Iran prepares for the day after the nuclear deal collapses

It is unlikely that the Europeans will be able to keep the JCPOA afloat without the United States.
Sunday 10/06/2018
Winning friends. French Finance Minister Bruno Le Maire (L) and Israel’s Prime Minister Binyamin Netanyahu prior to their meeting in Paris, on June 6.  (AP)
Winning friends. French Finance Minister Bruno Le Maire (L) and Israel’s Prime Minister Binyamin Netanyahu prior to their meeting in Paris, on June 6.(AP)

LONDON - The Iran nuclear agreement faced another blow after Tehran announced it was preparing to increase uranium enrichment in preparation for the deal failing. This coincided with Israeli Prime Minister Binyamin Netanyahu’s tour of Europe, which put even greater pressure on the teetering agreement, with few now believing that the deal can survive without the US.

Iran’s Atomic Energy Organisation Director Ali Akbar Salehi said on June 5 that Tehran was looking to build advanced centrifuges to increase uranium enrichment capabilities at the Natanz facility following instructions from Supreme Leader Ayatollah Ali Khamenei to prepare to increase nuclear enrichment should the deal fall apart.

Khamenei has warned European governments that it cannot expect Iran to accept new sanctions and give up its nuclear programme at the same time. “[This is] a dream that will never come true,” he said.

While the move does not technically violate the terms of the Joint Comprehensive Plan of Action (JCPOA), it is an indication Tehran is considering its options if the deal fails. Khamenei said Iran would stick to enrichment limits under the deal “for now,” but there have been major rumblings of discontent in Iran’s power of corridors over the growing pressure on Tehran.

The speaker of Iran’s parliament Ali Larijani warned that the entire security of the Middle East was at stake if the pressure continued, specifically citing Saudi Arabia and Israel. “The region’s security will be threatened if they corner Tehran,” he said.

French Foreign Minister Jean-Yves Le Drian described the announcement that Iran was preparing to increase enrichment as “unwelcome” and warned: “It is always dangerous to flirt with the red lines.”

Netanyahu’s 3-day tour of Europe involved him meeting with the leaders of France, Germany and the United Kingdom — three signatories of the JCPOA — as he sought to soften the European stance on the Iran agreement.

Netanyahu first met with German Chancellor Angela Merkel, warning that Tehran was using the sanctions-relief guaranteed in the deal to finance destabilising activities in the Middle East. “This will inflame a religious war and the consequences will be many more refugees… We have to break their money machine,” he said.

During a news conference with French President Emmanuel Macron on June 6 in Paris, Netanyahu said he expected the JCPOA to collapse “soon” under pressure from US sanctions.

“If you have a bad deal you don’t have to stick to it especially if you see that Iran is conquering one country after another and you cannot divorce this from Iran’s aggression in the [Middle East] region,” he said.

One day later in London, Netanyahu went even further. “The deal is dad. It’s done… because of the force of the economic sanctions of the United States,” he told the BBC.

Despite the Israeli prime minister’s proclamation, British Prime Minister Theresa May, like Merkel and Macron, showed little willingness to abandon the deal at a time when relations between the United States and Europe have become increasingly tense.

“We will remain committed to it as long as Iran meets its obligations but we do recognise that there are other issues that need to be addressed in relation to Iran — its destabilising regional activity in countries like Syria and Yemen and also the proliferation of ballistic missiles,” May said.

Ali Ansari, the founding director of the Institute for Iran Studies at the University of St Andrews, told the BBC that Netanyahu was seeking to build a “coalition of the willing” to nix the Iran deal.

“He’s trying to bring the Europeans on board and it will just put more pressure on Iran,” Ansari said.

Despite France, Germany and the United Kingdom reaffirming their intention to uphold the deal, Ansari said it was unlikely that the Europeans would be able to keep the deal afloat without the United States.

“A lot of this is diplomatic theatre. It’s an attempt just to keep the pressure on but actually there’s very little that the EU can do given the integrated nature of the European economy with the US,” Ansari said. “The deal is dying the death of a thousand cuts.”

Netanyahu’s European tour coincided with the foreign ministers of Britain, France and Germany sending a letter to the US Treasury and State departments, urging the United States to exempt European companies from sanctions on Iran.

“As close allies we expect that the extraterritorial effects of US secondary sanctions will not be enforced on EU entities and individuals and the United States will thus respect our political decision and the good faith of economic operators within EU legal territory,” the letter said.

However, few say the United States will acquiesce, particularly with a potential trade war looming between the European Union and Washington.

Although the European Union has sought to use a European Commission “blocking statute” to get around US sanctions, this does not cover large multinational companies with ties in the United States, meaning that almost any major deal between a multinational company and Iran could fall under US sanctions.

Several international companies have reportedly been scared off by the prospect of US sanctions, not least French automotive manufacturer Peugeot, US industrial giants such as General Electric and Boeing, Russian energy giant Lukoil, German conglomerate Siemens and Indian conglomerate Reliance Industries.