Alerts. Real-time analysis of events occurring at the intersection of economics, finance and global security concerns.

On August 16, Beijing Construction Engineering Group announced its expansion into Iran, building — and providing 85% of the financing for — a 90,000 square meter construction materials market in Tehran.  Once complete, the marketplace will reportedly ease the procurement of materials by Chinese construction firms operating in the country (deemed vital for the timely completion of projects).

This appears to be a reaction to past difficulty China has had using Chinese-manufactured materials for overseas projects, where shipments have been held up in customs or been otherwise delayed, stunting progress and leading to a variety of political and labor-related problems.  The establishment of what amounts to a forward operating base for Chinese contractors in Iran is an indicator of a likely continued increase in Chinese economic activity in Iran.  This fits with recent reporting emphasizing Iran as a central component to China’s “One Belt, One Road” strategic initiative.