Europe’s Failure to Meet Iran Halfway

by Kaveh L. Afrasiabi

With Iran’s July 7 deadline rapidly approaching for Europe to live up to its obligations under the nuclear agreement or face consequences, there is little evidence that European governments are willing to meet Iran even halfway. Instead, European governments are hoping instead that Iran will deem satisfactory their token gestures, such as the launching of a special financial mechanism for Iran trade with a credit line of a paltry few million euros.

Iran, however, has insisted steadfastly that, unless Europe fully implements its obligations, it will reciprocate with incremental non-implementation of its part of the agreement. Iran’s exceeding the ceiling on stashed enriched uranium and heavy water has already caused alarm in European capitals. Iran’s Foreign Minister Javad Zarif has made it abundantly clear that Iran’s next move will be to forgo the limit on the level of enrichment, presently capped at 3.67 percent, which is a major proliferation concern.

Other Iranian challenges to the nuclear agreement remain in the offing, such as reducing transparency, limiting short-notice inspections, and perhaps even halting the voluntary adoption of the intrusive Additional Protocol of the International Atomic Energy Agency. In the end, if U.S. sanctions continue and Europe fails to address Iran’s concerns, the nuclear agreement (the Joint Comprehensive Plan of Action or JCPOA) will be destined for history’s dustbin and Iran may even exit the Nuclear Non-Proliferation Treaty altogether, as Zarif and other Iranian officials have repeatedly warned.

Currently, the nub of Europe’s problem with Iran is “INSTEX reductionism.” INSTEX (Instrument For Support of Trade Exchange) is now operational after a six-month delay. But few Iranians are willing to attach too much importance to it, primarily because it is expressly limited to the exchange of “humanitarian goods,” which are exempted from the U.S. sanctions in the first place. The European Three (France, England, and Germany), which are the powerhouses behind the INSTEX, pledged billions of euro to assist Iran over a decade ago when it initially agreed to halt its nuclear fuel cycle. Despite Iran’s great advance in its nuclear technology, which have since raised proliferation concerns, Europe’s stingy response has been one of diminishing returns, offering less and less for the sake of reaching a grand bargain.

This Eurocentric attitude of bargaining on the cheap is destined to backfire. Europe has much to lose from the demise of the JCPOA and the return of the Iran nuclear crisis. Europe’s reduction of its JCPOA commitments to token gestures under the guise of INSTEX, while insisting on Iran’s full compliance with the accord, speaks of a hypocritical double standard as well as failure to take Iran’s warnings seriously. As Iranian Ambassador to the UN Majid Takht-Ravanchi has put it, Iran cannot be expected to be a unilateral party to a multilateral agreement. The INSTEX initiative, moreover, has no tangible effect on Iran’s economy. Its purview must be immediately expanded to include major oil contracts as well as other participants—China, for instance, has expressed interest in joining—and the limited credit line should be vastly increased.

Although the Western media has interpreted INSTEX as a European mechanism to “bypass US sanctions,” Tehran believes it to be a mechanism to “contain Iran” and indirectly rationalize the U.S. sanctions. Yet, U.S. sanctions on Iran violate international law and the will of UN Security Council, and there is no justification for the failure of JCPOA parties to take the United States to the UN Security Council over its violation of Resolution 2231. Instead, Europe has limited itself to expressions of “regret” over the unilateral U.S. exit from the JCPOA, an international binding agreement, while in the same breath warning Iran not to breach the agreement.

Iran has made it clear that it will continue with selective non-implementation of the JCPOA but is willing to reverse its decisions if Europe implements its written commitments under the terms of JCPOA.  In other words, the ball is entirely in Europe’s court. The Europeans should learn from China, another JCPOA signatory, which has explicitly denounced U.S. bullying on its oil trade with Iran. Indeed, Europe ought to file a complaint against the United States in the World Trade Organization, arguing that U.S. sanctions on Iran violate the norms of global free trade and introduce serious trade distortions. But Europe is unlikely to pursue these tactics, neither at the UN nor at the WTO, and thus the crisis will only get worse.

Kaveh Afrasiabi has taught at Tehran University and Boston University and is a former consultant to the UN Program on Dialogue Among Civilizations. He is the author of several books on Iran, Islam, and the Middle East, including After Khomeini: New Directions in Iran’s Foreign Policy (Westview Books, 1995) and most recently Iran Nuclear Accord and the Remaking of the Middle East (2018). He is the co-author of the forthcoming Trump and Iran: Containment to Confrontation.