It’s a lovely image, but we won’t go there. Instead, the most recent compilation of news about Iran suggests a country struggling to get it’s mo jo back, and they may be doing just that. – at a cost.
The recent agreement between China and Iran could be considered the most significant of developments. Americans need to remember that Iran, aka Persia, and China have trade relations thousands of years old. However, one cannot discount other events that appear to not work in Iran’s favor.
The Economy - National economies, like huge ships, take a long time to change speed and direction. The Trump administration certainly made its impact felt and it persists. Evidence shows Iran is still largely in a downward trend economically. Their GDP declined around -6% in 2018, -7% in 2019 and -6% in 2020. That is almost a 20% contraction in three years. Technically, the country is close to being in a depression. However, the International Monetary Fund has projected the Iranian economy will grow 3% in 2021. Perhaps they expect the existing American sanctions to be lifted quickly. So far, that has not been the case.
Exports and imports have also done poorly. In round numbers, both parts have declined from roughly $100 billion in 2016, to $50 billion in 2020. This is expected to continue declining as well. However, the new deal with China may turn this around.
Even so, their oil production has dropped from 3.8 million barrels per day in 2016, to 1.8 million in 2020, and is expected to continue falling as well.
When one thinks back to the pallets of cash Obama gave Iran amounting to hundreds of millions, if not billions of dollars, one has to wonder just what happened. Most would know how to use that money to turn a profit.
Oil for ….Something - While the agreement signed between Iran and China suggests exchanging Chinese goods and services for Iranian oil over the next 10 years for around $400 billion, it still sounds like an agreement-in-principle which could become anything. That includes a deal where the Iranians get screwed. It has happened to other countries, and it can happen here. Mullahs take note.
Whatever relief the mullahs may find from increased oil trade with China, it will be tempered by the fact that China has carefully constructed diversified energy sources to meet their future needs. If the mullahs get a little pushy or demanding, their economy could be back in the crapper pretty quickly.
There is some argument over the extent to which China will aid Iran militarily. Fine, in the meantime, if the agreement is about “infrastructure improvements” for Iran, one has to wonder if the mullahs have mulled over what it means to work with Huawei. The word, sucker, comes to mind. Also, do the mullahs want a Chinese style social credit system for their own population while China collects intelligence on their citizens? The Iranians will love Tik Tok just as much as the Americans.
Getting Back to the Table – Not So Fast Yankee Dog – To independent observers, the current dance over reviving the nuclear deal (JCPOA – The Joint Comprehensive Plan of Action) is not making a whole lot of sense. Iran basically got what it wanted with Obama. Why not default to those original agreements? Instead, Iran is demanding the Americans get South Korea to give back Iran’s seven billion in frozen assets first. Further, they are demanding the immediate unilateral dropping of all the sanctions. Curiously, the faux Biden administration is taking its time.
Is there a subtext? Is there some other back-channel narrative involving China which is influencing this work? On its face, it makes no sense. Iran sounds like they are being unreasonable, while America seems to be reluctant to restart the negotiations. It is all very odd.
That said, pragmatically, China would not want a nuclear Iran. Not really. You already have Pakistan and India, now Iran? Things get messy geo-politically. Stands to reason that a nuclear power may strike a tougher bargain with China. Moreover, the very idea of a mutual nuclear security agreement among Asian and mid-eastern countries seems strange to unworkable.
Plus there is a veritable fly in this nuclear ointment. Israel. Never admitted, but they are a nuclear power too. China already has long standing technology agreements with Israel. This is one geo-political circle which is not going to get squared. Best answer is to quietly discourage Iran’s nuclear ambitions. Buys lots of their oil. Keep them happy.
This becomes a very interesting backdrop to the faux Biden administration scrambling to rebuild the JCPOA. Let’s hope they can do the math.
Ned Price, State Department talking head commented on the recent (re)negotiations in Vienna by saying “There is still a long road ahead of us. Most of the road is still ahead of us.” There is not a whole lot of reading between the lines needed there. Translation: The Mullahs are a pain in the ass.
Israel - When your neighbor keeps threatening to kill you, the only prudent response is to make sure he fails. That summarizes Israel’s approach to a belligerent and bellicose sponsor of state terrorism. Certainly, from Israel’s perspective, the two-faced nature of Iran’s handling of their nuclear programs merits constant pressure; pressure on their scientists, pressure on known facilities, pressure on anything that serves to ultimately destroy Israel.
The recent reports about damage at Natanz, and the assassinated Iranian nuclear scientist, along with other attacks, certainly suggest someone doesn’t want Iran to make progress there. If nothing else, the continued string of intelligence successes suggest that Iranians do not support their government. They have good reason.
This will be a continuing source of drama and setbacks for the mullahs. They continue to sneak around, the Israelis continue to spy.
The most telling image though of how the mullahs are not immune to the events of the world they hate is seeing one of them sitting, wearing a mask to avoid getting covid-19.