A new nuclear deal?

French President Emmanuel Macron and his US counterpart Donald Trump have floated the idea that the present Iran nuclear deal could be replaced with an entirely new one.

Background

Iran’s current nuclear program involves several research sites, two uranium mines, a research reactor, and uranium processing facilities. The country ratified the Non-Proliferation Treaty in 1970. Thus, its nuclear program has to be subject to International Atomic Energy Agency (IAEA) verification.

In the 2000s, reports began emerging on Iran running a uranium enrichment program in secret.  An investigation by the IAEA revealed that Iran had not declared a number of its nuclear activities to the group. Thus, the nation was subjected to multiple harsh sanctions from the international community. This has cost the nation billions of dollars (estimated $100 billion in oil revenues alone till 2015). It has also lost out on foreign direct investment.

On 2 April 2015, the P5+1 and Iran reached a provisional agreement that sought to lift most of the sanctions in exchange for limits on Iran's nuclear programs extending for at least ten years. When the International Atomic Energy Agency (IAEA) certified that Iran had restricted its sensitive nuclear activities, the UN sanctions were lifted on January 16, 2016. In turn Iran agreed to give up the means to make nuclear weapons.

Under the agreement, these were some of the terms that the parties agreed to:

• Lift all sanctions within 4 to 12 months of a final accord.
• Develop a mechanism to restore old sanctions if Iran fails to comply as per IAEA reports and inspection.
• The EU will remove energy and banking sanctions.
• The United States will remove sanctions against domestic and foreign companies who do business with Iran.
• All UN resolutions sanctioning Iran will be annulled.
• All UN-related sanctions will be dismantled.

Analysis

US President Trump refused to certify Iran’s compliance with the deal in October last year. He directed his administration to “address the deal’s many flaws so that the Iranian regime can never threaten the world with nuclear weapons.” Additionally, in January this year, Trump announced that he would extend the waiver of sanctions until Europe and the US could fix the deal. Washington hopes for the European allies to commit to improving the deal by May, in return for which it would renew sanctions relief.

Most European nations have been staunch supporters of continuing the deal. In April 2018, French President Macron met with Trump in a bid to persuade him in favor of the deal.  Now, in a move, that has reportedly surprised European allies, he has floated the idea of an entirely new Iran deal. Trump himself confirmed this new proposal noting that there is a possibility of "doing a much bigger, maybe, deal".

As the May 12^th deadline approaches, Trump spoke of the European signatories of the deal noting that “we could at least have an agreement among ourselves fairly quickly”. “I think we are fairly close to understanding each other,” he said.

“The discussions we have had together make it possible . . . to pave the way for a new agreement,” Mr Macron said. “I constantly said that we needed to find a framework so that together, with the powers of the region and the Iranian leaders, [we can] find a deal.” One of the biggest problems that Trump has voiced with regards to the deal is the so-called sunset clause. It allows Tehran to resume its nuclear activity from 2025. “They restart their nuclear programme — they will have bigger problems than they’ve ever had before,” the president told reporters as he sat beside Macron at the White House. “They’re not going to be restarting.” 

German Chancellor Angela Merkel will likely speak in favor of the deal when she arrives in Washington later in the week. However, the outcome remains bleak. “The decision to leave is pretty much made,” said a person familiar with the administration's thinking on Iran to CNN.

Counterpoint

In December 2017, Mohammad Javad Zarif, Minister of Foreign Affairs spoke at length about the nucelar deal and its necessity. He said that the reason why the present deal worked was that no singular party was entirely happy with outcome including Iran. He noted, “The nuclear deal was achieved that all of us understood that we could not have everything we want. I can tell you for sure that this deal is not what I want. And I can tell you for sure that this deal is not what John Kelly wants. Nor is it what other participants wanted. And that’s the beauty of the deal because it’s not what we wanted. It’s what we could achieve.”

More recently, Zarif has warned that if the US were to pull out from the deal, Tehran would immediately re-start its programme to enrich uranium, which can produce both nuclear fuel and weapons-grade material. “I am telling those in the White House that, whether they are loyal to their commitment or not, Iran’s great nation and government will firmly stand against any conspiracy,” Iranian president Hassan Rouhani told a cheering crowd of thousands gathered in the Iranian city of Tabriz on Tuesday. “If anyone betrays the deal, they should know that they would face severe consequences. Iran is prepared for all possible situations.”

Assessment

Our assessment is that this is French President Macron’s last ditch effort to salvage the 2015 nuclear deal. His approval ratings have continued to dip well below 50% in the recent months and he might be looking for an easy win internationally. However, the US President is in a precarious position. He has long advocated against the present deal and a number of his supporters are pro-Israel and anti-Iran. In addition, his new National Security Advisory John Bolton has also advocated against the deal. Iran for its part has maintained that it would resume its nuclear programme if the US withdraws and that is an outcome that Europe will wish to avoid at all costs. There are also additional concerns that Iran will not be willing to engage in any discussions regarding a new deal. Some critics have pointed out that if Iran cannot trust the US with upholding its end of the agreement, then it would not trust the US to enter any new agreements.