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Global Implications of the Iran Nuclear Deal

he historic nuclear deal struck between the P5+1

and Iran has profound implications for the future of
Tehran, the region and the world. The reintegration of
Iran into the global economy will boost private sectors
throughout the country and mitigate the importance of
black markets, weakening hardliners and boosting the
moderates. Nothing in the agreement removes or forbids
sanctions on Iran based on human rights or support of
terror groups, so those restrictions will remain in place.
With the framework of the deal in place, the world is
watching and waiting to see what will happen in the days
ahead.
Itamar Rabinovich, former ambassador of Israel to the United
States, opened the discussion stating that there will be a
heated debate in the United States for the next 60 days during
which the Congress will debate the Iran deal, vote and likely
veto. The debate around the deal ties into the presidential race
and its not likely to abate before the election. He stated that
his evaluation is that the administration will be able to keep
the democrats in support of the deal because it is distinctly a
partisan issue and because Congress, at the end of the day,
tends not to obstruct the president on foreign policy issues.
He continued to state that the deal itself - and weve heard
numerous positions for and against it - is not as bad as
some of the critics make it out to be and its not as great
as the administration claims. It will be the legacy project of
the Obama administrations foreign policy and an issue that
has preoccupied the president since the primaries and the
beginning of his term.
The real question is the future. The deal takes back the Iranian
nuclear program and checks it for 10 years, but the questions
and the criticism is what will happen after 10 years? Are we
mortgaging the future for the sake of the deal? Will the Iranians
cheat and does the deal provide sufficient mechanisms for
monitoring? How will the United States and other nations react
if the Iranians are caught cheating? Thats the biggest question
mark.
Is a future president likely to use force? Or could the regime
be rebuilt a few years down the road? And regionally there is a
major concern about the impact on the politics of the region.
1

What will an unchanged Iran, with the influx of hundreds of

billions of dollars, do in places like Yemen, Syria, Lebanon and
Iraq?
There are very high emotions in the region and they are most
vociferously expressed by Benjamin Netanyahu, the prime
minister of Israel, who has made this his legacy project. He
is perfectly messianic about it, and is taking the fight to the
American domestic arena. Netanyahu needs to accept the deal
and try to improve relations with the United States, primarily to
negotiate with them on a defense package in coordination with
the view of what happens in the region.
But Netanyahu will likely continue to fight the president.
He does not want to settle, at this point, on a package of
compensation because he thinks this is a bad deal. He is
banking on having a Republican victory in the 2016 elections.
In the region itself, its not going to be the sole issue. As we go
around to the different countries, the conflict continues in each
of them in a different way. The Iranian deal, and reinforcements
of Irans influence, is just going to exacerbate these conflicts,
so we should anticipate a very active and tense period in the
Middle East itself.
Bruce Jentleson, former senior advisor to the U.S. State
Department policy planning director, noted that when the
United States had the arms control agreements with the Soviet
Union, there was a full and serious debate in Congress; and its
important that there be a constructive debate on Iran. The two
lines of debate on the Iranian deal are: were the concessions
made by Iran sufficient? And even if they are deemed sufficient,
will they be verified and enforced?
On this second question, many technical experts disagree.
While its prudent to anticipate some cheating, U.S. secretary of
energy Ernest Moniz, himself a distinguished nuclear scientist,
has basically said that while we wont find everything, we
believe we can find efforts that would have the most likely effect
on Iran making serious progress to nuclear weapons.
The sanctions are multi-faceted from a business perspective;
the U.S. sanctions are falling into two categories. Primary
sanctions, which affect U.S. companies and U.S. citizens, arent
really being affected by the terms of the agreement largely
until we get past Congressional action. Secondary sanctions,
which are largely extraterritorial, apply to non-U.S. persons and
companies through the use of financial transactions involving
the dollar and certain licensing of U.S. technology. These are
being more extensively loosened.
From a business perspective, weve already seen the Europeans
shifting to Iran. The French foreign minister was there this week
and there was a German delegation there a couple of weeks
ago. Germans have more than 2 billion euros in exports and
believe they can double them fairly quickly.

The demographics in Iran are pretty interesting with about 60

percent of the 70+ million population under the age of 30; a
society which in its own way has secular elements, the highest
levels of literacy in the region other than Israel, and some sense
that some of their policies may not be serving their interests as
much as they once thought. The president opened the door on
the possibility of broader changes in relations. For example, he
said that Iran should be part of the conversation on Syria, which
is very different than the U.S. position a year and a half ago.
So, there is risk in being both taken advantage of, giving up too
much too quickly with too little in return, and there is also risk in
not taking advantage of an opportunity and doing too little too
slowly and having a possible window of opportunity for major
change close. We dont know, but its important that people
assess the risks on both sides and make their own judgment.
There is not just risk on one side.
Lalit Mansingh, former ambassador of India to the United
States, commented that India welcomes the agreement.
India has been working behind the scenes trying to persuade
Americans and Iranians to put a deal in place. Prime Minister
Modi invited President Rouhani to visit India, and India expects
that once the sanctions are lifted there will be much closer
commercial ties with the Iranians.
At one time India received 20 percent of its oil from the Iranians,
and that has dwindled because of the sanctions. Now India is
embarking on a phase of close economic cooperation with Iran,
particularly building a route through Iran through the Chabahar
Port to Central Asia, which will bypass Pakistan.
Mamoon Sbeih, managing director of APCO in the Middle East,
said that the Iran deal is the key topic in the Gulf; and while
there seems to be a single voice on the issue of the deal with
Iran, in reality the attitude is quite different. Saudi Arabia is
probably as opposed to the deal as Israel and Egypt, and they
are very vocal about it. They believe this will strengthen Irans
hand and it has nothing to do with the nuclear aspect.
That is the biggest issue in the Middle East and the biggest
concern the Saudis have raised. So in a sense, there is a lot of
dissatisfaction with Irans attitude towards the region and the
opposition to the deal has a lot to do with that.
Key takeaways:
1. The deal is not as bad as some of the critics make it out to
be and it is not as great as the U.S. administration claims.
2. There is risk in giving up too much too quickly with too little
in return, and in not taking advantage of an opportunity
and doing too little too slowly and having a possible
window of opportunity for major change close.
3. The biggest issue in the Middle East is the dissatisfaction
with Irans attitude towards the region.
4. There is an opportunity for those businesses who carefully
look at the sanctions and identify what is allowed or not in
considering this new market as it is opening up.
Driving Global Dialogue
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