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Iran's Partners in Crisis after Trump Announces New Tariffs

The Iranian flag and 3D printed oil barrels miniature are seen in this illustration taken June 23, 2025. (Reuters)
The Iranian flag and 3D printed oil barrels miniature are seen in this illustration taken June 23, 2025. (Reuters)
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Iran's Partners in Crisis after Trump Announces New Tariffs

The Iranian flag and 3D printed oil barrels miniature are seen in this illustration taken June 23, 2025. (Reuters)
The Iranian flag and 3D printed oil barrels miniature are seen in this illustration taken June 23, 2025. (Reuters)

US President Donald Trump on Monday said any country that does business with Iran will face a tariff rate of 25% on any trade with the US as Washington weighs a response to the situation in Iran which is seeing its biggest anti-government protests in years.

Iran, a member of the OPEC oil producing group, exported products to 147 trading partners in 2022, according to World Bank's most recent data.

China and the United Arab Emirates are Iran’s largest trading partners, putting them at the top of the list of countries at risk of being hit by Trump’s 25% tariff threat, according to Bloomberg.

Countries like India, Brazil, Iraq, Türkiye and Russia are also major trade partners of Iran.

Fuel is Iran's biggest export item by value, while major imports include intermediate goods, vegetables, machinery and equipment.

China

China is the primary buyer of Iranian oil, which remains under international sanctions over Tehran's nuclear program.

In 2024, the trade turnover between the two countries amounted to $17.8 billion.

In 2025, China bought more than 80% of Iran's shipped oil, according to data from Kpler, an analytics firm.

Iranian oil has a limited pool of buyers because of US sanctions that seek to cut off funding to Tehran's nuclear program.

Also, Iran has a record amount of oil on the water, ​equivalent to about 50 days of output, with China having bought ‌less because of sanctions and Tehran seeking to protect its supplies from the risk of US strikes, data from Kpler and Vortexa shows.

Iranian oil imported by China is typically labelled by traders as originating from other countries, such as Malaysia, a major transshipment hub, and Indonesia.

Chinese customs data has not shown any oil shipped from Iran since July 2022.

UAE

While China is Iran's premier trade partner, the UAE is the second largest. Trade between Iran and the UAE has reached $16.11 billion, making it a vital center in Iran’s regional trade and putting the Emirates at the top of the list of countries at risk of being targeted by Trump’s tariffs.

Iraq

Iraq, Iran’s historical partner and geographically closest, ranks fourth globally with a trade volume reaching $12.3 billion, representing 9.9% of Iran’s total foreign trade activity.

In recent years, Iraq has relied on Iran to supply about 40% of its needs for gas and electricity, at a time when Iraqi infrastructure lacks the capacity to process natural gas for domestic use.

Iraq is already subject to US tariffs of 35% under Trump’s decision to impose reciprocal tariffs with many countries last August.

Currently, gas exports from Iran have been suspended or severely curtailed due to a combination of extreme domestic heating demand and broader economic pressures.

India

India's total bilateral trade with Iran stood at $1.34 billion for the first 10 months of 2025, according to India's commerce ministry. Major Indian exports to Iran include basmati rice, fruits, vegetables, drugs and other pharmaceutical products.

The US president already imposed levies as high as 50% on Indian goods tied to their purchase of Russian oil. The two sides have been working for months to finalize a deal that would provide long-sought tariff relief to New Delhi.

Türkiye

Turkish exports to Iran were $2.3 billion in full-year 2025, while imports were $2.2 billion over 11 months of the year, according to sector and official data sources.

Germany

Iran's exports to Germany stood at around 217 million euros in the first eleven months of 2025, an increase of 1.7%, according to data from the state-owned international economic promotion agency Germany Trade & Invest. German exports to Iran fell by a quarter to 871 million euros over the period.

South Korea

South Korea's exports to Iran between January and November 2025 were marginal at $129 million, while imports stood at $1.6 million during the same period, according to data from the Korea International Trade Association.

Japan

Japan imported modest amounts of fruit, vegetables and textiles from Iran and shipped some machinery and vehicle engines there, according to the latest trade data from Japan that goes through November 2025.

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Business

IMF and Arab Monetary Fund Sign MoU to Enhance Cooperation

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
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IMF and Arab Monetary Fund Sign MoU to Enhance Cooperation

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA
The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki - SPA

The International Monetary Fund (IMF) and the Arab Monetary Fund (AMF) signed a memorandum of understanding (MoU) on the sidelines of the AlUla Conference on Emerging Market Economies (EME) to enhance cooperation between the two institutions.

The MoU was signed by IMF Managing Director Dr. Kristalina Georgieva and AMF Director General Dr. Fahad Alturki, SPA reported.

The agreement aims to strengthen coordination in economic and financial policy areas, including surveillance and lending activities, data and analytical exchange, capacity building, and the provision of technical assistance, in support of regional financial and economic stability.

Both sides affirmed that the MoU represents an important step toward deepening their strategic partnership and strengthening the regional financial safety net, serving member countries and enhancing their ability to address economic challenges.

Business

Saudi Chambers Federation Announces First Saudi-Kuwaiti Business Council

File photo of the Saudi flag/AAWSAT
File photo of the Saudi flag/AAWSAT
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Saudi Chambers Federation Announces First Saudi-Kuwaiti Business Council

File photo of the Saudi flag/AAWSAT
File photo of the Saudi flag/AAWSAT

The Federation of Saudi Chambers announced the formation of the first joint Saudi-Kuwaiti Business Council for its inaugural term (1447–1451 AH) and the election of Salman bin Hassan Al-Oqayel as its chairman.

Al-Oqayel said the council’s formation marks a pivotal milestone in economic relations between Saudi Arabia and Kuwait, reflecting a practical approach to enabling the business sectors in both countries to capitalize on promising investment opportunities and strengthen bilateral trade and investment partnerships, SPA reported.

He noted that trade between Saudi Arabia and Kuwait reached approximately SAR9.5 billion by the end of November 2025, including SAR8 billion in Saudi exports and SAR1.5 billion in Kuwaiti imports.

Business

Leading Harvard Trade Economist Says Saudi Arabia Holds Key to Success in Fragmented Global Economy

Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
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Leading Harvard Trade Economist Says Saudi Arabia Holds Key to Success in Fragmented Global Economy

Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).
Professor Pol Antràs speaks during a panel discussion at the AlUla Conference for Emerging Market Economies (Asharq Al-Awsat).

Harvard University economics professor Pol Antràs said Saudi Arabia represents an exceptional model in the shifting global trade landscape, differing fundamentally from traditional emerging-market frameworks. He also stressed that globalization has not ended but has instead re-formed into what he describes as fragmented integration.

Speaking to Asharq Al-Awsat on the sidelines of the AlUla Conference for Emerging Market Economies, Antràs said Saudi Arabia’s Vision-driven structural reforms position the Kingdom to benefit from the ongoing phase of fragmented integration, adding that the country’s strategic focus on logistics transformation and artificial intelligence constitutes a key engine for sustainable growth that extends beyond the volatility of global crises.

Antràs, the Robert G. Ory Professor of Economics at Harvard University, is one of the leading contemporary theorists of international trade. His research, which reshaped understanding of global value chains, focuses on how firms organize cross-border production and how regulation and technological change influence global trade flows and corporate decision-making.

He said conventional classifications of economies often obscure important structural differences, noting that the term emerging markets groups together countries with widely divergent industrial bases. Economies that depend heavily on manufacturing exports rely critically on market access and trade integration and therefore face stronger competitive pressures from Chinese exports that are increasingly shifting toward alternative markets.

Saudi Arabia, by contrast, exports extensively while facing limited direct competition from China in its primary export commodity, a situation that creates a strategic opportunity. The current environment allows the Kingdom to obtain imports from China at lower cost and access a broader range of goods that previously flowed largely toward the United States market.

Addressing how emerging economies should respond to dumping pressures and rising competition, Antràs said countries should minimize protectionist tendencies and instead position themselves as committed participants in the multilateral trading system, allowing foreign producers to access domestic markets while encouraging domestic firms to expand internationally.

He noted that although Chinese dumping presents concerns for countries with manufacturing sectors that compete directly with Chinese production, the risk is lower for Saudi Arabia because it does not maintain a large manufacturing base that overlaps directly with Chinese exports. Lower-cost imports could benefit Saudi consumers, while targeted policy tools such as credit programs, subsidies, and support for firms seeking to redesign and upgrade business models represent more effective responses than broad protectionist measures.

Globalization has not ended

Antràs said globalization continues but through more complex structures, with trade agreements increasingly negotiated through diverse arrangements rather than relying primarily on multilateral negotiations. Trade deals will continue to be concluded, but they are likely to become more complex, with uncertainty remaining a defining feature of the global trading environment.

Interest rates and artificial intelligence

According to Antràs, high global interest rates, combined with the additional risk premiums faced by emerging markets, are constraining investment, particularly in sectors that require export financing, capital expenditure, and continuous quality upgrading.

However, he noted that elevated interest rates partly reflect expectations of stronger long-term growth driven by artificial intelligence and broader technological transformation.

He also said if those growth expectations materialize, productivity gains could enable small and medium-sized enterprises to forecast demand more accurately and identify previously untapped markets, partially offsetting the negative effects of higher borrowing costs.

Employment concerns and the role of government

The Harvard professor warned that labor markets face a dual challenge stemming from intensified Chinese export competition and accelerating job automation driven by artificial intelligence, developments that could lead to significant disruptions, particularly among younger workers. He said governments must adopt proactive strategies requiring substantial fiscal resources to mitigate near-term labor-market shocks.

According to Antràs, productivity growth remains the central condition for success: if new technologies deliver the anticipated productivity gains, governments will gain the fiscal space needed to compensate affected groups and retrain the workforce, achieving a balance between addressing short-term disruptions and investing in long-term strategic gains.