While China’s overseas investment in Belt and Road Initiative projects surged by 62 percent last year compared to 2024, exceeding $85 billion, two sanctioned countries—Russia and Iran, which ironically consider themselves China’s most important partners—received almost none of these investments.
A new report by the Green Finance & Development Center shows that the value of Chinese construction contracts related to Belt and Road Initiative projects also surpassed $128 billion last year, marking an 81 percent increase compared to 2024.
While China’s investments in Central Asia, right on Russia’s doorstep, jumped 375 percent to $28.5 billion, the figure for Russia was only $674 million—thirty-eight times less than Kazakhstan, Russia’s own neighbor.
While China’s investments in Central Asia, right on Russia’s doorstep, jumped 375 percent to $28.5 billion, the figure for Russia was only $674 million.
The volume of Chinese construction contracts in the Middle East also reached $39.5 billion last year, ranking second after Africa. As in previous years, Iran received no Chinese investment.
This comes four years after Tehran and Beijing signed a “Comprehensive Cooperation Agreement” aimed at attracting $400 billion in Chinese investment. During this period, the only major cooperation between the two countries has been China’s purchase of heavily discounted and sanctioned Iranian oil, mainly by small independent Chinese “teapot” refineries. Even that trade declined in the second half of last year, and according to data intelligence firm Kpler, Iranian oil shipments to China fell by 40 percent, dropping to around one million barrels per day by year’s end.
Among Middle Eastern countries, Egypt, Saudi Arabia, and Iraq topped the list of Chinese project destinations. China’s Belt and Road Initiative engagement in Saudi Arabia stood at $19.8 billion, the third highest globally, and Iraq accounted for $4.5 billion. Saudi Arabia also saw the largest Chinese engagement in green energy last year, worth approximately $5.2 billion. Total Chinese Belt and Road Initiative investment in Saudi Arabia from 2013 through last year reached $40 billion, ranking second only to Pakistan.
Kazakhstan was the single largest recipient of Belt and Road Initiative investment in 2025, with about $25.8 billion, followed by Egypt at $10.2 billion, according to Green Finance & Development Center estimates.
The Belt and Road Initiative, launched in 2013, is Beijing’s flagship global infrastructure drive to expand trade routes and deepen its economic presence across Asia, Africa, the Middle East, and beyond, spanning transport, energy, ports, and increasingly, green and digital projects.
Since its launch, cumulative Green Finance & Development Center engagement has reached $1.4 trillion—about $837 billion in construction contracts and $561 billion in non-financial investments.
This steep drop in China’s trade with Russia and Iran came as China’s total trade with Central Asian countries exceeded $100 billion for the first time.
Taken together, the countries surrounding Iran and Russia are at the center of China’s financial focus, while the two sanctioned states are excluded from the benefits of financial and commercial cooperation with Beijing. This reflects China’s pragmatic priorities and its preference for avoiding ideological posturing or direct confrontation with the West.
Iran and Russia have not only fallen behind regional countries in construction, energy, and investment projects, but amidst China’s rapidly expanding trade ties with Central Asia and the Middle East, both countries also experienced declines in trade with China in 2025.
Chinese customs data show that last year, China exported $103 billion worth of goods to Russia, down 7 percent, and imported $125 billion from Russia, down 10 percent. China’s exports to Iran dropped 22 percent, falling below $7 billion, while its imports from Iran, excluding oil and petroleum products, declined 32 percent to just $3 billion.
Ironically, bilateral trade between China and Israel—Iran’s principal regional adversary—reached about $33 billion last year, with growth of around 48 percent. Israel’s exports to China increased by 103 percent to above $17 billion in 2025.
This steep drop in China’s trade with Russia and Iran came as China’s total trade with Central Asian countries exceeded $100 billion for the first time. China’s exports to Persian Gulf states also climbed 11 percent last year, reaching $162 billion. China’s trade balance with Persian Gulf countries is largely balanced.
With Iran and Russia representing less than 4 percent of China’s overall trade, the two sanctioned countries should not expect full political backing from Beijing.
