The Secrets of 'JCPOA 2'

'The Joint Comprehensive Plan of Action' (JCPOA), which last July allowed Hassan Rouhani's government to extricate the country from the dangerous crisis stemming from the nuclear file, has introduced a new concept into the political lexicon of the Islamic Republic that is increasingly utilized in the struggle among political factions. The discussion revolves around 'JCPOA 2', which, through sentences filled with codes and metaphors, showcases the growing disagreements within Iran's ruling system regarding the country's economic policies and international relations. The emergence and application of 'JCPOA 2' in Iran's political and economic scene can be summarized as follows: 1) On February 3 of last year, during the 'Space Technology Day' ceremony, Hassan Rouhani, after listing the damages inflicted on the economy by sanctions and his government's efforts to achieve the 'Joint Comprehensive Plan of Action', stated: 'We have passed JCPOA 1, and today we must start JCPOA 2, and everyone, including supporters and critics of the government, must join hands because we have no disagreement in national goals and the development of the country.' His continued remarks indicate that the concept of 'JCPOA 2', from his perspective, pertains to solving economic problems, especially through changes in the country's international policies, as he states, 'We are seeking economic prosperity and employment, and we have no disagreement in this regard, and in my opinion, we must interact with the world.' 2) In his Nowruz message this year, Hassan Rouhani again employed the concept of 'JCPOA 2' in relation to the necessity of extricating the country from economic difficulties, saying: 'We can achieve a 5% growth through collective effort, growth that will hopefully be greater than all our neighboring countries. Growth that can create economic prosperity and bring our unemployed workers back to factories and farms. Growth that can attract our dear graduates to economic enterprises. What is important for our nation is sustainable employment, and this work will hopefully begin next year (1395) with JCPOA 2.' 3) The use of the concept 'JCPOA 2' faced negative reactions from Ayatollah Khamenei, the leader of the Islamic Republic. In his speech on the first day of the New Year at the shrine of the eighth Shiite Imam, he stated: 'Some say that just as the nuclear agreement was named JCPOA, discussions with the U.S. on other matters could be... JCPOAs 2, 3, and 4, so that through these discussions and agreements, people can live comfortably and their problems can be solved.' Ayatollah Khamenei described this thinking as 'dangerous' because, according to him, it would lead Iran to abandon its support for the peoples of Palestine, Yemen, and Bahrain in its pursuit of rapprochement with the U.S. 4) Khamenei's stance on the concept of 'JCPOA 2' has provided a new ground for fresh attacks against Hassan Rouhani's government. The latest example of this can be found in the remarks made by Ayatollah Ahmad Khatami during the Friday prayer on April 6. He stated that since the inception of the Islamic Republic, there have always been two thoughts within the system. According to the first thought, the Iranian government is like other governments in the world, while the second thought considers this government, due to its Islamic nature, to be different from other governments. Ahmad Khatami deemed the term 'JCPOA 2' as a product of the first thought and added: 'In this view, all hopes are pinned on the West, and it is implied that if JCPOA is resolved, the country will become a paradise, and a great victory will have been achieved, and now that this candy seems to have a great taste, they talk about JCPOAs 1, 2, and 3.' Understanding the concept of 'JCPOA 2' is fundamentally important for grasping the intellectual transformations and gradual changes in the balance of power within the Islamic Republic. On one side, there are movements that see the survival of the regime in its 'exceptional' nature and its insistence on the principles governing the Islamic Revolution, while on the other side, there are tendencies that, while declaring their deep attachment to the regime born from the revolution, demand 'interaction with the world' and believe that without rebuilding bridges of communication between Iran and the global community, especially with powerful industrial and commercial poles in the West, it is impossible to end the country's enormous economic difficulties. To better understand the fundamental differences between these two policies and their impact on the internal and international political and economic landscape of Iran, the following points can be emphasized: a) The conflict between the two policies is not new, and to trace its roots, even if we do not go back to the revolution and the early years of the regime that emerged from it, we can at least emphasize the elements and factors that, after the end of the Iran-Iraq war, laid the groundwork for a clear delineation between the two major tendencies of supporters and opponents of 'internal adjustment' and 'external interaction.' With the onset of Hashemi Rafsanjani's presidency, a significant part of the nascent technocracy of the Islamic Republic, influenced by the waves of economic liberalization in the world, turned to the policies known as 'economic adjustment', ranging from downsizing the government to creating favorable conditions for business and individual initiatives, strengthening budget discipline along with optimal allocation of public spending, implementing tax reforms, ensuring and reinforcing security for private ownership, privatizing state-owned production units, liberalizing the capital market, unifying the currency rate, liberalizing commercial transactions, removing obstacles to foreign investment, etc. The success of 'internal adjustment' depended on the 'external interaction' policy, especially through advancing an 'economic diplomacy' aimed at utilizing cooperation with Europe and Japan and paving the way for normalizing relations with the U.S. as a long-term goal. The strategy aimed at modernizing Iran's economy and gradually 'normalizing' the country's position in the international relations system faced strong reactions from Ayatollah Khamenei and a set of tendencies that later gathered under the banner of 'principlists.' This strategy effectively faltered during Rafsanjani's second term before re-emerging in a new form during Mohammad Khatami's presidency, achieving even relative successes in both domestic (including within the framework of the third plan) and international arenas. With Mahmoud Ahmadinejad's rise to power, the offices of 'adjustment' and 'interaction' were closed, and Ayatollah Khamenei officially announced his 'closeness' to the policies of the ninth and tenth governments. Between 2005 and 2013, the president, with the support of the leadership of the regime, abandoned even the slow-moving reforms of the previous era and turned to what was termed 'justice-oriented economy' with an 'anti-capitalist' stance domestically and an 'anti-imperialist' stance externally. The record of this policy is before us, from the collapse of the country's management system to the dizzying rise in inflation, falling growth rates, and the heavy losses inflicted on the country due to sanctions. b) With Hassan Rouhani's victory in the 2013 presidential elections, supported by Akbar Hashemi Rafsanjani and Mohammad Khatami, the architects of the 'internal adjustment' and 'external interaction' policy once again took the helm of the Islamic regime's executive apparatus. In both areas, the contradiction between the leadership's positions and the executive apparatus resurfaced, except in the case of efforts to resolve the nuclear issue and end sanctions. In fact, Ayatollah Khamenei himself, along with a broad segment of the faction known as 'principlists,' had come to the conclusion that insisting on Iran's positions regarding the nuclear issue could jeopardize the regime's survival. With the green light from the office of the Supreme Leader, Hassan Rouhani and Iran's nuclear negotiating team were able to pave the way for achieving the 'JCPOA' to lift economic sanctions against Iran. In return, in other areas of domestic and international policy, especially in economic arenas, Hassan Rouhani's maneuvering space is very limited, and a large part of the president's initiatives is thwarted by obstacles arising from the opposition of the leadership apparatus and very powerful centers of power that lie outside the executive apparatus's authority. The two short-term policy packages that the eleventh government's economic team presented to extricate the country from severe recession in July 2014 and October 2015, despite the noise they created, were largely stalled amid the tedious conflicts between the parliament and the government. The sixth five-year plan bill, which was supposed to be the guiding document for Iran's long-term economic policy, was returned to the government due to the ninth parliament's opposition. Overall, if we set aside the relative decrease in the inflation rate, Hassan Rouhani's record is not very defensible, and as his government approaches the end of its four-year term, Iran is experiencing one of the worst economic recessions in its contemporary history. Even if, for temporary reasons, especially the results of lifting sanctions, the growth rate in 1395 improves as expected, its sustainability in subsequent years, given the multitude of structural problems facing Iran's economy, remains highly questionable. The treasury of the Islamic Republic is severely empty, the country's banking system is struggling in an unprecedented crisis, corruption is rampant, waves of newly unemployed are on the way, and a very large portion of the country's industrial units, which are still standing, operate at less than fifty percent capacity. In such an environment, Hassan Rouhani has introduced the concept of 'JCPOA 2.' The president and his advisors aim to convey several major messages to the country with this concept: 1) In the nuclear negotiations, which successfully led to the 'JCPOA', all factions of the regime acted somewhat united. This unity was particularly displayed when the responsibility for the nuclear negotiations was transferred from the 'Supreme National Security Council' to the Ministry of Foreign Affairs of the Islamic Republic, assuring Iran's interlocutors in the group known as 'P5+1' that a professional team backed by all political power structures in the country was conducting the negotiations. The 'JCPOA' was the result of this event. 2) Contrary to what transpired in the nuclear negotiations, Iran's economic policy arena is a field of endless conflicts that obstructs any initiative. The eleventh government has its economic programs, the main goal of which is to extricate the country from the grip of a heavily state-controlled and oil-dependent economy. Rebuilding this economy is impossible without establishing normal relations with the world. Iran cannot overcome its multitude of economic and social problems unless it becomes a regular member of the international economic community. 3) Amid the uproar surrounding the 'resistance economy' proposed by Ayatollah Khamenei and his emphasis on the necessity of maintaining the exceptional and revolutionary nature of Iran, it is unclear who is responsible for the country's economic policymaking and who is steering the country's economy. In this situation, neither Iran's business circles can identify the priorities of the country's policy nor can international economic circles. 4) From Hassan Rouhani and his team's perspective, 'JCPOA 2' means that the agreement governing the acceptance of nuclear negotiations and their advancement to completion should be repeated this time in the realm of the country's economic policies. From the viewpoint of the president's supporters, if this agreement is not reached, preparing short-term, medium-term, and long-term plans and holding dozens of economic seminars for the country will yield results as fruitless as 'pounding water in a mortar and hiding sugar under the water.'