Protests, arms to Russia and the nuclear deal

It has been a tumultuous year for Iran.

A year that some believed would see the revival of the Iran nuclear deal and successful diplomacy with the West has seen Iran strengthen its ties with Russia. A popular protest movement was violently suppressed Led by women.

 

Table of Contents

Investment news

What lies ahead for the country and its foreign actions will have significant consequences not only for millions of Iranians, but also for Ukraine, Russia, much of the Middle East, and the foreign policy of Western governments.

The Biden administration went from promoting negotiations on reviving the Iran nuclear deal to imposing additional sanctions on and condemning Tehran. Providing lethal weapons and training to Russian forces fighting in Ukraine. Despite evidence that Iranian-made drones have wreaked havoc in Ukrainian cities, Iran’s Foreign Ministry denies any knowledge of Iranian arms transfers to Russia.

And the country of 85 million people is in what is described as a protest movement The biggest challenge to the Islamic Republic government in decades. Meanwhile, its economy revolves and it Currently enriching uranium to its maximum level – That means Iran has never come close to achieving the capability to build a nuclear bomb.

“2023 will be a pivotal year for Iran,” Ali Vaz, director of the Iran program at the nonprofit Crisis Group, told CNBC. “The economy is more troubled than ever; society is more disaffected than ever; and the country is more isolated than ever.”

“The Islamic Republic is what the Soviet Union was in the early 1980s, not the late 1980s,” Vaez said. “It is an ideologically bankrupt, economically broken and politically paralyzed regime.”

“However,” he added, “it still has the will to fight.”

Already in 2021, Rafael Croci, head of the United Nations nuclear watchdog, told reporters. Only “bomb-making countries” are enriching uranium on the scale of Iran 60% – This is a technological step away from weapons grade, which is 90% purity.

Under the 2015 Iran nuclear deal — which included the United States and other powers and lifted economic sanctions on Iran in exchange for curbs on its nuclear program — Iran’s uranium enrichment was set at 3.67%, enough for a civilian nuclear program.

“Prospects for the revival of the JCPOA are dim in 2023,” said Henry Rome, a senior fellow at the Washington Institute for Near East Policy, referring to the agreement by its official summary, which refers to the Joint Comprehensive Plan of Action.

Rome added that “the ‘extension and pretense’ approach to the nuclear deal will continue for some time,” rather than halting it altogether in response to Iran’s apparent support for Russia and its brutal crackdown on opponents. Negotiations have been suspended since September.

The Trump administration pulled the U.S. out of the deal in 2018, reimposing tough sanctions on Iran, damaging its economy and pushing its government to ramp up nuclear development. Chances of the Biden administration reviving the deal are shrinking fast.

And the time to salvage anything is running out — the deal’s key nuclear restrictions are due to expire in late 2023 when “sunset provisions” are set in place.

“The original JCPOA will expire in 2023,” said Ryan Ball, senior Middle East and North Africa analyst at RANE. And, he added, “neither Europe nor the United States is willing to grant sanctions relief to a regime that actively represses dissent.”

Negotiators will have to start fresh, and some analysts say Western signatories to the deal will want to find a solution to the protest movement first.

Meanwhile, the West is announcing new sanctions while Iran is pushing forward with its nuclear development, creating a bigger and bigger gap between the two sides.

Nationwide protests that began in mid-September quickly spread to several cities across Iran, when Mahza Amini, a 22-year-old Kurdish Iranian woman, died in police custody after being arrested for violating Iran’s strict headscarf rules. The unrest turned into a full-fledged movement demanding the overthrow of Iran’s hardline theocratic government, the Islamic Republic.

But nearly four months later, after a campaign of bloody crackdowns and state executions, the question remains: How long will the protests last?

“The four forces to keep your eyes peeled for in the Iranian protests in 2023 are the streets, strikes, sanctions and security forces,” said Behnam Ben Taleblu, senior fellow at the Foundation for the Defense of Democracies. He expects continued protests against the Islamic Republic in 2023, despite the government’s greater leverage in the exercise of power.

“The regime has all the tools of repression and will use them increasingly,” he said, but Iranians’ demands for political change inevitably mean more domestic instability.

Most Iran analysts interviewed by CNBC expect the demonstrations to continue in some form, but estimates of their intensity and effectiveness vary.

Rome noted that while the protests could still take unexpected turns, “the protesters have not yet mobilized substantial, sustained support in key economic sectors or attracted defections from the security services.”

For Raney’s Ryan Bohl, the most likely outcome is that protests are “eventually suppressed and dispersed.” The second effect is that the movement becomes institutionalized and becomes a viable opposition movement that is able to extract concessions from the regime.

A third and “less likely” — but still unlikely — outcome next year is that “the resistance movement intensifies to include other sections of Iranian society and creates divisions within the regime that could actually threaten its survival,” Bohl said.

The latest conflict between Iran and the West comes amid the Russia-Ukraine war, in the form of deadly Iranian drones used by Russian forces to attack Ukraine.

This has already prompted more US and EU sanctions on Iran – but it is unlikely to stop the growing cooperation between the two increasingly isolated countries.

“Iran cannot afford to alienate Russia,” said the Crisis Group’s Vaez. “The West needs to be creative in finding a way to slow down and limit the arms transfer to Russia,” he said — something the Biden administration is already doing. Allegedly involved in an attempt to block Iran’s access For foreign components for weapons.

Still, “more drones and missiles and technical cooperation in military matters seems possible,” said Boll, in addition to deep trade links to create a “barriers-proof trade network”.

That would have diplomatic costs, something Tehran appears prepared to weather, but it’s unclear what it will get in return — money, weapons, technology, or a combination thereof.

In any case, “Iran is likely to continue playing hardball in 2023,” Ben Taleblu said, adding, “I fully expect Russia and Iran to continue tightening security, political and economic ties in 2023.”

“An increasingly risk-tolerant political elite is unstoppable abroad as they face challenges at home,” he said. “If Iran were to proliferate ballistic missiles and not just drones for Russia to use in Ukraine, that would be further evidence of this notion.”