Iran’s Raisi faces economic challenges while US speculates on sanctions

Iran's newly elected President Ebrahim Raisi speaks during his swearing-in ceremony at the Iranian parliament in the capital Tehran on Aug 5, 2021.
(ATTA KENARE / AFP)

Iran’s new president, Ebrahim Raisi, will look beyond any sanctions relief from the United States as he seeks to revive his nation’s economy, given that a quick breakthrough is unlikely in negotiations to salvage the US-damaged nuclear deal in view of the trust deficit between Teheran and Washington, experts said.

Kamaruzaman Bin Yusoff, a Middle East political analyst and former professor of Middle Eastern politics at the Universiti Teknologi Malaysia in Johor, said the important thing now is Raisi “has to do something to bring Iran’s economy back as usual”.

It seems that (Ebrahim Raisi) does not actually rely on the negotiation or on the deal to change the economic situation and he does not want to rely on the West because he does not trust the West.

Mahjoob Zweiri, Director of Gulf Studies at Qatar University

“I think that (Raisi) might be able to do something for the betterment of the people but I’m sure (he will) need some time. At least two to three years,” Yusoff said.

Following his inauguration on Aug 5, Raisi said Iran supports and welcomes any diplomatic proposal for the lifting of sanctions on his country, but said the country will continue to resist foreign bullying.

He said his foreign policy priority would be to improve relations with neighboring countries, while seeking an end to “illegal US sanctions”.

Elected president on June 18, Raisi was endorsed by Iran’s Supreme Leader Ayatollah Ali Khamenei on Aug 3. He faces a tough challenge in shoring up the economy, which has been battered by US sanctions and the coronavirus pandemic.

Mahjoob Zweiri, Director of Gulf Studies at Qatar University, noted that US President Joe Biden’s administration has expressed interest in going back to the nuclear deal, but he doubts Washington’s sincerity.

He believes there will be serious difficulties and obstacles in reaching a final deal and that it may take some time, given the new government in Iran.

“It seems that (Raisi) does not actually rely on the negotiation or on the deal to change the economic situation and he does not want to rely on the West because he does not trust the West,” Zweiri told China Daily.

Asif Shuja, an Iran expert and senior research fellow at the Middle East Institute of the National University of Singapore, or NUS, said Iran is at a “crucial juncture” — one, in which it has emerged as a predominant regional power, but simultaneously faces an insurmountable opposition to that stature from regional as well as global adversaries.

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In July 2015, a deal, known as the Joint Comprehensive Plan of Action, was reached between Iran and five United Nations’ Security Council members, including the United States. But in 2018, then US President Donald Trump withdrew from the deal after accusing Iran of failing to curb its nuclear aggression, and restored sanctions.

This handout photo taken and released on May 1, 2021 by the EU Delegation in Vienna shows delegation members from the parties to the Iran nuclear deal – Germany, France, Britain, China, Russia and Iran – attending a meeting at the Grand Hotel of Vienna as they try to restore the deal. (PHOTO HANDOUT/ EU DELEGATION IN VIENNA / AFP

Negotiations have been taking place in Vienna since April this year between Iran and other signatories of the nuclear pact in an effort to revive the deal, which could potentially pave way for lifting of sanctions.

For its survival, Iran needs to sell its oil, which is transferred through tankers, Asif Shuja, an Iran expert and senior research fellow at the Middle East Institute of the National University of Singapore

The indirect negotiations with the US reached their sixth round in June, but have been stalled since.

Khamenei has called the US “stubborn” for discussing Tehran’s missiles and regional influence, and has accused the West of being unhelpful and “hitting wherever they can”.

“Iran’s economic woes, which are central to its current domestic problems, are the result of this international interplay involving the country,” Shuja from NUS told China Daily.

Trust issues between Iran and the West run deep. Just days before Raisi’s inauguration, the US, UK and Israel had accused Iran of being behind a deadly drone attack, which killed two people, on an oil tanker off the coast of Oman.

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On Aug 3, Iran was again accused of hijacking a Panama-flagged vessel, MVAsphalt Princess, in the Arabian Sea. Iran has denied any involvement and offered assistance on standby to the ships in distress.

Yusoff said it is normal for the Western powers to easily put the blame on Iran if there are incidents in Persian Gulf waters.

“In my opinion, this is not a good allegation without giving or showing any evidence. This is not very good in terms of international relations,” he said.

Qatar University’s Zweiri believes the US wants to impose pressure on Iran and corner the sanctions-hit nation so that Washington “can get more concessions of Iran and the negotiations”.

Shuja, from the NUS, thinks the disturbances in the seas of the Gulf and adjoining areas involving incidences such as seizure and sabotage of tankers are fallout of failure of the nuclear negotiations between Iran and the US.

For its survival, Shuja said, Iran needs to sell its oil, which is transferred through tankers.

“Since Iranian oil trade is under the US sanctions, such actions and reactions linked to tankers and ships in the seas involving Iran and its adversaries are bound to increase in near future unless the Iranian nuclear problem is resolved,” Shuja said.

Zweiri said the maritime incident should not be looked at separately and has to be put in a context since there has been ongoing confrontation between Iran and Israel in the region.

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“This was in the context of weakening Iran and in … the context of maximum pressure policy, which was imposed by Donald Trump. So now what we witness these days is actually a continuation of tensions, said Zweiri.

There could also be other parties who have an interest in keeping the tensions alive, he added.

jan@chinadailyapac.com