What to Expect When US Exits the Nuclear Deal

05 April 2018 | 01:09 Code : 1975833 General category
In return for its good will, Iran has seen broken promises and has good reason to Japanize its nuclear program, write Salman and Hasti Savafi of the International Peace Studies Center – London.
What to Expect When US Exits the Nuclear Deal

Diplomacy between Iran and the US was full of tension during the last Persian calendar year (March 2017 to March 2018). Donald Trump's rise to US presidency from the hawkish camp marked the beginning of a new round of deeply rooted hostilities against the Iranian nation. In response, Iran adopted an iron fist policy as its foreign policy strategy in the face of US' aggressive approach.


US policy:

The nuclear agreement between Iran and world powers as well as the Middle East were the main focus of new US administration's aggressive policies against Iran. US conservatives, represented by the Republicans, already had a majority in the Congress but secured control over all branches of US government, i.e. the administration, the Congress, and the judiciary, when Trump won the presidential race. In the meantime, the Saudi government signed a multibillion-dollar agreement with the US, a kickback in line with Washington's aggressive policies against Iran, shifting Trump's cynicism during the campaigns from Saudi Arabia to Iran.


Terrified by Iran's destroy-Israel strategy, Israel followed Saudi suit using full force to improve its relatively cold relations with the US administration under Obama and make Iranophobia as US' main strategy in the Middle East. Thus, the Israeli government's lobby and Saudi petrodollars succeeded in pushing doves to Trump's anti-Iran policy, making anti-Iranism even stronger in the US government. In sharp contrast with the Obama era, the new US government declared regime change in Iran as its strategy.


In doing so and to weaken Iran's power, the US impose new economic sanctions, using two important leverages against Iran's economy. First, the US Treasury Department warned major European and Japanese banks about huge fines in case of deals with Iran. Secondly, Washington's threat to walk out of the JCPOA deteriorated the risk of loans, finances, and investment with Iran. In practice, the European and Japanese banks avoided dealing with Iran.


Considering the multibillion-dollar fines HSBC and BNP Paribas paid to the US during the Obama era, British banks also avoided normalization of relations with Iran, despite a plea by the Prime Minister.


Weakening Iran's defense power was yet another side of US's aggressive policy against Iran. Last year, sanctions against the IRGC, missiles program, and those involved with it were instrumental to weakening Iran.


Iran's policy:

The Iranian lobby's failure to access Trump's circle (because they did not come from known bodies in power) was a fundamental weakness for the Iranian foreign policy apparatus vis-à-vis the White House. However, by adopting an iron fist policy and announcing it will not concede to US' hegemonic approach, Iran implemented two strategies in its economic and defense policies.


Despite US sabotage, Iran sealed major economic deals with several countries. These include: Italy) €5b investment agreement between Invitalia and Bank of Industry and Mine and Middle East Bank, France) €660m joint-venture deal between Renault and Iran's state-run Industrial Development and Renovation Organization, Bpifrance's move to finance investment projects of French companies in Iran from 2018, granting up to 500 million euros, agreements worth €400m and €300m with Iranian carmakers Iran Khodro and Saipa, worth $536m with Iran Air, and $5b with Petropars, South Korea) $1.8b deal with National Iranian Oil Engineering and Construction Co., $831m deal for passenger rail cars production, Export-Import Bank's $9.6 billion deal, Austria) Oesterreichische Kontrollbank's agreement to increase its export guarantees for deals with Iran to roughly 1 billion euros, Britain) Quercus deal with Iran's Ministry of Energy to build a €500m solar power farm, Norway) €2.5b deal with Iran's Ministry of Energy, and Denmark) Danske Bank's €500m credit line deal with 10 Iranian banks. Emphasizing its resistance economy, Iran also signed huge economic and military deals with rivals of the US. These include: China) Sinopec's $1.2b agreement with National Iranian Oil Refining and Distribution Co. and $10b credit line deal with Iranian banks and Russia) Transmashholding's $3b deal with the Industrial Development and Renovation Organization of Iran, €3b agreement between Russian Export Center (REC) and Iran Railway Company, and a $742m deal with National Iranian Oil Company.


As for defense affairs, Iran inflicted heavy defeats on the US-Saudi-Israel triangle in the Middle East. In Syria, the most important battlefield for Iran and the US, Tehran neutralized the strategy followed by the US and its allies despite disbelief of intelligence services, military experts, and Western diplomats. In line with its national interests, Iran pulled Russia, a powerful US rival, to Syria on the one hand and pushed Turkey's Syria policy away from what US and its allies (Israel, Saudi Arabia, and the UAE) wanted. In Yemen, despite billions of dollars spent by the Saudis and military support from the US, the two countries failed to win against a nation without an army. The Resistance movement's missiles now hit as far as Riyadh. Iran's spiritual support thrown behind the Yemeni nation in the face of hegemonic policies of the US and the Saudis has proved costly for them.


In Iraq, Iran used help from the Iraqi nation and government to deal with three crises of the US triangle. In doing so, Iran helped strengthen the central government and Popular Mobilization Forces, eradicate Daesh in the country, and prevent the Balkanization of the Iraqi Kurdistan in the last minute. The US was checkmated in Iraq and it became clear that despite spending two trillion dollars, the US failed to take advantage of the Saddam Hussein's collapse. The ultimate victors were the Iranian nation, administration, and Quds force.


New Year Prospects:

By its failure to stick to its commitments under the deal and its imminent exit, the US administration weakens its international credibility more than ever, as no other government could trust them to remain committed to deals they sign. Seemingly, every deal with the US remains valid within a 4 to 8 year window. Moreover, the nuclear talks will have a negative bearing on talks with North Korea. When the US walks out of the deal and adopt new sanctions, Iran will also exit the accord as it has been deprived of its benefits. A new round of nuclear debates will start but it becomes harder to bring Iran back to the table.


In return for its good will, Iran has seen broken promises and has good reason to Japanize its nuclear program. Another consequence of US' exit from the deal is a rift in the EU, as the US presses the union to exert pressure on Iran. On the one hand, countries such as Italy and Austria do not follow US and French policy on delimitation of Iran's missiles program and on the other hand in economic, military, and political spheres, Iran will become increasingly closer to Russia and China, main rivals of the US and Europe. In the domestic scene, the US' aggressive policy against Iran will cause radical forces to become more powerful in Iran's power structure, delaying any sort of accord between Iran and the US for many years. United States' failure to fulfill commitments under the nuclear deal will remain in the nation's memory like the coup against the Mosaddegh administration, adding to the distrust.

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