May 16, 2019 Special Dispatch No. 8067

Russian Expert Kortunov On The JCPOA: Russia Can Help Iran At The Political Level, But It Cannot Replace Europe As A Driver Of Iran's Economic Development

May 16, 2019
Iran, Russia | Special Dispatch No. 8067

On May 8, 2019, in an address aired on IRINN TV, Iranian President Hassan Rouhani announced that, in keeping with the decision of Iran's National Security Supreme Council, he sent letters to the leaders of the five countries remaining in the JCPOA (France, Germany, Britain, China and Russia) giving notice that Iran will stop selling surplus heavy water and surplus enriched uranium to a "certain country" in a gesture designed to allow the five countries to enter negotiations with Iran surrounding oil and banking. He explained that Iran has been selling surplus heavy water in excess of 130 tons to a "certain country," and that any enriched uranium in excess of 300kg has been sold to a "certain country" in exchange for yellowcake. Rouhani stated that if an agreement is not reached within 60 days, Iran will no longer abide by the JCPOA's enrichment limit of 3.67%, and it will resume building the Arak heavy water reactor according to pre-JCPOA construction plans.

Rouhani also announced that there will be an additional 60-day extension during this second phase, after which further actions would be taken. Rouhani said that the letters warned that if the five countries send the dossier back to the Security Council, they will face a "very decisive measure," which he elaborated further upon in the letters. He then reminded Iran's friends that if Iran hadn't "played its role," terrorists would be walking around European capitals, immigrants would have flooded Europe, and large amounts of drugs would be passing through Europe. The JCPOA, per Rouhani, had been a win-win agreement, but if it was transformed into a win-lose agreement, as the U.S. want, Iran would proceed to turn it into a lose-lose agreement.[1]

Andrey Kortunov, director general of the Russian International Affairs Council, commented that the 60-day period ultimatum shows that Iran does not consider France, Germany, and Britain's efforts to create separate trading mechanisms sufficient to fulfill the JCPOA's conditions. "Since it is obvious that for Russia and China, US sanctions are not so important and fundamental, the ball is being thrown to the Europeans," Kortunov wrote.

As for the possible contribution of Russia, Kortunov stressed that Moscow Russia can do quite a lot at the political level, but at the same time cannot significantly affect the economic situation in Iran, and therefore it cannot replace Europe as a potential driver of Iran's economic development.

Below is Kortunov's article:[2]


Since It Is Obvious That For Russia And China, US Sanctions Are Not So Important And Fundamental, The Ball Is Being Thrown To The Europeans

"Iran's decision now looks like a largely forced one. According to the original agreement, Iran was left with the right not only to store stocks of enriched uranium and heavy water, but also to sell their surplus on the international market. However, now, given the US sanctions, Iran has actually lost this opportunity and faces an unpleasant dilemma: either to stop the enrichment program, or to exceed the limits that were provided for in the JCPOA agreement of 2015. Naturally, Iran prefers to pursue the second path, referring to the fact that, because of the sanctions, it does not have the technical ability to fulfill this part of the agreement. Therefore, the latest statement of Iran should not be over-dramatized.

"As for the 60-day period, this is a much more serious ultimatum, addressed primarily to the European parties of the agreement. From this we can conclude that Iran does not consider their efforts to create separate trading mechanisms sufficient to fulfill the JCPOA's conditions. Since it is obvious that for Russia and China, US sanctions are not so important and fundamental, the ball is being thrown to the Europeans. It is a call to show more energy and somehow ensure that the European companies won't comply with unilateral American sanctions. Achieving this, for obvious reasons, is very difficult, since no one wants to be targeted with lawsuits and multi-million-dollar fines for engaging in economic cooperation with Iran.

"This is the outcome the Trump administration actually hopes to achieve: Iran's withdrawal from the deal will relieve tensions in US-European relations and confirm US fears that Iran is insincere and does not intend to comply with the terms of the deal. Moreover, it will give the United States formal grounds for moving the issue to the UN Security Council and demanding the restoration of sanctions at the level of the international community, as they existed before 2015. Therefore, the problem here is to what extent the Iranian leadership is able to show enough restraint and readiness to continue implementation of the JCPOA's main provisions, despite growing American pressure.

"If we talk about whether it is possible to save the deal, this is primarily a question for Europe. Iran has some idea about what to expect from Russia and China, even if the deal fails. The position of the European countries, from which Iran expects an increase of trade volume, investment and technological exchange, looks rather two-sided, because they do not want to quarrel with the United States, and their businesses do not want to lose this big market. The Europeans could accelerate the establishment of alternative financial settlement mechanisms that would take the businesses out of the US sanctions, or take other steps towards Tehran.

"On the whole, the task of the international community is to find a worthy place for Iran in the region's security system, so that it could act as a stakeholder rather than as a spoiler. This is about Iran's behavior in the region, which raises questions from its Sunni Arab neighbors, not to mention Israel. The solution of this formidable task will require a lot of time, the gradual building of confidence, a reduction in hostile rhetoric, contacts between the militaries, a refusal to interfere in the internal affairs of other countries, an agreement on the status of foreign armed forces in Syria, and similar measures. Now, however, this process is not only difficult, it has been effectively paralyzed due to pressure from the United States. However, using a 'stick' method in the absence of 'carrots' cannot solve this problem.

"As for the possible contribution of Russia, it cannot significantly affect the economic situation in Iran: if you look at the total trade and investment between the two countries, it is not very significant. Russia can block the resolutions that the United States may put forward in the UN Security Council and to some extent act as a mediator between Iran and its opponents in the region, such as Saudi Arabia. For example, Russia is believed to have played a big role in connecting Iran to the OPEC+ agreement, which restricted the supply of oil to world markets. Hypothetically, we can even assume that Russia, as a country with good relations with both Iran and Israel, could help relieve tensions and increase predictability in these very complex and painful relations. In other words, Russia can do quite a lot at the political level, but it cannot replace Europe as a potential driver of Iran's economic and social development."


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