Germany and Iran
What will the new American administration and its European allies do to prevent Iran from getting the bomb?
TELOSscope, February 8, 2021
The days are over when Europeans only had to point to Donald Trump to legitimate their appeasement politics toward Tehran. But what will the new American administration and its European allies do to prevent Iran from getting the bomb?
Of course there is the nuclear deal with Iran. For months its proponents have been hoping for Joe Biden’s electoral victory. He would revoke Trump’s leaving the deal and loosen the sanctions on Iran; in return Iran would revise its violations of the agreements, and everything would be good again.
And now? Biden is still holding onto his controversial promise to return to the deal. He has filled the most important positions in the State Department with people who played leading roles in the negotiation of the deal under Barack Obama, including some who—like the new Iran envoy Robert Malley—proved to be particularly accommodating toward Iranian demands. And Biden has not at all insisted that the regime change its missiles program or aggression policies in response to a lifting of the American sanctions. He has only asked for one concession: that Iran return to the terms of the deal before lifting the sanctions that Trump imposed.
But this is where the regime refuses to cooperate. It wants to rescind its technological violations of the agreement only after Biden retracts Trump’s sanctions.
Meanwhile Tony Blinken, the new secretary of state, is insisting on Biden’s terms: Iran must first return to the terms of the deal, subject to inspection and proof, before any revocation of the sanctions—which means more resources for the regime—can be possible. Although Washington is infinitely more powerful, Tehran believes it can blackmail the United States with an ultimatum.
Unless the sanctions are revoked by February 21, the window of opportunity for the Iran deal will close, according to Foreign Minister Javad Zarif. At that point Tehran will accelerate its nuclear program, send most IAEA inspectors home, and accelerate the uranium enrichment even more. That would be the definitive end of the deal. Ali Vaez, the Iran expert of the International Crisis Group, calls this a “ticking time bomb.”
This will be an early test for the Biden administration. If it caves in to Tehran, it will be seen as incapable, and it will have to expect an Israeli attack on the Iranian nuclear arms project. If it sticks with its conditions, the Iranian regime could undertake a massive escalation—or it might give up, which, given its genuine weaknesses, is more realistic.
However, the outcome of this test of strength is open. While Iran has secured Moscow’s support for its demands on Washington, the foreign ministers of France and the United Kingdom spoke with their colleague Blinken by telephone and agreed to the American priorities. “The French and U.S. administrations were clear on what needed to be done,” according to an official close to Macron. But what about Germany?
Iran and the Bundesbank
During the past 25 years, the Federal Republic of Germany has played a mediating role in the Iranian-American nuclear conflict, or it has preferred—sometimes in the open, sometimes behind the scenes—the Iranian standpoint. John O’Donnell, the Reuters chief correspondent, uncovered a current example of hidden German support for Iran in December 2020. He shows in his article that the Deutsche Bundesbank has been acting as the transfer venue for the financing of business with Iran; a speaker for the Bundesbank has confirmed this. It provides services to five Iranian banks, two of which are under U.S. sanctions, including Bank Melli, which is run by the regime.
As of the beginning of 2020, these banks had deposits reaching 3.8 billion euros to support German firms doing business in Iran. Records of the Bank for International Settlements show that as late as October 2020, 3 billion euros were still available.
This is how Trump’s strategy of “maximum pressure” was effectively undermined. In October 2020 the regime was particularly weak, since Trump had placed 18 Iranian banks under sanctions that month. Tehran’s connections to the global finance system were nearly capped, but the Iran deposits in the Bundesbank were a lifesaver for the regime.
If a private German bank had allowed this deposit, the U.S. could have blocked its access to the American market and additionally imposed high fines. However since the Bundesbank has the status of a government agency, it had little to fear. As early as 2011, the German government under Angela Merkel had used the Bundesbank to circumvent Barack Obama’s sanctions by transferring billions from India to Tehran.
Then-Vice President Joe Biden will remember the role Germany played. It was during his period in office that a telephone call took place between Chancellor Merkel and President Obama concerning the “European-Iranian Commerce Bank,” located in Hamburg, which was undermining the international sanctions regime. The renowned journalist John Vinocur reported on August 2, 2010, in the New York Times:
“I have also been told that similar reluctance, this time involving German hesitation to clamp down on a bank in Hamburg facilitating suspect European deals with Iran, resulted in a recent phone call, to no immediate avail, from Mr. Obama to Chancellor Angela Merkel.”
O’Donnell’s revelations were fully ignored by the German-language press. He also quoted a specialist for financial crimes who stated that Germany stands out internationally in its willingness to maintain accounts for Iran. And he quotes a European diplomat who claims that Germany is in the lead in the efforts to save the nuclear deal with Iran. Perhaps this is why Heiko Maas, the German foreign minister, urged the United States in late 2020 to take the first step toward Tehran:
“The key point is whether the U.S. will loosen its economic sanctions on Iran. The two sides have to move toward each other. Time is of the essence because there is a presidential election next year in Iran.”
It is clear that this position collides with Biden’s demand that Tehran must move first. Is this why the German government has said nothing about the recent telephone calls with Biden and Blinken?
The Failure of the EU
What is the EU doing in this matter? When the EU foreign ministers gathered on January 25, 2021, the Iran deal was high on the agenda. Iran’s recent plans for uranium enrichment could “undermine . . . diplomatic efforts to facilitate a return of the U.S. to the nuclear agreement,” warned Josep Borrell, the EU minister for foreign affairs, in his invitation to the meeting. But in the subsequent press conference, the matter was not mentioned at all. Perhaps because there was no consensus on the topic?
Although the E-3 group—United Kingdom, France, and Germany—issued three joint statements in the first weeks of the new year, there has been no joint statement since Biden’s inauguration. Is this because of differences concerning Biden’s Iran policy?
When Trump left the nuclear deal in May 2018 and placed new sanctions on the regime in order to force a change of course, the E-3 did not only take Tehran’s side but also initiated financial devices to undermine the sanctions and save the deal. However, when in May 2019 Tehran began intentionally to violate the terms of the deal, the Europeans refrained from taking any steps in response, only issuing admonishing statements. A review of the “success” of this strategy during the past six weeks is revealing:
December 2, 2020: Iran’s pseudo-parliament takes the decision to prepare for uranium enrichment to 20%, in flagrant violation of the agreement.
December 7, 2020: Germany, France, and the United Kingdom describe this step as “deeply worrying. . . . If Iran is serious about preserving a space for diplomacy, it must not implement these steps.”
December 21, 2020: The regime has taken these steps. The foreign ministers of the states involved in the deal—E-3, Russia, People’s Republic of China, and Iran—convene under the auspices of the EU Minister for Foreign Affairs Borrell. Their joint declaration refrains from mentioning Iran’s provocative step, although the ministers express their “deep regret” over the U.S. withdrawal from the deal. Nor is there any mention of additional demands on the regime, such as ending its missiles program or its regional expansionism. Everyone at the conference reportedly was in agreement that the United States must “go back to the deal the way it is and without preconditions and without saying yes, but we want to add something more.”
December 22, 2020: The state-run Iranian media celebrate. They refer to a “taming” of the European foreign ministers and are elated over “the rejection of the non-nuclear pre-conditions” by the E-3, viewed as a victory won thanks to “Iran’s dignified position” and its politicians.
January 2, 2021: The weakness of the E-3 encourages Tehran. The head of the Iranian Atomic Energy Organization, Ali Akbar Salehi, announces that the production of 20% enriched uranium has begun. His military tone on state television underscores the goal of this step: “We are like soldiers, and our fingers are on the triggers…. The commander should command and we shoot. We are ready for this and will produce as soon as possible.”
January 6, 2021: The E-3 again “strongly urges” that the violations of the agreement end.
January 11, 2021: The EU joins the protest of the E-3, but its statement concentrates on a goal shared by Tehran: the return to the nuclear deal, even though it can at best delay but never prevent Iranian access to nuclear weapons.
January 13, 2021: The weak European reaction invites the regime to make its boldest move so far: It announces that it is immediately commencing with the preparation for production of uranium metal, a material that is primarily used in nuclear weapons and previously played a key role in the Iranian nuclear weapons project twenty years ago.
January 16, 2021: While in Israel a discussion about preventive military strikes erupts immediately after this announcement, the E-3 limits itself again only to verbal protest: one is “deeply concerned” and “strongly urges” that Iran end these activities. On the next day, French Foreign Minister Jean-Yves Le Drian appropriately states: “Iran is in the process of acquiring nuclear [weapons] capacity.”
Why No Snap-Back?
It is clear to see: The tentativeness that the E-3 adopted during these six weeks did not move Iranian policy toward moderation but rather to an acceleration of its preparation for a bomb.
Of course, the E-3 might have responded differently. About a year ago, on January 13, 2020, the group initiated the “dispute mechanism” in response to continued Iranian violations. This mechanism gives every participating state the possibility to threaten a snap-back if Tehran does not revoke its violations within a few weeks. Snap-back means that all the UN sanctions would come back into force. Iran continues to fear this tool. Why is the E-3 so reluctant to threaten its use in order to force the regime to change course?
Biden’s tactics pose questions as well. His concept of stages envisions first a return to the nuclear deal as well as the lifting of the sanctions. Then in a second step, all other problems are to be negotiated, such as an extension of the obligations in the agreement and the end of the Iranian rocket program. But how is that supposed to work if the new administration gives up all its sanctions leverage in order to restore an obsolete and flawed agreement? Does Washington really believe that one merely needs good arguments to convince the Iranian regime to give up its plans for a bomb?
The mullahs’ goal is complete nuclear ability. Their strongest tool to make progress is the fear of the Iranian bomb and the fear that Iran might leave the deal or the nuclear Non-Proliferation Treaty. The effectiveness of this tool was perfectly clear during the negotiations, as Barack Obama gave up one American position after another, in order to keep Tehran in the game.
But what kinds of pressure can Biden bring to bear? First there is the enormous military superiority of the United States. But if he wants to avoid military action, then he only has one other tool: Trump’s sanctions. The prospect of lifting those sanctions is the only remaining incentive for Tehran to change its policies. Ending the sanctions prematurely would mean losing this last bit of leverage. Biden would give up the sole instrument that might lead to changes in the deal, let alone additional demands of the international community concerning the missiles program, the terror against the Iranian people, and the regime’s destructive role in the region.
Germany should “also support a military attack by the United States and/or Israel against Iran.”
In Germany, Guido Steinberg, a renowned Middle East expert, has expressed concern. He is a fellow at Germany’s most important foreign policy think tank, the German Institute for International and Security Affairs. “A return to the nuclear agreement with Iran in its previous form is improbable,” he predicted in a working paper for the Federal Academy for Security Policy. On the contrary, the “conflict has the potential to worsen.”
The cause is “primarily Iranian expansion in the Middle East.” The Islamic Republic “as a Shiite-Islamist and revolutionary-anti-imperialist power [aims] at a revision of the regional power structure.” Given the power struggle between Iran and Saudi Arabia, Steinberg considers it improbable that Tehran “will give up its wish for a bomb of its own” and make substantial concessions to the United States. Germany too should be “preparing itself for crises scenarios.”
Steinberg draws a remarkable conclusion from this lucid analysis. It is necessary, he writes, “for Germany to rethink its hitherto valid interest” and “in an extreme case” consider supporting military strikes:
“Politicians, diplomats, and scholars have frequently argued in recent years that it is paramount to avoid a military conflict between Iran and its neighbors. However the even more important interest of the Federal Republic should be to prevent the nuclear armament of the regional states. The necessary implication of this interest definition could be in an extreme case support for a military strike by the United States and/or Israel, if this should become necessary in order to prevent Iran’s nuclear armament.”
Steinberg makes an important distinction. On the one hand, he sees German politicians, diplomats, and scholars, who would rather accept an Iran capable of nuclear weapons than “a military conflict.” This is an accurate depiction of the priorities in German Iran policy to date.
However, on the other hand, Steinberg sees those who prioritize preventing an Iranian bomb and who regard military strikes for this purpose as appropriate. This group includes Israelis of most parties as well as their new Arab allies. Germany should belong to this group too, according to Steinberg: “A clearer formulation of this interest could also serve the purpose of increasing pressure on Iran.” To be sure. But at this point, no one in Berlin wants to face the prospect of the necessity of military action.
Translated by Russell A. Berman.
1. Kim Hjelmgaard and Deirdre Shesgreen, “Exclusive: Iran Diplomat Says ‘Window Is Closing’ for Biden to Rejoin Nuclear Deal,” USA Today, January 28, 2021.
2. “Iran Will Take Steps Next Month to Curb Short-Notice IAEA Inspections: Official,” Reuters, January 26, 2021.
3. John O’Donnell and Jonathan Saul, “Exclusive: European Allies Pushed Back When Trump Sanctioned Iran’s Banks,” Reuters, December 1, 2020.
4. See my “Indien, Iran und die Bundesbank” in Matthias Küntzel, Deutschland, Iran und die Bombe (Berlin: Lit Verlag, 2012), pp. 143-52; or Küntzel: “Berlin lässt iranische Bank in Hamburg fallen,” matthiaskuentzel.de, May 15, 2011.
5. John Vinocur, “Loopholes Let Iran Off the Hook,” New York Times, August 2, 2010; see also my “EIH-Bank Hamburg: ‘Lebensader des Regimes’” Welt, September 29, 2010; and Küntzel, “Berlin muss die deutsch-iranischen Bank in Hamburg schließen,” matthiaskuentzel.de, September 29, 2010.
6. “Es muss ein Signal an Iran geben,” interview with Minister for Foreign Affairs Heiko Maas, Spiegel 50 (December 5, 2020), p. 32.
7. “Iran-Abkommen an ‘kritischem Punkt,’” Frankfurter Allgemeine Zeitung, January 20, 2021.
8. Federal Foreign Office, “E-3 Statement on the JCPoA: Response to Iranian Plans to Expand Its Nuclear Programme and Restrict Access of IAEA Monitoring,” press release, December 7, 2020.
9. Federal Foreign Office, “Joint Ministerial Statement on the Joint Comprehensive Plan of Action,” press release, December 21, 2020.
10. Laura Rozen, “Europe, Biden Aligning on Saving Iran Deal before Expanding on It,” Diplomatic (substack.com), December 21, 2020.
11. Mideast Mirror, December 22, 2020.
12. Robin Wright, “Biden Faces a Minefield in New Diplomacy with Iran,” New Yorker, January 4, 2021.
13. “E-3 Foreign Ministers’ Statement on JCPoA: January 6, 2021,” GOV.UK.
14. See Matthias Küntzel, “Iran: Fünf Atombomben für 100 Millionen Dollar,” matthiaskuentzel.de, May 15-17, 2020.
15. TOI Staff, “France: Iran Is Acquiring a Nuclear Weapons Capacity,” Times of Israel, January 17, 2021.
16. Concerning the snap-back, see Matthias Küntzel, “Neue Eskalationsstufe im Atomstreit mit Iran,” matthiaskuentzel.de, February 1, 2020.
17. Guido Steinberg, “Kalter Krieg im Nahen Osten: Der iranisch-saudische Konflikt dominiert die Region,” Arbeitspapier 1/2021 der Bundesakademie für Sicherheitspolitik, Berlin.
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Linkes Bild: Hassan Rouhani während der “Sechsten Internationalen Konferenz zur Unterstützung der palästinensischen Intifada” in Teheran im Februar 2017 . Quelle: khamenei.ir . Lizenz: Creative Commons Attribution 4.0 International Rechtes Bild: Joe Biden, Präsident der USA, 20. Januar 2021 . Quelle: whitehouse.gov . Lizenz: Public domain