China stands to gain in Iran after US quits N-deal
18 May 2018 5:04 PM GMT
Beijing: The US decision to reimpose sanctions on Iran could scare off European investors but oil-thirsty China may step into the void and ramp up business links with the country.
China, which is already Iran's top trade partner and one of its biggest buyers of crude, has signalled that it intends to keep working with the Islamic regime despite the US move.
Beijing is a signatory of the 2015 Iran nuclear deal that had eased sanctions on Tehran, but President Donald Trump quit the accord earlier this month and said Washington would reinstate punitive measures.
"By driving away American, European and Japanese companies, the sanctions could increase opportunities for Chinese businesses," Hu Xingdou, an economist at the Beijing Institute of Technology, said.
The Iran deal has been highly profitable for the Asian giant. Chinese businesses involved in Iranian developments are worth at least 33 billion as of June 2017 according to Beijing's Commerce Ministry -- part of the country's ambitious Belt and Road global infrastructure initiative.
In September, China provided a 10 billion credit line to five Iranian banks financing water, energy and transport projects, and in March the two countries inked a 700 million deal allowing China to build a train line that links the port of Bushehr to the rest of Iran's railway network.
Beijing now has its sights on the expansion of a major Iranian gas field, with state-owned oil company CNPC set to replace Total if the French energy behemoth withdraws from the project over US sanctions.
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