As Iran and the ‘P5+1’ (the five permanent members of the Security Council plus Germany) prepared for a new round of negotiations in late April to finalise the details of a nuclear agreement, a group of 24 executives and investors were touring the country on a ‘fact-finding’ mission. Although Iran still remains under a sanctions and American companies are prohibited from doing business there, the trip was the group’s third to the Islamic republic. So although several important differences remain between the US and Iranian interpretations of the tentative agreement on 2 April in Lausanne, some American firms are already signalling their hopes for new business opportunities with Iran.
Sanctions have massively undermined Iran’s economy but that anticipated new era is a matter of mutual interest. Iran’s supreme leader, Ayatollah Ali Khamenei, has implicitly supported the view of the president, Hassan Rouhani, that the nuclear issue is a “symptom” of mistrust and conflict, not a “cause”. For the first time in decades, he indicated that reaching a decent deal might lead Iran to more co-operation with the US in the region. A few days later in the New York Times, the Iranian foreign minister, Javad Zarif, underlined that “there are multiple arenas where the interests of Iran and other major stakeholders intersect … This unique opportunity for engagement must not be squandered.”
It seems then, that “the waiting list” of US companies—as Dick Simon, a co-founder of the Young Presidents’ Organization and one of the executives who visited Iran put it—is expanding. Another American investor told BBC Persian that the “vast number of educated youth, a huge market in the region, a western consumer middle class and the friendly attitude of the people” had made “the prospect of a changing Iran a very interesting one”.
As the US president, Barack Obama, has made clear, however, this is not a done deal and hardliners on both sides are trying to sabotage it. There are substantial disagreements between the US ‘fact-sheet’ on the outline agreement and Iran’s understanding. Iran insists that nothing has been surrendered and “none of the nuclear facilities or related activities will be stopped, shut down, or suspended” but the US summary suggests otherwise. In addition to the lack of such crucial detail, there are at least two main differences: over the inspection arrangements and the lifting of sanctions.
Contrary to the ‘fact-sheet’, Iran insists that its military bases are not to be subject to inspection by the International Atomic Energy Agency (IAEA)—as both Khamenei and the commander of the Revolutionary Guards, Major General Mohammad Ali Jafari, have reaffirmed. On the other hand, Iran maintains that all sanctions should go within days of the signing of the final agreement: “At the same time as the start of Iran’s nuclear-related implementation work, all of the sanctions will be annulled on a single specified day.” But the ‘P5+1’ are insisting that sanctions will only be suspended through verifications by the IAEA and “at the end of the first stage of implementation, not at the beginning”. According to the US secretary of state, John Kerry, this could take six months to a year.
Even more importantly, however, there is a critical suspicion as to whether the Islamic regime is genuinely changing. What puts Iran’s policy in question is its aggressive strategy, regionally and domestically.
Some members of the US Congress have already discounted any agreement with Iran. The former Republican secretary of state James Baker alleged that it would “alienate all of our allies in the region”, making clear by this he meant not just Israel but all “moderate Arab states”. Yet Algeria, Oman, Iraqi, Lebanon and Tunisia all welcomed the framework deal as a positive alternative to war.
Since Shaheed assumed his post, he claims nearly 2,000 Iranians have been executed by the regime
Iran’s desire to increase its hegemonic influence in the region has agitated some countries, however, especially Saudi Arabia. Many Saudi media have claimed that Iran is trying to shape a ‘Shiite arc’, comprising Yemen, Lebanon, Syria, Iraq, Afghanistan and Bahrain. And there is some evidence that the Saudi government sought to sabotage any agreement with Iran. Although immediately after the announcement of the potential deal Obama called King Salman to reassure him of America’s “enduring friendship”, Saudi officials have several times declared their anxiety about Iran’s nuclear programme.
So Saudi Arabia has moved in advance of the outcome of further negotiations in July, partly because of Iran’s aggressive policy within some Arab nations to influence Shiite populations and challenge Saudi power. And there is no sign yet, from either side, of a peaceful resolution of this hegemonic conflict between the two regional powers, being played out in Syria, Iraq and Yemen (while some other Arab states in the Persian Gulf, like Bahrain, are not as stable as they might seem).
King Salman did say he hoped “the deal would reinforce the stability and security of the region and the world” but this was an official gloss. Al Arabiya, a Saudi-backed news website, carried the unvarnished claim that “the Saudi king decided his country could no longer bear the provocative Iranian expansive policy in the Middle East, or the American silence over it”. In this perspective the skeleton deal has only reinforced Salman’s determination to push back against Iranian influence, with or without Washington.
“This is the new Iran,” the American entrepreneurs were told during their visit. Nasrollah Jahangard, Iran’s deputy minister of telecommunications, encouraged them to invest in a country where the number of smartphones was soon expected to reach 40m, or one for every two Iranians. Jahangard also told them privately that although the internet was filtered and Facebook banned in Iran, there were more than 30m users and at least 10m actively used Facebook every day. As one of the youngest countries in the world with a huge number of university students, there were many other socio-economic factors which could lead western companies to consider “the potential of getting involved in Iran”, Simon told BBC Persian after the group came back to America.
Hassan Rouhani—his administration hangs on nuclear deal. Wikimedia / BotMultichillT. Creative Commons.The main concern for human-rights activists, however, is the regime’s total suppression of socio-political demands while it open up economically to foreign investment—and here even the Islamic republic’s rhetoric has not changed. The most recent reports by Human Rights Watch and Amnesty International indicate that human rights are sharply deteriorating and the UN special rapporteur on human rights in Iran, Ahmed Shaheed, has echoed that the situation has worsened since Rouhani was appointed.
Since Shaheed assumed his post, he claims nearly 2,000 Iranians have been executed by the regime, while there are “around 900 prisoners of conscience in Iran, many of them in prison for simply expressing their opinions”. Based on official reports, during the past few months more than 200 people have been hanged and a large number on death row risk imminent execution.
Many experts thus suggest Rouhani’s administration has only one mission—to solve Iran’s nuclear problem with the west. In the annual budget socio-cultural sectors have faced a 62% cut over the past three years while provision for the military, allied to that of the police and domestic paramilitary forces, has increased just this year by 32.5%. The state remains utterly silent on the situation of minorities and those who were jailed following the protests against the controversial 2009 election, as well as the continued house arrest of the ‘green movement’ leaders.
Domestically, therefore, not only is there no genuine change in the Islamic regime with Rouhani’s government but no hope of that is in prospect. So perhaps that US ‘enduring friendship’ with Saudi Arabia—regardless of its infamous human-rights situation—provides a new perspective for Iran to define an economic relationship with America.
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