The P5+1-Iran Interim Nuclear Agreement: First impression of an agreement 11 years in the making

IranPolitik was live at the Intercontinental Hotel and Centre International de Conference Geneve (CICG) in Geneva, Switzerland, as the historic interim agreement between the United Nations Security Council Permanent Five plus Germany (P5+1) and the Islamic Republic of Iran was signed and unveiled to the world. While the agreement is a very positive step toward addressing the international community’s nuclear non-proliferation concerns and re-integrating Iran into the global economic and political system, much remains to be seen in terms of how the agreement will play out in practice. We briefly summarize the agreement based on the short document circulated by the P5+1 and Iran and look to possible areas of future contention as the P5+1 and Iran seek to implement the document over the next six months.

The Deal

The interim agreement, or “First Step Understandings Regarding the Islamic Republic of Iran’s Nuclear Program”, is a brief but relatively comprehensive document which touches on all of the key points raised by the IranPolitik primer on the nuclear issue. It is to last for six months, and sets up a long-term multistep process which, if successfully executed, will lift nuclear-related United Nations, United States, and European Union economic sanctions on Iran, normalize the status of the Iranian nuclear program at the United Nations Security Council and International Atomic Energy Agency (IAEA), and begin the process of normalizing Iran’s relations with the West and most of its neighbors. Critically, the agreement establishes a “Joint Commission” of the P5+1 and Iran which will “monitor the implementation of the near ­term measures and address issues that may arise.” Some of the key elements of the agreement are outlined below.

Uranium Enrichment: The deal pledges Iran not to enrich uranium above five percent and effectively eliminates Iran’s stockpile of uranium refined to 20 percent, which many experts see as a short technical step away weapons grade material, by fabricating half of it into fuel for the Tehran Research Reactor (TRR) and diluting the other half to no more than five percent.

The deal further freezes the number of installed centrifuges Iran to current levels, allowing it to install new centrifuges only as replacements of damaged machines (replacements must be of the same type). Furthermore, Iran will cease operating three quarters of its centrifuges at the Fordow Fuel Enrichment Plant (FEEP).

IR-40 (Arak) Heavy Water Reactor: The interim agreement also touches on the Arak facility, which has not yet been completed, but which may in the future provide Iran with a plutonium path to a nuclear weapon.  For the duration of the agreement Iran “will not commission the reactor or transfer fuel or heavy water to the reactor site and will not test additional fuel or produce more fuel for the reactor or install remaining components.”

IAEA Inspections: While the interim agreement does not pledge Iran to sign the Additional Protocols, it does impose a vigorous inspection regime, or “enhanced monitoring”, which will provide for daily inspections and cover some if not all of the most sensitive aspects of the Iranian nuclear program, including the Arak reactor and Natanz and Fordow uranium enrichment facilities.

Sanctions-relief: The major short-term incentive for Iran under the interim agreement is what a White House fact-sheet on the deal has called “limited, temporary, reversible [sanctions] relief.” According to the provisions of the interim agreement, pursuant to Iran’s compliance the P5+1 would refrain from imposing new sanctions for six months. In terms of Iran’s energy trade, the agreement would “[E]nable the repatriation of an agreed amount of revenue held abroad” and allow importers of Iranian crude oil to continue their purchases at current averages without the hindrance of insurance and transportation sanctions. The agreement would also suspend sanctions on Iran’s imports/exports in terms of petrochemical products, precious metals, the auto sector, and civilian aircraft spare parts and safety, among other things. Finally, the deal would create a financial channel to facilitate humanitarian trade for Iran’s domestic needs including “food and agricultural products, medicine, medical devices, and medical expenses incurred abroad,” as well as potentially a larger list of items. One possible use of the channel which has gained particular positive attention is to allow the thousands of Iranian students studying abroad to receive funds from Iran to pay for tuition and living expenses.

If implemented, the interim agreement can be a very positive first step in resolving the Iranian nuclear saga by addressing the international community’s nuclear non-proliferation concerns as well as normalizing Iran’s international status. But few things in life go according to plan, and the P5+1 and Iran may find themselves facing a number of impediments in implementing this plan over the next six months.

Clash of Narratives

Sitting at the CICG auditorium in Geneva early Sunday morning, we were surprised to find just how divergent the narratives of the United States and Iran were regarding the nature of the interim agreement. Even before Iranian Foreign Minister Javad Zarif took the stage to give his remarks and answer questions, the White House had released a fact-sheet which framed the interim agreement as a victory for the United States that denied Iran some of its basic demands, including more expansive sanctions-relief and acknowledgement of Iran’s “right” to a peaceful uranium enrichment program.  The fact sheet clashed with Zarif’s presentation, which very much asserted the latter right. And possible discrepancies existed elsewhere. For example, both the documents specified the number of installed centrifuges to be left operating at Fordow, while only the White House fact-sheet specified that nearly half of Natanz’s centrifuges would remain inoperable. The gulf between the two sides’ official explanations of the agreement seemed even further after Secretary of State John Kerry’s triumphal speech, which reiterated the key points of the White House fact sheet.

The gap between the United States and Iran here may have a simple, political, explanation: Their respective interpretations allow each side to more easily sell the deal to domestic audiences and, for the United States, to foreign allies. If there is a shared understanding of the agreement, than this can be explained away as a tactical issue of limited significance. But if there is indeed a divergence in interpretation, it could leave both sides vulnerable to domestic attacks. In the case of both countries, domestic opposition to the deal could make the implementation of the interim deal more difficult, and kill a final deal. Just as seriously, divergent interpretations could lead to a breach between the P5+1 and Iran which could seriously undermine a multidimensional negotiation process already fraught with complexities.

The deal is also ambiguous about the expected end-state, and this is likely out of necessity as it remains to be negotiated. But expectations about the end-state could change over the period of the interim deal. This could especially leave Iran vulnerable, as it appears to have met the P5+1 more than half way in expectation that in later phases, it will receive more incentives. Yet, for instance, having taken steps to eliminate its supply of 20 percent enrichment uranium even as sanctions remain intact and no “right of enrichment is explicitly recognized,” Iran will have a weaker bargaining position in six months and will have to rely on the good faith of the P5+1.

This Sunday we experienced a historic moment in Geneva, and IranPolitik is happy to have been there to witness it. Sunday morning was especially catharstic for millions of Iranians, many of whom stayed awake through the final evening of the talks to hear the outcome, because the nuclear saga has had such a profoundly negative impact on their lives. Iranians today not only live with the threat of war over their heads, but have witnessed a steady decline in their standard of living thanks to sanctions. For all the promise it holds, however, we are only at the start of a long process and many challenges lay ahead.

Update: 25 November 2013

Former U.S. Ambassador to the North Atlantic Treaty Organization (NATO) Nicholas Burns, responding to expected criticism of the interim agreement by American conservatives, tweeted Monday: “What I told @FoxNews on #Iran deal: Good for U.S.; sensible halt progress on Iran program. Gives time for much tougher final deal.”

Given Burn’s good ties with Barack Obama administrations one wonders whether this reflects the real position of the White House. While it is still a little soon to gauge the reaction of Iranian conservatives, who are suspicious of the intentions of the United States and European Union, they cannot be overjoyed about how much Iran has conceded in exchange for limited sanctions relief. If the Obama administration truly seeks a “much tougher final deal”, the months ahead could be even more difficult than we expect.