Iran, China discuss $600b economic deals as Xi Jinping visits

Local news agency says China ‘acknowledges Iran’s constructive role in fight against terrorism and maintaining peace and stability in the region’

Iranian Foreign Minister Mohammad Javad Zarif (R) meets with Chinese President Xi Jinping (L) upon the latter's arrival in the Iranian capital Tehran, on January 22, 2016. (AFP/ISNA/MOHAMMAD REZA NADIMI)
Iranian Foreign Minister Mohammad Javad Zarif (R) meets with Chinese President Xi Jinping (L) upon the latter's arrival in the Iranian capital Tehran, on January 22, 2016. (AFP/ISNA/MOHAMMAD REZA NADIMI)

TEHRAN, Iran — Iranian President Hassan Rouhani on Saturday hailed a “new chapter” in relations with China after talks with President Xi Jinping, who is touring the region to boost Beijing’s economic influence.

The Asian giant and the Middle East’s foremost Shiite power aim to build economic ties worth up to $600 billion within the next 10 years, Rouhani announced.

The two leaders oversaw the signing of 17 agreements in areas including politics, the economy, security and cooperation on peaceful nuclear energy.

“With the Chinese president’s visit to Tehran and our agreements, a new chapter has begun in Tehran-Beijing relations,” Rouhani said in a televised speech, flanked by Xi.

“China has always stood by the side of the Iranian nation during hard days,” Rouhani said, in comments posted on his official website.

Iran’s Supreme Leader Ayatollah Ali Khamenei, who has the final say on all state matters, told Jinping later Saturday that Iran will continue its policy of bolstering ties with the “East.” He praised China’s “independent” stance in global issues, saying it helps deepen strategic ties with Tehran.

“Westerners have never obtained the trust of the Iranian nation,” he said. “The government and nation of Iran have always sought expanding relations with independent and trustful countries like China.”

Khamenei said Iran won’t forget China’s support at the time of sanctions.

“The Islamic Republic will never forget China’s cooperation during the sanctions era,” state TV quoted Khamenei as saying.

It is the first visit to Iran by a Chinese president in 14 years, according to state news agency IRNA, and comes just days after sanctions against Tehran were lifted under a historic nuclear deal with world powers.

“Iran is China’s major partner in the Middle East and the two countries have chosen to boost bilateral relations,” IRNA quoted Xi as saying.

“China and Iran are two important developing countries that must continue regional and international cooperation,” Xi added.

Beijing has long taken a backseat to other diplomatic players in the Middle East but analysts say the region is crucial to Xi’s signature foreign policy initiative — known as “One Belt One Road” — touted as a revival of ancient Silk Road trade routes.

China, the world’s second-largest economy, also relies heavily on energy imports from the Middle East.

Beijing is Tehran’s top customer for oil exports, which in recent years were hit by US and EU sanctions over Tehran’s nuclear programme.

Trade between the two countries was worth $52 billion in 2014. They did not give details of their goal of developing relations worth $600 billion over the next decade.

According to Iranian media, more than a third of Iran’s foreign trade is carried out with China.

‘Constructive role’

The two presidents issued a joint statement outlining a long-term “comprehensive strategic partnership”.

The two countries agreed to enhance cooperation including in fossil and renewable energy, transportation, railways, ports, industry, commerce and services, said the statement, published by Mehr news agency.

China has committed to “invest and finance upstream and downstream energy projects in Iran,” it said.

China “acknowledges Iran’s constructive role in the fight against terrorism and maintaining peace and stability in the region,” it added, while supporting Tehran’s increased role in regional and international affairs.

China, along with the United States, Britain, France, Germany and Russia, was among the countries that reached the agreement with Iran in July to curtail its nuclear activities in exchange for ending international sanctions.

Xi, accompanied by three deputy prime ministers and six ministers, also brought with him a large business delegation.

Xi’s tour, his first of the Middle East as Chinese president, has also taken him to Saudi Arabia and Egypt.

Riyadh and a number of Sunni Arab allies broke diplomatic ties with Iran this month after protesters angry over the execution of a prominent Shiite cleric ransacked Saudi diplomatic missions in Iran.

In Cairo, Xi offered $55 billion in loans and investments to the Middle East, a region where China wants to strengthen its economic presence.

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