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China Reform Monitor - No. 1252

China eyes closer ties to Iran post-sanctions;
Xi visits Bangladesh, pledges $24 billion

Edited by Joshua Eisenman
November 2, 2016

October 1:

Belarus is expanding its economic relations with China to gain more financing via the One Belt, One Road initiative, Gazeta.Ru. reports. Last month Minsk invited Chinese firms to purchase shares in 25 companies, including strategic public enterprises in the power, construction, cement and metal manufacturing sectors. On September 30, President Alexander Lukashenko concluded a trip to China, where he and President Xi signed deals to increase Chinese investment in Belarus. "The agreement with the Export-Import Bank of China is very important,” said the Office of the President of Belarus. "It will promote Chinese companies to invest in Belarus.” The 80 sq. km Belarus-China Velikiy Kamen industrial park being built near Minsk is the biggest Chinese project in Belarus. Chinese investors are building facilities there to supply the European market. China's loans go to Chinese companies operating in Belarus, said Viktor Yevmenenko of the Belarus Security Blog. "We never see direct investments from China. The Belarusians will continue to be forced to accept proposals from China that are not beneficial." 

[Editor's Note: In 2010, China opened a $15 billion line of credit for Belarus which, despite the 2009 financial crisis, supported pay raises and pensions ahead of the presidential election. In 2015 Xi Jinping visited Minsk and provided another $7 billion in loans. In 2015, China-Belarus total trade was $3.3 billion, of which $2.4 billion were Chinese exports to Belarus.] 

October 6:

China is helping Iran redesign the Arak heavy water reactor following last year's nuclear agreement with world powers, Deputy Foreign Minister Majid Takht said in comments carried by 
the official Islamic Republic News Agency reports

October 9:

During a meeting in Bangkok, Chinese Vice-President Li Yuanchao and Iranian President Hassan Rouhani agreed to expand cooperation in banking, energy, and other economic fields, 
Iran's official Press TV reports. Li called for "China's financial institutions to broaden their cooperation with Iran. Iran-China relations have been upgraded to the strategic level following [President Xi's] visit. The post-sanction era is a good opportunity for starting a new chapter in Iran-China relations and we are, ready to expand our strategic ties more than ever." Rouhani accepted President Xi's invitation to the forthcoming International Silk Road Conference, and said: "Iran welcomes China's investment in the fields of oil, gas, transport and technology. China can play a role in restoring peace and stability in the region, particularly in the provision of humanitarian aid to the oppressed people of the region including those in Yemen and Syria." 

October 10:

In her first National Day speech Taiwan's president Tsai Ing-wen emphasized that Beijing should acknowledge Taiwan's democracy: "I call upon the authorities of mainland China to face up to the reality that the Republic of China exists, and that the people of Taiwan have an unshakable faith in the democratic system.” Many in Taiwan, especially young people, view China's growing power with deep apprehension, The New York Times reports. In a statement on its website, the Taiwan Affairs Office in Beijing said the growing power of mainland China would eventually lead to unification. "The historical tide is so powerful and irreversible that those who go along with it will prosper, and those who go against it will perish.”

October 14:

During President Xi Jinping's visit to Bangladesh, China provided $24 billion worth of loans to build power plants, a seaport and railways. Xi's trip, the first by a Chinese president in 30 years, is aimed at boosting China's financing for 25 infrastructure projects, including a 1,320 megawatt power plant, a deep sea port, highways and information technology development. "Beijing is especially keen to revive a plan to build a deep sea port in Sonadia which has been on hold for years,” 
the Times of India reports
. China's Jiangsu Etern Co Ltd signed a deal worth $1.1 billion to strengthen the power grid network in Bangladesh. Bangladesh has backed Xi's "One Belt, One Road" initiative to boost trade and transport links across Asia and into Europe.

Related Categories: China; China and East Asia Program

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