Polina Aniftou- Geopolitical and Investments’ Analyst
In March 2020 Iran and China signed the 25-year agreement for trade, commercial and political collaboration, the agreement is valued for USD 440 billion and it is considered as the biggest agreement in Northern Hemisphere that will unify a geographical space from Shanghai to Beirut. Iran and China, both belong to Shanghai Cooperation Organization, try to build a new partnership that Iran will guarantee the commercial and economical influence of China in Central Asia, Middle East and provide the port of Beirut as the exit to Mediterranean. From the other side Iran needs this agreement for monetary reasons after the USA sanctions of 2018 and to establish its foreign policy ambitions.
According to this agreement Iran would provide all the infrastructure for the commercial trade of China in exchange to political, financial and banking facilitations. Iran after the sanctions of 2018 has no banking relations with our countries and even German banks that used to facilitate under compliance checks any transactions with Iran, they have ceased their operations. The agreement has activated the two main pillars of Iranian foreign policy, the Persian nature of Iran as the product state of Persian Empire with soft powers influence in Eurasia, and the Shia character that Iran is an Islamic Republic that interprets its existence via the Islamic Governance and the dynamic nature of Sharia and it is accepted by Shia populations in region.
The agreement is planning to engage the national markets of Eurasia to collaborate with both countries. Iran is a major investor in Tajikistan and in EAEU countries in construction sector, in infrastructure networks and transportation, additionally, Iranian investments are present in Oil and Gas, Non-Ferrous Metals, and Wholesale and Retail Trade, and until recently also in Mechanical Engineering. Also, Iran has built in 2020 the biggest railway connection with Afghanistan, it has more than 17 cultural centers in Tajikistan and there are attempts by Tehran’s side to publish a Farsi speaking newspaper that it will be circulated in Iran, Afghanistan, Tajikistan, Uzbekistan, Southern Lebanon. Iran since the Paris Treaty in 1857 it has a strong consulate in Herat in Afghanistan and most of its foreign policy influence contains both cultural diplomacy and military expansion as the famous Afghan Shia Fatemiyoun militias that fight with the pro- Iranian groups in Middle East.
The Iran- China agreement states Beirut port as the major competitor of neighbor Haifa port and the exit of China and Iran to west through Mediterranean. The explosion on 4th of August 2020 at Beirut port has indicated the lack of security of the port, next to the other big alliance that created by the Abraham Accords signed on 13th of August 2020 in Washington between Israel and UAE. UAE became the third monarchy after Egypt and Jordan that recognized Israel, and ahead Bahrain, Sudan and Morocco with large monetary, territorial (e.g. Morocco annexed Western Sahara) and political exchanges normalized their relations with Israel. Saudis had always motivated the relations between Arab monarchies and Israel isolating Qatar that maintains good relations with Iran. The Abraham Accords alliance controls a sea and inland periphery from Gibraltar to Persian Gulf.
Both alliances of Iran and China and Abraham Accords countries are competing in the same periphery with major points to be controlled to increase the influence of the alliances. The Gulf of Oman and the Strait of Hormuz is a deadlock for UAE, Saudi Arabia and Iran, already many attacks to Iranian and Israeli ships occurred in that sea point. The Gulf of Aden and the Bad el Mandeb that face attacks and sieged by Houthis of Yemen and by pirates. From the other side Israel is activating its hidden card, the Eilat port in Red Sea and it has agreed to use it for the transportation of UAE oil through the Ashkelon pipes to Mediterranean to avoid Suez Canal. If Israel decides to use Eilat for heavy trade purposes this will make Eilat a large competitor to Suez but also a main inland transportation partner that oil will be transported via the pipes of former Israel-Iran oil company “The Eilat Ashkelon Pipeline Company” (also known as the Europe Asia Pipeline Company), the goods will be carried from Eilat to Ashkelon port that it is very close to Gaza, and this may require the international organizations and UN to be addressed for the security of the port, creating an anti- Hamas frond by Arab monarchies and international community in the future.
The Mediterranean Sea is in the middle periphery where both alliances meet their exit to west and to Europe. In Cyprus after the bail in of 2013 major Russian companies moved out from the island and currently it is the biggest investment hub for Israeli companies and individuals, while Israeli and USA funds buy land in Greece and operate start- ups in Athens. The normalization of the relations with Morocco gives the opportunity the Israeli ships and aircrafts to travel all over Mediterranean, while Mediterranean for Iran is becoming an alien place that the policy of Tehran did not try to approach and build political and commercial trust.
The developments in Eurasia and Middle East are the first time in history after WWII that involve Mediterranean countries that belong to EU and try to maintain their sovereignty and political independence. The alliance between Greece- Cyprus – Israel and Greece- Cyprus- Egypt initiate a political and commercial frond to the powers of Asia and non- US allies, making Mediterranean as the sea frond of controlling the China- Iranian operations and from the other side creating a united MENA common trade, energy and goods market with all the relevant countries. This market potentially will increase the geopolitical value of Mediterranean as sea equilibrium between powers, but also as it is a market that involves non -EU and EU countries, and may force EU to change its geopolitical and monetary orientation towards MENA.