What Zarif’s words should tell President Biden about Iran deal

On the anniversary of Qassem Soleimani’s death, Iranian Foreign Minister Javad Zarif gave an interview in which he highlighted his close relationship to the late commander of the Islamic Revolutionary Guard Corps’ expeditionary and dark-arts branch, the Quds Force. Zarif said he and Soleimani coordinated their regional tasks and projects. Zarif also offered insight into the clerical regime’s strategy for handling the Biden administration: He denied there was going to be any JCPOA 2 and 3, meaning the regime will not negotiate any follow-on agreements to the 2015 nuclear deal (known by the acronym JCPOA) that limit Iran’s missile program and regional policies.  

This is a serious problem for Biden, since he justifies his pledge to rejoin the flawed JCPOA — and, in doing so, lift sanctions — by insisting that he will pursue a tougher follow-on deal. Rather than pursuing that futile objective, Biden should employ the leverage generated by Trump’s “maximum pressure” campaign to insist the clerical regime accept restraints on its missile program and regional policies before any sanctions come off.   

In his interview, Zarif made clear the regime understands the coercive power of sanctions. He said, after the JCPOA, Tehran’s first priority was to develop a “resistance economy,” which is effectively sanctions-proof. Popularized by Supreme Leader Ali Khamenei, this concept focuses on encouraging the domestic production of goods, thereby diminishing the country’s reliance on oil exports to finance the purchase of foreign goods. It also emphasizes finding reliable allies to help Iran bypass potential sanctions. To that end, Tehran’s economic diplomacy entails creating division among western countries, as well as working with Russia, China, and other states to prevent the imposition of further sanctions on Tehran. The regime also cultivates close ties to groups and factions in the West which are ideologically more aligned with Tehran’s worldview.

Tehran has actually managed to execute parts of this plan. Over the last 15 years, the Islamic Republic has heavily invested in petrochemical and oil refinery complexes whose products are much more challenging to track than crude oil, diminishing the efficacy of crude oil sanctions. Iran has also used its political influence in Iraq to make it an essential sanctions-busting haven. Tehran has also tried to convince China to form a strategic partnership as a countermeasure against U.S. sanctions. Additionally, the clerical regime has heavily invested in foreign propaganda and influence operations to spread disinformation and weaken the forces in Europe and the United States hostile to Tehran’s foreign and domestic policies. 

Zarif’s comments are in line with Tehran’s long-standing refusal to negotiate over its missiles. It’s an excellent guess that the Obama administration initially wanted to include ballistic missiles when it negotiated the JCPOA but relented when Khamenei refused to do so. This would mean that a U.S. re-entry to the deal would trade, once again, only a modest, ever-shrinking Iranian delay in industrializing its nuclear program for massive sanctions relief. Missiles would be off the table, along with limits on Iran’s Revolutionary Guard and Shiite militia deployments, conventional-arms deliveries, and other destabilizing activities in the region.   

Tehran’s strategy has been clear from the beginning: It sought a deal that offered a patient pathway to the bomb and massive economic benefits. And the clerical regime would use its financial gains to build a more effective, diversified “resistance economy.” The U.S. withdrawal from the deal disrupted this plan. Washington’s re-entry to the agreement would simply put it back in motion.  

Only if it fears for its existence will the Islamic Republic make any meaningful long-term concessions on ballistic missile development and regional subversion activities. The moment the threat is gone, Tehran will go back to business as usual.

The riddle to solve is how to keep Tehran in compliance. The most direct solution is for the Iranian people to down the Islamist dictatorship. However, imperfect solutions exist. To make Tehran’s return to bad behavior more difficult, a deal would need clear snapback triggers that reimpose sanctions if Iran violates missile and regional stability provisions. 

It will be hard for U.S. diplomats to wring such concession from Tehran. Yet Iran has already experienced three years of negative GDP growth, high inflation, and massive currency depreciation. Tehran’s accessible currency reserve is now around $9 billion. Since 2017, Tehran has faced two waves of widespread protests that shook the country. It obviously fears a third wave that could be even wider and more dangerous.

To pacify the increasingly disillusioned and desperate population, the regime needs an economic lifeline. That offers Washington an opportunity.

The new administration should double down on the pressure campaign until Tehran has no choice but to make real concessions on nuclear, missile, terrorism, and regional issues. If Washington reenters the JCPOA, it will lose all of its leverage, and Tehran will have no reason to curb its missiles and regional policies. 

We should learn from our mistakes, not repeat them.

Dr. Saeed Ghasseminejad is a senior Iran and financial economics advisor at the Foundation for Defense of Democracies (@FDD), specializing in Iran’s economy and financial markets, sanctions and illicit finance. Follow him on Twitter @SGhasseminejad. FDD is a nonprofit, nonpartisan 501(c)(3) research institute focusing on foreign policy and national security. FDD does not accept donations from foreign governments.