Nine hurdles to revitalizing JCPOA

A West Asia security and nuclear policy specialist at Princeton University, has enumerated nine hurdles to revitalizing Joint Comprehensive Plan of Action (JCPOA), nuclear deal that Iran signed with 5+1 nations - five permanent members of the UN Security Council plus Germany - in July 2015.

Seyed Hossein Mousavian points that “snapback” mechanism in JCPOA favors 5+1 nations only. “The ‘snapback’ mechanism built into the agreement allows any country to force the UN Security Council to reimpose multilateral sanctions against Iran if Iran fails to fulfill its commitments. But this is one-sided: There is no such remedy for Iran if other parties fail to do their part,” Mousavian writes.

The article was published in Bulletin of the Atomic Scientists on 19th January 2021, one day before Joe Biden officially sworn in as President of United States.

Following is the text of the article titled “Nine hurdles to reviving the Iran nuclear deal”:

Iran’s Supreme Leader Ayatollah Ali Khamenei said on 8th January 2021 that Tehran was in no rush for the United States to rejoin the 2015 nuclear deal formally known as the Joint Comprehensive Plan of Action (JCPOA), but, he also said, sanctions on Iran must be lifted immediately.

“If the sanctions are lifted, the return of the Americans makes sense,” he insisted. President-elect Joe Biden has announced his plan to return to the deal soon after he is sworn into office. “If Iran returns to strict compliance with the nuclear deal,” he wrote in an op-ed for CNN, “the United States would rejoin.” His Iranian counterpart, President Hassan Rouhani, has also expressed willingness to return to the deal, stating that, “Iran could come into compliance with the agreement within an hour of the United States doing so.”

Five years ago, after years of intensive negotiations, six world powers managed to sign the world’s most comprehensive nuclear agreement with Iran. While the agreement was a political one, it was also ratified by the UN Security Council in Resolution 2231. According to the International Atomic Energy Agency (IAEA), the organization tasked with verifying the agreement’s technical aspects, Iran was fully complying with the deal for about three years, until President Trump withdrew from it in May 2018. In response to the US violations of the nuclear agreement, Iran too reduced some of its commitments. Most recently, on 4th January2021, Iran announced that it had increased its uranium enrichment levels to 20 percent. Although reviving the agreement is certainly still possible, it won’t be easy. The two sides will need to overcome nine hurdles to make it happen:

First, the sequencing of a mutual return could be an immediate problem. Iran expects the United States to lift sanctions first, because it was the Trump administration that withdrew first. While Tehran’s demand is legitimate, Washington may ask that Iran come into full compliance before lifting sanctions. Indeed, a straightforward reading of the quotation from Joe Biden’s op-ed suggests just that. In this scenario, after Joe Biden’s executive order rejoining the deal, Iran and the world powers can meet and agree on a realistic plan with a specified timeline of proportionate reciprocal actions.

Second is the issue of what compliance constitutes. During the Obama administration there was one major barrier to the full realization of the terms of the agreement: Many primary sanctions, targeting US citizens and permanent residents, organizations, and individuals that engage in trade and business with their Iranian counterparts, remained intact. These sanctions limited the economic benefits of the deal for Iran. The 29th paragraph of the deal clearly states that all signatories will refrain from any policy specifically intended to directly and adversely affect the normalization of trade and economic relations with Iran. This cannot be achieved without abolishing the primary sanctions.

Third, the Trump administration imposed numerous sanctions against Iran under the guise of terrorism and human rights, aimed at preventing the Biden administration from returning to the deal. For a clean implementation of the agreement, Biden will need to remove all of these sanctions as well.

Fourth, Trump’s withdrawal from the agreement and violation of the UN Security Council Resolution 2231 as well as other international commitments has damaged US credibility abroad. There is now a widespread belief among policy makers in Iran that the United States will simply not live up to its end of the bargain, no matter what that bargain is. This naturally raises the important question: What guarantees are there that the United States will remain committed to the deal in the post-Biden era?

Fifth, because of Trump’s maximum pressure policy, the Iranian economy has suffered hundreds of billions of dollars of losses, while Iran was in full compliance with the terms and conditions of the deal. Some Iranian leaders, including Iran’s foreign minister Mohammad Javad Zarif, have demanded compensation for the economic damage the country suffered after the United States withdrew. The challenge will be to find a mechanism to compensate for the economic damages that the Trump administration inflicted on the Iranian economy.

Sixth, the “snapback” mechanism built into the agreement allows any country to force the UN Security Council to reimpose multilateral sanctions against Iran if Iran fails to fulfill its commitments. But this is one-sided: There is no such remedy for Iran if other parties fail to do their part. This became abundantly clear when the Trump administration first withdrew from the deal and then tried to unilaterally re-impose multilateral sanctions on Iran through the snapback mechanism. It was as if the injurer was demanding punishment for the injured. Although the UN Security Council rejected the US demand, the stunt revealed the structural flaw of the snapback.

Seventh, in the first week of December 2020, the Iranian parliament passed a bill mandating Iran’s Atomic Energy Organization to resume enriching uranium to 20 percent purity. The legislation also requires the Iranian government to cease voluntary implementation of the IAEA’s Additional Protocol within two months of the bill’s enactment if the other signatories fail to fully deliver on their commitments under the agreement. And after three months, the Atomic Energy Organization is obliged to begin using at least 1,000-second-generation centrifuges. In short, president-elect Biden will need to move fast.

Eighth, there were some in the United States who were worried that Trump may start a reckless last-ditch war with Iran before leaving office. While this concern is overblown, there should be no doubt that US partners in the region will do whatever they can to prevent Biden’s return to the deal. Israeli Prime Minister Benjamin Netanyahu has already said as much. To be sure, the hardliners in Iran are also fundamentally opposed to the deal.

Ninth, some pundits and politicians in Washington want Biden to leverage the Trump administration’s sanctions to pressure Iran to accept additional commitments beyond the original agreement as a condition for US return to compliance. These include limiting Iran’s missile capability, extending the “sunset” clauses within the deal, or resolving regional disputes. But from Iran’s perspective, such demands are a non-starter. As the spokesperson for Iran’s foreign ministry said recently, “No negotiation has been, is being, or will be held about Iran’s defense power.”

Despite these hurdles, Biden should nevertheless seek re-entry into the deal. Only a clean and full implementation by all parties can save the world’s most comprehensive nuclear agreement, contain rising US-Iran tensions, and open the path toward more confidence building measures. That path should include, upon Biden’s issuing an executive order to rejoin the JCPOA, the creation of a working committee of parties to the agreement tasked with ensuring full compliance by all signatories, and a forum, organized by the UN Secretary General, in which Iran and the Persian Gulf countries can discuss a new structure for improving security and cooperation in the region.

Focus should be on oil and gas, not maritime dispute, Beijing urges Philippines

China and the Philippines should not be distracted by their disputes in the South China Sea and should instead focus on advancing cooperation on oil and gas exploration in the region, Chinese Foreign Minister Wang Yi said when wrapping up his week-long tour of Southeast Asia.

Wang said the two countries would continue to “properly manage their disputes” and push for oil and gas exploration in the South China Sea.

Wang’s trip that included stopovers in Myanmar, Indonesia and Brunei was part of Beijing seeking to consolidate its ties with the region.

In an interview with state media posted on the Ministry’s website, Wang highlighted China’s desire to move the focus away from maritime disputes to joint exploration of resources in the waters. “Both sides believe that the South China Sea issue is only partial to the entirety of Sino-Philippines relations,” Wang said, discussing the outcomes of his Manila visit. “We should not let such one percent difference derail the 99 percent of our relations.”

Separately during Wang’s tour, China and Brunei set up a working group on energy cooperation, the ministry said on Friday, without providing details.

The Philippine government in October lifted a ban on offshore oil and gas exploration, reopening the door to joint energy development with China.

Two years ago, the two governments signed a memorandum of understanding to jointly explore undersea oil and gas, a way of defusing their corner of a broader regional dispute.

In 2016, an international tribunal in The Hague upheld the Philippines’ challenge to Beijing’s territorial claims to almost all of the South China Sea, but Beijing has never accepted the ruling. President Rodrigo Duterte’s administration has promised to shelve the dispute in exchange for Beijing’s economic aid.

As the Duterte administration nears its end, Beijing has sought to reaffirm support for its neighbour, promising half a million doses of Covid-19 vaccines, US$1.34 billion in loan pledges for infrastructure projects and US$77 million in grants.

Wang said the supply of vaccines to the Philippines showed Beijing’s willingness to help the Philippines overcome its Covid-19 pandemic challenges.

China and the Philippines also announced an arrangement for fast-track border crossing during the pandemic for certain personnel, and opened the Bank of China’s yuan clearing business in the Philippines.

China would continue to take part in the Philippine side’s infrastructure plans and actively promote cooperation on major projects to lay a better foundation for the Philippines’ long-term development, Wang said.

He said China and the Association of Southeast Asian Nations were working together to advance post-pandemic recovery. “Facts once again show that adherence to regional and a multilateral mechanism is more important than ever,” he said.

Israel fears losing its freedom to operate against Iran

Speculation about the extent to which the incoming American administration will appease Iran has been rampant. But US President-elect Joe Biden’s picks for relevant top positions don’t seem to leave much room for supposition.

Let’s start with William Burns, Biden’s nomination for CIA director. Burns currently serves as president of the left-wing foreign-policy think tank the Carnegie Endowment for International Peace, one of its donors is the Open Society Foundations network, established by George Soros.

Burns has decades of experience as a career diplomat under both Democratic and Republican administrations. Burns is a longtime associate of Biden. The two have worked closely together, most recently when the latter was Vice President and the former was Deputy Secretary of State for Near Eastern affairs, during the administration of former US President, Barack Obama.

Burns who had served as Ambassadors to Russia and Jordan, also had a key role in talks with the regime in Tehran in 2013. These led to the 2015 signing of the Joint Comprehensive Plan of Action (JCPOA) between Iran and the 5+1 countries: the United States, United Kingdom, France, Russia and China plus Germany. By that time Burns had retired, but his imprint lived on in the nuclear deal.

In this context, Biden’s statement about Burns – “[He] shares my profound belief that intelligence must be apolitical” – is not liked by his opponents. The cause of greater concern is Burns’s faith in the JCPOA from which outgoing US President Donald Trump withdrew in 2018.

In an 29th August 29 2020 opinion piece in The Atlantic titled “‘America First’ Enters its Most Combustible Moment,” Burns spelled out his objections.

 “Any leverage against Iran produced by the UAE-Israel agreement [the Abraham Accords between the United Arab Emirates and the Jewish state that subsequently were signed on 15th September 2020 at the White House] is already being swallowed up in the serial diplomatic malpractice of the administration’s ‘maximum pressure’ campaign – aimed more at toppling the Iranian regime than at changing its behavior,” he wrote. “Doubling down on failed policy is not a smart diplomatic prescription... but the Trump administration is not likely to see the light. Instead, it will continue to pretend that the United States can participate in only the punitive parts of the Iran nuclear deal... [a strategy that it] tried – and spectacularly failed at.”Nothing could be further from the truth. Trump’s “maximum-pressure campaign” is anything but “diplomatic malpractice.”

Antony Blinken, for instance – who, pending congressional confirmation, will replace Pompeo – is another JCPOA enthusiast. Blinken served under Obama, first as Deputy National Security advisor and then as deputy secretary of state. Like Burns, he was instrumental in formulating and promoting the deal. He also wants to lift sanctions against Tehran as one of those “goodwill gestures” that American multilateralists so love extending to the regimes.

He was clear about this in the immediate aftermath of Trump’s withdrawal from the JCPOA. In a thread of tweets on 9th May 2018, Blinken wrote, “By blowing up the Iran nuclear deal, President Trump puts us on a collision course with Iran and our closest allies. It gives Iranian hardliners the excuse to speed again toward the bomb without a united international coalition to oppose them or inspectors to expose them. Or if Iran and Europe stick with the deal, it forces us to sanction the latter to stop them from doing business with the former. Either way we lose.”

AS IF THIS weren’t an illustration of the degree to which Democrats misunderstand – or are willfully blind to – the mindset of the Iranian mullahs, Blinken goes on to make a ridiculous assertion. The cancellation of the JCPOA, he tweeted, “makes getting to yes with North Korea that much more challenging.

Cognizant of new reality, Israel is boosting its ability to combat Iranian forces and other proxy groups. The Democrats in the White House, State Department and Capitol building are lying in wait to lead the world, as Obama proudly did, “from behind.”

Will Biden also use India against China?

The United States has declassified its 2018 Indo-Pacific strategy for unknown reasons, although it was initially set to be released to the public at the end of 2042. Over the last three years, this National Security Council strategy has guided American maneuvers and policy in a region extending from the United State’s Pacific Coast all the way to India.

At its heart, the strategy reveals a deep concern with China’s rising influence in the Western and Central Pacific. It also highlights plans to deal with an increasingly belligerent North Korea, while seeking to strengthen India to counter Chinese military power.

The strategy was initially devised throughout 2017, going on to be approved and enforced by President Donald Trump in 2018 shortly after the US National Defense Strategy was finalized.

While the strategy’s actual authors are not credited in the document, much of the document accurately reflects the White House’s actions in the region for the last three years.

The strategy shares rare insights into how the US perceives its opponents and allies in the region, specifically India, China and North Korea. There is a realization that China enjoys growing dominance in the Indo-Pacific and it is the United State’s primary adversary and strategic opponent in the area. 

The strategy dwells how to maintain the US strategic edge and promote a liberal economic order while preventing China from establishing new, illiberal spheres of influence, and cultivating areas of cooperation to promote regional peace and prosperity. It also emphasizes that China will circumvent international rules and norms to gain an advantage in a strategic face-off between the two powers.

While the strategy doesn’t specifically mention the paths China follows to further its dominance in the region, it does cite China’s increasing use of digital surveillance, information controls, and influence operations that will counter US efforts to promote its values and national interests, not only in the Indo-Pacific, but also within the Western hemisphere itself.

Parallel to the strategy, the US government and military have consistently sounded alarms over China’s expanding nuclear arsenal, long-range ballistic and cruise missile capabilities, and the resurgence of its naval fleet.

Broadly speaking, it aims to build US capabilities to be capable of, but not limited to denying China control of the air and the sea in the first island chain, referring to a string of Pacific islands surrounding China that include Russia’s Kamchatka peninsula, Japan, Taiwan, Philippines, Malaysia and Vietnam. China claims most of these waters. It also emphasizes the need to defend the first island chain, and dominate all areas outside it. 

While the document does not mention the South China Sea dispute, it reflects a concern over China’s claims there and in other parts of the Western Pacific. The South China Sea and Western Pacific as a whole have seen a tremendous increase in Chinese military activity, but also activities by the US and its allies in the region.

The strategy adopted by the Trump administration has arguably led to the worst deterioration in US-China ties in recent history, triggering an ongoing trade war and US commitment to defence of Taiwan by approving large defence deals with the island nation. On top of Trump blaming China for the COVID-19 global pandemic and accusing it of mismanaging the outbreak, Trump has fostered deeper ties with Taiwan that go beyond arms deals and include military capacity building and reinforce diplomatic ties.

After identifying China as a primary strategic concern, the strategy turns its attention to North Korea. Threatened by its multiple missile launches in 2017 including one missile that flew over Japan, the strategy acknowledges the rapid technological advances North Korea realized in its missile technology.

India features prominently in US strategic plans for the region. Specifically, the strategy seeks to build a quadrilateral security framework with India, Japan, Australia and the US. The four-cornered strategy wants to use a strong India to counterbalance China.

This comes after pointing out that India is already able to counter border provocations by China. It should be noted that the strategy was passed before India-China skirmishes in the Doklam region. 

Interestingly, the strategy makes no mention of Pakistan at all in spite of its close ties to China. It further defines a key need to accelerate India’s rise and capacity to serve as a net provider of security and Major Defense Partner; solidify an enduring strategic partnership with India underpinned by a strong Indian military able to effectively collaborate with the United States and its partners in the region to address shared interests.

The US Navy has advocated creating a new naval command exclusively for the Indian Ocean and close-by areas of the pacific. With the expiration of the Intermediate-Range Nuclear Forces Treaty, the US has also assessed different locations in South East Asia to position long-range missile forces that would be able to counter China’s own strategic missiles.

Meanwhile, India continues to enjoy large defence procurements from the US, including the F-21 fighter jet. Others have indicated this could be a form of induction to bring India into the F-35 stealth fighter program. 

In spite of its bold efforts, much of the strategy’s ambitious objectives have yet to be fulfilled. That’s not to say that the strategy went entirely unfulfilled. The US Navy is set to create a new fleet to cover the Western Pacific. Freedom of Navigation deployments to the region is increasing, along with the major US efforts to arm Taiwan. While the strategy reflects Trump’s legacy, its approach may still shape coming US strategy as Biden’s new administration seeks to contend with China and North Korea. 

Biden Middle East Policy: Need to disentangle United States from Iran-Saudi Arabia rivalry

The Biden administration will face a number of challenges in the Middle East over the next four years. The diplomatic landscape of the region offers the United States ample opportunities to offer peace initiatives. 

Some have been successful and enduring, like the 1978 Camp David Accords between Egypt and Israel. There have also been many more notable failed attempts, such as the stalled talks between Israelis and Palestinians during the Obama administration.

Diplomacy does not have to be big and bold to be successful. The Biden administration has an opportunity to stabilize the Middle East by disentangling from the regional rivalry between Iran and Saudi Arabia. This has the prospects of reducing the temperature of relations between these two regional rivals and possibly even prompting them to settle some of their differences on behalf of regional stability.

One may like it or not, the United States has become party to the rivalry between Iran and Saudi Arabia. Of course there are profound issues related to wars in Syria and Yemen and instability in Iraq and Lebanon that separate them. But much of the enmity they harbor for each other relates in no small way to Washington. Iran sees Saudi Arabia (and Israel) as the tip of the spear of US efforts to undermine it. Iran sponsored attacks on Saudi oil facilities in 2019 after Washington’s maximum pressure campaign is prima facie evidence of this.

Saudi Arabia has felt little incentive to even entertain diplomacy with Iran given the large US military footprint in the Persian Gulf and Trump’s hostility toward Iran. Not only is the United States a party to the Iran-Saudi rivalry, but it has hardened the resolve of both sides, driving them further away from diplomacy, with negative consequences for the entire region.

The United States lacks the capacity to persuade either of the regional rivals toward rapprochement. But Washington can play a constructive role by extricating itself from the role of central character in this conflict. This will require recalibrating relations with Saudi Arabia, supporting Riyadh but also making sure that it does not continue using Washington as a crutch for shunning diplomacy.

It also necessitates the United States working to ensure that the Abraham Accords between Israel and the UAE are used as a bridge for building further regional cooperation and not merely as a cudgel for deepening hostilities to Iran. And it will necessitate the United States moving toward a diplomatic track with Iran, starting with rejoining the 2015 nuclear deal, on the condition that Tehran reverts to compliance.

The US will need to use leverage to move a stubborn Iran into a more constructive regional role, but skillful diplomacy can deprive Iranian leaders of the narrative that their regional adventurism is a necessary defensive crouch for deterring a hostile Washington.

Disentangling the United States from the regional rivalry between Iran and Saudi Arabia won’t ensure peace between the two regional powers. But it can force Iran and Saudi Arabia to deal with each other on their own terms, and not hide behind relations with Washington.

If successful in cooling the temperature of relations between these two powers, it can also possibly have other benefits, such as sucking some of the oxygen out of the proxy conflict dimension of the civil wars roiling Syria and Yemen and helping stabilize Lebanon and Iraq.

While the United States can’t start a peace process between Iran and Saudi Arabia, peace should be the objective of the US diplomacy. Rebalancing relations with friends and foes would go a long way toward this objective. Steady resolve rather than bold diplomacy might be just what the region needs from Washington right now.

Jewish groups laud Trump impeachment

Several Jewish organizations have welcomed the impeachment of US President Donald Trump by the House of Representatives and condemned him for his role in the storming of the US Capitol last week.

At a rally given at The Ellipse, adjacent to the White House, on 6th January, Trump spoke to several thousands of his supporters, whom he had told to attend via Twitter. He called on them to march to the US Capitol building and demand that Congress not certify President-elect Joe Biden’s victory in the 3rd November 2020 presidential election.

 “You’ll never take back our country with weakness. You have to show strength and you have to be strong. We have come to demand that Congress do the right thing and only count the electors who have been lawfully slated,” Trump said, among other provocative comments.

The House of Representatives impeached Trump for high crimes and misdemeanors, with the article of impeachment stating that Trump “willfully made statements that, in context, encouraged – and foreseeably resulted in – lawless action at the Capitol, such as: ‘if you don’t fight like hell you’re not going to have a country anymore,’” and that these remarks incited the crowd to interfere with Congress’s certification of the election results.

The American Jewish Committee (AJC), one of the oldest and respected US Jewish organizations, said it welcomed the passage of the impeachment resolution and reiterated its “unqualified condemnation” of Trump’s actions, which it said “run counter to the democratic values we hold dear,” and disqualify the president from continuing to occupy his office.

“He has subverted the will of American voters by falsely alleging, without evidence that the November 2020 election was illegitimate, beset with fraud, and ‘stolen.’ Beyond that, he has incited his followers to commit acts of insurrection which involved an assault on a sacred edifice and which resulted in chaos, injury, and death,” the AJC said in a statement on Wednesday afternoon.

It added that “public officials charged with responsibility for addressing such conduct” use all means possible to hold Trump to account for what happened, including in the courts.

The Union for Reform Judaism said it applauded the passage of the article of impeachment “for his incitement of violence against the United States government,” and urged the Senate to convict him on this charge.

“President Trump’s behavior has shaken our democracy to its core. The president’s language and his actions preceding the riot and in the days since are an abdication of moral leadership,” said the URJ in its statement.

The organization said that “the expression of remorse is central to the act of teshuva, repentance” but that “rather than accept responsibility or express contrition for the role that his words played in the desecration of the Capitol and the deaths of at least six individuals, including two Capitol Police officers, President Trump has stood by his disproven lies and provocative rhetoric.”

The organization noted that Trump said in a video he tweeted out as the riot and invasion of the Capitol was underway that he loved his supporters involved in the attack, “among them white supremacists who rampaged through the House and Senate, some armed, some dressed in clothes bearing racist and antisemitic words and symbols.”

The left-wing J Street organization, which called for Trump’s removal from office immediately after the storming of the Capitol, also welcomed the passage of the article of impeachment.

“The House just voted (for the second time) to make clear what a majority of Americans know to be true: Trump is a danger to our democracy and is not fit to be our president. He never has been and should never have the opportunity to hold elected office again,” the organization said on Twitter.

The Pompeo ploy

In a sign of inability to prevent the incoming administration from rejoining the 2015 Iran nuclear deal, US Secretary of State Mike Pompeo has resorted to what he took from the CIA archives to cook up a new story against Iran.

Lately, Pompeo participated in an event at the National Press Club in Washington, DC to level new accusations against Iran for its alleged links to the al-Qaeda (AQ) terrorist group. Pompeo claimed that Iran has become a “new Afghanistan” in terms of hosting al-Qaeda leaders.

“Al-Qaeda has a new home base: it is the Islamic Republic of Iran. As a result, bin Laden’s wicked creation is poised to gain strength and capabilities. We ignore this Iran-al-Qaeda nexus at our own peril. We need to acknowledge it. We must confront it. Indeed, we must defeat it,” the hawkish top US diplomat claimed.

Pompeo pointed out that the United States has taken drastic measures against al-Qaeda since the 9/11 attacks. These measures, Pompeo claimed, have pushed the al-Qaeda members to search for a new haven.

“That effort drove al-Qaeda to search for a safer haven, and they found one. The Islamic Republic of Iran was the perfect choice,” he claimed. The outgoing US secretary of state went to say that Iran still has links to al-Qaeda.

Pompeo did not present any evidence to support his allegations, and, in fact, some of these allegations are nothing new. However, they elicited a strong response from Iran and Russia.

Iran termed Pompeo’s claims as “warmongering lies.”

“From designating Cuba to fictitious Iran 'declassifications' and AQ claims, 'we lie, cheat, steal' is pathetically ending his disastrous career with more warmongering lies. No one is fooled. All 9/11 terrorists came from @SecPompeo's favorite ME destinations; NONE from Iran,” Iranian Foreign Minister Mohammad Javad Zarif tweeted in response to Pompeo’s remarks.

Iran’s Foreign Ministry also rejected the allegations as “baseless,” calling on Pompeo to “die of anger.”

“Resorting to such ploys and threadbare and baseless claims can, by no means, help the terrorist US regime correct its path, which is full of mistakes, and restore the unjustifiable image of the officials of this regime,” Saeed Khatibzadeh, spokesman for Iran’s Foreign Ministry, said in a statement. “As martyr Beheshti aptly put it, Mr. Pompeo! Be angry and die of this anger,” the spokesman continued.

Pompeo accused Iran of supporting al-Qaeda while ignoring his predecessor’s admission that it was the US that “created” and “funded” al-Qaeda. Former US Secretary of State Hillary Clinton said many times that the US has created and funded al-Qaeda to defeat the Soviets in Afghanistan.

“Let’s remember here that people we are fighting today, we funded 20 years ago. And we did it because we were locked in the struggle with the Soviet Union; they invaded Afghanistan. And we did not want to see them control Central Asia and we went to work. And it was President Reagan in partnership with the Congress led by Democrats, who said you know what? Sounds like a pretty good idea. Let’s deal with the ISIS and the Pakistani military, and let's go recruit these mujahidin. And great, let's get some to come from Saudi Arabia and other places, importing their Wahhabi brand of Islam, so that we can go beat the Soviet Union. And guess what? They retreated. They lost billions of dollars, and it led to the collapse of the Soviet Union,” Clinton infamously said testifying before a Congressional committee.

But why does Pompeo ignore these facts? The question is simple, because he hates the 2015 Iran nuclear deal – officially known as the Joint Comprehensive Plan of Action (JCPOA) – and wants to make sure that the incoming Biden administration would not be able to return to it.

This was on full display during his Tuesday speech. Pompeo sought to use the alleged links between Iran and al-Qaeda to warn against reviving the JCPOA. He claimed that before 2015, Iranian authorities had strictly restricted the movement of al-Qaeda members living inside of Iran, “putting them under virtual house arrest.”

“But I have to say today that is not the situation. Indeed, everything changed in 2015 – the same year that the Obama administration and the E3 – France, Germany, and Britain – were in the middle of finalizing the JCPOA,” Pompeo noted.

He then tried to imply that Iran may use its links to al-Qaeda to put pressure on JCPOA signatories to revive the nuclear deal.

“Imagine that al-Qaeda starts carrying out attacks at Iran’s behest, even if the control is not perfect.  Who is to say that this isn’t the next form of blackmail to pressure countries back into a nuclear deal?” Pompeo asked.

Pompeo is clearly trying to torpedo any future effort to revive the JCPOA. Over the past few years, he has taken many measures to ensure that the nuclear deal will not be revived. Pompeo led the Trump administration’s efforts to change the logic of sanctions and, in some cases, reimpose previously imposed sanctions under non-nuclear-related authorities, including the U.S.’s counterterrorism sanctions authority. The main purpose of these measures was to create what pro-Trump experts call a “wall of sanctions,” a strategy that aims to make it harder for the Biden administration to lift sanctions against Iran.

Establishing links between Iran and al-Qaeda may be intended to make it even more difficult for the incoming US administration to lift sanctions that were re-imposed under United States counterterrorism sanctions authority.  Pompeo may have succeeded in doing so.

In his recent interview with the website of the Leader’s office, Zarif said that a US return to the JCPOA will not be enough anymore because the US has imposed pre-JCPOA sanctions and changed their logic to terrorism-related authorities, which made the lifting of sanctions even more difficult.

According to Zarif, when the JCPOA was negotiated there was a different kind of sanctions imposed on Iran and the JCPOA has outlined how these sanctions would be lifted but the situation has changed after the Trump administration pulled out of the JCPOA.

“Over the past four years, Trump worked to hollow out the JCPOA and impose sanctions that even if the U.S. returns to the JCPOA, they will remain in place. For example, they (the Trump administration) removed nuclear-related sanctions on our Central Bank and Petroleum Ministry and imposed sanctions on them under counterterrorism authority. They basically changed the logic of sanctions,” Zarif said.

UAE aspires to become Israel’s largest trading partner?

Bilateral trade between Israel and the United Arab Emirates (UAE) could realistically reach as high as US$6.5 billion in several years, which would make the UAE one of Israel’s largest trading partners, Samir Chaturvedi, CEO of the Khalifa Industrial Zone Abu Dhabi (KIZAD), said at the UAE-Israel Peace and Prosperity Roundtable, presented by The Khaleej Times and The Jerusalem Post.

“I think that’s a realistic goal, not overly optimistic, “Chaturvedi said in a fireside chat on increasing bilateral trade. “Both of our economies are similar, in terms of size, population and innovation.”

David Leffler, Director General of the Economy Ministry, agreed.

“Both economies are export-oriented, and there are many reasons to be optimistic,” he said. “For example, the UAE imports about US$58 billion of precious stones and metals every year, and Israel imports US$12 billion. That can come out of that.”

Therefore, Leffler said, after all the official ceremonies about peace, the next step is for the countries’ business communities to get to know each other.

In a talk on preparing for a decade of economic transformation, Hamad Buamim, CEO of the Dubai Chamber of Commerce & Industry, expressed hope that normalization between the two countries will open up new opportunities in the post-pandemic world.

The year “2020 was a very difficult year, and everyone is looking for new markets to support economic recovery,” he said.

Buamim singled out tourism, healthcare, agriculture, food security and pharmaceutical equipment as areas ripe for new channels of cooperation.

A joint project with Israel’s Chamber of Commerce to map out other opportunities for collaboration will also help educate both sides and facilitate future cooperation, he noted.

In a panel on collaboration opportunities, Khalid al-Marzooqi, Commercial Director of KIZAD, noted that business “free zones” in Abu Dhabi offer a deregulated environment that helps create environments that are conducive for the ease of doing business.

Dr. Ibtesam al-Bastaki, Director of the Public-Private Partnership Department of the Dubai Health Authority, noted that Dubai’s government encourages public-private partnerships on many projects that allow it to split the risks with investors and provide potentially lucrative returns for dedicated investors.

Nir Hollander, Country Manager of Israel, Cyprus and Greece for cloud computing company Nutanix, noted that Israel and the UAE have a lot to learn from each other.

“Israel, the Start-up Nation, is said to have the most start-ups in the world outside of Silicon Valley, and Emirati society is known to be very innovative. The challenge will be to build infrastructures that will support future collaboration and trust for a long time.”

Biden appeasing Iran would be bad for US security, says Mike Pompeo

Lifting sanctions on Iran while it maintains its nuclear aspirations will endanger America and the world, US Secretary of State Mike Pompeo warned in an interview for The Jerusalem Post-Khaleej Times conference.

“If we appease Iran, if we underwrite Iran, if we allow Europeans to reenter [Iran] and create wealth for the kleptocrats at the head of this theocracy, that would be a bad thing for the region’s security, for Europe’s security and for American security,” Pompeo said.

Pompeo expressed hope that President-elect Joe Biden’s administration “will recognize that this is not 2015…The whole world can recognize that Iran is the destabilizing influence in the whole Middle East.”

The Trump administration left the 2015 Iran deal in 2018, and has maintained a “maximum pressure” sanctions campaign against the Islamic Republic. Biden has said he intends to bring the US back to the Joint Comprehensive Plan of Action, the Iran deal’s official name, along with an Iranian return to compliance.

Iran has repeatedly violated the agreement, most recently declaring last week that it would enrich uranium up to 20% in the underground Fordow facility.

As a result of the “maximum pressure,” Pompeo said “it’s very clear that Iran is more isolated than it has ever been.”

“Our decision to abandon the ridiculous thing called the JCPOA, which enabled, armed and provided resources and money to the largest state sponsor of terror in the world…put Iran in a place where it had to make hard decisions about its own economy, whether to feed its own people or fund Shi’a militias in Iraq and Syria,” he said.

Should Iran change its ways, the US can engage with its regime, Pompeo said, but “if they don’t, the US has to make sure it is part of a coalition that works alongside each other to promote stability in the Middle East.”

Building that coalition was one of the major factors in launching the Abraham Accords, in which the United Arab Emirates established diplomatic relations with Israel in August, followed by Bahrain, Sudan and Morocco.

“One of the things that enabled the Abraham Accords was America’s recognition that the most important players in this effort [against Iran] were the countries in the region, Gulf states, Israel – all those players were truly impacted,” Pompeo said.

Still, Pompeo said those countries did not just normalize ties with Israel because of the US; “it happened because it was the right thing to do.”

“Those sovereign nations came to the Abraham Accords…because it was the right thing for their own people,” he said. “These commercial, security and diplomatic relationships will continue to grow, and I hope the US will be an encouragement for that.”

The Abraham Accords has allowed the countries to partner with Israel to be “safer, more prosperous and more secure,” Pompeo said.

Normalization with Israel is “the right direction of travel for the entire region,” he added.

Asked if the rioting at the US Capitol last week was an obstacle to more countries establishing relations with Israel in the final days of US President Donald Trump’s term, Pompeo said he saw no correlation whatsoever.

“It’s not binary, normalizing or not. We see lots of countries moving in the right direction even if they have not formally signed the Abraham Accords,” he said.

Pompeo projected that Muslim-majority nations in Asia and Africa will likely be next to have open ties with Israel.

“It truly augurs well for security in the region,” he said.

Asked about the Pompeo Doctrine, his declaration that the State Department no longer sees settlements as illegal per se, he said: “We knew we had to recognize reality", adding that the US recognition does not undermine security for any country in the region. 

Similarly, Pompeo said that Jerusalem as the capital of the Jewish people and Israeli sovereignty in the Golan Heights are “just reality, and we recognized it.”

“We were told if we recognize those things all hecks would break loose and that didn't materialize,” he added.

At the same time, Pompeo said that the Trump administration worked to find a solution to the Israeli-Palestinian conflict, calling its peace plan “a real, true pathway for better existence for the Palestinian people.”

“The Palestinian leadership must get on board,” he said.

Chinese investment in undersea cable projects upsets United States and Australia

Moves by Chinese corporations to buy into undersea cable projects and telecommunications companies in the Pacific islands have become a point of major concern for Australia and the United States over the possibility of spying. This region has long been the backyard of Canberra and Washington. 

Now they increasingly find themselves fighting over influence with Beijing, which has strengthened its presence there by building infrastructure. The US has warned Pacific island nations about security threats posed by a bid by China's Huawei Marine to build a US$72.6 million undersea cable linking the Federated States of Micronesia, Kiribati and Nauru.

Washington sent a diplomatic note to Micronesia in July expressing strategic concerns about the project as Huawei Marine and other Chinese companies are required to cooperate with Beijing's intelligence and security services. It noted in a follow-up report that Republican senators Ted Cruz and Marco Rubio told Micronesia in a letter dated 18^th September 2020 that China could leverage its way into the project to wage "campaigns of espionage and geopolitical coercion."

Huawei Marine used to be under the umbrella of Huawei Technologies, the Chinese telecommunications equipment maker that has been targeted by the US sanctions, before it was acquired by China's Hengtong Group.

The East Micronesia Cable project is backed by the World Bank and Asian Development Bank. The bidding process ended in May and the World Bank and ADB are currently reviewing the bid evaluation report, according to sources.

An undersea cable is needed to improve the weak telecommunications infrastructure in the Pacific islands. Such equipment is important from a security standpoint due to the massive volume of data that flows through it. Because Washington is responsible for Micronesia's defense under a decades-old agreement, it apparently has concerns that Beijing will be able to get its hands on military and other classified information.

"Companies that are required to cooperate with their home government's intelligence agencies and to conceal such cooperation, as is the case with Chinese companies, pose risks to the integrity and security of data travelling through undersea cable systems," said Michael Shoebridge at the Australian Strategic Policy Institute.

Australia has removed Huawei Marine from an undersea cable project in the past. In 2018, it decided to finance construction of an undersea cable between Sydney, Papua New Guinea and the Solomon Islands, and excluded Huawei Marine, which had already received an order from the Solomon Islands. And in October, it decided to finance the connection of a submarine internet cable to the Pacific island nation of Palau along with the US and Japan.

There has also been talk of Chinese companies entering the mobile-phone business in the Pacific islands. Australian media reported that China Mobile is interested in acquiring the Pacific operations of Jamaica's Digicel.

A spokesperson for Digicel confirmed to Nikkei that the telecom has received unsolicited approaches from a number of parties with respect to its Pacific operations. The spokesperson declined to comment further as discussions with the parties are confidential.

Digicel is believed to control 90% of the mobile market in Papua New Guinea and more than half in Vanuatu and Tonga. The Australian government is considering offering financial support to local bidders circling the Pacific operations of Digicel to block Chinese companies from acquiring the politically sensitive assets, according to the Australian Financial Review.

South Pacific island nations have come to the forefront in the battle for dominance between the U.S. and China, and hold geopolitical significance for Washington and its ally Canberra.

Beijing held a videoconference with 10 of the region's 14 island countries in late November. Even though the topic of the meeting was the coronavirus pandemic, the joint press release issued afterward included a line stating that "Pacific Island Countries reaffirmed to uphold the One China principle," which asserts that Taiwan is an inalienable part of a single China.

The Solomon Islands and Kiribati both severed diplomatic ties with Taiwan in September 2019 and switched to Beijing. China had reportedly been offering infrastructure support to both countries for some time, and agreed that October to fund a stadium for the Solomon Islands.

The US and Australia worry that if Beijing builds structures in the region that can be put to military use, it could monitor their military activities.

A Chinese company and the fisheries minister of Papua New Guinea have signed a memorandum of understanding to build a US$147 million "comprehensive multi-functional fishery industrial park," according to the UK's Guardian newspaper.

The proposed site of the facility is only about 200 km from Australian shores. The possibility has been floated of the Chinese side building a port for this business, which could further stoke tensions in the area.

German Chancellor threatens 8-10 weeks lockdown

EUR resilience remained remarkable on Tuesday. The common currency ended the day higher against the USD and JPY despite German Chancellor Merkel’s warning that the lockdown may last for 8 to 10 weeks if the numbers don’t improve. 

Reportedly, she told her conservative party counterparts that “If we don't manage to hold off this British virus, we will have a 10-fold incidence by Easter.” The government also warned that there could be no travel until late May. Germany reintroduced lockdown measures in early November but restrictions that include travel limitations, closures of schools and non-essential businesses were tightened this week only. 

Lockdown until April all but assures another technical recession with a contraction in the fourth quarter of 2020 and first quarter of 2021. EUR should be much weaker, but it continues to be supported by virus optimism, low interest rates, the persistent rally in stocks and lackluster demand for USD. 

We saw this same resilience in the fall when EUR/USD shrugged off early signs of a second wave. Will EUR/USD finally break down? Probably but it may take a more meaningful correction in stocks to draw away risk on flows.

Meanwhile, GBP soared on the back of less dovish comments from Bank of England Governor Bailey. Despite the UK’s virus troubles, he expressed skepticism about the effectiveness of negative interest rates and that it was too soon to talk about the need for more stimuli. Bailey said the idea was “controversial.” He also noted that the pandemic had a lesser than expected effect on inflation. 

The USD gave back its gains amidst little economic data. There’s talk that the Fed could considering tapering sooner than previously suggested. With virus cases raging across the nation, it is far too early for this type of speculation. Still, Fed President Bostic continues to suggest that he’s in that camp in saying that prices are stronger than expected. 

US inflation numbers are due for release Wednesday – CPI is expected to be stronger than expected with gas prices and average hourly earnings on the rise. This week’s US economic reports should be firmer, keeping the possibility of a dollar recovery in play.

All three of the commodity currencies traded higher on Tuesday with AUD leading the gains. No major economic reports were released from any of these countries, leaving USD weakness and the intraday recovery in stocks driving demand for those currencies. 

 

Return to Iran deal could spark Middle East nuclear arms race, says Henry Kissinger

The new US administration should not return to the spirit of the Iran deal, which could spark an arms race in the Middle East, said former US Secretary of State, Henry Kissinger at a Jewish People Policy Institute online conference.

He criticized the 2015 Iran deal, which President Donald Trump left in 2018. President-elect Joe Biden seeks to return to it if Iran agrees to comply again with the agreement’s limitations on its nuclear program.

“We should not fool ourselves,” the 97-year-old diplomat, consultant and author said. “I don’t believe that the spirit [of the Iran deal], with a time limit and so many escape clauses, will do anything other than bring nuclear weapons all over the Middle East and therefore create a situation of latent tension that sooner or later will break out.”

The current leaders in Iran “don’t seem to find it possible to give up this combination of Islamist imperialism and threat,” Kissinger said. “The test case is the evolution of nuclear capacities in Iran, if these can be avoided.”

“I do not say we shouldn’t talk to them,” he added.

Dennis Ross, a former adviser to presidents George H.W. Bush, Bill Clinton and Barack Obama, interviewed Kissinger at the JPPI farewell event for its founding director, Avinoam Bar-Yosef.

Ross asked Kissinger what he would advise Biden and his administration to do to take advantage of the Abraham Accords, in which four Arab states normalized ties with Israel.

“We should not give up on what has recently been achieved in these agreements between the Arab world and the Israeli world,” he said. “I would tell the incoming administration that we are on a good course.”

The accords “have opened a window of opportunity for a new Middle East,” Kissinger said. “Arab countries understood that they could not survive in constant tension with parts of the West and with Israel, so they decided they had to take care of themselves.”

Normalizations with Israel show that the four states taking part “have come to the conclusion that their national interests transcend their ideological interests,” said the secretary of state and national security advisor to presidents Richard Nixon and Gerald Ford in the 1970s.

“So they have decided, and Israel has advocated, that they should pursue their interests and come together, and they will take into account Arab concerns where they clash.”

That idea “has worked out very well,” Kissinger said, adding that he always opposed the idea of finding “all-out solutions” to peace in the Middle East, advocating for the US “to work out the solutions that we can because they can build on themselves.”

The Palestinians need to give up on their “ultimate aims” and look for possible interim achievements, Kissinger said.

Bar-Yosef is leaving the JPPI after 18 years as president and founding director. The institute formulates policy recommendations for the government of Israel and Jewish organizations in areas such as Jewish identity, religion and state in Israel, fighting antisemitism and Jewish demographic trends.

His successor is Yedidia Stern, a law professor at Bar-Ilan University and longtime senior fellow at the Israel Democracy Institute.

Afghan president calls for long term relations with Iran

Afghan President, Ashraf Ghani said on Friday that the Afghanistan government must have short-term, medium-term and long-term relations with Iran. But the US sanctions, the Afghan president noted, have overshadowed the Tehran-Kabul relations.

Two million Afghans live in Iran, and our relationship must be based on mutual interests, President Ghani said in an interview with CNN, adding he hopes that the resumption of talks between the United States and Iran will have positive results for Afghanistan.

Ghani also addressed the issue of peace with the Taliban, saying that the Afghan society doesn’t want to go back.

“One thing needs to be clear; the Afghan society is not willing to go back and we’re not a type of society that the Taliban-type approach of the past can be imposed on us. That was the peace of the graveyard. We want a positive peace where all of us together overcome our past, embrace each other and together rebuild an Afghanistan that can be what I call a roundabout,” the president noted, calling on the US to chart a predictable process for withdrawing its troops from Afghanistan.

Ghani pointed out that the US has lost 98 lives in Afghanistan since 2015 “while we the Afghan people have lost over 40,000 civilians and military… We’re assuming responsibility for our future, so if the US would like to withdraw, all we ask for is a process that is predictable.”

Iran has also called for a responsible US withdrawal from Afghanistan. In a recent meeting of the UN Security Council on Afghanistan, Majid Takht-Ravanchi, Iran’s ambassador to the United Nations, voiced support for Afghan peace talks, saying the success of the talks “requires flexibility and patience by all sides, placing the interests of the people of Afghanistan above all other interests.”

Takht-Ravanchi expressed concern over the presence of foreign forces in Afghanistan but at the same time called for an “orderly and responsible” withdrawal of these forces.

“As a manifestation of external interference, the presence of foreign forces is another source of Afghanistan’s instability. However, as many countries have stressed, their withdrawal must be orderly and responsible and must not lead to a security vacuum in Afghanistan. Accordingly, prior and simultaneous to the withdrawal of foreign forces, Afghanistan’s military and security forces must be supported and strengthened,” the Iranian diplomat said.

“Afghanistan’s decades-long insecurity and instability can end only through a comprehensive and inclusive Afghan-led and Afghan-owned peace process, involving all Afghan factions, including the Taliban, supported by neighboring, regional and international partners,” he noted.