The aim of this thread to to track Chinese compliance with US-Iran sanctions and assess US performance in getting China to do it.
This article came out a year ago, but its still relevant as as scene settter.
Meanwhile, the Zhenrong firm has already been sanctioned this January, by the US for trading with Iran.
Getting China to Sanction Iran | Brookings | March/April 2011
The chinese gameplan
A model for US to use with China
This article came out a year ago, but its still relevant as as scene settter.
Meanwhile, the Zhenrong firm has already been sanctioned this January, by the US for trading with Iran.
Getting China to Sanction Iran | Brookings | March/April 2011
Ultimately, the Obama administration will have to find a middle ground. It must avoid slapping sanctions on U.S. allies and fragmenting the hard-won international coalition on Iran while maintaining robust economic pressure on Tehran and enhancing the credibility of U.S. policy. Outreach toward Beijing should thus reinforce the intrinsic limitations of Chinese-Iranian cooperation and reduce the chances of a confrontation between Washington and Beijing over Iran.
Beijing is wary of an outright breach with Washington, its most important bilateral relationship. Circumspection toward Tehran partially offsets Beijing's mercantilist considerations. A case in point: Chinese crude oil imports from Iran dropped by 35 percent during the first half of 2010. Chinese oil traders blame pricing issues, but the decline notably coincided with Washington's efforts to get Beijing to support UN sanctions, which included pressuring the Saudi government to guarantee oil supplies to China.
Yet ties between China and Iran are hardly ironclad. Beijing takes a more cautious approach to Iran than sensational press headlines and political rhetoric in the United States often imply. The amount of money that China's NOCs have committed to projects in Iran, let alone actually invested, is considerably smaller than the $100-$120 billion frequently cited. Chinese firms are not entirely immune to the checks that have hindered other companies. They have also been deliberately prudent in finalizing their investments. Their strategy is to negotiate agreements but delay major spending in the hope of securing access to Iran's resources over the long term while minimizing the immediate risks of taking on legal and financial commitments in an unpredictable environment.
One model for such an effort is Washington's handling of the Iran issue with Moscow. For more than a decade, Washington invested in a high-level dialogue, frequent bilateral consultations, and intelligence sharing. The payoff has been greater trust and cooperation and a shift in Russia's position on Iran from obstructionism to cordial collaboration.
Another step will be to ensure clear communication with Beijing about Washington's expectations regarding the sanctions. This should include both a quiet bilateral dialogue and public statements announcing the limits of Washington's forbearance. One obvious point to make is that penalties might be applied to firms that take over projects that other companies have abandoned because of the sanctions. The senior State Department official Robert Einhorn has already warned China's NOCs not to replace departing European and Japanese oil companies, as this could undermine international efforts to isolate Iran by prompting the companies that voluntarily pulled out of Iran to reinvest there.
Another step will be to ensure clear communication with Beijing about Washington's expectations regarding the sanctions. This should include both a quiet bilateral dialogue and public statements announcing the limits of Washington's forbearance. One obvious point to make is that penalties might be applied to firms that take over projects that other companies have abandoned because of the sanctions. The senior State Department official Robert Einhorn has already warned China's NOCs not to replace departing European and Japanese oil companies, as this could undermine international efforts to isolate Iran by prompting the companies that voluntarily pulled out of Iran to reinvest there.
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