Why Iran’s hopes for Chinese and Russian investment don’t add up
Dalga Khatinoglu
Oil, gas and Iran economic analyst
Tehran’s optimism about fresh Chinese and Russian investment may be more aspirational than realistic.
Oil, gas and Iran economic analyst
Tehran’s optimism about fresh Chinese and Russian investment may be more aspirational than realistic.
Just days after returning from the Shanghai Cooperation Organization (SCO) summit—where he met senior Russian and Chinese officials—Iran’s president Masoud Pezeshkian told Supreme Leader Ali Khamenei that Moscow and Beijing had agreed to invest in Iran.
Despite such assurances, the record suggests that neither has been willing or able to channel significant capital into Iran’s struggling economy.
Iran also faces a persistent flight of domestic wealth, likely to accelerate if United Nations sanctions are reimposed in the coming weeks.
Between 2014 and 2024, the country’s capital account balance was negative $123 billion, or an average of $12 billion leaving each year, according to Central Bank data.
Pezeshkian, fresh from his high-profile trip to China, may hope to offset that outflow with allies’ money. But the numbers are not on his side.
China: reluctant partner
The last major Chinese commitment came in 2016, when state-owned CNPC signed a $600 million contract to develop Phase 11 of the South Pars gas field.
When US president Donald Trump withdrew from the nuclear deal in 2018, CNPC walked away without investing a cent.
In 2021, Tehran signed a 25-year cooperation agreement with Beijing, supposedly worth $400 billion—an average of $16 billion in annual Chinese investment.
Yet official Chinese data show that between 2021 and 2023, Chinese companies invested about one percent of that figure.
Looking further back, China’s cumulative direct investment in Iran between 2003 and 2023 totaled just $1.1 billion—around $110 million annually.
UN Trade and Development (UNCTAD) data put Iran’s net foreign direct investment (FDI) inflows during the same period at nearly $23 billion, meaning China’s share was under 5 percent.
Russia: troubled source
Iran’s hopes for Russian capital look equally shaky.
Over the past decade, Tehran has signed dozens of agreements with Russian companies such as Gazprom, but none have materialized.
Gazprom alone posted more than $21 billion in net losses between January 2023 and June 2025 amid Western sanctions over Russia's war in Ukraine and has canceled many of its foreign projects.
Russia itself is bleeding investment. According to UNCTAD, the stock of foreign direct investment in Russia fell from $522 billion in 2021 to $216 billion last year.
For the first time, China made no new investments in Russia in the first half of 2025.
Russian Central Bank data confirm this massive flight of foreign capital, alongside a parallel outflow of Russian private wealth abroad.
Taken together, these figures explain why Pezeshkian’s assurances to Khamenei likely ring hollow.
Neither Russia nor China appear to be in a position to bankroll Iran. For now, Tehran’s hopes of outside investment remain more a matter of political rhetoric than economic reality.
