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Europe Might Save the Iran Deal Yet

Iranian hardliners have always been pessimistic about the West, arguing that the governments there have “ominous” plans for Tehran, which they seek to stab in the back. That impression has certainly been reinforced this past year, as America pulled out of its own hard-won nuclear deal and Donald Trump on Sunday threatened Iran [1] with “CONSEQUENCES THE LIKES OF WHICH FEW THROUGHOUT HISTORY HAVE SUFFERED” on Twitter.

But a new round of talks between Iran and three European countries (the UK, Germany, and France) have opened a possible new window of opportunity to soften the hardliners’ view about cooperation, with Europe if not the United States.

Since President Donald Trump’s decision in May to exit the 2015 nuclear deal, Europeans have come forward and stated firmly that they oppose Washington’s actions. In various joint statements, the European Union and the three major European powers announced that they would strive to keep Iran in the deal, as Tehran had threatened to leave the agreement if its interests weren’t guaranteed.

Following these declarations, Europe and Iran started a new round of talks in order to save the JCPOA, which took more than a decade to be negotiated. Tehran is now seeking guarantees that its oil sales and access to Western banking systems will be preserved, as Trump has vowed to impose heavy pressure and sanctions on the Iranian economy.

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Meanwhile, hardliners in Iran are rebuking reformists who had promised that the nuclear deal and other interactions with the West would solve the country’s problems. Putting faith in Europe, some of the radicals declare, will prove as foolhardy as did trusting the United States.

But while the hardliners are voicing their skepticism, it seems some of them are still hopeful about Tehran and Europe reaching a deal. Ironically, should that deal be achieved, the moderate government will face fewer obstacles from the radicals as it seeks to open Iran up to the world.

During Tehran’s Friday prayers on May 11 when a group of people started chanting [2] against a number of European countries, the hardline prayer leader stopped them and asked them to chant only against the U.S. and Israel.

Moreover, a number of ultra-conservative figures have indicated that they aren’t opposed to the talks and even to a new agreement, even though they are generally dubious about Europe.  

The commander of the hardline Islamic Revolutionary Guards Corps (IGRC), General Mohammad-Ali Jafari, stated [3] on May 13: “Europeans have announced that they can’t resist the U.S. sanctions. Now, an opportunity has been given to the Europe but they should provide guarantees, but I [think of it] as unlikely.”

Furthermore, Ayatollah Seyyed Hashem Hosseini Boushehri, the Qom Friday prayer leader, noted [4] on May 18: “The results of continued talks with Europeans shouldn’t be like the U.S. withdrawal from the JCPOA, and the interests through the JCPOA should be protected.”

The influential Grand Ayatollah Makarem Shirazi also said [5] on June 28: “Today, America is isolated more than anytime [in the past] and we are witnessing that Europeans haven’t cooperated with the Americans on the issue of withdrawal from the JCPOA, and this issue is very important.”

More importantly, Iran’s Supreme Leader Ayatollah Ali Khamenei, who has the final say on foreign policy issues, hasn’t stopped the government from talking to European delegations, instead calling for developed ties with the West.

“Except for a few cases, such as the U.S., the country’s relations with the East and the West should be enhanced as more as possible,” Khamenei said [6] on July 16.

These statements are in disagreement with what hardliners have been urging since the American withdrawal from the JCPOA. In the wake of Trump’s decision in May, Iranian conservatives urged the government to turn to East. In this vein, the hardline Javan newspaper quoted Russian President Vladimir Putin telling [7] Ayatollah Khamenei in 2015: “We have thought of our relationships with you as tactical. We know that there are figures who say that we may sell you out to the West. [But] Russia won’t [turn away] from Iran as a strategic ally.”

Nonetheless, Khamenei’s recent speech may be a green light to the moderate government of Hassan Rouhani as it enhances ties with Europe. Thus does a new chapter of relations between Iran and West, excluding America, open.

Iran’s political establishment seems to look at the new talks with Europe as a test of how far they can go while maintaining their obligations to the Islamic Republic. If the new negotiations yield positive results, the path for continued negotiations will be paved.

Before leaving Tehran for his European tour, President Rouhani remarked [8] on July 2: “There are some regional issue that we have talked to Europe and will continue these talks about the role Iran can play in stability and security of the whole important region of Middle East.”

In sum, if a new agreement is achieved between Europe and Iran to save the 2015 deal, a new inclination towards broader cooperation on a variety of issues might be realized. The result of fruitless talks, however, could be that Iran embraces Russia, an outcome it doesn’t want but that Donald Trump may have made more likely.

Rohollah Faghihi is a Tehran-based journalist who has worked for various Iranian media outlets including Entekhab news. He is also a contributor to Al-Monitor.

20 Comments (Open | Close)

20 Comments To "Europe Might Save the Iran Deal Yet"

#1 Comment By charles cosimano On July 23, 2018 @ 1:05 pm

Europe is irrelevant. This is between the US and Iran. All Europe can do is duck as the missiles fly over.

#2 Comment By collin On July 23, 2018 @ 2:10 pm

After all CAP tweets, Trump is doing everything to get the US against Iran in any form or fashion. At the heart of it, it appears the other five nations are well on their way increased Iranian trading without Trump and the US so I suspect Iran still follows the deal for the most part.

Long term, it appears China finding ways of trading Iranian oil for Chinese Yuan.

#3 Comment By balconesfault On July 23, 2018 @ 2:40 pm

The latest spin is that Trump successfully got North Korea to come to the table by making nuclear threats … so hinting towards nuclear threats against Iran will bring them to the table.

a) aside from giving Trump the international stage for a few days, how was giving Kim a face-to-face meeting with our President a “win” for the US? NK has been willing to meet with the President at any time in the past – it was always the US who refused to give Kim or his father/grandfather the recognition such a meeting conferred.

b) Iran did meet with the US, as well as the rest of the global community. Trump is a fool if he expects any subsequent meetings to provide him any greater concessions without further US concessions.

It seems that Trump really doesn’t know how to deal when he doesn’t have the threat of bankruptcy to fall back on.

#4 Comment By JeffK On July 23, 2018 @ 2:56 pm

I expect The Europeans to hold a big middle finger up to Trump on this one and uphold the JCPOA agreement. Trump will bluster and whatever, but at the end of the day he won’t/can’t do anything about it.

Threatening to not allow European banks and business to interact with the US banking system would be an act of war (a financial embargo). I believe The Republicans in the US Senate will tell him that. He may even listen.

At some point I believe Trump will wear out his welcome with most Republicans, especially in the Senate. This may be the start of that. Regarding his base, we shall see.

Nothing this buffoon does surprises me anymore. The surprise is the lack of spine shown by The Republicans.

#5 Comment By b. On July 23, 2018 @ 3:07 pm

This is wishful thinking unless and until the EU nations are able to actually offer concrete mechanisms for sanctions relief. So far, the only option mentioned as under discussion was direct Iranian access to EU central banks or institutions like the EIB.

The EU will not be able to sustain a campaign of taxing its citizens or borrowing to divert money from other needs into bankrolling EU companies that are fined by the US, or suffer damage from US government prosecution and other retaliatory action. In the case of access to the finance system, the EU could create a situation in which the US has to penalize “allied” governments directly, but ultimately, funds will have to move from international banks operating in the US as well as in the EU, to Iranian banks. Nothing will stop the US from attempting to track these transactions, and unilaterally impose penalties on corporations and banks involved anyway, no matter how many degrees of separation are added.

Oil will have to be pumped, shipped, and sold. Unless the EU governments proposed to fill their strategic reserves, or enter the market as a reseller, it is not clear how the EU governments will facilitate that. It cannot even be ruled out that the US Navy embarks on an actual blockade for tankers with Iranian oil – Tehran certainly appears to see this as a possibility.

The only way the EU can impose an actual cost on the US is by retaliating against US sanctions, prosecutions and penalties by imposing their own on the US and US government officials and corporations. At that point, the situation becomes indistinguishable from the unilaterally imposed US-EU trade war Trump is already courting.

It is doubtful that any EU government has the intestinal fortitude to risk an open break with the US. Hence, Iranian trade cannot be saved, with the possible exception of oil going out and money going in.

#6 Comment By Anthony M. On July 23, 2018 @ 3:28 pm

I really hope the EU forces Trump’s hand on this one and calls his bluff. It’s just stupid and unworkable to attempt to stop Europe from doing business with Iran. It’ll be an absolute train wreck and everyone will point the finger at Trump.

#7 Comment By Clyde Schechter On July 23, 2018 @ 4:17 pm

“I expect The Europeans to hold a big middle finger up to Trump on this one and uphold the JCPOA agreement. Trump will bluster and whatever, but at the end of the day he won’t/can’t do anything about it.

Threatening to not allow European banks and business to interact with the US banking system would be an act of war (a financial embargo). I believe The Republicans in the US Senate will tell him that. He may even listen.”

Well, I hope so, but I doubt it very much. I think b. has it right: the US has enormous economic power over Europe and Trump will not hesitate to use it. The best one can hope for is that this scenario will awaken the EU to the danger of remaining in close alliance with the US and motivate them to start withdrawing, simultaneously building alliances with Russia and China. If the EU, Russia, and China were aligned, and developed their own international monetary institutions, excluding the US, then in time they would be free to tell the US to go fly a kite. But as long as everybody is working in a monetary system owned and operated by the US, the US will always be able to get its way.

By the way, if the rest of the world did develop international monetary institutions that exclude the US, we might well end up with “Trump’s fallback,” i.e. bankruptcy, as a result. If access to US controlled financial systems were not necessary for economic viability, the demand for US dollars and US debt would tank, with disastrous economic consequences for the US, which has put nearly all its eggs in the financial basket. Of course, all of this is really playing with fire, as the likelihood of the US responding to this militarily would be high, and the consequences of that could approach Armageddon.

The notion that Republicans will stand up to Trump on this is somewhere between wishful thinking and delusional, in my opinion. While there are a few mavericks who occasionally speak out or even break ranks on a vote, in most cases when that happens a few Democrats will vote with Trump anyway. And in this Iran situation, the Democrats mostly side with Trump anyway, and they will not come to the EU’s defense on this.

#8 Comment By One Guy On July 23, 2018 @ 4:50 pm

Trump to Iranian President Rouhani: DO NOT THREATEN AMERICA EVER AGAIN OR I WILL FLY TO YOUR COUNTRY, SPEND TWO HOURS CHATTING OVER A LIGHT LUNCH, THEN PUBLICLY DECLARE WHAT A GREAT GUY YOU ARE.

#9 Comment By JeffK On July 23, 2018 @ 5:02 pm

We all may wake up one morning to find that the EU has put 100% tariffs on all of our exports while we were sleeping. The elites, of course, will have gotten the word early and have sell triggers on all of their stocks. Us rubes, however, will ride it all the way down to almost zero. At that point we will capitulate and sell the stocks in our 401Ks at 10 cents on the dollar. Soon after the elites will come in and buy it all, ensuring our economic slavery till we die. Think 2008 on steroids.

My decision to take my 401K to cash in March looks better every day.

#10 Comment By Bob K. On July 23, 2018 @ 5:26 pm

As noted above, Europe is irrelevant on this.

But there is one other party which is being ignored here and it is Russia. It shares the Caspian Sea with Iran and it has always had close ties to Iran.

Trump is not going to do anything to Iran which will not have Russia’s approval.

#11 Comment By Egypt Steve On July 23, 2018 @ 6:59 pm

I’m fine if Trump follows the North Korea playbook:

1. Make outrageous threats.
2. Have meeting.
3. After meeting, announce that the problem is solved.
4. Lose interest and go back to tweeting about the Russia investigation.

#12 Comment By EliteCommInc. On July 23, 2018 @ 7:22 pm

If O recall the agreement requires the assent of all parties. Now I have long contended that there is too much money at stake for the EU to walk away merely because the US is pressing for unreasoned demands.

And while they make prognostications otherwise during the previous admin. When push comes to shove, that is too much economic potential on the table. And the EU is need of fresh income streams given the hemorrhage of the several state economies and more. While president Trump may be a convenient excuse, the choice would have been the same had Sec. Clinton or any other US president advocated pulling out of the deal. Though, I think they might have had more leverage because they most likely would not have challenged any issues as to NATO and sent heavy weapons and advisers to the Ukraine.

#13 Comment By SteveK9 On July 23, 2018 @ 7:58 pm

What would be interesting instead of vacuous statement would be to explain what ‘sanctions’ from the US would mean precisely, and precisely what methods would be used to circumvent them.

#14 Comment By SteveK9 On July 23, 2018 @ 7:59 pm

Sorry, I should have noticed ‘b’s’ comment above. He gets it and understands that specifics are what matters here, and the likelihood of seeing them enacted.

#15 Comment By TheSnark On July 23, 2018 @ 7:59 pm

The best scenario is what happened with N Korea: lurid threats followed by a summit, after which Trump claims victory and GREAT success while achieving nothing.

That is not likely in this case as there are several factions that want us to punish Iran (for adhering to the agreement?) or to start a war with them. So the best case scenario there is that Trump pushes everyone for more sanctions, backed by the threat of cutting them off from the US financial system.

That will just accelerate the day when an alternative financial system, probably run by China, is developed, and we are left out in the cold. As Clyde pointed out, that could lead to our bankruptcy.

Our leverage over global finance is one of our greatest strengths. It should be used rarely, and than only for issues that are really vital to the US.

#16 Comment By Falls Kirk On July 24, 2018 @ 5:45 am

“During Tehran’s Friday prayers on May 11 when a group of people started chanting against a number of European countries, the hardline prayer leader stopped them and asked them to chant only against the U.S. and Israel. “

And in truth they ought to be chanting against Israel alone, because Americans haven’t given a damn one way or another about Iran since the mid 1980s. No one I know cares about “the deal” or wants to bomb Iran.

This is a Binyamin Netanyahu production of a Binyamin Netanyahu film, directed and scored by Binyamin Netanyahu. Co-produced by Sheldon Adelson, of course.

Mueller ought to finish up the “Russian meddling” crap and start doing something about Israeli meddling, a more urgent and dangerous matter that already led to multiple catastrophes for America.

#17 Comment By Whine Merchant On July 24, 2018 @ 8:10 am

…and all the while, Xi Jinping assumes the mantle of world leader as his ‘One Belt – One Road’ bankrolls central Asia, undercuts Russian influence, and makes friends everywhere. America’s sweet spot lasted from 1915 – 2019, barely a century, just a fraction of other empires. But Trump’s true boss, Bibi, won’t care, as long as he can stay in power at any cost.

MAGA – hah!

#18 Comment By A rather stupid former trump supporter On July 24, 2018 @ 10:12 am

The USA will do what Israel tells it to do as long as Trump is in office.

#19 Comment By EliteCommInc. On July 24, 2018 @ 5:48 pm

“It is doubtful that any EU government has the intestinal fortitude to risk an open break with the US . . .”

You might be surprised what stat will do to feed their populations.

#20 Comment By tz On July 27, 2018 @ 5:52 pm

Closing the Strait of Hormuz would shrink the EU’s carbon footprint.