THE BLOG
08/13/2015 10:42 am ET Updated Aug 13, 2016

Why the European Union is a Big Winner from the Iran Deal

On July 14, 2015, Iran and six world powers agreed to a landmark deal to suspend Iran's nuclear program. The deal offered Iran sanctions relief and an end to its international isolation, in exchange for Iran's pledge to stop its quest for a nuclear bomb. After the conclusion of this deal, the European Union's High Commissioner for Foreign Affairs, Federica Mogherini made a powerful statement highlighting the prominent role of the European Union in the Iran negotiations. In her exact words: "What we have achieved is the result of the strong political will of all parties, and the combined commitment of many. But it is mainly thanks to the extraordinary work of an extraordinary team, the European one, that we made it."

This bold statement contrasts markedly with the EU's typically low-key rhetoric on its involvement in world affairs. Despite this change in behaviour, the EU's role has largely been overlooked in most analyses of the deal in the Western press, which have predominantly focused on the implications of the deal for the United States, Middle East security and to a lesser extent Russia. It is therefore important to consider the EU's instrumental role in the Iran nuclear talks.

The EU's approach to resolving the Iran nuclear crisis gradually morphed in the years following the start of its involvement in 2004. Initially, the EU's primary role was as a mediator between Iran and the international community. As the talks progressed, the EU moved beyond mediation to demonstrate to the world that it can be an assertive actor capable of formulating its own policies. The EU's unerringly consistent message that military action against Iran was an unacceptable outcome defined the EU's position in the Iran nuclear talks. The EU's successful achievement of its preferred outcome in the Iran talks provides concrete justification for Mogherini's statement.

Putting the EU's Mediating Role and Increased Assertiveness in Context

Since the early 2000s, the EU has been eager to prove itself as an independent actor in a multipolar world, through the defense of its doctrine of effective multilateralism. Effective multilateralism emphasized the EU's close involvement with other international institutions like the United Nations. It also strengthened the EU's effectiveness as an institution by promoting a more cohesive foreign policy identity that could transcend variations in foreign policy doctrines across its measures. Effective multilateralism was initially difficult to implement as it conflicted drastically with the Bush administration's unilateral, neoconservative foreign policy inclinations.

The gradual U.S. tilt towards multilateralism after the backlash caused by the 2003 Iraq War, provided more credibility for the EU's doctrine. The EU's involvement in the Iran negotiations has become the symbol of its flagship effective multilateralism project. The 2004 Paris Agreement placed the EU on the map in the Iran negotiations, and involved close trilateral cooperation between the UK, France and Germany. In that treaty, Iran agreed to dismantle part of its nuclear program and allow IAEA inspectors into the country.

When the conservative Mahmoud Ahmadinejad government, elected in 2005, violated the Paris Agreement, the EU, and in particular Mogherini's predecessors, Catherine Ashton and Javier Solana played a fundamental role in mediating between the US and Iran. Sustained intransigence from the Iranian regime caused the EU to alter its doctrine of effective multilateralism. It assumed a tougher stance on the nuclear issue and imposed an oil embargo and sanctions on financial services in 2012.

The importance of the EU's mediation role diminished after the election of the rhetorically moderate Hassan Rouhani created a limited thaw in U.S.-Iran bilateral relations. Rouhani, in late 2013, emphasized Iran's need to cement closer multilateral ties to the U.S. and the EU, and in particular, praised Italy's role in providing a gateway for more conciliatory Iran-EU relations.

Rouhani's rhetoric ushered in a new wave of soft power-building efforts between the EU and Iran. In December 2013, eight representatives of the European Parliament traveled to Iran and met with prominent Iranians of all political stripes, ranging from conservatives to human rights activists. Jewish organizations and German human rights watchdogs scathingly criticized these efforts, but they further underscore the EU's unwavering resolve to achieve a diplomatic solution to the Iran nuclear crisis.

Why the European Union was so committed to Diplomatic Engagement and a Peaceful Solution to the Iran Crisis

The European Union's especially active role in resolving the Iran nuclear crisis can be attributed to a wide range of long-standing economic and political linkages with the Iranian regime, that the EU was keen to preserve. In particular, the EU's policy towards Iran was driven by its need to access Iranian energy reserves. Iran possesses the biggest combined energy deposits in the world, with the fourth largest oil reserves and second largest natural gas reserves. Prior to the institution of the EU oil embargo in 2012, Iran was the seventh largest provider of oil to the European Union. The EU also opted not to extend its sanctions to Iranian electricity exports, which allowed the Iranian natural gas industry to become a source of limited foreign currency influxes.

The 2014 Russian annexation of Crimea and subsequent souring of relations between the EU and Russia led to optimism amongst European policymakers that a nuclear deal with Iran would result in Iranian energy exports, compensating for disruptions in the flow of Russian gas. Iran's rhetoric on this issue vacillated, however. On September 24, 2014, Rouhani declared that Iran could be a "secure energy center for Europe". A little over a week later on October 4, however, Rouhani declared that Iran was not ready to replace Russia as a gas exporter as its extraction capacity was limited and Iran needed to satisfy domestic demand first. Despite Rouhani's inconsistent rhetoric and a long history of Russian defense linkages to Iran, the notion that Iran could be an energy partner that could assist in containing Putin undoubtedly featured in the minds of European policymakers.

European businesses also provided extensive support for an Iran nuclear deal. According to Ramin Rabii, the CEO of Turquoise Partners Group, an organization that encourages the inflow of foreign investment to Iran, more than 100 Western business delegations traveled to Iran in the 15 months prior to the nuclear deal with 90% of those delegations representing European businesses. German business leaders targeted a doubling of trade with Iran in the immediate aftermath of the deal. The wave of interest in European investment in the Iranian energy and manufacturing sectors signifies that businesses clearly saw the benefits for a peaceful resolution to the Iran crisis.

Despite common economic interests that would be satisfied by enhanced cooperation with Iran, EU countries varied in their commitment to the Iran nuclear deal. Germany's emphasis on energy security led it to be very proactive in promoting the Iran deal. German Foreign Minister Frank-Walter Steinmeier also forcefully denounced Republican threats to reject the Iran nuclear deal in the U.S. Congress. France, by contrast, was on the opposite extreme, leading the last-minute resistance to U.S. efforts to remove sanctions on Iran. A top French official rebuffed John Kerry's and Steinmeier's emphasis on the need for Congressional Republicans to accept the deal, by claiming that if this Iran deal failed, another improved Iran deal could be made.

The European Union's ability to smooth drastic differences amongst its members and retain a prominent mediation role is a testament to the EU's success and justifies Mogherini's optimistic outlook of the EU's ability to project influence on world affairs. The EU's effectiveness in bringing about the Iran deal can be a role model for smoothing discord amongst EU member states on other issues like how best to confront Putin's aggression in Ukraine.

Despite these positives, serious questions must be raised about the long-term sustainability of the EU's effective multilateralism strategy with regards to Iran. Should Iran fail to comply with the deal's terms and continue to destabilize the Middle East through the sponsorship of terrorist networks, the Iran deal could become an agent of polarization rather than a breeder of new confidence in the EU's ability to act as a diplomatic arbiter. Ultimately, Iran's conduct and the willingness of EU countries skeptical about the deal, like France, to remain committed to a common European approach will provide the basis for a final judgment of Mogherini's triumphalist statement.