude, which had been discounted, as U.S. maritime blockades reduce supply.
John Gong, a professor at the University of International Business and Economics in Beijing, said Washington appears to be seeking small concessions rather than expecting China's full compliance, adding that "Iran has been under sanctions for a long time but has never yielded." Derek Scissors, a researcher at the American Enterprise Institute (AEI), noted that "China will never move first," pointing out that "the United States needs to show its commitment to a new policy, but it has not yet done so."
Some observers suggest that to get China to abandon its ties with Iran, the United States would have to make an offer of comparable scale. The most likely option cited is a halt to U.S. arms sales to Taiwan. A U.S. plan to provide $14 billion in weapons to Taiwan is currently pending.
