The Takeaway: Iran hoped to close nuclear deal before economic reforms, says expert

Al-Monitor – Iran wants nuclear deal before answering IAEA questions, says Bijan Khajehpour

While fresh evidence of Iran’s continued nuclear activities has set back the Biden administration’s efforts to revive the Joint Comprehensive Plan of Action (JCPOA), that doesn’t necessarily mean that Iran’s leaders have given up on the landmark nuclear agreement — and the windfall that would come from sanctions relief. 

IAEA file reopened. The United Nations’ nuclear watchdog, the International Atomic Energy Agency (IAEA), issued two new reports to member states on May 30. 

• The IAEA reported that Iran’s stockpile of enriched uranium is 18 times over the limit set by the 2015 nuclear agreement. The watchdog said the amount of uranium enriched to 60% has reached 43.1 kg, an increase of nearly 10 kg since March. Experts have said Iran could now enrich uranium to weapons-grade level within a few weeks.
• In a separate report, the IAEA said Iran has yet to explain the presence of undeclared nuclear material detected at three different sites. The Wall Street Journal reported last week on how Iranian intelligence obtained secret IAEA records nearly two decades ago that Tehran used to hide  suspected previous work on nuclear weapons.

Iran and the IAEA seemed to have an agreement on a roadmap for explaining the undeclared material back in March. Iran, expecting the JCPOA to be signed soon afterward, is now calling the IAEA reports “unfair.” Seemingly closed, that now-reopened file could further complicate already stalled nuclear talks.

Iran also wanted JCPOA before “economic surgery.” Bijan Khajehpour, an Al-Monitor columnist and a managing partner at Eurasian Nexus Partners, says Iran remains genuinely interested in returning to a deal that would provide relief from biting economic sanctions in exchange for curbs on its nuclear program.

• “I think if they see a prospect of signing a deal, Iran will resolve the IAEA issues very quickly,” Khajehpour said at an Al-Monitor event on Wednesday.
• Last month, Iran’s government announced reforms to the country’s subsidies system, which included temporary cash handouts to most Iranians. The payments are expected to further drive up the government’s budget deficit and lead to higher inflation.  
• Khajehpour said the economic reform plan was likely based on the mistaken assumption that a renewed JCPOA was within reach earlier this year.
• That the new measures — dubbed “economic surgery” — are now being implemented without a revived JCPOA “shows they are desperate to adjust some of the economic realities of the country,” Khajehpour said.

“Incompetence” in the open. The recent collapse of a building in the southwestern city of Abadan, which killed at least 37, has given further life to protests elsewhere in the country over price hikes caused by the government’s reform programs and general economic hardships under sanctions.  

• “I think what’s happening in Abadan today or in the past few days is a microcosm of what’s happening in Iran,” said Khajehpour. “There is a large degree of incompetence in Iran, and it can’t be hidden anymore. The wealth is not there anymore to cover it up.”  

What we’re watching: The newly released IAEA reports come as the watchdog agency gears up for its Board of Governors quarterly meeting next week: 

• June 6 – The 35-nation IAEA board will meet in Vienna, where Western powers will decide whether to censure Iran for its failure to cooperate with inspectors. Until now, they’ve held off on formally reprimanding Iran over concerns that doing so would derail the nuclear talks. Iran has threatened to respond to “any unconstructive action” taken by the board on Monday.  
• Around June 23 – The UN Security Council will receive the secretary-general’s latest six-month report on the implementation of Resolution 2231, which enshrined the landmark nuclear deal.  
• Late June – President Joe Biden is expected to visit Israel and the region, and Iran is likely to be high on the agenda. 

More from Bijan on Iran: Listen to the full audio recording of his presentation at Al-Monitor, which also covered Iran’s energy industry and relations with Russia and China. 

From our regional correspondents

1. Israelis warned to leave Turkey over Iran threat . To avenge the Mossad-suspected killing of senior Revolutionary Guard Corps officer Sayad Kohdai, Iran is reportedly eyeing Israeli targets based in Turkey. Israel has warned against non-essential travel to Turkey after the Israeli National Security Council said it identified specific Iranian threats against Israeli citizens in the country. Israeli security officials have advised some 100 Israelis in Turkey to return home as quickly as possible.  

The travel warning could force many Israelis to scrap their summer vacation plans in Turkey’s seaside resorts. Ben Caspit writes that “Israel is currently concerned that the escalating struggle with Iran will affect the warming of relations with Turkey,” which has benefited from a return of Israeli tourism in recent years.