This is what you need to know about the Iran nuclear deal

This article is brought to you based on the strategic cooperation of The European Sting with the World Economic Forum.

Author: Adam Jezard, Formative Content

What just happened?

President Donald Trump has withdrawn the United States from a deal brokered in 2015 to curb Iran’s ability to produce nuclear weapons. After announcing the US withdrawal on May 8, Trump, a long-term critic of the deal, signed a presidential memorandum to begin reinstating US economic sanctions on Iran.

Despite President Trump’s decision to walk away, other signatories remain committed to the deal and believe it is crucial to providing stability in a turbulent region.

What was the deal?

Iran, the five permanent members of the UN Security Council – the US, UK, France, China and Russia – and Germany all signed up to a Joint Comprehensive Plan of Action, or JCPOA. From Iran’s side, it eased crippling economic sanctions, while other signatories hailed it as a diplomatic breakthrough that would make the world less dangerous.

Key points of the plan included Iran agreeing to a large reduction in its uranium enrichment capacity by two-thirds for 10 years. The republic’s stockpile of low-enriched uranium was cut by 96% to 300kg and capped at that level. External inspectors from the International Atomic Energy Agency were also to be allowed to visit nuclear sites, including military ones, if they suspected undeclared nuclear activities were taking place. The Arak heavy-water reactor was redesigned so it could not produce weapons-grade plutonium. Use of further heavy-water reactors was also banned for 15 years. Once the deal was agreed and the limitations of its nuclear activities had been confirmed, international sanctions against Iran were lifted. This move was aimed to help the country boost its economy by selling oil and regaining access to financial markets. While Iran’s GDP did improve after the lifting of sanctions, unemployment has continued to take a toll on living standards. The International Atomic Energy Agency, a UN body that monitors disarmament, says that Iran is complying with the treaty. “Iran is subject to the world’s most robust nuclear verification regime under the JCPOA, which is a significant verification gain. As of today, the IAEA can confirm that the nuclear-related commitments are being implemented by Iran,” the director of the agency, General Yukiya Amano, said in a statement. Why did President Trump drop it?

Even before assuming the presidency, Trump was a vocal critic of JCPOA. He called it “the worst deal ever” while on the 2016 campaign trail. Opponents have said JCPOA’s so-called “sunset clauses”, which allow the republic to recommence nuclear activities at various stages over a 15-year period, could not ensure that Iranian nuclear weapons could never be built. Deal opponents add JCPOA placed no stipulation on how Iran can spend any post-sanctions revenues it generates, including on missile programme development and proxy wars. Upon withdrawing, President Trump described it as a “horrible, one-sided deal that should have never, ever been made.” He argued that the limits and inspections on its nuclear activity were too weak, and criticised the deal’s failure to deal with Iran’s development of ballistic missiles. Israel and Saudi Arabia both welcomed President Trump’s decision, while statements issued by the other signatories to the deal say they remain committed to keeping JCPOA alive. What next?

Iran has ordered negotiations to begin with the remaining parties in an effort to salvage the agreement. “If we achieve the deal’s goals in co-operation with other members of the deal, it will remain in place,” Iranian President Hassan Rouhani said. However, he has also made it clear that Iran will restart uranium enrichment if the deal cannot be saved. Meanwhile, President Trump has said that he is “ready, willing, and able” to discuss a new deal that places tougher restrictions on Iran. Whatever course the negotiations take, the move is likely to have major repercussions for Iran, the region and for international cooperation. It will put the spotlight on Iran’s relationship with European powers, as well as China, while marking a divide between the United States and its western allies. It also comes at a time when the process of nuclear disarmament is under scrutiny as North Korea edges towards talks on dismantling its own weapons programme.

Domestically, speculation that the United States would pull out of the deal had already pushed Iran’s rial to near record lows. Renewed sanctions could hamper an economy already struggling with unemployment and lead to a spike in inflation, further eroding living standards. Oil prices have risen, reflecting concerns that sanctions and geopolitical instability could curb production.