Iran Deal Implementation: Six Months Later
The Iran nuclear deal remains controversial in the United States, largely because of critics who claim it has not delivered the benefits promised to the U.S. and its negotiating partners.
But a new report from Columbia University’s Center for Global Energy Policy, assessing the implementation of the agreement six months out, beings a different perspective. According to that documents, the agreement has successfully pushed out in time Iran’s ability to turn its weaponize its nuclear program.
Where implementation has faltered, according to the report, is in the area of the lifting of sanctions which have hobbled the Iranian economy. “Though nuclear implementation has gone largely according to plan,” the report concluded, “the same cannot be said of sanctions relief.”
The U.S. and its partners, as well and the United Nations, have done everything required of them under the accord. But other circumstances are preventing Iran from gaining the economic benefits it expected under the agreement. One of these is low oil prices. Another is Iran’s internal regulatory and bureaucratic mess. There also remain U.S. financial sanctions against Iran and its banks unrelated to the implementation of the nuclear deal.
With regard to the latter two points, the paper suggests that Iran can enact domestic reforms to being its banking operations in compliance with international standards for anti-money laundering, tax compliance, financial disclosure, capital adequacy, and stopping the financing of terrorism. Reform of Iran’s bureaucratic processes would makes it easier for foreign companies and domestic entrepreneurs to operate. Pursuing more constructive policies that reduce tensions in the Middle East would alleviate concerns that sanctions will once again get worse.
Politically, it would be impossible for the U.S. to reduce residual sanctions on Iran. But the paper suggested there are measures the U.S. government could take. One would be the issuance of guidance the U.S. intends to use in judging foreign due diligence to prevent Iranian bad actors from receiving benefits from increased business. Another would allowing foreign companies to use U.S. business software and services to make it financially possible for them to do business with Iran.
“Ultimately,” the report stated, “time may be the most important element of Iran’s return to a more normal relationship with the international economy. Time will permit Iran’s compliance with its nuclear obligations to continue to be established and international companies and banks to regain their confidence in doing business in the country. Time will also enable Iran to make the kind of regulatory and bureaucratic reforms necessary for the Iranians to have the kind of economy that they appear to
desire…and to develop the political will to make the necessary changes at home.”
But time appears not to be on the side of Iranian leaders. They are facing “claims that they were suckered in their negotiations with the United States.” “The trick, therefore,” the report concluded, “will be to ensure that Iran is able to make more progress, even if halting, in its reintegration into the global economy and the rigorous monitoring of its progress.”