By the calculus of madman theory of diplomacy, Donald Trump thinks he can use the tactics of diplomatic compellence to pressurize the opponents into adopting a behaviour that suits the U.S. interests. Let alone the U.S.’ vaunted opponents (North Korea and Iran), its trans-Atlantic partners in Europe are not expressing any pliancy on scuttling the Iranian nuclear deal.
In continuation of their more than 12 years long process of diplomatic negotiations, European leaders consistently tried to persuade U.S. President Trump to remain in the deal.
Disregarding European concerns, Trump said sayonara to the deal.
Furthermore, the U.S. secretary of state Mike Pompeo, in his speech at Heritage Foundation, specifically warned European companies to stop doing business in Iran or face the U.S.’ secondary sanctions.
European leaders have voiced their upfront defiance.
Arguably, there is a high politics involved in Europe’s efforts to preserve the Iranian nuclear deal. For Europe, security of Middle East is much more important than economic interests. That said, the issues of low politics are of secondary value to Europe and are merely used as a ploy to convince Iran to stay in the deal.
Europe is well aware that the chaos and entropy in the Middle East—civil war in Syria, devastated state institutions in Iraq and the subsequent emergence of the Islamic State—were not least the aftermath of the instability following the 2003 invasion on Iraq. That also explains the logic behind EU’s investment of around 2 billion Euros every year on the security of the Middle East and North Africa.
For insecurity in the Middle East does spill over across the Mediterranean Sea in the shape of refugee problems and insecurity and terrorism issues in Europe. These issues have in part led to the subsequent rise of extremist political parties in Europe, be it Italy’s recent election victors 5-Star Movement and League, Germany’s AfD party or France’s National Front led by Marie Le Pen.
The JCPOA is not only a staple of crisis-stability in the Middle East but also, according to Ms Mogherini, “an essential part of the nonproliferation global architecture”.
If anything, the pull-out from the deal would push Iran to intensify its efforts for building the nuclear bomb. That being a precedent, Saudi Arabia might also follow the suit. Extending from that premise, Israel would resort to making preventive strikes on Iran’s nuclear facilities, inviting Iran’s retaliatory response. Consequently, a full-blown war in the Middle East would erupt. That is the scenario that Europe seeks to ward off.
Europe’s effort to protect their economic stakes is arguably only a ploy, not a major foreign policy concern. It is not bent on diplomatic disagreement with the United States to preserve its economic interests alone. For EU’s bilateral trade with Iran of $21 billion in 2017 was fifty-two times lower than its trade with the United States, which stood at $1.1 trillion in 2016.
To maintain the leverage over Iran through guaranteeing economic benefits, the European leaders met in Sofia, Bulgaria on 17th-18th May and formally declared their steps.
The measures included the reintroduction of the Blocking Statute of 1996, which prohibits European companies from complying with the U.S. sanctions, making direct payments to Iranian central bank in Euros, financing transactions in Iran under the EU budget guarantee, and encouraging further investments in Iran’s energy sector, among others.
Insofar as the European Multi-National Corporations (MNCs) are concerned, such as France’s oil giant Total, they have multibillion-dollar investments in the United States and most of their transactions are financed by the U.S. banks. Total has already declared to wind down operations in Iran if the U.S. and European authorities do not grant it sanctions-waiver for its multibillion-dollar South Pars 11 project in Iran. Same is the case with other French, German and Italian MNCs working in Iran.
To protect interests of the European giant enterprises in Iran, the Europeans have the leverage of massive trade with the United States as a bargaining chip to persuade the latter to grant exemptions to the European companies involved in strategic trading areas such as energy, automobile and aeronautics. U.S.’ grant of a waiver to Chinese ZTE is a precedent already.
After all, for the European stakes to remain intact, Europe needs to convince the Trump administration as to why preserving the 2015-nuclear deal is so vital for the U.S. strategic interests as well. Europe needs not navigate away from the United States, nor it can. The European-US, European-Iran and intra-Europe negotiations are crucial for preserving the Iranian nuclear deal.
A version of this article appeared in Eurasiareview, online platform.
Riaz Khokhar is a Research Assistant at the Center for International Strategic Studies. Mr. Khokhar holds a Masters degree in International Relations from Quaid-e-Azam University, Islamabad. His research interests include Pakistan's foreign policy affairs, strategic dimensions of world affairs and nexus of security and economic issues among South Asian states. He wrote his Masters thesis on Pakistan's Foreign Policy Posture after Donald Trump's Coming into Power, completed in May 2017.