The Iran War Is Costing China Dearly, Too

To think about how the Iran war affects China, you might take a look at Yiwu, a global trading hub in the eastern Zhejiang province that hosts sprawling wholesale markets selling goods from hair clips to toys.

Exporters are eager for business. At the entrance is a prominent display that reads “World’s capital of small commodities eagerly embraces your gracious presence.” Buyers from Gulf states are the city’s most prized guests, as Middle Eastern restaurants — the best in China according to social media influencers — spread across the main shopping districts. After all, these customers bring big business. Exports to the region doubled in five years, exceeding $120 billion in 2025. In the first two months of the year, China’s exports to the UAE and Saudi Arabia alone grew 23%.