In what may be a bid for voter support ahead of elections for the Assembly of Experts, Rouhani claimed that sanctions would be effectively removed by the end of 2015. But Iran must complete a series of alternations to its declared nuclear programs before sanctions relief can go into effect under the terms of the deal.
The process of removing enriched uranium from the country, disassembling some enrichment centrifuges, and removing the core of the Arak heavy water facility is generally expected to take approximately six months. Western analysts thus tend to believe that the earliest date for implementation of the nuclear deal will be sometime in early to mid-2016.
The timeframe is further complicated by the fact that Supreme Leader Ali Khamenei, the ultimate authority in virtually all Iranian affairs, declared last week that Iran would not even begin to follow through on some of its requirements until the International Atomic Energy Agency presents its report on Iran’s nuclear capabilities and the past military dimensions of that nuclear program. This is not expected to happen until December 15.
Rouhani’s optimistic projections thus appear to be in direct contradiction to Khamenei’s influence on the process. While both figures are certainly eager to obtain sanctions relief under the deal, they may have different conceptions of the trade-offs involved in rushing that outcome. Rouhani’s political strategy has involved softening Iran’s approach to dealing with the West, while Khamenei has been notably wary of the nuclear negotiations opening up Iran to cultural and economic “infiltration” by the US and its partners.
Iran remains in the difficult position of trying to obtain foreign investment quickly while keeping non-economic foreign interest at bay. This is made more difficult by the sheer volume of foreign investment that is apparently needed. UPI reported on Monday that the National Iranian Oil Company has decided that the country needs at least 250 billion dollars in new investments in order to handle roughly the next ten years of oil industry projects.
And this is only a portion of the overall investment that will be needed on a recurring basis to counteract the impact of former sanctions enforcement while also modernizing the oil economy and encouraging transactions in other sectors of the Iranian economy. Bloomberg notes that Iranian officials have determined the total figure to be about 150 billion dollars per year.
But Bloomberg also indicates that Rouhani’s optimism about sanctions relief is backed up by more general optimism about the ability of Iranian officials and their proxies to secure the necessary investments, with a significant portion of them even coming from traditional enemies like the United States. Toward that end, Bloomberg notes that there are prominent figures residing in New York and other financial capitals, lobbying for such investments. On Monday, the financial news outlet profiled one such Wall Street financial lobbyist, Hamid Biglari.
Such individual sources of pressure are only one portion of the resources that may be available to the Islamic Republic, though. A Washington Post editorial pointed out that another factor may relate to Iran’s efforts to enter the World Trade Organization – efforts that had previously been blocked by the United States but might no longer be blocked now that there is an apparent policy of rapprochement with Iran.
The editorial notes that membership in the WTO puts countries on virtually equally footing with one another, barring other member states from treating them unfairly unless they can demonstrate adequate cause related to national security. Until Iran becomes a member, it remains an open question whether the organization would justify existing economic sanctions along these lines. So WTO membership could shield Iran from some types of economic pressure, but the Washington Post argues that Western policymakers may be willing to overlook this because Iran’s membership would also encourage more lucrative trade.
Such a change in the power relationship between the two countries would surely be a further cause of concern for Western critics of the Iranian regime. Many such critics are certain that Iran is already committed to violating its obligations under the nuclear deal. Thus they see any loss of Western leverage as potentially enabling Iran to cheat on the agreement and come away with economic benefits and a lack of genuine restrictions on its nuclear projects.
Expressing this view, an editorial published on Monday in the Wall Street Journal described the nuclear agreement as a “dead letter.” The article cited the well-publicized Emad ballistic missile test as evidence of this, along with Khamenei’s insistence that sanctions be removed entirely, not just suspended, and that sanctions on human rights and terrorism be affect in much the same way as sanctions on the nuclear program. Through such demands, the editorial argued, the regime is still “wheedling for more” benefits from an agreement that was poorly handled by the US.
These accusations of poor handling have also been used to cast doubt on the effectiveness of “snap back” provisions that would supposedly bring former sanctions back into effect if Iran is found to be cheating.
A Reuters editorial asserted on Monday that the US was aware that economic pressure might not be enough and thus maintained that “all options were still on the table.” The article goes on to argue that under current circumstances, if Iran resumes its former efforts to obtain a nuclear weapon the only guarantee of an end to those efforts would come from war, and not from assassination, sabotage, or air strikes alone.
