Iran's Deadly Ambition (11 page)

The move was a marked departure from prior practice. For years, European diplomats attempted precisely the strategy now being contemplated in Washington as a way of altering the Iranian regime’s conduct. To that end, the European Union tried to engage the Islamic Republic in what it termed “critical dialogue” during the 1990s. Between 2003 and 2005, the E.U. 3 (France, Germany, and the United Kingdom) sought in vain to negotiate a compromise with Iran’s leaders over nuclear ambitions. Both were manifestations of the continent’s extensive trade with the Islamic Republic, which led European leaders to consistently favor engagement over isolation and diplomatic carrots over strategic sticks, with little success.

By November 2009, it seemed, European leaders were talking—and thinking—tougher. And while the Dutch resolution may have been the most prominent sign of this stiffening resolve, it was not the only one. A month earlier, the British government had invoked counterterrorism legislation in order to formally prohibit business ties with Iran’s national shipping carrier, Islamic Republic of Iran Shipping Lines (IRISL).
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The European Commission, meanwhile, was carrying out a preliminary feasibility study of sanctions that could be levied against the Islamic Republic.
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All this, coupled with sterner rhetoric emanating from Paris, Berlin, and London, led experts to conclude that the European Union was “much closer to backing sanctions in some form than ever before.”
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Today, a great deal has changed. Over the past two years, and especially since the November 2013 signing of the Joint Plan of Action (JPOA) between the P5+1 nations and Iran,
Europe has moved steadily away from a policy of applying pressure on the Islamic Republic and embraced anew the idea of engagement and outreach.

This reversal is expressed on two fronts, the first of which is legal. Specifically, a series of recent court decisions helped roll back the European Union’s sanctions on Iran and its constituent entities. A July 2013 expose by the Reuters news agency outlined how Europe’s courts systematically dismantled sanctions previously levied on Iranian individuals and companies.
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In all, dozens of Iranian companies and individuals previously censured by the European Union saw decisions against them reversed. Those verdicts, made in part on procedural grounds, arguably have transformed the European Union’s own judicial system into the biggest obstacle in its effort to maintain pressure on Iran.
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But Europe’s courts aren’t the only area of reversal. On a second front, European businesses have assumed a distinctly unhelpful role. Historically, the countries of the European Union collectively served as Iran’s largest trading partner, with billions of dollars in annual two-way trade. That began to change in the late 2000s, as European countries frequently curtailed economic ties to Iran in response to mounting international sanctions. As a result, China surpassed the European Union in 2009 to become Iran’s biggest trading partner, with an annual turnover of at least $36.5 billion.
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Nevertheless, business between Europe and Iran continues to boom and totaled 7.4 billion euros (nearly $9 billion) in 2012.
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Amid slackening international pressure on Iran, those ties are strengthening anew.

That is because the November 2013 JPOA included a significant easing of restrictions on investment in a number of Iran’s economic sectors, including its petrochemical and pharmaceutical industries. This paved the way for European companies, such as Sanofi and Siemens, which had restricted
business in the Islamic Republic, to broaden their presence there.
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Iran’s automotive sector, too, is fast becoming a growth industry. Steady demand had already positioned Iran as the fastest-growing car market in the Middle East, and now the industry is on the cusp of serious expansion. In just one sign of this newfound dynamism, Iran Khodro, the country’s largest carmaker, is reportedly looking for international partners, with negotiations said to be under way with French automakers Peugeot and Renault.
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This scramble for reengagement is animated by the sense that, in the words of one German business executive, investment in Iran has the potential to be the “chance of a century.”
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For their part, Iranian officials are doing everything they can to encourage foreign interest. To that end, in February 2014, the Iranian regime formally changed the requirements governing international oil contracts in the Islamic Republic. Under the new structure, deals would no longer be buybacks, requiring the host nation to pay the contractor an agreed-upon price for all volumes of hydrocarbons the contractor produces. Instead, they would be fully fledged joint ventures—a more attractive structure that Iranian officials estimate could net the regime as much as $100 billion in new oil deals.
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These developments, and many others, have steadily moved the political dial in Europe back toward engagement and normalization with the Iranian regime. That was the message of the first Europe-Iran Forum, which convened in London in October 2014. The high-profile event, which featured presentations by such luminaries as the former British foreign secretary Jack Straw and the former French minister of foreign affairs Hubert Védrine, was held for a singular purpose: to prepare Europe for trade with, and investment in, a post-sanctions Iran.
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That process is well under way. Take Germany, which alone accounts for a third or more of Europe’s total business with Iran. In 2012, Germany exported $3.4 billion in goods to the Islamic Republic. That year, 136 companies were estimated to be active within the Islamic Republic.
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And while commercial ties between Berlin and Tehran dipped temporarily as a result of U.S. and European sanctions, they are on the upswing as hungry German businesses position themselves for a post-sanctions economic boom.
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This momentum, in turn, is augmented by groups, such as the Hamburg-based German-Iranian Chamber of Industry and Commerce, which lobby heavily in favor of trade détente with Tehran.
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But Germany is not alone. Throughout the continent, the consensus to isolate and pressure Iran is crumbling, undermined by political considerations and the economic lure of normalized trade. Indeed, even the Netherlands—which championed the idea of pressure on Iran—has begun to go wobbly. Officials in Amsterdam are said to be considering allowing their businesses to reenter the Iranian market.
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Thus, in a matter of half a decade, Europe has come full circle, from engagement to isolation and back again, without any real material change having taken place in Tehran. Sadly, this is hardly the first time Europe has done so.

A COSTLY DIALOGUE

It was the fall of 2003, and European diplomats were waxing decidedly optimistic. Only a year before, the world was jolted awake to Iran’s nuclear ambitions when a controversial opposition group, the National Council of Resistance of Iran (NCRI), disclosed alarming details about Iran’s previously covert nuclear program.
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The revelations were a highly unwelcome surprise to the United States and Europe, both preoccupied with the opening stages of the global war on terror.

In response, the international community sprang into
action. In February 2003, the International Atomic Energy Agency (IAEA), the United Nations’ nuclear watchdog, dispatched a fact-finding mission to the Islamic Republic and found the Iranian government violating its commitments under the 1968 Treaty on the Non-Proliferation of Nuclear Weapons (NPT).
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The discoveries led to pressure from other quarters, including the Group of Eight (G8) and the European Union, and to rumblings about serious international censure in the form of United Nations Security Council sanctions.

Only eight months later, it looked like Iran was ready to change course. That October, Iran struck a deal with the E.U. 3 countries—France, Germany, and the United Kingdom—to suspend its uranium enrichment activities.
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For Paris, Berlin, and London, this deal represented a major diplomatic victory. The agreement was also an implicit condemnation of the American approach to Iran, which featured economic pressure as its centerpiece during the final years of the Clinton administration and during President George W. Bush’s first years in office.

The euphoria of Europe’s leaders turned out to be short-lived, however. By the summer of 2004, just eight months later, Iran reneged on the agreement and was mapping out new plans for centrifuge enrichment.
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Yet Europe’s response wasn’t renewed pressure, but still greater engagement. Between the fall of 2004 and the late summer of 2005, the E.U. 3 nations floated no fewer than five separate proposals, ranging from guaranteeing Iran’s access to advanced nuclear technology to the possibility of returning spent nuclear fuel to supplier countries.
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The goal was always the same: to provide the Iranian regime with an opportunity to climb down from confrontation with the West over its nuclear program.

But Iran didn’t bite. Officials in Tehran were, indeed, eager to talk to Europe and thereby forestall the possibility of sterner measures from the international community. They
were not, however, willing to give up on their nuclear ambitions and substantially scale back the atomic work they saw as their regime’s inalienable right.

In this regard, Europe’s outreach proved to be nothing short of a godsend. The eagerness of European leaders for some sort of negotiated settlement gave Iran precious time to expand the scope and strength of its nuclear project. As one senior Iranian policy maker candidly explained to a domestic audience in late 2005, in a speech published in the Farsi-language journal
Rahbord
: “While we were talking with the Europeans in Tehran, we were installing equipment in parts of the facility in Isfahan, but we still had a long way to go to complete the project . . . [B]y creating a calm environment, we were able to complete the work on Isfahan.”
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The speaker was none other than the man who served as Iran’s chief nuclear negotiator with the E.U. 3 and who is now the Islamic Republic’s “moderate” president: Hassan Rouhani.

Today, the situation is much the same. Long-standing hopes for normalization have been rekindled since November 2013, causing European nations to invest heavily in Iranian negotiations. In the process, Europeans have turned a blind eye to a wide range of worrying activity, from parallel work on Iran’s ballistic missile arsenal (a key delivery vehicle for any Iranian nuclear device) to unexplained but persistent signs that the Iranian nuclear project has a definite military dimension. European countries have also muted their concerns about Iran’s other deformities—including its abysmal track record on the one issue that ostensibly sits at the center of Europe’s foreign-policy agenda.

AN UNFULFILLED MANDATE

The summer of 1975 was a rare moment of international harmony at the height of the Cold War. That August, thirty-five world leaders headed to Helsinki. The list of luminaries
included U.S. president Gerald Ford and his opposite number in Moscow, Soviet general secretary Leonid Brezhnev. It also encompassed the two faces of a divided Germany: West German chancellor Helmut Schmidt and his East German counterpart, Erich Honecker. They, and thirty-one others, descended on the Finnish capital to conclude the Conference on Security and Cooperation in Europe (CSCE), a three-stage international process first convened in 1973 and aimed at reducing tensions in Europe through greater trade, cooperation, and dialogue.

They were successful. In what Brezhnev at the time called a “triumph of reason,” the conferees passed a landmark framework accord, paving the way for greater political and economic cooperation between East and West. But the agreement, which came to be known as the Helsinki Final Act, was much more. It provided a code of conduct for Europe’s states to follow in their relations with each other and with nations beyond the CSCE. Among other things, the Helsinki Final Act required that its signatories “recognize the universal significance of human rights and fundamental freedoms, respect for which is an essential factor for the peace, justice and well-being necessary to ensure the development of friendly relations and co-operation among themselves as among all States.”
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At the time, hopes ran high that this directive would set a new humanitarian standard. Commenting on the accord, President Gerald Ford noted that “history will judge this Conference not by what we say here today, but by what we do tomorrow—not by the promises we make, but by the promises we keep.”
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By that yardstick, European foreign policy writ large and, in particular, its approach to the Middle East have been abject failures. Today, the directive in the Helsinki Final Act is observed almost entirely in the breach with regard to the
continent’s relationships with a range of repressive, autocratic regimes.

Iran is prominent among them. The Islamic Republic has long ranked as one of the world’s worst human rights abusers, receiving condemnation from a wide array of human rights watchdogs. Moreover, internal conditions have worsened considerably over the past two years. In his March 2014 report on the human rights situation in Iran, U.N. secretary-general Ban Ki-moon noted continued widespread violations of civil and political rights, including political repression and intimidation of journalists and dissidents, a surge in public executions, and significant ongoing instances of torture and arbitrary detention.
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All of this makes the Iranian regime an exceedingly odd political partner for countries concerned with human rights and freedoms, as European nations profess to be.