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On Bilderberger, Arab League Summit, G7, and China-Central Asia Summit
The Bilderberger Meeting takes place with participants from Europe and North America in Lisbon in Portugal this weekend, focusing mainly on AI and geopolitical tensions.
Simultaneously, the Arab League Summit assembles leaders in Jeddah in Saudi Arabia with President Assad from Syria back around the table. In addition to President Zelensky as a guest of honor, invited by King Salman. The Arab League Summit’s timing after Saudi Arabia and Iran reached a diplomatic rapprochement may open a new chapter in the history books for the Middle East. With Turkey heading into a second election round on May 28, Erdogan positions for a new presidential period cementing his leadership position as Turkey celebrates its 100 anniversary with the founding of the Turkish republic by Kemal Atatürk in 1923.
Meanwhile in the east, the China-Central Asia Summit convenes in Xian in China mapping and signing new trade, industrial, and infrastructural corridors across Central Asia. This opens a strategic opportunity for China to connect and integrate infrastructural, industrial, and trade corridors between Central and South Asia, with West Asia / the Middle East. This trilateral geostrategic architectural design forms with the China-Pakistan Economic Corridor (CPEC) via Gwadar in southern Pakistan, and in the longer term across Central Asia, Afghanistan, and Pakistan through northern, central, and southern corridors with what I termed the China-Iran Economic-Corridor (CIEC).
The China-Central Asia Summit reflects China´s strategic focus on Central Asia, and its long-term commitment to the One Belt One Road. The One Belt strategy, in the dual land-based and maritime One Belt One Road, is the land-based strategy from China across Central and South Asia, and onwards to the Middle East, Africa, the Caucasus, and Europe. Those China analysts who said that China´s One Belt One Road is not working or a failure, are wrong. Indeed, China continues to focus on developing infrastructure and connectivity across Asia, Africa, the Middle East, Latin America, Oceania, and Europe.
Concurrently, G7 leaders gather in Hiroshima in Japan over the weekend with President Zelensky attending on Sunday. G7 likely provides a final statement affirming its support for Ukraine, common stance against Russia´s war of agression, focusing on AI, while also seeking a way forward to strengthen and stabilise trade, economic growth, fiscal, and macro-economic conditions.
These high-level meetings and summits reflect how international relations and geopolitical dynamics ebb and flow.
By Arne Elias Corneliussen
May, 19, 2023
A Cardinal Error in EU's Foreign Policy Strategic Thinking & What EU's International Strategy Should Focus On
EU’s Chief Diplomat, Josep Borrel, makes a cardinal error when he seeks to shape a reactive foreign policy strategy to counter what he thinks will be China´s strategy to take geopolitical advantage of Ukraine in the event of a Russian defeat in Ukraine. In addition, Josep Borrel, fails to understand why many countries across Asia, Africa,the Middle East, and Latin America engage constructively with China.
When the underlying premises of a foreign policy strategy rest on misunderstood and erroneous strategic thinking, the foreign policy strategy itself ends up misguided and without the preferred results. Instead of focusing the EU foreign policy establishment and EU foreign ministries´ limited resources to counter China’s effective and resourceful global strategy, EU’s Chief Diplomat, Josep Borrel, should travel along with large EU business delegations on several extensive tours to multiple countries across Africa, Asia, the Pacific and Indian Oceans, the Middle East, and Latin America.
In addition, to strengthen Europe’s future, EU’s Chief Diplomat, Josep Borrel, should take similar extensive tours with large EU business delegations across Eastern Europe and the Balkans to strategize, negotiate and plan large country-wide and regional investments to form major economic and investment schemes, and new infrastructural corridors to connect Eastern Europe and the Balkans with Western Europe to form a new European strategic economic architecture.
Josep Borrel must understand that if the EU wants to form a successful globalstrategy then Brussels needs to focus all its valuable energy, limited resources, and pressured diplomatic establishments and capital to form a respectful, balanced, sophisticated, and highly pro-active industrial, energy, infrastructural, and global investment strategy with real investments, job creation, and economic growth resultsthat drive balanced strategic relationships, and economic development across Asia,Africa, the Middle East, Latin America, and Europe. Only then will the EU have a remote chance of gaining a stronger position internallyand globally, independent of China ́s global strategy, and with an autonomous strategic position able to manage its external relations effectively, without interference from the US and China, on a global scale.
By Arne Elias Corneliussen
May, 13, 2023
On China, Saudi Arabia and Iran
China Hosts Iranian Foreign Minister Hossein Amir-Abdollahian and Saudi Foreign Minister Faisal Bin Farhan in Beijing today on April 6 as part of China’s mediated rapprochement deal between the Sunni and Shia historic rivals. This coincides, albeit not coincidentally, with Von Der Leyen and Macron’s trilateral meeting with Xi Jinping in Zhangnonhai in Beijing today. Reflecting Beijing’s gravitational power role as new geopolitical epicenter for high-level global diplomatic activity.
Riyadh and Tehran open respective embassies within weeks and likely reactivate security and economic agreements signed around 2000. Recently, leading high level officials in Riyadh allegedly talked in closed door forums about the possibility of investing in Iran. Saudi investors along with other Gulf investors realise the enormous and epochal-shifting potential a revitalised Iran forms for the entire region. Remember, Iran’s almost 90 million population represents a vast market opportunity.
In addition, Iran’s geography connects South Asia as it borders Pakistan and Afghanistan, Central Asia with its border to Turkmenistan, the Caucasus with its border to Azerbaijan, and West Asia / the Middle East with its border to Iraq, and almost Kuwait. China understands Iran’s unique geography and that it represents Beijing’s land-based entry into West Asia. As I argued over three years ago, China plans to establish what I termed a China-Iran Economic Corridor (CIEC) with its historic 25-year historic agreement signed with Iran on 24 June 2020. China likely strategizes to build three infrastructural corridors from China across the northern Central Asian corridor via Turkmenistan into northern Iran, across the middle corridor across the Wakhan Corridor and overland through Afghanistan into central Iran, and connecting the China-Pakistan Economic Corridor (CPEC) via Gwadar with Chabahar and into southern Iran.
Beijing comprehends Saudi Arabia’s leading role in the Gulf Region and its central balancing role in global energy markets, which is why President Xi visited Riyadh for a 3-day state visit in December 2022. This coincides with Saudi Arabia’s historic transformation with a wide range of infrastructural, logistical, architectural, urban planning and economic mega projects including NEOM, and a major rediscovering of Riyadh’s urban design, along with the growth of new industrial, business and tourism sectors. Beijing’s strategic thinkers in Zhangnonhai, government headquarters in Beijing, regard stabilizing relations between Tehran and Riyadh as foundational to broader peace, balance and stability to prepare strategic ground for long-term Chinese One Belt One Road infrastructural, trade and export networks connecting East and West Asia.
By Arne Elias Corneliussen
April, 10, 2023
25-Year China - Iran Strategic Agreement charts China – Iran Economic Corridor: Architecture & Implications
On July 5, Iran´s Foreign Minister Mohammad Javad Zharif informed Parliament in Tehran of ongoing negotiations between China and Iran on a 25-year strategic accord. When Chinese President Xi visited Tehran in 2016, China and Iran signed a joint statement on a comprehensive strategic partnership. Over the last four years Chinese and Iranian leading strategists gathered in Zhongnanhai – Beijing´s central government district and in Tehran to map out the contents and architecture of this strategic agreement which likely includes military, economy, energy, telecommunications, industry, infrastructure, science and education. This may transform the strategic and geopolitical equilibrium in the Middle East in the long term.
Military
In October 2020 the UN lifts the arms embargo on Iran in accordance with the nuclear deal, Joint Comprehensive Plan of Action (JCPOA). This enables Iran to purchase conventional military hardware from other countries. According to Zarif´s presentation to Parliament on July 5 Iran does not want or allow China to establish permanent military bases or gain any long-term land-control on Iran´s territory in exchange for any economic deals. However, while developing industrial or infrastructure contracts in Iran, China may demand to provide security at ongoing construction locations, particularly in areas with prevailing security risks. Furthermore, in the military field we may see a wide array of initiatives and deals including increased military training, land-based, naval and aerial exercises, such as last year´s China – Russia – Iran naval exercise in the Gulf of Oman. In addition, investments in new military installations and advanced technology.
Following the October 2020 UN arms embargo lifting, Iran´s military forces likely want to upgrade the air force with new fighter jets; maritime capacities particularly submarines and advanced missile technology. With an approximate 15 – 20bn USD annual defense budget Iran´s new military acquisitions in the air force, naval capabilities, advanced missile development, aerospace technology and other areas modernize Iran´s armed forces over the next decade. Iran´s military industrial capacity remains substantial despite years of continued US and UN arms embargoes. Most of Iran´s missile capabilities emerge from indigenously developed missile production, although Iran maintains S300 missiles purchased from Russia. Iran´s missile forces include thousands of ballistic and cruise missiles. The world witnessed Iran´s missile capacity when the IRGC on January 8 this year launched 15 – 22 indigenously developed short-range ballistic missiles at the Ayn al-Asad airbase in the Al Anbar governorate in western Iraq, in retaliation for US killing of Qasem Soleimani. Reports assessing the Iranian missile attack revealed an attack with very high precision and no casualties.
Economy
In the economic field the impending China – Iran strategic agreement likely covers a range of areas including investments in Iran´s energy sector covering oil, gas and petrochemical industry including new pipelines. Chinese banks may establish offices in Iran, reforms and support for Iran´s national banking sector and its private and public economic sectors. Chinese tourism likely increase substantially requiring investments in new hotels, restaurants, tourism infrastructure and investments in new airports. In addition, Chinese companies also likely enter the emerging commercial and private real estate markets across Iran.
In addition, Chinese companies may contribute with advanced technology, robotics and AI in various industrial fields. China and Iran need to agree on how to deal with US sanctions to mitigate risks in its strategic relations. While barter agreements trading Iranian oil and gas contracts for Chinese industrial, infrastructure and energy deals appear likely, other options may emerge in negotiations between China and Iran. Iran´s sovereign wealth fund, the National Development Fund of Iran with 90bn USD in estimated holdings may finance strategic industrial and infrastructure projects. Other international financial partners also seem likely.
Telecommunications:
Iran´s telecommunications sector needs reforms and new infrastructure. Although Iran seeks 5G capability, internal issues with Iran´s Islamic Republic of Iran Broadcasting (IRIB) which controls the 5G capable 700MHz and 800MHz remain as IRIB currently appear unwilling to release spectrum for future 5G services nationwide. When relevant internal issues resolve, we may see Huawei´s 5G network gain a long-term position in Iran.
Energy
Development of Iran´s energy sector constitutes a central part of the industrial component in a strategic agreement between China and Iran. While the China National Petroleum Corporation (CNPC) pulled out of a deal to develop Phase 11 of Iran´s the South Pars gas field, adjacent to Qatar´s section of that gas field, a new strategic agreement between China and Iran may reinvigorate a CNPC re-entry. Currently, Iranian energy company Petropars develops Phase 11 in the South Pars gas field.
A range of new energy deals covering oil, gas, petrochemical industry, and renewable energy may ensue with a strategic agreement between China and Iran. Chinese companies may also contribute to new oil and gas pipelines connecting to existing regional pipeline networks and form new pipeline corridors. Regionally, existing pipeline networks include the Central Asia – China gas pipeline, which connects to China´s west – east pipeline grid which runs from the western part of China to the east, and covers approximately 7000 km from Turkmenistan to eastern China. The Tabriz – Ankara pipeline runs 2,577 km from Tabriz in north-west Iran to Ankara in Turkey. The Iran – Pakistan gas pipeline also known as the Peace Pipeline foresaw construction of a pipeline from the South Pars gas field in Iran to Karachi in Pakistan. However, while the pipeline remains delayed, a strategic agreement between China and Iran may provide the necessary final push to complete the Iran – Pakistan pipeline. Currently, Iranian companies build the 1100 km Goureh – Jask pipeline stretching from the Goureh Oil Terminal near Busher to Mobarak Mount in the western Jask region along the Sea of Oman, with a 1 million barrels per day transfer capacity.
Manufacturing Industry
Iran maintains a substantial manufacturing industry producing automobiles, electric appliances, telecommunications equipment, military hardware, industrial components, steel and manufactured commodities for its energy sector. Chinese industrial players may enter to modernize Iran´s manufacturing industry further. This combined with educational and scientific exchanges and partnerships between Chinese and Iranian universities and research institutes may drive educational, scientific and innovative advances.
Infrastructure
In the infrastructure field, Iran effectively enters into China´s One Belt One Road strategy. Due to Iran´s unique geostrategic location with a 2250 km coastline in the Persian Gulf, Strait of Hormuz, Sea of Oman and the Caspian Sea; in addition to a vast land-border with Iraq, Turkey, Armenia, Azerbaijan, Turkmenistan, Afghanistan and Pakistan; Iran becomes a vital country in China´s maritime One Road strategy and the land-based One Belt strategy.
Chinese port developers may assume development of Chabahar Port, which India failed to complete in recent years. Chinese port developers may also develop a range of other ports along Iran´s 2250 km coastline along the Persian Gulf and in the Caspian Sea – which then facilitate port and shipping connections to Turkmenistan, Kazakhstan, Russia and Azerbaijan. Combined with port modernization and port terminal development, Chinese infrastructure developers likely also modernize Iran´s railway structure with high-speed railway infrastructure. China´s strategic infrastructure architecture thinking often combines its maritime ports and port terminals with railways and highways to different inland logistics clusters and special economic zones which form economic corridors enabling supply chain connectivity with countries across vast geographies.
China and Iran may also seek to connect the 3200 km long China – Pakistan Economic Corridor (CPEC) which stretches from Kashgar in the Xinjang-province in Western China to Gwadar in southern Pakistan along the Indian Ocean into Iran´s inland infrastructure and maritime port structure networks. This appears increasingly plausible now as Pakistani Prime Minister Imran Khan visited Tehran twice in 2019 improving Iranian – Pakistani relations further. Building infrastructure in the border region between Iran and Pakistan may also provide economic development in the tense Balochistan region, which experienced an insurgency with various groups including the Balochistan Liberation Army and the Baloch Liberation Front which regularly clash with Pakistan´s army. Calming tensions in the Balochistan region through economic and infrastructure development may provide employment and new trade networks unlocking the economic potential of this important border region and herald a new economic era for Iranian – Pakistani relations.
In the longer term a Chinese – Afghan – Iranian infrastructure initiative may emerge, pending negotiations with Afghan authorities and Taliban, constructing an infrastructure corridor including a railway, highway and a pipeline from Western China across the Wakhan Corridor in eastern Afghanistan through the Hindu Kush mountain range to Iran. This may form one of many initiatives driving Afghanistan´s future economic development as US military forces complete their planned withdrawal.
In addition, Iran and China may also seek to develop high-speed railway and cargo railway networks across Iran with connections from Iran to Kazakhstan and Turkmenistan, and onward to Tajikistan and Kyrgyzstan, thus connecting Iranian transportation networks to the emerging Central Asian infrastructure architecture. This enables connectivity with the important logistics cluster – Special Economic Zone Khorgos Eastern Gate located 330 km from Almaty on the Kazakh – Chinese border about four hours from Urumqi – the capital in the Xinjang-province in western China. Connecting China and Iran via Kazakhstan and Turkmenistan in addition to Afghanistan and Pakistan cement economic corridors across Central and South Asia.
Strategic Implications
Fundamentally, the China and Iran strategic agreement forms a geostrategic economic architecture by connecting a China – Pakistan – Iran corridor, a potential China – Afghanistan – Iran corridor and a China – Central Asia – Iran corridor into a geostrategic China – Iran Economic Corridor (CIEC).
Although China and Iran face various challenges by entering a 25-year strategic agreement, both China and Iran constitute historical trading and merchant civilizations with substantial manufacturing industrial bases and traditions in advanced scientific innovation. This provides a unique historic opportunity for both countries to finally form what may become a new strategic economic theater from East to West Asia for the coming decades transforming the geopolitical equilibrium in the Middle East as it in reality negates large parts of the US sanctions regime; propels Iran´s economic development eastwards; and grows the economic landscape from China to Iran. This strategic agreement shifts the geopolitical equilibrium in Iranian – Saudi relations, since it upends the status quo, which Saudi Arabia seeks to maintain.
In conclusion, the impending China – Iran strategic agreement forms the basis of a China – Iran Economic Corridor (CIEC) which may transform the strategic and geopolitical equilibrium in the Middle East in the coming years creating a tectonic strategic inflection eastwards to China.
By Arne Elias Corneliussen
July, 22, 2020