On July 15th 2015, the Joint Comprehensive Plan of Action (JCPOA), more commonly known as the Iran nuclear deal, was signed between Iran, the European Union and the P5+1 states, the permanent members of the United Nations Security Council (UNSC) and Germany. This agreement, implemented on January 16th 2016, is the result of more than 12 years of negotiations during which Iran was subjected to several rounds of sanctions, severely impacting its economy. The terms agreed upon deter the development of a nuclear weapons program in Iran for the next 15 years by reconverting nuclear facilities, limiting uranium enrichment and enforcing intrusive inspections.

More than one year has passed since the JCPOA was signed on July 14th last year and many have been keen to draw up an assessment of the situation in Iran, both economically and politically, as well as considering to what extent Iran has kept its word on the nuclear front. Reviews so far have been mixed, taking into account the existing diverse range of views on Iran and the deal itself which has divided scholars, academics and the public itself for years. Critics and advocates have so far agreed that Iran has respected most of the terms of the agreement relating to nuclear matters. Other elements however remain contentious: economic benefits (or lack thereof), non-nuclear missile testing, the enforcement mechanisms and Western reticence to do business with Iran for instance.
When looking at the Iranian economy one year later, results may not be very encouraging. Economic growth recorded as only 0.5% between March 2015 and March 2016, according to the World Bank is still small, but given the incremental lifting of sanctions since January this is not very surprising. This has however impacted the Iranians’ perceptions of the agreement which was illustrated in a recent poll, noting a decline in support for the deal by Iranians who cited noticeable lack of improvements and the impression that the United States are persistently blocking the sanctions relief as some of their main reasons for feeling disillusioned. Many had been expecting immediate benefits following the lifting of sanctions, but this would underestimate other factors which impact growth such as low oil prices, corruption, mismanagement and the duality of Iranian domestic politics which constantly opposes hard-liners and reformers. These various issues have discouraged Western long-term investment in the country so far and European banks have been hesitant to let Iran access credit[1]. Furthermore, the sanctions that were indeed lifted following the implementation of the JCPOA do not include sanctions that are still in place related to terrorism and human rights violations.

When looking at how the conditions of the deal itself are respected, the latest International Atomic Energy Agency (IAEA) reports have noted that Iran is on track and on schedule when it comes to the verification of activities related to heavy water and reprocessing, enrichment and fuel, as well as transparency measures[2]. IAEA reports following the implementation have however been criticized by some states as being shorter and much less detailed than before the agreement, a reflection perhaps of the confidentiality provision included in the deal but resulting in less public visibility when the agreement intended to promote better transparency[3]. The fact that Iran has so far respected its end of the deal is good news but the efficiency of certain aspects of the deal itself still remain to be certified – notably the enforcement mechanisms, the dispute resolution mechanisms and the use of the procurement channel. The latter is a particular element which might deserve some closer attention in the future but has so far remained under the radar. The Procurement Working Group is the mechanism set in place to evaluate proposals by states who want to engage in activities related to the supply, sale or transfer of nuclear and dual-use items with Iran[4]. So far it has apparently only seen one proposal which was later withdrawn. When, in which way and how often this mechanism will be used remains to be seen, and its efficiency to be tested.

zarif-and-kerry-nuclera

A July report by the UNSC has also praised the positive developments since Implementation Day while noting concern for the following: the ballistic missile launches conducted by Iran, the seizure of an arms shipment by the US suspected of originating from Iran, and the participation of Iran in the Fifth Iraq Defence Exhibition without prior approval[5]. The missile launches highlight some confusion regarding the wording of UNSC resolution 2231 which mentions ‘ballistic missiles designed to be capable of delivering nuclear weapons’, a distinction which Iran has used when justifying its actions by saying these missiles are not capable of delivering nuclear weapons. Moreover, the snapback provisions in the agreement do not apply to missile violations, meaning these are harder to enforce and according to the same UNSC report, there has been no consensus yet on how to resolve these issues related to perceived violations of missile-related provisions contained in the agreement.

The US and the EU have also not necessarily been the most proactive when dealing with their obligations under the JCPOA. In a speech at the UN General Assembly on September 22nd, President Hassan Rouhani has accused the US of ‘lack of compliance with the JCPOA’[6].For instance, the US is making it difficult for people who have travelled to Iran to obtain a visa, which qualifies as a discriminatory procedure under the JCPOA, and it has also seized from Iran’s Central Bank about US$ 1.7 billion worth of assets, an action which can be qualified as ‘inconsistent with the spirit of the JCPOA’[7].

iran-nuclear-deal-march-meeting-vienna-2016More than a year after the signing of the JCPOA, the deal seems to be on track. Some elements remain to be determined, such as the workings of the procurement channel and how all parties should be properly handling disagreements over smaller issues. The expected effects of the implementation of the deal are still only tentative and its scope remains limited. Although it can be seen as a cautious first step to improving Iran’s relations with the West, the development of many diplomatic and economic elements remain outside the scope of the agreement and will need to be cultivated separately.

[1] Khosrozadeh, Behrouz. “Iran: One Year after the Nuclear Deal.” The Diplomat, July 11 2016. http://thediplomat.com/2016/07/iran-one-year-after-the-nuclear-deal/

[2] International Atomic Energy Agency. “Verification and Monitoring in the Islamic Republic of Iran in light of United Nations Security Council Resolution 2231 (2015).” May 27, 2016. https://www.iaea.org/sites/default/files/16/06/gov2016-23.pdf

[3] Hibbs, Mark. “Vigorous Verification in Iran.” June 28, 2016. Carnegie Endowment for International Peace. http://carnegieendowment.org/2016/06/28/vigorous-verification-in-iran-pub-63946

[4] Lincy, Valerie. “The Iran Nuclear Agreement: What comes next?” Speech at Heritage Foundation April 21, 2016. http://www.iranwatch.org/our-publications/speeches-testimony/iran-nuclear-agreement-what-comes-next

[5] United Nations Security Council. “Report of the Secretary-General on the implementation of Security Council resolution 2231 (2015).” July 12, 2016. http://www.un.org/en/sc/2231/sg-reports.shtml

[6] Statement by H.E  Dr. Hassan Rouhani President of the Islamic Republic of Iran at the General Debate of the General Assembly of the United Nations. September 22nd 2016. https://gadebate.un.org/sites/default/files/gastatements/71/71_IR_en.pdf

[7] Idem

SHARE
Previous articleIran’s President Accuses U.S. of ‘Lack of Compliance’ on Nuclear Deal
Next articleIBC Threat Assessment September 2016
Névine Schepers is an analyst at IB Consultancy. She holds a Dual Masters' Degree in European and Asian Affairs from the universities of Sciences Po in Paris and Fudan in Shanghai, after having completed her Bachelor's Degree in Asian studies from the University of Sydney. Before joining IB Consultancy, Névine travelled extensively in Asia and conducted an internship at a French consultancy firm in Shanghai.