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Nuclear agreement with Iran: consequences of the rupture

Nuclear agreement with Iran

The arrival of Donald Trump to the White House in January 2017 was a major setback to the melting of relations between the United States and Iran , which had begun after the signing of the international agreement on the Iranian nuclear program reached in Vienna on the 14th. July 2015 and internationally known as the Joint and Complete Action Plan (JCPOA). After signing the agreement for Barack Obama, the US Congress maintained a decision quota on the same, as a supervision, and passed a law – Nuclear Agreement with Iran Review Act, or INARA, which requires the president to certify every 90 days that the Persian country is fulfilling the agreement.

Iran then pledged not to produce highly enriched uranium for the next 15 years, to get rid of 98% of its nuclear material, to eliminate two thirds of the centrifuges it had installed, to keep a limited number of tons of heavy water, as well as to allow, for the first time, that international inspectors could enter their nuclear facilities to control their degree of compliance.

 

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Source: Stratfor

 

In return, the international community eliminated some of the sanctions that hung over the country. It was granted access to the 100 billion dollars it owns in banks in China, Japan and South Korea, and the limitations imposed on the Central Bank and the state oil company were lifted, which meant immediate access to more than 50,000 million dollars. dollars of frozen assets. In addition, the European Union withdrew its financial sanctions related to nuclear technology, on transfers, insurance, trade financing, oil and gas, and initiated a commercial campaign in the country.

The nuclear agreement was applauded by the international community and considered a milestone of multilateralism. For the first time in almost forty years, two bitter enemies shook hands and granted a truce. To make matters worse, that pact was endorsed by five other international powers, in addition to the US: Russia, France, China, Germany and the United Kingdom.

 

Economy and oil

However, the break of the pact by the Trump administration has been a turning point in the development of the JCPOA and the return to the dialectical confrontation between the two powers. In fact, the economic battle to which both countries are heading is one of the first consequences of the breakdown of the agreement. The reimposition of economic sanctions against the Persian country by the US is one of the first measures announced by Trump, which has also directly threatened European companies that continue to operate in Iran, in order to keep them within their sphere of influence.

Although the consequence – until the moment – more visible has been the increase in the price of a barrel of oil . In fact, after hearing the decision of the US president, the price of a barrel of Brent shot up to reach 80 euros. But how could the US benefit from an increase in the price of crude oil at this time? It turns out that the rising cost of oil favors to the producing countries, as is the case of the US, and to the companies in the sector. On the other hand, Saudi Arabia, regional ally of the Trump administration, it is convenient this price increase, as its state oil company Aramco prepares its IPO and clearly wishes that the trend remains on the rise, as this would facilitate its incorporation – presumably to the New York Stock Exchange – on the financial gaming board. Aramco plans to sell 5% of its shares, which would make it the largest initial public offering in history.

 

Smash the Near East Hornet’s Nest

Trump’s decision is wreaking havoc in an already convulsive region. With it, the US confirms its silent withdrawal from the issues that tie it directly to the Middle East to focus on its pivot towards Asia-Pacific, while showing unconditional support for Israel and Saudi Arabia, direct enemies of the ayatollahs and with those who rival for the control and hegemony of the Fertile Crescent. A few days after the ratification of the agreement, the Israeli Prime Minister, Benjamin Netanyahu, He denounced that Iran had a supposed secret atomic program and based that accusation on more than 100,000 files compiled by Israel’s intelligence services, the Mosad, which served as an excuse for Trump to back his decision to break the agreement and raise the tension regional.

Iran, for its part, is not intimidated and turns its gaze towards the main US partner in the region, Israel. Supported by its military strength – the country that devotes 5% of its GDP to the development of the defense industry, three points more than the commitment that the NATO states have achieved by the year 2024 – Iran gains influence and support in Near East and for weeks it has maintained with Israel a tense dialectic and even exchanges blows in the Golan Heights, one of the hottest areas of the region.

Meanwhile, the International Atomic Energy Agency(IAEA), whose members are responsible for visiting and checking the Iranian nuclear facilities to verify if the Persian country is complying or not with the JCPOA, maintains that Iran is sticking to the agreement in Vienna and that, in addition, it is subject of the “most demanding verification regime in the world”. The IAEA authorities do not doubt Iran’s willingness to stay on the right track. In fact, in their last report, dated September 2017, the international inspectors endorsed that Iran’s enriched uranium inventory has remained within the agreed limits and that the amount of heavy water remained at 111 tons, below the red line of the 130 tons established in the agreement. In that same report it says, in addition, that the inspectors were able to access all the required Iranian nuclear facilities without problems, that they provided them with all the information they requested, provided them with adequate facilities to carry out their work and that they were able to use the electronic means of surveillance provided for in the agreement. “The verification and supervision tasks are carried out impartially and objectively, in accordance with the specifications agreed upon in the JCPOA,” said the head of the OEIA,Tero Varjoranta,who resigned from his post only three days after announcing the break of the pact.

 

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Source: Statista

 

Internal problems in Iran and European aid

The withdrawal of the US has given wings to the radical Islamists, who remember the president of the country, Hasan Rohani -progressist- , who were the ones who warned the executive when negotiating about any kind of rapprochement with Washington. Since the announcement of the departure of the US from the JCPOA, there have been several protests that have been organized in front of the US embassy in Tehran, as well as numerous images issued in which the slogan “death to America” ​​and the burning of flags moved to 1979. Meanwhile, the Iranian government persuades and trusts the diligence of European countries.

In a show of support for the JCPOA, the High Representative of the European Union, Federica Mogherini,traveled during the second week of November to the US to try to reconsider Trump’s position and try to save the agreement. “We want the US to continue its implementation in the future. The EU has a security interest in keeping the agreement going, “Mogherini said at the time.

Despite the development of the events and the pressure generated, Mogherini has not changed his opinion: “The agreement is crucial for the security of the region, of Europe and of the whole world.” It should not be forgotten that in 2017 the EU exported goods worth 11 billion euros to Iran and that imports reached 10,000 million euros. These figures represent 0.6% of total EU trade and 6% of Iranian trade.

In addition, the agreement with Iran has been presented to the international community, from the beginning, as one of the great successes of European foreign policy. Given the withdrawal of the US from the negotiating table, it is the Union that assumes the leadership of the JCPOA supported by Russian President Vladimir Putin, who has skillfully taken advantage of the absence of his direct rival to fill its vacuum.

For his part, the head of Iranian diplomacy, Mohammad Javad Zarif, this week began a round of visits to their European counterparts – French, German and British – as well as the EU High Representative, in order to save the nuclear agreement. Many cross their fingers to make it successful.

-BEATRIZ YUBERO

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