What Beijing really means by a ‘strategic partnership’ with Iran

In May 2026, as Iran was still confronting the consequences of the war launched by the US and Israel, Tehran made an unusual institutional move. Mohammad Bagher Ghalibaf, the speaker of parliament and a prominent figure in Iran’s conservative establishment and national security system, was appointed special representative for China affairs. Proposed by President Masoud Pezeshkian and approved by the supreme leader, the appointment gave Ghalibaf responsibility for coordinating government agencies involved in cooperation with China and overseeing major bilateral projects.

Ghalibaf’s appointment may reflect Tehran’s recognition that stronger coordination is needed to translate political commitment into practical cooperation. Giving a senior political figure responsibility for coordinating China-related policy suggests an effort to reduce bureaucratic fragmentation and accelerate implementation. But the creation of a new mechanism is not in itself a guarantee of success. What is more important is whether it can improve coordination, ensure policy continuity and convert political intent into consistent implementation.

Iran’s growing need for China

For much of the past two decades, Iran’s growing engagement with China was driven primarily by external pressure. After the US withdrew from the Joint Comprehensive Plan of Action (JCPOA) in 2018 and reimposed sanctions, Tehran placed greater emphasis on its “Look East” policy and sought closer relations with China, Russia, and other non-Western powers. China offered Iran a large market, diplomatic space, and a degree of economic resilience in a hostile international environment.

The ongoing war has reinforced this orientation, but it has also altered its underlying logic. Iran now faces a broader national challenge. Preserving the political system and maintaining regional influence remain central objectives, but they are no longer sufficient. Tehran must also revive economic growth, rebuild infrastructure, upgrade industry, attract external resources, create employment and restore public confidence. Iran increasingly needs to convert its geopolitical resilience into economic recovery and national renewal.

China’s comparative advantages increasingly align with Iran’s development needs. Beijing possesses the market size, industrial capacity, infrastructure expertise, technological capabilities and financial resources that Tehran requires for reconstruction and longer-term development. This growing complementarity explains why Iran increasingly sees China not merely as a buyer of oil or a diplomatic partner, but as a potentially comprehensive partner in national renewal.

But greater need does not guarantee greater cooperation. For years, China-Iran relations have been marked by high political expectations and limited practical results. The 2021 comprehensive cooperation plan generated considerable enthusiasm in Iran, but implementation moved more slowly than many Iranian officials and observers expected. The war may have increased Tehran’s determination to deepen ties with Beijing, but it has not removed the structural constraints that have long prevented the relationship from reaching the level Iran desires.

Why cooperation still falls short

The central problem in China-Iran relations is not the absence of common interests. Both countries oppose unilateral sanctions and external domination. Both support a more multipolar international order. Both see value in energy cooperation, infrastructure connectivity, and engagement across the Global South. Yet common interests alone have not produced sustained, large-scale cooperation.

China and Iran assign different strategic weight to the relationship. For Iran, China is one of the few major powers capable of helping it reduce the effects of sanctions, develop its economy and strengthen its international position. Tehran therefore hopes that Beijing will play a more active role in energy, investment, finance, technology and diplomatic coordination.

China values Iran, but it does not organise its Middle East policy around Iran. Beijing simultaneously maintains important relations with Saudi Arabia, the UAE, Egypt and other regional actors. Its influence in the Middle East depends partly on its ability to work with states that are divided by strategic rivalry. China therefore approaches Iran within a broader policy of regional balance rather than exclusive alignment.

This difference has real consequences. Iran wants China to treat it as a partner of exceptional strategic importance. China prefers to deepen cooperation without allowing one bilateral relationship to disrupt its wider regional position. Beijing’s caution is not necessarily evidence that it undervalues Iran. It reflects the fact that Iran occupies a different place in China’s foreign policy than China occupies in Iran’s.

The two countries also understand “strategic partnership" differently. Iranian officials expect such a partnership to include visible political support, large-scale investment, stable energy ties and close coordination in international affairs. When official statements are not followed by rapid progress on major projects, some in Iran conclude that China is too cautious or insufficiently committed.

Beijing takes a more conditional view. For China, a strategic partnership does not require cooperation to expand rapidly in every sector, nor does it oblige Chinese institutions to absorb unlimited commercial or political risks. Instead, Beijing generally views long-term cooperation as something that must develop gradually under conditions that remain economically viable and strategically sustainable.

This approach reflects the way Chinese overseas engagement actually operates. State-owned companies, private firms, banks, insurers and investors make decisions according to commercial and regulatory realities as well as diplomatic priorities. Sanctions exposure, financing constraints, project profitability, legal uncertainty and regional instability all shape their willingness to invest. Friendly political relations can facilitate cooperation, but they cannot remove these practical constraints.

US sanctions remain one of the most important obstacles. They have not ended China-Iran trade, particularly in energy, but they have raised the costs of deeper economic engagement. Large firms with extensive global interests have particular reason to proceed cautiously. As long as the sanctions regime and the pressures of the international financial system remain in place, Chinese investment in Iran will continue to fall short of Iranian political expectations. This helps explain the persistent contrast between strong political rhetoric and limited implementation.

Iran’s domestic environment also matters. The country possesses abundant resources, a large market, an educated population and an important geographic position. But foreign investors must also contend with administrative inefficiency, policy inconsistency, limited transparency, legal uncertainty, bureaucratic fragmentation and complex relations among central institutions, provincial authorities and local interests. 

These difficulties are not unique to Chinese companies, but they affect the willingness of Chinese actors to undertake large, long-term projects. Public discussion in Iran has often attributed the limited results of bilateral cooperation primarily to sanctions or to Chinese caution. Yet many of the obstacles to deeper cooperation cannot be removed by sanctions relief alone.

Variables in China-Iran relations

The future of China-Iran cooperation will depend on whether both sides can move beyond political commitment and create the conditions for sustained implementation.

Iran’s first challenge is institutional. Tehran must translate its strategic emphasis on China into consistent policy. It will require administrative coordination, realistic project selection, stable regulation and credible assurances that can withstand changes in political leadership. 

In June of this year, there were successive reports from Iran that the speaker of the Iranian Parliament and special representative for China Affairs, Ghalibaf, would soon visit China, but such a visit has not yet taken place. On the other hand, China has not publicly responded to Iran’s reports regarding this matter. Clearly, Beijing has its own assessment of the political developments in Iran.

Iran’s domestic and external trajectory will also shape the relationship. In recent years, the country has faced repeated large-scale protests, inflation, prolonged sanctions, and pressure on social stability. Its continuing tensions with the US, Israel and some regional states raise the political and security costs of engagement.

International cooperation is inherently selective. Governments and companies usually have alternatives, and they will avoid markets where risks appear excessive. If Iran improves governance, strengthens social stability, promotes economic recovery and gradually eases external tensions, it will create a stronger foundation for cooperation with China. If internal and external pressures continue to accumulate, political goodwill alone will not overcome the resulting risks.

China must decide how it values Iran within its broader Middle East strategy. Iran matters to Beijing not only as an energy supplier or a participant in the Belt and Road Initiative. Its significance also relates to Persian Gulf security, Eurasian connectivity, and cooperation across the Global South. If China concludes that Iran will play a larger role in these areas, Tehran may assume a more prominent position in Chinese regional policy. If Beijing instead sees Iran as persistently constrained by sanctions, economic weakness and regional confrontation, cooperation will probably remain limited and cautious.

China must also prepare for greater competition. Sanctions have reduced the number of international actors willing or able to invest in Iran. But if Iran becomes more open, European states, Japan, India, Turkey, the Gulf countries and other economic powers may seek renewed access to the Iranian market. Under such conditions, Chinese companies will need to compete through technology, industrial capacity, financing, infrastructure delivery, project management and long-term investment. China’s accumulated political relationship with Iran remains an advantage, but it will matter only if it can be converted into practical competitiveness.

Transforming common interests into shared interests

Common interests explain why China and Iran cooperate: both resist external pressure, seek greater strategic autonomy, and favour a less Western-dominated international order. But common interests do not necessarily create durable economic and institutional ties. Shared interests are more demanding. They emerge when cooperation produces benefits that both sides have a stake in preserving. Stable projects, industrial links, technological collaboration, long-term investment, institutional coordination and mutually beneficial economic relations can create this deeper form of interdependence.

For Iran, this requires a more predictable investment environment, stronger governance, and a more open approach to external economic cooperation. For China, it requires maintaining competitiveness and integrating cooperation with Iran into a broader Middle East policy without abandoning regional balance.

The most important change in China-Iran relations is therefore not simply that Iran needs China more than before. It is that Tehran is redefining why China matters. In the past, China was important largely because it helped Iran withstand isolation and sanctions. Increasingly, Iran sees China as central to reconstruction, industrial upgrading and national development.

Whether this new logic produces a more substantial relationship will depend less on political rhetoric than on implementation. China and Iran already possess common interests. Their challenge is to turn those interests into institutions, projects and durable benefits that both sides are willing to protect. Political trust has brought China and Iran this far. Whether they can build lasting institutions will determine how much further the relationship can go. 

As for the ongoing US-Iran war, the longer it continues, the greater the challenges it will pose to China-Iran relations. A prolonged state of war will seriously disrupt Iran’s domestic political functioning and constrain its ability to pursue external cooperation. Broadly speaking, the prospects for China-Iran relations are closely tied to Iran’s own development trajectory. The sooner Iran can return to a stable and sustainable path of development, the more favorable the conditions will be for advancing bilateral relations.

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