China cements influence in Iraq through oil, infrastructure deals

China has gained a major foothold in oil-rich Iraq, shaking up Western domination in fields from energy to construction, even as some warn that infrastructure projects could leave Baghdad in debt.

After decades of conflict, Iraq is "badly in need of foreign investment, and specifically investment in energy sector infrastructure", said John Calabrese of the Middle East Institute in Washington.

China, with its soaring energy needs, has stepped in to fill that gap, and is expanding its presence in Iraq under a 2019 "oil for construction" deal.

Beijing has become one of the largest importers of Iraqi crude, and in 2021 accounted for 44 percent of Iraq's oil exports, according to prime ministerial adviser Muzhar Saleh.

And state firm PetroChina has partnered with France's TotalEnergies and Malaysia's Petronas to exploit the Halfaya oilfield in southern Iraq.

"China is just getting started," ambassador Cui Wei told journalists in a recent videoconference.

But Beijing is interested in more than just Iraq's trade potential, Calabrese said.

Beyond the "obvious commercial incentives" are China's ambitions to "deeply entrenched itself in a country and a region that the West, and especially the United States, has dominated," he said.

Iraq is among the many partners in China's vast "Belt and Road" infrastructure initiative, which Western leaders say risks saddling poorer countries with debt.

Baghdad is an "important cooperation partner" in the project, a Chinese foreign ministry spokesman said, adding that Beijing had "actively participated in the reconstruction of Iraq's economy".