December 18, 2020

Middle East Roundup: Khamenei Says Sanctions Lifting Shouldn’t be Delayed & Dissident Executed

This week, Iran’s Supreme Leader leaves the door open for Iran to negotiate with the U.S. under President Elect Biden. Also, Iran’s execution of dissident Ruhollah Zam provoked international condemnation, while the Rouhani administration submitted its budget proposal. Please see a breakdown and analysis of events below: 

Supreme Leader Parrots Rouhani’s JCPOA Return Commitment 

  • JCPOA Joint Commission Meets For First Time Since U.S. Election
    • On Wednesday, December 16th, Iran’s Supreme Leader said, “If sanctions can be removed, we shouldn’t delay, not even for an hour…I support the country’s officials as long as they are committed to the nation’s goals.”

    • He spoke at an event with government officials marking the upcoming anniversary of the killing of Iranian General Qassem Soleimani. This marks the first time in over a year that Supreme Leader Khamenei has explicitly addressed JCPOA issues, expressing his continued openness to swiftly lifting sanctions and returning to compliance with the deal.

    • He went on to lambast the U.S. more broadly, stating that, “the hostility (against Iran) is not just from Trump’s America, which supposedly some could say would end when he leaves,” but “Obama’s America also did bad things to the Iranian nation.”
    • His comments on sanctions are similar to a statement made by President Hassan Rouhani earlier in the week, who said, “The administration will not allow anyone to delay the end of sanctions, and some want this to happen…We will not allow it for one minute or even one hour, and the sanctions must be broken. America must return to its previous commitments …and we will return to our own commitments.”

    • However, elements in Iran may still complicate a return to compliance. Iran’s conservative parliament passed a bill earlier this month that would mandate a rapid escalation of Iran’s nuclear program if sanctions are not removed swiftly (see previous roundup on this issue). The Rouhani administration has since said that it plans to implement the bill, but only according to their “interpretation.”

    • In a meeting on Dec. 16th, the Joint Commission for the Iran nuclear deal met to discuss the state of the agreement. It is the commission’s first meeting since the U.S. elections. In a readout of the meeting, the countries discussed ongoing work to preserve the JCPOA and how to ensure the full and effective implementation of the agreement by all sides in light of existing challenges.” Foreign ministers party to the deal will hold a virtual meeting next week to continue the conversation.
  • Key Takeaways
    • The comments from Khamenei and Rouhani, made so soon after one another, are a sign of internal consensus within Iran on returning to compliance with the deal. Very rarely does the Supreme Leader buck hardliners during contested internal fights, but these comments clearly leave the door open for a compliance-for compliance return to the nuclear deal. More importantly, it will give the Rouhani administration more political space to pursue a swift return to compliance, which behooves both the political climates in Washington and Tehran.

    • The Supreme Leader’s language also suggests he is hedging his bets. In emphasising that he backs the government as long as they are committed to the “nation’s goals,” he can keep himself at arms length in case negotiations fail. Moreover, Khameni highlighted his view on Democrats and Republicans, suggesting yet again a more hardline view of the U.S. that is not shared by everyone without Iran’s political establishment. However, the longer sanctions remain in place, more and more average Iranians will likely begin to ascribe to this assessment.

Execution of Iranian Dissident

  • Fury Over Killing Forces EU Pull Out of Major Business Conference With Iran
    • On December 12, Iran executed a dissident journalist, Ruhollah Zam, who was the son of a prominent reformist cleric with ties to the government. He was accused of “corruption on earth,” a national security charge commonly used against activists and critics of the government. He was first captured in 2019 after Iranian agents lured him into Iraq on false pretenses.

    • Zam was a resident of France since 2011 where he ran a Persian language Telegram channel that shared stories about corruption within the Iranian government which helped spark protests in multiple cities in Iran between December 2017 – January 2018. His telegram channel was controversial, and shut down after it shared instructions on making molotov cocktails amid protests in Iran.

    • The execution, which was rightly condemned by international organizations, foreign governments, and Iranians, occurred two days before a major business conference between the EU and Iran. Major European countries, whose ambassadors were set to speak at the event alongside Iranian Foreign Minister Javad Zarif, pulled out of the Europe-Iran Business Forum in protest of the killing, leading to its postponement.

    • President-Elect Biden’s incoming National Security Advisor, Jake Sullivan, condemned the killing on Twitter and UN human rights experts called his conviction and execution “unconscionable and a serious violation of Iran’s obligations under international law.”
  • Key Takeaways
    • Zam’s killing was not only a miscarrige of justice, but also an indication of how many factions inside Iran are willing to use the levers of state power to set the boundaries of what the government will tolerate and what it won’t. As NIAC’s Human Rights Tracker on Zam’s killing states: “In spite of an alarming escalation of repression, harsh sentences, and the use of the death penalty, Iranian authorities will not silence voices of protest through forcefulness. Instead, violence begets violence, Iranian officials should heed calls for human rights and must abide by their obligations under international law.”

    • The execution may also be a sign of things to come as the likelihood for negotiations between the West and Iran increases. For many factions in Iran, especially those that control Iran’s judiciary and certain security institutions, Iran opening up to the West threatens their grip on power. 
    • It may not be a coincidence that Zam’s execution, which was sudden and without warning, came before a major business conference between Iran and Europe that was created in hopes of generating more ties between the two parties. After the execution of a European resident, EU officials would predictably be under pressure to withdraw their attendance, putting more obstacles in front of further engagement between Iran and the West.

Rouhani Draft Budget Predicated on Sanctions Being Lifted

  • Proposal Highlights Iran’s Economic Issues 
    • In a budget proposal submitted to the Iranian Parliament, the Rouhani administration projected that tax revenues and oil and gas income would increase significantly in order to pay for a 10% increase in spending.

    • In particular, the budget’s reliance on petrodollars doubled from the previous year, pointing to an assumption that Iran will be able to increase its oil exports next year. Iran plans to earn 170% more oil revenue in 2021 than in 2020 (in inflation-adjusted terms), constituting 21% of government revenue, as opposed to 9% in 2020. If enacted, and sanctions are not removed, Iran would have a significant budget deficit.

    • In May 2019, the Trump administration imposed secondary sanctions on Iran’s oil exports with the explicit purpose of “driving Iran’s oil exports to zero.” While Iran is primarily a service-based economy, fossil fuel income remains the backbone of the economy. Now, with the prospect of both Iran and the U.S. returning to compliance with the JCPOA following President-Elect Biden’s inauguration, the government expects a windfall of revenue if oil sanctions are removed. 
    • Sanctions-lifting will undoubtedly lead to an increase in government revenues across the board. Amid JCPOA implementation, U.S. intelligence assessed that the “preponderance” of increased revenue was directed toward “economic development and infrastructure.” 
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