Iran and the U.S.: Still Possible to Escape the Worst and Work for the Best

by Francois Nicoullaud

The U.S. withdrawal from the Iran nuclear deal—the Joint Comprehensive Plan of Action (JCPOA)— could be an ill-advised, even absurd decision. Like it or not, however, it’s not a violation of international law. Let’s remember the care taken by the American negotiators in Vienna to avoid giving the JCPOA any formal attributes of an international treaty — which would have required ratification by the U.S. Senate. They even took care to avoid presenting it as an “agreement”—not only in its title but even in the body of the text. The document was never signed by the parties, only adopted by a silent consensus of the seven parties following a declaration by the representative of the European Union.

True, the JCPOA, soon after its adoption in Vienna, has been “endorsed” by a formal resolution of the United Nations Security Council. But again, the U.S. negotiators took great care to deprive the formula of any binding force under the UN Charter during the drafting process.

Destroying the JCPOA from Outside

What happened after the withdrawal is another matter, however. Washington initiated an aggressive strategy against the six remaining parties designed to destroy the JCPOA from without. Reintroducing sanctions could have been accepted as a logical consequence of the American withdrawal so long as it did not produce direct adverse effects on the smooth implementation of the Vienna arrangement. Unfortunately, the extraterritorial dimension of most of these sanctions created a steadily growing imbalance between the Iranian nuclear commitments and the benefits that would accrue to Iran for its compliance.

Until now, the Trump administration had spared the inner mechanisms of the JCPOA. But that is no longer true. By threatening to forbid Tehran from sending abroad the low enriched uranium and the heavy water it may produce in excess of the limits agreed in the Vienna arrangement, Washington has gone one step further. Washington’s latest moves undermine both the letter and the spirit of the very core of the JCPOA.

Furthermore, in its May 3 statement, the State Department explicitly demands that Iran “stop all proliferation-sensitive activities, including uranium enrichment.” That demand effectively returns the process to square one, in 2003, when John Bolton—yes, this is not something new—was bullying the three Europeans negotiating with Iran into gaining Tehran’s submission to the famous “zero centrifuge” formula. There was, of course, zero chance of success, and the negotiation collapsed two years later. However, it never stopped entirely and morphed into different formats until the final and decisive push given it by Barack Obama and John Kerry. This last effort led, in the JCPOA, to de facto recognition, within determined limits, of Iran’s enrichment program.

Collective Failure of Iran’s JCPOA Partners

The six remaining parties to the JCPOA, and not only Iran, should have felt equally attacked by Washington’s latest moves. One would have liked to hear from the Europeans the word “protest” instead of the meek “regret” and “concern.” China, embroiled in a difficult trade negotiation with the United States, prudently called “on all relevant parties to exercise restraint etc.” Only Russia dared to “blame” the United States and to express its “understanding” of Iran’s position.

An opportunity was missed by Iran’s other JCPOA partners to demonstrate via a common statement their solidarity against what can only be considered a clearly hostile gesture by the United States towards each and every one of them. Let’s hope that the next meeting of the Joint Commission provided for by the JCPOA itself will offer a new opportunity for the parties, including Iran, to speak with one voice.

The Europeans were braver when it came to reacting to Iran’s reply. Asserting their “great concern,” they urged Iran “to refrain from any escalatory steps” and rejected “any ultimatums.” In reality, Tehran’s “ultimatum” to progressively step up its nuclear activities absent any progress in alleviating the U.S. sanctions reads as one of the most carefully poised and soft-spoken ultimatums in history. It rather sounds like an appeal for help by Iranian President Hassan Rouhani, who finds himself increasingly squeezed between a rock and hard place—the United States and his own radical opposition.

Where to Go from Here?

INSTEX, the barter mechanism intended to facilitate run-of-the-mill trade between Iran and the European Union has yet to launch and will require no less than a year, probably more, to operate at full capacity. China is not presently in a position to take a bold initiative. Russia could perhaps help Iran sell some of its oil, but this carries serious risks. All in all, no easy solution is in the offing in Tehran’s two-to-four-month time frame for its JCPOA partners to alleviate on a priority basis sanctions on its oil exports and its banking system.

In waiting for better opportunities, the primary requirement for Iran’s partners in the JCPOA should be to defuse all risks of further tensions between them: primum non nocere (“first do no harm”). The Europeans should therefore avoid threatening to refer Iran to the Security Council for non-compliance with its commitments. The urgency for now is to save the spirit of the JCPOA, even against its letter, so long as Iran does not resort to measures that could give rise to a significant danger of proliferation. This is still not yet on the horizon.

Of course, Iran, too, should play its part. To get around the latest U.S. decisions in the immediate future, it can down-blend to its natural level the enriched uranium produced in excess of the JCPOA limit that cannot be exported anymore. It can also down-blend its excess heavy water to common water. Regardless of the JCPOA, Iran has today no interest in accumulating at great cost and effort, using a fully outdated model of centrifuge, large stockpiles of enriched uranium of which it has no use in the short or even medium term. It would better prepare for the future by prioritizing, within the perfectly legal framework offered by the JCPOA, the development of its new and more efficient centrifuge models. And, instead of trying to revive the uncertain construction of the natural uranium research reactor that it abandoned when joining the JCPOA, it should instead press its partners to help speed up the construction of the new reactor promised by the same JCPOA but whose implementation has been lamentably delayed. This would be a positive ultimatum.

But this covers only one part of the picture. The other is in Washington, where the war drums have begun beating at a disturbing tempo. While displaying their solidarity with all the remaining parties to the JCPOA, the Europeans, in spite of all difficulties, still have the capacity to bend the situation in a better direction.

Of course, they will not convince President Trump to return to the JCPOA or the Iranians to renegotiate the JCPOA with the Americans. But they could capitalize on Donald Trump’s obvious longing, as seen in multiple tweets and remarks, to produce at long last proof of his “art of the deal” by striking some kind of arrangement with Tehran. All the better if it takes place before the next presidential election. For this, a limited agreement would suffice, if it both clearly benefits the United States and reduces the Iranian risk of proliferation. This is where the Europeans could enter the game in the role of honest broker. The first prerequisite would be to take into account the mutual distrust of the two parties. They should therefore be able to put forward equally balanced, fully voluntary, and reversible gestures. The task is difficult, but not impossible.

What the U.S. Can Give

A possible first gesture from the U.S. side could be to reinstate the waivers allowing the sale to Iran of commercial passenger aircraft, as provided by article 22 of the JCPOA. Negotiations between Iranian companies and Boeing as well as Airbus did start after the conclusion of the Vienna arrangement. They were interrupted, however, by Washington’s withdrawal. They provided for the acquisition of more than 200 planes divided equally between Boeing and Airbus. The completion of this deal would be highly beneficial to Iran, due to the precarious state of its fleet, but also to Boeing, which is going through a difficult period owing to the recent crashes of its 737 Max airliners, and to the U.S. economy at large. The prospect of creating thousands of jobs in the American aircraft industry would be a positive signal in an election year. Last but not least, it would also benefit the European economy.

Another possible American gesture would be to reintroduce some waivers for Iranian oil’s main clients. This would reduce tensions on the oil international market and improve Washington’s relations with its traditional friends: Japan, South Korea, and Taiwan among others, not to mention Europe. And again, reasonable gasoline prices at U.S. gas pumps in an election year would be welcome. A third possible gesture would be to ease the restrictions imposed on the Iranian banking sector, provided, of course, that Iran finally brings its legislation into conformity with international norms against the financing of terrorism.

What Iran Can Give

How could Iran reciprocate such a bounty of gestures? The adoption of anti-terrorism international norms currently feeds a bitter internal debate in Iran. But the prospect of an attractive package could lead to a favourable decision by the supreme leader and thus settle the matter. However, this would not be enough by far, to satisfy the Trump administration. Another important Iranian gesture would be needed to tip the scales.

Like Edgar Allan Poe’s purloined letter, it’s hidden in plain sight. As long as Iran is committed by the JCPOA provisions not to exceed a stockpile of 300 kilograms of low-enriched uranium (LEU), it has absolutely no interest in spinning the 5,000 or so centrifuges authorized by the same JCPOA. Their potential output goes far beyond this limit: 1,500 centrifuges would amply suffice to produce a couple of hundred kilograms of LEU per year. And again, the real challenge for Iran is not to run a large number of outdated centrifuges (the present IR1 model dates back from the early 1970s), but rather to produce and operate efficient, up-to-date centrifuges when the JCPOA ends. There would be therefore no drawback for Iran in announcing a voluntary switch-off of about two-thirds of its presently active centrifuges. All of this would take place under the supervision of the International Agency for Atomic Energy, in return for Washington’s own commitments—and for as long as it keeps its commitments.

Such reciprocal gestures would constitute the main elements of a fair deal that both parties could celebrate. Donald Trump could claim to obtain much more than Barack Obama did in curbing Iran’s nuclear activities without giving more than what was already contained in the JCPOA. Hassan Rouhani could moderate some of the most disruptive American sanctions while preserving the legitimacy and future development of the Iranian nuclear program. The combining of all these elements into a successful venture is the job of the diplomats, which plays on the strengths of the Europeans. With some luck and hard work, they could be proud of having helped defuse one of this era’s most serious crises.