Damage Control

Damage Control
Damage Control

Last summer lawmakers in the United States warned the Obama administration that the world "cannot" trust Iran. "No part of this (nuclear) agreement relies on trust. It is all based on thorough and extensive transparency and verification," US Secretary of State John Kerry responded.

Iran upheld all its commitments that was officially acknowledged and verified by the UN nuclear agency. The so-called implementation day of the deal between Tehran and the US-led six world powers started in mid-January. The West achieved its objective as Iran curbed its nuclear energy program that was the subject of major dispute.  

The comity of nations is now confident that Iran will not have any nuclear weapons as was often alleged by Washington and its allies. But what about the other part of the historic deal? What does it have for Iran? During the long and drawn out process that led to the final agreement in Vienna, the other side tried to convince us that the deal would put a permanent end to the economic isolation brought on by the unjust sanctions.         

Iran’s aim now as then is crystal clear: normal relations with the outside world that also would be underscored by the western powers, which had engineered and pushed for the toughest economic restrictions unheard of in recent global memory. Can the six states now truly claim that Iran reaped the benefits enshrined in the nuclear agreement?    

True, the Europeans have generally and positively demonstrated their intention and desire to cooperate as can be seen in the increasing number of delegations that visit Tehran on a regular basis looking for mega economic deals in the 80 million market. However, the first step toward any tangible economic collaboration is the function of banks. The US has not yet assured non-American banks that they can restart normal ties with Iran. How can a country emerge from isolation without the proper international financial and banking channels?

President Hassan Rouhani’s critics had been screaming long before the deal was signed that the Americans and their friends would indeed respect the accord, albeit in the breach. The more vocal political opponents told all those willing to listen that the other side will never fulfill its commitments. This, they said, would and should compel Tehran to rethink all that it agreed to in the Austrian capital based on good will. Now the same camp and probably others have all the more reason and ample of evidence to make their point it.

 Central Bank of Iran Governor Valiollah Seif believes “almost nothing” has happened for facilitating Iran’s financial transactions. Most Iranians who supported the government in the February parliamentary elections are apparently disappointed and even frustrated at the lack of progress and absence of any positive moves in the sanctions-hit economy.  

They may be rational enough to accept that such deals normally take a lot of time to come into effect and reflect on the lives. But at the same time they understandably want to be sure that Mr. Rouhani has chosen the right option. They also want to see cogent signs that the other party is honest and is starting to implement the deal in letter and spirit.

Iran and the six powers (the US, Britain, France, Russia, China and Germany) held marathon negotiations for more than two years. They struggled to seal the deal and now the agreement is in our hands. But can we really hold it? Mr. Rouhani always argues that the Joint Comprehensive Plan of Action, as the deal is officially known, is a win-win accord. But as time passes, there are more people who are openly questioning this official view and the government position is weakening, to say the least. Is this really what the major powers, especially the US, want?

If the US wants Iran to continue limiting its nuclear program, it needs to remove the obstacles to the banking sector sooner rather than later. Any bank which seeks an unambiguous confirmation from the US Treasury to do business with Iran should have it now. The US pledge to grant Iran sanctions relief obliges it to adopt such an approach. The treasury should avoid vague statement which could prompt international banks and major financial institutes to shy away from interacting with Iranian lenders.

It is obvious that if Iran does not see any tangible change in the first step, which is the easing of all international banking relations, there would be no logic or motivation for Tehran to keep its part of the nuclear deal. We don’t think this reality is very complicated for the Americans to understand.