Euromoney Conference Highlights Different Paths Europe Can Take on Iran Policy

Thursday marked the second annual Euromoney Conference in Paris, which was attended by an Iranian delegation headed by Deputy Foreign Minister Abbas Araqchi. Earlier in the week, Iranian state media touted Araqchi’s planned trip and said that the conference would showcase the “vast economic opportunities” available to European investors in the Islamic Republic.

In other words, the event promised to help Tehran push back against pressure from the White House and other critics of the Iranian regime who are trying to forestall European investments and make them conditional upon new agreements over Iran’s behavior in such areas as human rights, regional interference, and missile activities.

During and after the conference, statements from Iranian officials have expanded upon the sentiments expressed by state media. UPI highlighted this trend in a report focused on officials from the Iranian Central Bank, who teased the country’s plans to develop non-oil sectors of its economy and to reintegrate into the global banking system. The bank’s governor, Valiollah Seif, was quoted as saying that those efforts had been bolstered by a number of financial agreements that had been struck with “partners from China to Denmark” in the time since nuclear negotiations between Iran and six world powers concluded in July 2015.

While it is certainly true that various European entities have actively pursued an expansion in trade relations with the Islamic Republic during that time, it is also true that U.S. pressure and Iran’s own failure to come into line with international standards have slowed the pace of that expansion and have generally prevented the provision of financing by banks that also have ties to American markets.

Europe has responded to this situation in two contrasting ways. In the first place, various leading policymakers have shown an interest in resolving the problems that the U.S. president and American lawmakers see in the 2015 nuclear deal. While still defending that agreement, the leadership of Britain, France, and Germany has gradually strengthened their positions on Iran policy, acknowledging the need for action to restrict the Iranian ballistic missile program that was not addressed by the JCPOA.

If such action succeeds in assuaging American anxiety, it can be expected to mitigate the White House’s lingering threats to the very survival of the nuclear deal. Last month, U.S. President Donald Trump cautioned that it was the last time he would do so unless the U.S. Congress and its European partners agreed on supplementary agreements that would strengthen the nuclear deal to his satisfaction. This January 13 announced effectively set a deadline of 120 days for Europe to either win over the Trump administration or find workarounds for the threat of re-imposed sanctions.

The latter option speaks to the second trend that Europe has put on display in the face of these threats, and it was these that appeared to be the focus of reporting on the Euromoney Conference. Iran’s English-language propaganda network Press TV boasted of relevant remarks that had been made on the sidelines of that conference by Denis Chaibi, the head of a European Union task force on Iran. Chaibi discussed the possibility of Europe imposing “blocking regulations” that would theoretically allow companies to do business in the Islamic Republic without making themselves subject to sanctions enforcement in the event that the U.S. decides to pull out of the JCPOA.

This possibility had already been discussed in the global media, but the Euromoney Conference arguably brought it much closer to the realm of actual policy. Chaibi also reportedly touted the relative ease with which that policy could be implemented.

“It is not complicated to do it legally in that the legal instrument exists, but it doesn’t require a huge internal debate,” he said, referring to provisions that had been put into place in 1996 to deal with the effects of U.S. sanctions on Cuba.

Those same measures could now be adapted to the present case to help facilitate trade with Iran over American objections. It is not yet clear whether Europe is prepared to actually take this route. For the time being, the EU’s efforts seem to be focused on resolving its own support of the JCPOA with the justifications provided by the White House for its opposition to the same agreement. But it remains possible that this reconciliation will prove unattainable, in which case Europe will be placed in the position of either begrudgingly following America’s lead or else openly defying the U.S.

The Euromoney Conference and the remarks from figures like Chaibi have evidently inspired new Iranian confidence in the attainability of the latter alternative, and Iranian officials could be observed trying to derive leverage from the discord over the JCPOA on Thursday and Friday. EA Worldview quoted one advisor to Supreme Leader Ali Khamenei, for instance, as rejecting the notion of further negotiations over the Iranian nuclear program, missile activities, and other matters. “In the nuclear deal, they have shown themselves as dishonest, so what is the use of new talks anyway?”

Meanwhile, Reuters noted that Abbas Araqchi, the leader of the leader of the Iranian delegation to the Paris Conference, had sought to undercut some of the White House’s apparent belief that working with Europe to strengthen the JCPOA would result in the reduction of Iranian threats to regional peace and stability.

“There is no link between the [nuclear] deal and our role in the region. Make the [deal] a successful experience and then we discuss other issues,” Araqchi said.

The Iran Project frame this quotation in a way that suggested Tehran was showing willingness to have such broader discussions with the international community, but it seems clear that Araqchi’s short-term aims are focused on mitigating U.S. pressure while discouraging European policymakers from buying into an assertive Iran policy.

While those talks were still ongoing, Iranian Supreme Leader Ali Khamenei ordered his subordinates to continue avoiding talks with the West over any issues other than the nuclear program. And subsequently, Khamenei has led the way in attempting to place blame exclusively on the U.S. for the relative lack of economic and diplomatic gains for Iran.

These narratives continue to be invoked to the present day, with participation from the supposedly moderate Iranian presidential administration that is supposed to be a political counterpoint to Khamenei. Hassan Rouhani used a press conference earlier in the week to once again reiterate Tehran’s rejection of any prospective negotiations over the country’s missile program.

“The key to the problems between Tehran and Washington is in Washington’s hands. They need to stop their threats and sanctions and pressure, and automatically the situation will improve and we can think about our future.” Rouhani said in the same speech.

Such comments reflect Tehran’s tendency to blame American pressure for the slow pace of Iran’s economic recovery while ignoring such elements as Iran’s non-conformity with the anti-money laundering standards of the Financial Action Task Force. And insofar as these sentiments are being repeated against the backdrop of events like the Euromoney Conference, it is fair to say that Tehran is working to convince the European Union to adopt similar positions.

On Thursday, the Fair Observer published an article that made the case for Western policymakers using the JCPOA as “both a carrot and a stick” in order to curb Iranian activities in areas outside the nuclear sphere. The article also highlighted recent popular protests in the Islamic Republic as catalysts for this opportunity, noting that the unrest exposed the desperate need for the Rouhani government to show economic gains for ordinary Iranians now that the nuclear agreement is two years old.

Notwithstanding the boastful claims made in recent days by Central Bank officials and other Iranian entities, such economic gains remain dependent on the survival of the JCPOA, and this, in turn, remains dependent on the collective will of European leaders. In light of the Euromoney Conference, the question at the forefront of this issue is whether Tehran is willing to gamble on the possibility of European defiance of the United States, or whether it would prefer to negotiate with the West in order to guarantee that the nuclear deal remains in force.