A recent Private Eye cover featured Jacob Rees-Mogg, resplendent in top hat and tails, urging us to “throw off the shackles of the EU and trade freely with Persia, Mesopotamia and Cathay.”
Jokes aside, and despite the publication’s sneering tone, a simple truth exists: encouraging more and freer trade with the erstwhile Persia represents our best hope of normalising relations with Iran and bringing it back into the international fold.
The ambition to move towards a friendlier and more constructive relationship between Iran and Western democracies has been evident on both sides for some time. Increasingly isolated during the tenure of President Ahmadinejad between 2005 and 2013, the Iranian people made their feelings known by electing the moderate Rouhani in 2013. He has brought in promising economic and social reform and shown his willingness to moderate Iran’s nuclear ambitions in return for an easing of international sanctions.
The discussions had been going on for some 13 years, but it was just two years after Rouhani’s election that the clumsily named “Joint Comprehensive Plan of Action” (JCPoA) was agreed in July 2015. It committed Iran to a series of measures designed to prevent it from developing nuclear weapon capacity and, in return, they would benefit from phased sanctions relief. The deal was agreed between Iran and the E3+3 (the UK, France and Germany, alongside the USA, China and Russia) and was hailed on all sides as a triumph of perseverance and diplomatic determination.
Within weeks and months the fruits of the JCPoA became clear. The UK and Iran reopened embassies in each other’s capitals, trade missions poured in from all around the world, and Renzi, Hollande and Xi announced commercial agreements worth tens of billions of pounds. Simultaneously, Iran moderated its nuclear activity and each time International Atomic Energy Association (IAEA) representatives have conducted their regular site inspections, Iran has been found compliant with the deal.
The approval of everyday Iranians has been clear at the ballot box. In the 2016 elections, only 12 of the 81 MPs who supported ending the nuclear negotiations were returned and, for the first time, more women than clerics were elected to the Majlis – the Iranian parliament. These results, and the re-election of Rouhani himself in 2017, show the Iranian people’s rejection of the hardliners who exist in the Revolutionary Guard, the Basij (or religious police) and the Majlis.
But despite these successes, dark clouds now loom over the JCPoA. Whilst standing for President, Donald Trump reffered to this agreement as “a bad deal” and his criticism has not waned since assuming office. Last year, he launched a “comprehensive policy review” towards Iran and, despite the clean bills of health consistently being issued by IAEA monitors, Trump has continued to talk down the deal.
In September last year the stakes were raised when Trump used a speech to call the deal an “embarrassment to the US” and by October he had upgraded “a bad deal” to “one of the worst… ever” and announced he would walk away from the JCPoA unless its “serious flaws” were fixed. The sorts of flaws he pointed to included the presence of sunset clauses regarding Iranian activity and the deal failing to cover ballistic missile testing, but his language suggested a much more fundamental opposition to the Iranian regime itself.
In January of this year, Trump issued a final warning and said that if the deal was not improved within 120 days then he would reinstate sanctions. We remain unsure as to what his next step might be.
Alongside the uncertainty generated by Trump, matters of trade and investment remain more difficult than many hoped. Visas remain a challenge for business people on both sides but, more fundamentally, banking and finance channels are sclerotic and expensive at best, and blocked off entirely at worst. Most of the world’s banks remain nervous about the implications of remaining US sanctions, which prevent US nationals doing business with Iran (a particular issue here given the preponderance of US nationals in UK banks) and restrictions abound around both dollar and sterling clearing, diminishing trade opportunities.
Our country faces a particular problem as payments from Iran need to come to the UK via third party countries, injecting risk, delay and cost. As a result of these problems, many companies, British or otherwise, are either pausing trade and investment decisions, or steering clear of Iran altogether.
It is therefore unsurprising that many consider the JCPoA’s future under threat. It must not be allowed to fail. Whatever our view of some elements of the Iranian regime, the fact is we are more secure with the JCPoA than without it. The deal keeps Iran a safe distance from nuclear weapon capability. It bolsters Rouhani and weakens Iran’s dangerous hardline elements, helping smooth the path for Iran to reconnect with the world, and it brings new opportunities for UK business and global trade.
Now, then, is the time for the UK to burnish its diplomatic credentials; we have a vital role to play in steadying the ship and making sure all involved stay the course. We are, of course, long-term trusted partners of the Americans but the same does not go for the Iranians who still refer to the UK as “little Satan” or the “old Fox”. But the faltering nature of the JCPoA presents an opportunity to demonstrate to Iran and the Iranian people the positive role we can play.
Whether or not we are able to influence and reassure the Americans – which must be our primary aim – it would not do for us to join them in abandoning a deal which we signed up to just over two years ago. Rather, if the Americans are to walk away, we must work with the remaining four members of the E3+3 to ensure the deal remains as intact as possible.
Diplomatic visits, easing of consular services and ongoing recognition of the validity of the IAEA inspections become more important than ever but, vitally, we must strain every sinew to re-establish financial channels and get trade flowing once again.
Such measures will demonstrate to the Iranians that we are steadfast in the deals we make; they will demonstrate to the world that Britain is determined to play a leading diplomatic role as it exits the European Union; they will create trading opportunities for British companies and others besides.
Perhaps most vitally, however, they will help us normalise relations with a once great country whose decline has been tragic to see. But as its behaviour improves, and its fortunes increase, it can be a successful trading nation once again – perhaps even one that Rees-Mogg might wish to trade freely with.
This article first appeared in Bright Blue’s latest Centre Write magazine.
