Iran is in a very unique position

July 21, 2015 - 0:0

Finally a landmark deal was reached between Iran and G5+1. Only three years ago this achievement looked unlikely to all parties involved. Iran was under extreme international pressure and sanctions were beginning to paralyse the economy. However, many factors including the perseverance of the new government led by President Rouhani coupled with the defining role of Mr. Zarif, the most effective foreign minister in post-revolutionary Iran, paved the way for a major turning point. The role of other parties involved such as the Obama administration was also critical in this historic achievement. President Obama sees this deal as the main foreign policy achievement of his time.


In order to reach it, he confronted with the Republicans both in the Senate and the Congress, ignored powerful lobbying organisations such as AIPAC and compromised warm ties with historic allies such as Saudi Arabia and Israel. It would be fair to argue that, President Obama's commitment to the deal gave Iranian policy makers the motivation to not give up.
Now a deal has been reached which all sides call it a victory. From the Iranian point of view this has the potential to re-shape Iranian position within both the regional and global landscape.

Globally speaking, this deal will have the potential to pave the way for further integration of Iran into the world economy. It will create new platforms for investment, cooperation and trade. It is a mistake to assume that a deeper economic interconnection would only result in economic prosperity. Indeed, further economic ties could also result in political, strategic and security advantages for Iran. In other words countries that have deeper economic interconnection are more likely to have more reliable political ties. This is exactly what Iran needs in this volatile international system. Hence, this is a new opportunity for Iran to develop deeper roots in the global economy.

Regionally, Iran is in a very unique position at the moment. The deal, which was reached between Iran and G5+1, will have negative implications for Iran’s two main rivals, Israel and Saudi Arabia.

For Saudi Arabia a robust economy in Iran is far more dangerous than an Iran with a nuclear bomb. Saudis are very afraid that the lift of sanctions will strengthen Iranian position in countries including Syria, Iran and even Yemen. Their relatively unsuccessful campaign in Yemen has made them more afraid of their future geo-political positioning in the region. For the Saudis this is a zero-sum game. They feel that Iran’s new position in the global economy and closer ties with Western partners will seriously weaken their position.

As there is a new economic horizon in Iran, Saudi Arabia has started to face more economic difficulties at home. For example Riyadh has withdrawn $65.1bn from its general monetary reserve only in the first five months of 2015 to meet budget deficit. This has added to the tension in the corridors of power in Riyadh.
Before the deal was reached, Saudi Arabia led a serious diplomatic campaign to undermine negotiations. At times it used economic incentives to have its way, but it failed, to gain any concession from the United States. The nuclear deal between Iran and G5+1 was the last proof of the fact that, Riyadh no longer can rely on its ‘historic alliance’ with the United States. (Certainly not while President Obama is in office).

Hence, the Saudis are now more preoccupied with security than any other times in the last three decades. They are now re-calculating their regional security position and alliances. Riyadh has showed a lot of interest to strengthen its security ties with Turkey, but Turkey doesn’t exactly share the same vision. When it comes to Syria and anti-Bashar Assad sentiments, Ankara and Riyadh have a lot in common. Nevertheless, Turkey pragmatically is not interested in upright confrontation with Iran. Riyadh has been also trying to warm up relations with Moscow lately. For example in July 2015, The Saudi Public Investment Fund in partnership with the Russian Direct Investment Fund has agreed to invest $10 billion into Russian projects.

Moscow is suffering from a heavy Western embargos because of the annexation of Crimea. Thus, it is not surprising it is looking eastward to reduce reliance on Europe and the U.S. However, Russia enjoys cordial ties with Iran and there is no certainty whether Riyadh ever could rely on Moscow as a reliable security partner. Pakistan has also proved that it cannot be too dependable for the Saudis; this became particularly evident when Islamabad decided against military involvement in the Saudi-led coalition in Yemen. There also have been some speculation about Saudi Arabia seeking nuclear bomb from Pakistan but until today there has been no evidence to prove it. Although Saudi Arabia strategically is getting close to Israel (because of shared animosity against Iran), Israel would never tolerate a nuclear Saudi Arabia.

Riyadh knows that acquiring nuclear bomb in any shape or form will be the redline both for the U.S. and Israel. Hence, going down the roots of nuclear weapon never will be an easy option for the Saudis.

Israel and in particular Netanyahu are other major losers of this historic deal. Netanyahu took any extreme measure to undermine the deal. He effectively got into a bitter confrontation with President Obama over this issue. He actively attempted to get the Congress against the White House and tried to galvanize American public opinion against President Obama, but he failed. Some of his opponents in Israel have called for his resignation. Some of his opponents say that his extreme approach was in fact counterproductive. They say he could not even get a minimal concession from Obama and Israel’s interest was simply ignored because of the wrong policies of Netanyahu.

To conclude, Iran is in a very unique position at the moment. Its main rivals are weaker than any other times in recent years. It has an opportunity to reposition itself in the international system and make new allies. It has a new opportunity to emerge as an important world player and regional economic powerhouse. However, one should not take anything for granted. Although the rise of opportunities is important, using them wisely is even more important. Although reaching the deal was a great achievement, but a greater task is ahead of Iranian policymakers now. What they decide and how they act now can open a new chapter in Iran’s history.

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Dr. Afshin Shahi, director of the Centre for the Study of Political Islam & lecturer in International Relations and Middle East Politics at the University of Bradford.