Lifting of sanctions on Iran: The force awakens

A woman on her way to register her candidacy for the Assembly of Experts elections at the Interior Ministry in Teheran last month. Former US diplomat William Burns does not believe that the nuclear deal has strengthened Iran at Saudi Arabia's expense
A woman on her way to register her candidacy for the Assembly of Experts elections at the Interior Ministry in Teheran last month. Former US diplomat William Burns does not believe that the nuclear deal has strengthened Iran at Saudi Arabia's expense, saying the Iranian economy will not bloom overnight after sanctions are lifted.PHOTO: AGENCE FRANCE-PRESSE

With sanctions set to be lifted, a stronger Iran could pose a threat to Saudi influence in Middle East

"There are few coincidences in the Middle East," says Mr William Burns with a trace of amusement, answering a question as much as expressing a quintessential American attitude towards a region that seems to be ever on the boil.

Things are about to get a whole lot more fractious, with last year's historic United States-led Iran nuclear deal close to being implemented.

Mr Burns, a grey-haired former career diplomat, is the architect of that deal, asked by US President Barack Obama to delay retirement to see the deal through.

In Singapore at the invitation of the Ministry of Foreign Affairs, the understated, somewhat avuncular, man was answering the question of whether there was more than coincidence in Saudi Arabia's execution of an influential Shi'ite cleric earlier this month, just weeks before the Iran deal approaches its most significant moment.

Seen from the point of view of the other force in the region, Iran's emergence from the shadows represents a threat. To Saudi Arabia, it means that the largest country in the Middle East, at loggerheads with Riyadh for centuries, will gain economic clout and become emboldened to pursue an expansionist foreign policy, bringing it head on with Saudi Arabia's own chequebook diplomacy calculated to further its own hold across the Middle East.

The deal signed between the Shi'ite-ruled Iran and the so-called P5+1 nations - the US, Britain, France, Russia, China plus Germany - is about to be actualised, lifting years of crippling international sanctions on Iran in return for its agreement to accept limitations on its nuclear activities.

Iran has met almost all the requirements under the deal, even while test-firing ballistic missiles and briefly detaining 10 American sailors who strayed into its waters last Tuesday. Last week, Teheran announced that its heavy water reactor at Arak has been filled up with concrete to disable its capacity to produce plutonium, a pathway to producing a nuclear weapon.

Over the past few weeks, Iran has been dutifully shipping its enriched uranium stockpiles, another pathway to producing a nuclear weapon, to Russia. Next, the international atomic watchdog will certify Iran's actions, thus opening the gates for the US and other nations to announce they are ending the years of sanctions which have stunted Iranian progress.

With that, Iran will re-enter the world stage. It can claim back billions of dollars worth of its assets frozen overseas, resume exporting oil, which will add hundreds of billions more to its economy, rejoin the international banking system and import the software and infrastructural equipment it needs to grow.

It is easy to see why Iran's moderate President Hassan Rouhani has stayed faithful to the deal - he was elected to office on the promise of getting rid of the sanctions. And next month, he faces a parliamentary election which he hopes will return a larger share of moderate MPs to back the second half of his term. Post-sanctions, it is estimated that Iran can log annual growth rates of as much as 6 per cent.

To borrow a phrase from a current blockbuster movie, Iran is about to become a force awakened.

Seen from the point of view of the other force in the region, Iran's emergence from the shadows represents a threat. To Saudi Arabia, it means that the largest country in the Middle East, at loggerheads with Riyadh for centuries, will gain economic clout and become emboldened to pursue an expansionist foreign policy, bringing it head on with Saudi Arabia's own chequebook diplomacy calculated to further its own hold across the Middle East.

Mr Burns, now the president of Washington, DC's oldest foreign affairs think-tank, the Carnegie Endowment for International Peace, says: "There is a lot of anxiety in the Sunni Arab world that's palpable. It does not stem from the nuclear deal although that is one source of it. It's everything from the lingering after-effects of the Arab Spring, and the uncertainty that has produced for a lot of Sunni Arab leaderships. It's changes in the global energy market and the consequences of that for Saudi Arabia and its political transition which has just unfolded."

"I've learnt humility about making predictions about the Middle East," he adds, "but I think the tension is likely to be with us for some time."

He does not buy the argument that the nuclear deal has strengthened Iran at the expense of Saudi Arabia.

"The perception that Iran is inevitably ascendent is probably exaggerated. The notion that the lifting of sanctions is going to cause the Iranian economy to bloom overnight is misguided. There are other problems - red tape, bureaucracy, corruption, mismanagement - that are going to take years to resolve and a lot of hard political choices.

"Clearly the nuclear agreement will provide benefits but I don't think it follows that the Iranians will emerge 10ft tall as the dominant player in the Middle East. There are also some natural limitations, given that the Shi'ites in the Middle East are a minority in a largely Sunni world."

Whether these rational arguments can sway opinions and policies at a time when passions are aflame in the Middle East is another thing.

The cleric's execution raised tensions already fraught over civil wars raging in Syria and Yemen. The Arab world's complex relationship with the radical Islamic State in Iraq and Syria (ISIS) group is another volatile component.

Referring to Saudi Arabia and other Arab allies in the Middle East, Mr Burns says: "They also have responsibility and self-interest in curbing the flow of money to ISIS and Sunni extremists and to pushing back more effectively ideologically against Sunni extremism."

Since there are few coincidences in the Middle East, easing the current tensions will probably involve a great deal of preparation. A major opportunity opens up within a fortnight, at the Jan 25 talks to resolve the Syria crisis in which both Iran and Saudi Arabia - who support opposing sides in Syria - have confirmed participation.

"You have the Saudis and the Iranians both sitting at the table, it's not an insignificant thing," says Mr Burns. "There may be a long way from that to a serious conversation about some basic rules for the road in regional order. It doesn't mean they have to trust each other, doesn't mean they are not going to be competitors, but developing some precepts for regional order is going to be important.

"But it's going to be hard to do."

A version of this article appeared in the print edition of The Sunday Times on January 17, 2016, with the headline 'Iran: The force awakens'. Print Edition | Subscribe