Written by: Ken Wang

About a month ago, China brokered an agreement between the Islamic Republic of Iran and the Kingdom of Saudi Arabia. The nature of the agreement was to re-stabilize the Middle East by re-establishing the diplomatic channels between the two countries, which de-escalates the civil war in Yemen as a first step. The Foreign Ministry of Saudi Arabia released a trilateral statement on Twitter soon after the agreement was signed. 

This historic agreement resumed the diplomatic relationships between Iran and Saudi Arabia, two countries that have been political and military adversaries for decades. The deal came at a critical time, given the fact that the United States’ influence is dwindling after its pullout from Afghanistan, and the political instability of the Joint Comprehensive Plan of Actions (JCPOA), also known as the Iran Nuclear Deal. 

Needless to say, the deteriorating relationship between China and the United States adds another complication to the potential impacts of the trilateral agreement. Historically, there have been tensions between Iran and the United States, especially after Trump’s assassination of the Iranian General Qasem Soleimani and when the United States quit the nuclear deal in 2018. On the other hand, Saudi Arabia has been an essential ally of the United States in the Middle East, especially with ongoing arms deals. 

Some say this is a win-win situation for Beijing and Washington because China has cut out the work of growing the relationship between Iran and Saudi Arabia, but is this a naive assumption? Yes, it is. Arguably, the United States could lose a lot from this China-brokered deal, especially if it wants to keep Saudi Arabia as a close ally to deter Iran. 

With China brokering a deal between Iran and Saudi Arabia, it could change the power dynamics within the region for decades to come. First and foremost, because of this agreement, China’s future stance on the JCPOA is now uncertain. The agreement solidified the strategic partnership between Iran and China, meaning that China may loosen its stance on sanctioning Iran should Iran commit violations of the JCPOA. Without all members (P5 plus one) holding a firm stance on sanctions, sanctioning Iran would not be effective. 

On the Saudi side, this agreement allowed the kingdom to diversify its alliances. Although the United States and Saudi Arabia had long-standing alliances, purchasing U.S. arms is costly, and the United States has been critical of the human rights practices in the country. With support from China, the Saudis may need less support from the United States since the Iranians have signed the agreement to maintain peace. 

Additionally, the agreement can be considered mutually beneficial for all three parties. China imports over 40% of its oil and gas from the Gulf region, and both Iran and Saudi Arabia have expressed interest in joining the BRICS (Brazil, Russia, India, and South Africa). This economic potential could easily translate into a political one that could compete with the United States, with the potential to push the United States out. 

Regardless of what happens, one thing is certain: if China successfully installs itself as a major player in the Middle East because of this agreement, the United States would have no choice but to re-engage, or even further its engagement, in the regions post-Afghanistan. Washington should be worried about losing its strategic edge in the Middle East, specifically because this agreement could affect the bilateral U.S.-Israel relationship. 

It is well known that Iran poses a security threat to Israel regarding the possibility of a regional nuclear conflict. Israel has been counting on the Saudis to keep Tehran in check, but now that Tehran and Riyadh have re-established diplomatic channels, Israel’s security now hangs in the balance. This agreement could just be the edge Israel needs to join the new alliances brokered by China. 

Another potential for influence expansion for China with this deal is its Belt and Road Initiative (BRI). China has already been heavily expanding the BRI into African countries and some countries in Central Asia. Combining the BRI and the agreement, China could heavily invest in infrastructure projects such as railroads, bridges, etc., in Iran and Arabia, opening China’s land connections into Europe and Africa through the Middle East.  

China grabbed a critical opportunity to step into the politics of the Middle East. Although China cannot yet replace the United States as a major diplomatic player in the region, its Global Security Initiative (GSI) and efforts to make peace deals could tip the scale of the status quo. 

Furthermore, this deal brokered by China under GSI could help further stabilize the region, given the Iranians and Saudis have been on opposite sides of conflicts across Yemen, Iraq, Lebanon, and Syria. If the agreement holds and de-escalates conflicts in these countries, China could and would gain a huge geopolitical advantage that the United States does not have in the region. 

If the de-escalation happens, China will have gained direct access to the Persian Gulf and the Mediterranean Sea, opening its way throughout Eurasia. More importantly, it would have meant that China-led GSI would replace the United States as a solution to the conflicts in the Middle East, the region that has the most complicated history and politics. 

The trilateral agreement among China, Iran, and Saudi Arabia and its potential geopolitical consequences should make Washington worry about its current strategies in the Middle East. If the alliance between Saudi Arabia and the United States breaks, as it is already frosty, with China’s growing influence because of the trilateral agreement and BRI, the United States will suffer another major loss after Afghanistan and eventually lose all its advantages in the Middle East.