Aletho News

China’s success in reconciling Saudi Arabia and Iran is a huge blow to US hegemony

By Ahmed Adel | March 20, 2023

After agreeing with Saudi Arabia in December to buy its oil for Chinese yuan instead of just US dollars, while at the same time Russia is successfully cooperating with Saudi Arabia and Iran in the oil sector, Beijing is helping a historic reconciliation between the two major Muslim countries. Chinese efforts are all the more impressive when considering the persistent efforts of the US to cause conflict between the two countries instead of reconciliation.

It is hoped that reconciliation will lead to a huge blow to the hegemony of the US dollar. In Beijing on March 17, following negotiations in Iraq and Oman during the previous two years, China, Iran, and Saudi Arabia announced an agreement which includes the restoration of diplomatic relations, a confirmation of respect for the sovereignty of states and non-interference in their internal affairs, and agreements on security, economy, trade, investment, science and culture.

In short, with the mediation of China, the two regional powers, often framed as having a Sunni-Shi’a rivalry, made it official that they are embarking on a new path of improving relations instead of further spoiling them for the sake of serving Western interests that are contrary to the interests of the Islamic World.

Therefore, it is quite clear who the Chinese Ministry of Foreign Affairs had in mind when it announced that overcoming differences between Iran and Saudi Arabia will have a “beneficial effect on freeing the countries of the region from external interference” – evidently this is in reference to the US. As Beijing highlighted, these two countries have now “taken their own destiny into their own hands,” adding that their agreement “corresponds to epochal development trends.”

Chinese Foreign Minister Wang Yi, who was recently in Moscow and confirmed that Russia-China relations are reaching new frontiers in building a multipolar world, emphasised that the agreement between Riyadh and Tehran represents “a victory for dialogue and peace.”

In a China Global Television Network (CGTN) article published on March 13 and titled: “Why Iran and Saudi Arabia trust China?”, the author highlights that “dialogue between Tehran and Riyadh has unfolded as negotiations took place in Iraq, where the two countries reached an important consensus. Meanwhile, the main regional allies of Iran and Saudi Arabia, such as the United Arab Emirates and Kuwait, have restored diplomatic relations in 2022. Hence, the resumption of diplomatic relations between Iran and Saudi Arabia also is only a matter of time.”

The author’s belief in the resumption of diplomatic relations proved to be true only days after the article’s publication. The resumption signifies that a new era has dawned in the Middle East, and even more broadly when we consider the effects this could have on the hegemony of the US dollar.

The US has been the dominant force in the Middle East since the end of British and French colonialism in the 1940’s. The region has been in a constant state of war since then, with the US now maintaining 30 military bases in the Middle East – five of them in Saudi Arabia.

For the US that relies on its global network of military bases to maintain hegemony, Beijing is showing non-Western countries how a multipolar world can function with great power diplomacy based on agreements and reconciliation, and not rooted in the idea that “might is right,” like Washington adopts.

It is noted that the day before the reconciliation in Beijing, the head of Saudi diplomacy, Prince Faisal bin Farhan al Saud, visited Moscow unannounced. And a week earlier, on March 6, Russian President Vladimir Putin spoke by phone with his Iranian counterpart Ebrahim Raisi, who visited Beijing in mid-February. After that, Wang Yi was in Moscow. This suggests that although China was the main broker of peace between Saudi Arabia and Iran, Russia certainly played a role in reconciliation efforts.

Russia, Iran, and Saudi Arabia are three leading oil and gas producers and are accelerating their search for payment mechanisms to bypass the US dollar. China, for their part, is already discussing such arrangements with Saudi Arabia and Iran.

The decline of the US dollar as a world currency will weaken the American economy and military power. This in turn will cripple the US’ ability to wage perpetual wars abroad and impose its global hegemony.

Just as importantly, reconciliation between Saudi Arabia and Iran can be seen as a precursor to eventually joining BRICS in the near future. It is recalled that BRICS plans to decide this year whether to admit new members and under what conditions.

Although BRICS collectively accounts for 42% of the world’s population and 24% of the world’s gross domestic product (GDP), they collectively hold less than 15% of voting rights in both the World Bank and the International Monetary Fund, which are Western dominated. By admitting Saudi Arabia and Iran, BRICS’s global status will be elevated even higher as a symbol of not only peace and reconciliation, but also a path to prosperity independent of Western domination.

Ahmed Adel is an Cairo-based geopolitics and political economy researcher.

March 20, 2023 - Posted by aletho | Economics, Militarism | China, Iran, Russia, Saudi Arabia, United States