The Trump administration says it's asking countries to voluntarily cut off business with Iran to squeeze its economy further. But the most critical country — China — already says it won't cooperate.

Transcript

MARY LOUISE KELLY, HOST:

The Trump administration says it's asking countries to voluntarily cut off business with Iran to squeeze Iran's economy further. Here's Treasury Secretary Scott Bessent outlining the U.S. plan for, quote, "Economic D-Day."

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SCOTT BESSENT: Let me be clear. Any entity that facilitates money laundering on behalf of Iran will be removed from the U.S. dollar system.

KELLY: But the most critical country that the U.S. needs to get on board is China, and China has already said it will not cooperate. With me in the studio is NPR's Emily Feng. Hey there, Emily.

EMILY FENG, BYLINE: Hi, Mary Louise.

KELLY: Hey. So how is this newest economic pressure campaign against Iran working out? And explain why China is so critical.

FENG: Right. There's been one big success so far, and that's the United Arab Emirates. It was a big trade hub for Iran, but the UAE said it was cutting off trade ties with Iran earlier this month. But a bigger source of oil revenue for Iran has been from China, and China is where a lot of these front companies, which help Iran move money around, are also based. There were just two dozen of them sanctioned by the U.S. Treasury last week. And sanctions experts I've spoken to agree that the U.S. needs China to police this activity itself for it to be successful. But the problem is, as you've mentioned, is China has flatly rejected the U.S.'s new economic pressure campaign last week.

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UNIDENTIFIED SPOKESPERSON: (Speaking Chinese).

FENG: And here's one of their foreign ministry spokespeople saying here that China, quote, "resolutely opposes illegal unilateral sanctions."

KELLY: So there is precedent here. The U.S. has sanctioned Iran for many years. It has done so without China's help for many years. How have previous rounds worked out? How effective have they been?

FENG: Not very successfully, and failure to get China on board to support unilateral American sanctions is one of the many reasons that the Obama administration, which was struggling with this issue - it was one of the reasons why it negotiated something called the JCPOA, or what we sometimes call the Iran Nuclear Deal. This was multilateral. China was involved. And it would cut back some sanctions on Iran because Iran would agree to allow guardrails on its nuclear enrichment program. Here's, actually, President Obama, back all the way in 2015, defending that deal and explaining why the U.S. could not keep up unilateral sanctions on Iran.

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BARACK OBAMA: We'd have to cut off countries like China from the American financial system. And since they happen to be major purchasers of our debt, such actions could trigger severe disruptions in our own economy.

FENG: Meaning China could punch back by selling its dollar holdings, undermining the American currency. And since then, it's put a law on the books that allows Beijing to disobey American sanctions. Alan Eyre was at the State Department trying to unsuccessfully - I should add - persuade China to buy less Iranian oil during Trump's first term.

ALAN EYRE: Some countries you can put pressure on, some you can't. China - you know, we've got so many balls in the air with China. We've got so many various equities and to say nothing of the fact that we've got a state visit coming up.

FENG: But, you know, that visit from Chinese leader Xi Jinping to the White House in about a month - that could be an opportunity, Eyre said.

KELLY: How so? What kind of opportunity?

FENG: Well, it's the first Chinese state visit of its kind in more than 10 years. And Richard Nephew, a former sanctions coordinator at the State Department and a deputy special envoy to Iran, he says China may ask for something in return from the U.S.

RICHARD NEPHEW: My expectation is that the Chinese will say, well, listen, if you're going to grant us concessions on U.S.-China trade issues or you're going to agree not to use export controls, then China might be interested.

KELLY: Might be interested. Maybe a little daylight there.

FENG: Maybe, but cutting off trade economic activity with Iran completely, unlikely, he says.

KELLY: NPR's Emily Feng, thank you.

FENG: Thank you, Mary Louise.

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