In light of the current political tensions in the Persian Gulf, Tom Sauer asks whether the Europeans can save the Joint Common Plan of Action (JCPOA), better known as the 2015 nuclear deal.
Political tensions are once again rising in the Persian Gulf. Iran has been accused of attacking six tankers over the last weeks. It has confiscated a British tanker (after the United Kingdom confiscated an Iranian ship), and shot down an American drone (after which the US shot down an Iranian one). Iran’s policy of strategic patience with Trump’s maximum pressure approach is over. Worst of all, Iran has started violating the Joint Common Plan of Action (JCPOA), better known as the 2015 nuclear deal. The latter was initiated by the E3 (being France, the UK, and Germany) in 2003 and concluded by the EU3+3 (the EU3, plus the US, Russia and China). Today’s question is: can the Europeans save the JCPOA?
In May of this year, exactly one year after President Trump’s unilateral withdrawal from the nuclear deal, President Rohani announced that Iran will start crossing some of the limitations (like the amount of low enriched uranium, the percentage of enrichment, and in the future probably also the number of gas centrifuges that are needed for enrichment, etc) agreed upon in the deal, be it in a limited and reversible way. Tehran claims that it cannot continue fulfilling its part of the obligations without seeing any of the (economic) benefits of the deal.
The diplomatic signal by Teheran to the rest of the world, and especially the Europeans, is twofold: first, “rescue the deal!”. If not, Iran is planning to cross other limitations every two months. As a result, the Iranian break-out time (which is the time needed for Iran to build atomic bombs in secret, which was significantly lengthened thanks to the deal) will start shortening again, which brings Iran closer to the Bomb. The latter may provoke another war by the US in the Middle East, something that the Europeans absolutely want to prevent as the wars in Iraq, Syria and Libya led to migration streams to Europe (not to the US) and a boost for nationalist and populist parties in all EU member states. A second reason for Iran to put up the pressure is to position itself better for potential new negotiations with the US.
Unfortunately, the EU seems either incapable or unwilling to save the deal. The problem is not only that the most important actor – the US – withdrew from the deal. President Trump made matters worse by announcing that also any non-American (e.g. European) firms that continue doing business with Iran (and the US) would be sanctioned by the US through the so-called extraterritorial sanctions. As a consequence, all major European firms (like Total, Siemens, Peugeot, Citroën) left Iran again after flocking back to Iran in 2015. The result is an Iranian economy in shatters with high inflation (40-60%) and the rise of the conservative faction and the Revolutionary Guards.
The EU4 – the EU3 plus Italy – announced immediately after the US withdrawal in 2018 that it would set up a Special Trading Vehicle Mechanism (called INSTEX) that would help European firms to circumvent the American sanctions. Again, the future of the nuclear deal depends on the extent that Iran can enjoy its economic benefits. Setting INSTEX up has taken approximately one year, and it is still not running and so not bringing a lot of foreign capital towards Iran. Why does it take so long? Is it because the Europeans have never set up such a mechanism, or is it due to lack of political will? Or both? According to some observers, lack of political will, certainly on the side of the UK (because its close ties to the US, especially in uncertain times of Brexit), is definitely part of the answer.
More fundamentally, the whole episode shows the weakness of the EU4. Just like the period before the Iran deal, ad hoc informal international organizations (IOs) – in this case the E3, EU3, EU3+3, EU4 – are helpful and may be necessary, but are certainly not sufficient to resolve intricate international problems. There are however also advantages to these ad hoc groupings. First, they encounter less bureaucratic obstacles for cooperation than formal IOs, including flexibility with respect to membership. Second, they can decide faster than formal IOs due to less veto-players (at least if the political will exists). Third, and finally, these ad hoc groups are able to buy time to bring in more important diplomatic actors (like formal IOs – such as the UN and the EU – and major powers like the US) into the game in order to resolve the conflict. That’s what the EU3 rather successfully did before the deal, and what the EU4 is trying to do now with INSTEX. At the same time, the major limitation of these ad hoc informal IOs is that they need other actors – in this case the UN and especially the US – to finalize a (new) deal.
The recent tensions in the Persian Gulf has made it clear that the Rohani government cannot wait until the next US presidential elections to resolve their issues with the US and the international community. Iran needs money now. If it won’t be able to sell oil in the coming months, it will gradually up the ante by contravening other parts of the deal. This will bring us closer to an Iranian atomic bomb, and in all likelihood followed by a nuclear arms race in the Middle East or a new war in the region.
If the EU wants to be perceived in the rest of the world of being a strategic actor, independent from the US, it should act now by making that INSTEX works and that the Iranian economy can substantially benefit from it, and at the same time put pressure on the US to either re-enter the previous nuclear deal or (if that is impossible) to negotiate a slightly better agreement, so that President Trump can show his base that he has negotiated a better deal than Obama. If the US sanctions are then lifted again, the Iranians and the rest of the world (except maybe Israel and Saudi Arabia) can certainly live with that.
This piece draws on the article ‘The Role of Informal International Organizations in Resolving the Iranian Nuclear Crisis (2003–15)’ published in the Journal of Common Market Studies (JCMS).
Please note that this article represents the views of the author(s) and not those of Ideas on Europe, JCMS or UACES.
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Tom Sauer is Associate Professor in International Politics at the Universiteit Antwerpen (Belgium). He has published six academic books, and numerous journal articles, mostly on nuclear proliferation and disarmament. He is a former BCSIA Fellow at Harvard University. Sauer is also an active member of the Pugwash Conferences on Science and World Affairs, and received the 2019 Rotary International Global Service Award.