The JCPOA or a Major Misunderstanding

The comprehensive nuclear agreement between Iran and the group known as the "P5+1," which was signed on July 14, 2015, under the title "Joint Comprehensive Plan of Action" (JCPOA) in Vienna, has a significant presence in the twelfth presidential election of the Islamic Republic. Hassan Rouhani considers the signing and implementation of this agreement a major achievement, while his two main rivals, Ebrahim Raisi and Mohammad Baqer Qalibaf, point to its constraints and failures. Who is right? The green light from the Leader. None of Rouhani's rivals question the principle of the JCPOA or the necessity of respecting it. In the second presidential debate held on May 5, Ebrahim Raisi described the JCPOA as an agreement that, despite all its flaws, "as a national document, must be recognized by us and the opposing parties." Mr. Qalibaf also described the JCPOA as a document that "will be respected by all governments." In fact, spokespeople for the so-called "principlist" factions of the Islamic Republic have no choice but to recognize the essence of the JCPOA, simply because they know that without the green light from Ayatollah Khamenei, negotiations to lift sanctions related to the Islamic Republic's nuclear file would not have begun, and its step-by-step progress to the signing of the final agreement would not have continued. In other words, the JCPOA was primarily born out of the will of the Leader of the Revolution: this is an obvious reality for all those who understand the strategic decision-making mechanisms in the Islamic Republic, although the outcome of this decision-making is often wrapped in flattery and mysteries so that if the passage of time requires, it can be interpreted and reinterpreted in a new way, or even questioning it does not cause any problems. Here, it is not about belittling the role of Mr. Rouhani and Zarif in advancing nuclear talks. Without their bargaining power and the flexibility and skills they demonstrated during difficult negotiation stages, the path to reaching the final stage would undoubtedly have been longer and rockier. Nevertheless, it is clearer than the sun that to transition from each stage of negotiations to the next, Iranian diplomats in Vienna needed the "permission of the Leader's house." Various pieces of evidence indicate that Ayatollah Khamenei had concluded even before Hassan Rouhani's election as president that the Islamic Republic system, under the pressure of crippling economic sanctions, had reached the brink of unpredictable dangers and needed to avert the risk. This calculation was the beginning of a process that led to the conclusion of the JCPOA. To summarize: in the tumultuous negotiation process that culminated in the conclusion of the JCPOA, Ali Khamenei and Hassan Rouhani moved forward hand in hand. In other words, this agreement in its final form can be considered a joint product of the "leadership apparatus" and the "executive apparatus," although it should be repeated that the primary role in this regard was played by Ayatollah Khamenei. Two different assessments. However, after this joint product was created, the Leader of the Revolution and the head of the executive apparatus diverged in their assessments of its potential and prospects: 1) Ayatollah Khamenei sees the JCPOA as merely a document that the Islamic Republic was compelled to sign out of necessity to repel the damage from its enemies. From his perspective, the Vienna agreement is a manifestation of a "heroic flexibility" to fend off the deceit of "Western oppressors" and especially the "Great Satan." Woe to those who think that the Islamic Republic has become a normal system in the network of international relations by signing the JCPOA. Those who want to use the post-JCPOA atmosphere to disrupt the traditional positions of the system, both domestically and internationally, are misguided. In short, from the Leader's point of view, the Islamic Republic must remain as it was and only regain breathing space before sanctions at the cost of accepting minimal compromises based on the JCPOA. 2) Hassan Rouhani had a completely different assessment regarding the JCPOA and its prospects. The president believed that signing the Vienna agreement would mark the beginning of a new chapter in the Islamic Republic's international relations and could be used as a lever to "normalize" Iran's position in the global system. He and his close associates viewed this agreement as the beginning of reformative changes within the country, especially in economic structures, and spoke of the necessity to move towards "JCPOA 2." The argument was as follows: just as the consensus between the Leader of the Revolution and the head of the executive apparatus over ending sanctions led to "JCPOA 1," a new consensus between the same two figures over fundamental economic reforms could pave the way for "JCPOA 2" in service of the country's development. Hassan Rouhani and his associates, as well as their media arm, managed to convey their optimism about the JCPOA to a large segment of Iranian society. A significant portion of the business community and the middle class in large cities also placed great hope in the JCPOA and its outcomes. On the other hand, the eleventh government and its envoys succeeded in largely transmitting their optimistic assessment of the JCPOA to international economic circles. Many Western "Iran experts" also helped in instilling this optimism. The result was that large international companies, especially in Europe, concluded that with the Vienna agreement, a new Iran had emerged on the global stage. They compared the shift resulting from the JCPOA for the Islamic Republic to the changes in China after Mao and hoped that this eighty-million-strong country, with all its material and spiritual resources, would create a virgin market for investment and trade for Western companies by joining the process of "globalization." Today, more than fifteen months after the implementation of the JCPOA, Iranian society sees a large part of its hopes regarding this agreement dissipated. International circles also view the Iranian market as much more difficult than they had imagined. In fact, Western companies in Iran face obstacles such as heavy bureaucracy, an unfavorable business environment, a lack of transparency in the banking system, outdated foreign investment laws, and especially widespread corruption. However, the most significant difficulty in foreign trade with Iran lies in the rigid American laws that still block a very large part of the Islamic Republic's communication channels with the world under the framework of "primary sanctions." It should be noted that the JCPOA ended the American sanctions related to the Islamic Republic's nuclear file. In other words, the "secondary sanctions" or "JCPOA-related sanctions" have been lifted or are being lifted. In contrast, the "primary sanctions" imposed by the U.S. regarding issues such as "terrorism" or "money laundering" remain in place and obstruct the optimal utilization of the JCPOA by Hassan Rouhani's government. The most significant consequence of this situation is seen in the behavior of European banks. They withdraw from trading with Iran and refrain from financing trade and investment related to the Islamic Republic because they fear the heavy penalties imposed by the U.S. judicial system. Of course, non-American financial institutions can collaborate with Iran, provided that not a single dollar of U.S. currency is used in this collaboration, none of the American branches of these institutions participate in the transaction, and they ensure that they will not engage in transactions with any Iranian companies under special U.S. sanctions. Under these stringent conditions, large European banks are absolutely unwilling to take on the financing of trade with Iran. Additionally, Donald Trump's entry into the White House and his hardline approach towards the JCPOA and the Islamic Republic have also fueled uncertainties and made Western companies more cautious about entering the Iranian market. Why is this check not being cashed? The despair of Iranian society and international economic circles regarding the JCPOA and its outcomes is entirely understandable. Nevertheless, can one conclude that the JCPOA has been futile and has not changed anything in Iran's economic situation? Hassan Rouhani's rivals in television debates do not question the essence of the Vienna agreement (because they know this agreement was achieved with the Leader's green light), but they assess its outcome as "nothing." Ebrahim Raisi states, "The government is unable to cash the JCPOA check." In other words, Mr. Raisi accepts that the JCPOA has provided Iran with a check, but Hassan Rouhani's government lacks the capacity and authority to cash this check. In response to this criticism, two points can be emphasized: 1) To say that the JCPOA has brought no results for Iran's economy is completely baseless. Mr. Khamenei knows better than anyone what situation the country would have been in without this agreement. The most significant outcome of the JCPOA is the return of Iran's oil production and exports to pre-sanction levels. Among other achievements of this agreement, one can emphasize the return of some of Iran's frozen assets abroad, connecting Iran's banking network to SWIFT, opening several windows for Iran, including Rouhani's trips to France and Italy, signing agreements with several international companies such as Airbus and Boeing, and an increase in the number of tourists. 2) Nevertheless, it is true that a very large portion of the JCPOA's capacities remain unused. But who is to blame for this situation? We repeat that a major misunderstanding weighs heavily on the JCPOA and its capacities and consequences, which itself results from two different and even contradictory perspectives on this agreement. Ayatollah Khamenei sees the JCPOA as "minimal." Developing Iran based on foreign investment and international trade is not among his priorities. More importantly, Iran's opening could jeopardize the dogmas governing the foundation and survival of the Islamic Republic system. The mission of the JCPOA, from his perspective, has only been and remains to ensure that oil revenues flow back into the treasury of the Islamic Republic. And once this goal is achieved, the "system" repeats its usual positions: America and the West are Iran's enemies, Russia is the Islamic Republic's main ally, Israel must be destroyed, and Tehran's policies in "four capitals" (Beirut, Baghdad, Damascus, Sana'a) will continue as before. Can such words and actions turn a country into an attractive destination for international investors? Hassan Rouhani, however, had other demands regarding the JCPOA, the most important of which was to create "interaction" with the world. He was not oblivious to the weight of the "primary sanctions" and their negative impact on the implementation of the JCPOA, but he hoped that, with the signing of the Vienna agreement, the ground would be prepared for direct negotiations with Washington. He himself said, "We must talk to the big guy," because he knows that normalizing Iran's position in international relations depends on reducing tensions in Tehran-Washington relations. However, the Leader's house and the faction close to it have not refrained from any tricks to undermine the "big guy." The president bitterly remarked in the second television debate about the sabotage regarding the Vienna agreement: "They wrote slogans on missiles and showed an underground city to sabotage the JCPOA." The reference is to a phrase about destroying Israel that was written in Hebrew on an Iranian missile and its image circulated worldwide. We see that Hassan Rouhani's view of the JCPOA is not the same as Ayatollah Khamenei's. But in a republic based on the principle of absolute clerical authority, it is the Leader of the Revolution who has the final say.