Iran reentered the global economy Saturday, as years of crippling international sanctions were lifted in exchange for the verified disabling of much of its nuclear infrastructure.
For Iran, implementation of the landmark deal it finalized with six world powers last summer means immediate access to more than $50 billion in long-frozen assets, and freedom to sell its oil and purchase goods in the international marketplace. Tehran has hailed the deal as vindication of its power and influence in the world.
The removal of sanctions comes as President Obama begins his last year in office, and almost seven years to the day since he called on Iran to “unclench your fist” and take steps toward rapprochement with the United States and the world. As a result of the agreement, he said in his last State of the Union speech this week, a “nuclear-armed Iran” has been prevented, and “the world has avoided another war.”
The triggering event for implementation was certification by the International Atomic Energy Agency Saturday that Iran had successfully completed all the nuclear steps it agreed to in July: sending the bulk of its enriched uranium outside the country, dismantling and storing most of its centrifuges, and disabling its Arak nuclear reactor, capable of yielding plutonium. The IAEA is also charged with monitoring and verifying Iran’s continued compliance.
World leaders met Jan. 16 in anticipation of “Implementation Day,” which will result in international sanction relief for Iran, giving them access to more than $50 billion in long-frozen assets.
For Iran, implementation of the landmark deal it finalized with six world powers last summer means immediate access to more than $50 billion in long-frozen assets, and freedom to sell its oil and purchase goods in the international marketplace. Tehran has hailed the deal as vindication of its power and influence in the world.
Washington Post journalist Jason Rezaian has been freed from prison, according to U.S. and Iranian officials. He was arrested in Iran in 2014 and convicted of espionage last year. Here’s what you need to know about the case against him. (Monica Akhtar/The Washington Post)
Agency inspectors on the ground “verified that Iran has carried out all measures required….to enable Implementation Day to occur,” IAEA Director General Yukiya Amano said in a statement issued just before midnight, Vienna time.
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IAEA certification of compliance opened the door to announcements and speeches by high-level officials from the negotiating parties. A new U.N. resolution codifying the deal immediately goes into effect. The IAEA begins strict monitoring provisions on the ground in Iran. White House executive orders and implementation guidance issued by the European Union and the U.S. Treasury, along with waivers of certain restrictions signed here by Secretary of State John F. Kerry, will start the wheels of international business and finance turning.
To the consternation of critics in the United States including Republican presidential hopefuls who have called it a dangerous sellout by Obama and vowed to dismantle it the deal is now done.
In the long term, the agreement is a major milestone in the Iranian revolution, with the potential for far-reaching economic, political and cultural ramifications. The end of Iran’s near-total economic isolation could drive more modernization and open the country to moderating outside influences. More money spent at home to upgrade failing infrastructure and jump-start the economy would allow pragmatist President Hassan Rouhani to showcase the sanctions relief he pledged in his 2013 campaign..
U.S. and international opponents, including Israel, Saudi Arabia and other U.S. allies see the agreement as a dangerous gift to an aggressive and duplicitous regime, and have warned that Tehran will use the money to increase spending on terrorist groups that serve as its proxies in a fight for regional dominance.
Although Iran has more than $100 billion in available frozen assets most of it in banks in China, Japan and South Korea slightly less than half will more or less automatically go to preexisting debts. How the rest is spent will reveal the direction of internal power battles between Iranian hard-liners and pragmatists.
That kind of money is too much to be transferred in one fell swoop. Richard Nephew, a former sanctions chief of the U.S. negotiating team, said the Iranians will likely transfer it out in chunks, and may even leave it in place while they decide how to spend it.
“They’re going to find there are more demands” for the money, about $56 billion, “than they have plans to use it,” he said. “The question is to what degree will they have fights at home about what to do with it.”
The U.S. Treasury Department keeps close track of resources flowing to Lebanon-based Hezbollah, Iran’s most powerful proxy force in the region that is playing a major role in support of besieged Syrian President Bashar al-Assad. “I suspect they are going to get an increase in material support” that will “become apparent in the next couple of months,” said Dennis Ross, a former senior Obama adviser on the region.
