China vows payback for US Iran sanctions, testing stability ahead of Xi-Trump summit

Beijing has vowed to retaliate against Washington's expanded Iran sanctions targeting Chinese entities, potentially undermining recent stability in the US-China relationship ahead of President Xi Jinping's upcoming US visit, according to observers. However, observers believe that ongoing efforts, such as last week's Track 1.5 dialogue, could help mitigate tensions and enable both sides to understand each other's concerns.

The US announced fresh sanctions on Iran and its trading partners, including Chinese entities, on Monday as part of its latest effort to economically isolate Iran after limited success with military strikes and diplomacy. Chinese Foreign Ministry spokesman Lin Jian dismissed the sanctions as "illicit" with no legal basis, emphasizing that China's cooperation with Iran is lawful.

Sun Chenghao, a fellow at Tsinghua University, stated that it was unclear whether the sanctions would directly impact Xi's planned meeting with Trump, but noted that the development posed a new risk point before the summit. If secondary sanctions expanded to target core Chinese financial institutions, the summit could become an exercise in "damage control" instead of promoting stability, which would be a setback to the US-China relationship.

The latest US move highlights Washington's dilemma: while the Iran conflict causes domestic problems, its relationship with China is also crucial, suggesting that US sanctions could become a significant factor in Sino-US relations.