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Can the US trust Europe on Iran?

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Among his rationales for opposing the nuclear deal with Iran, US Senator Charles Schumer said that he did not trust the three European Union partners to punish Iran should it violate the terms of the accord that offers the Islamic Republic sanctions relief in exchange for scaling back its nuclear activities.
by CNAAN LIPHSHIZ | Aug 14, 2015

BRUSSELS

 Pictured: German Chancellor Angela Merkel speaking in Berlin on June 29. Merkel has vowed to renew sanctions if Iran fails to comply with the nuclear deal.

PHOTOGRAPH: SEAN GALLUP/GETTY IMAGES

The New York Democrat’s assertion served as a reminder that while Washington has been the driving force behind the deal, which was reached July 14 between Iran and six world powers, the agreement is an international one. Its implementation, therefore, will be determined in part by the foreign policies and interests of Britain, France, Germany, China and Russia.

“It is reasonable to fear that once the Europeans become entangled in lucrative economic relations with Iran, they may well be inclined not to rock the boat by voting to allow inspections” that would bring about renewed sanctions, Schumer wrote in an August 6 statement.

(Russia and China are unlikely to introduce new obstacles to trade with Iran, judging by their apparent eagerness to sell arms to Tehran. Qasem Soleimani, an Iranian defence official who is still the subject of a United Nations travel ban over his country's nuclear activities, reportedly travelled to Moscow to discuss, among other matters, the sale of air defence missiles. China, meanwhile, has agreed to provide Iran with 24 fighter jets in exchange for access to Iranian oil fields for the next 20 years, Taiwanese media reports have said.)

Schumer, the highest-ranking Jewish Democrat in the Senate, has said that he would vote against the deal in Congress, where it is expected to fail. President Barack Obama has vowed to veto any bill of disapproval, for which both houses of Congress would need a two-thirds vote to override.

Schumer’s stated concern about the European Union partners echoes warnings by critics of the deal who say that Europe’s fragile economies lack the discipline to cut trade with Iran should it violate the terms of the deal. But European supporters of the agreement argue that Europe has already proven its willingness to cut trade, and that Iran’s economic dealings will work to increase compliance, not diminish it.

“The resumption of an economic co-operation with the West will boost the gradual liberalisation of the Iranian regime and allow it to respond to demands for democracy from civil society,” JCall, Europe’s liberal pro-Israel lobby, similar to J Street in the United States, wrote in a statement.

Europe’s recent track record suggests it has the discipline to walk away from Iranian money. When the European Commission first imposed sanctions against Iran in 2007, it cut a booming trade of 25 billion euros (then worth some $42 billion) between Iran and EU member states to around $7 billion last year.

Promoting stricter sanctions against Iran was easier for the United States, whose trade with Tehran - just $318 million in 2007 - is in any case limited by legislation set in place in the 1980s. (US trade with Iran has gradually decreased since then to less than $1 million in imports and $186,5 in exports last year.)

But the economic situation in the European Union has worsened since 2007, with the union having been badly hurt by the global financial crisis the following year and struggling to maintain the integrity of its financial bloc and currency.

European leaders, including German Chancellor Angela Merkel, vowed to renew sanctions if Iran fails to comply. But with two of the three EU partners suffering from stagnant economies and rising unemployment, many share Schumer’s scepticism on whether this will actually happen.

“The sanctions are toast,” said Emanuele Ottolenghi of the Foundation for Defence of Democracies, a right-leaning think tank. Britain, France and Germany, he said, “are in no condition, economically speaking, to agree to implement sanctions once they are lifted”.

Even if they agreed to lift such sanctions, the deal’s terms meant that such punitive steps would not apply to contracts signed before the sanctions’ re-introduction, Ottolenghi said, noting: “The result is a rush in Europe to sign contracts now, even if they are not immediately applied, just to make them sanctions-proof.”

In 2007, Germany’s gross domestic product grew at a rate of 3,3 per cent. It now stands at 0,1 per cent. France went from a GDP growth rate of 2,4 per cent in 2007 to 0,2 per cent in 2014. Of the three EU partners, Britain alone has managed to restore its 2007 growth rate of 2,6 per cent after the 2008 crash.

The deal does allow for the reimplementation of sanctions through the UN Security Council, even over the objections of other veto players. But doing so, analysts warned, could alienate allies and complicate the creation of a new coalition to impose sanctions - making the snapback option anything but snappy.

But in defence of the deal, J Street has maintained in statements that “the EU and US can snap back their own sanctions at any time if Iran does not meet its commitments”. The left-leaning pro-Israel lobby insisted that the terms of the deal meant sanctions would be snapped back “automatically” at the Security Council if Iran violated any part of the agreement and provided the United States and EU partners demanded it. (JTA)

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