Will the Iran issue widen the US-EU rift?

Christina Lin December 12, 2016 3:15 AM (UTC+8)
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The EU is nervous about a Trump presidency’s hostile policy towards Iran and threats to destroy the nuclear deal.

There has been a barrage of articles from European Council on Foreign Relations, Carnegie Europe, Deutsche Welle and others issuing warnings not to unilaterally dismantle the multilateral nuclear deal. Otherwise, the EU and others in the P5+1 will deem American deals as unreliable and break ranks to go their own way with Iran.

EU, China and Russia coalesce

Already there is discussion of how remaining members of the P5+1 can hedge themselves to salvage the deal if such a scenario does occur. In addition to European leaders issuing a statement on November 14 to reiterate their “resolute commitment” to the deal, there are also proposals to work with China and Russia to salvage key nuclear restrictions by offering meaningful sanctions relief to Iran, such as lifting European banking sanctions and oil embargo, and protecting European companies against enforcement of American sanctions aimed at prohibiting business with Iran.

The US previously tried to isolate Iran in 1996 by threatening US sanctions on foreign companies that developed Tehran’s oil and gas industry. As a counter measure the EU forbade companies from complying with the sanctions, and eventually the US backed down from enforcing them.

As a further insurance policy if the deal is scuttled, ideas have also been floated to quickly resolve banking and regulatory hurdles now faced by companies seeking to execute major deals already made with Iran.

The Europeans are mainly grappling with uncertainty surrounding a few key issues with the incoming Trump administration. Besides the Iran nuclear deal and possible US military action, they are also concerned with a US trade war with China and the demise of NATO.

As such they are forging their own path to decrease tensions with Russia, and deepening economic cooperation with China. On November 23-24, Germany convened a Sino-European business conference—“Hamburg Summit. China meets Europe”—to discuss ways Beijing and Brussels can cooperate to weather unpredictable US trade and foreign policy.

Berlin for one sees China as a reliable partner in global trade, and wants to push for further alignment between China’s One Belt One Road (OBOR) initiatives and EU’s existing regional institutions and programs, as well as bilateral investments. It wants to use its influence in Brussels to include China for joint investments in third countries on the emerging European-Chinese economic corridor in Eurasia, and sees Sino-EU cooperation to create wealth and stability in the region is feasible without a visible US contribution.

Iran, China and Russia integrate

Iran likewise foresees continuing its Eurasia integration with China and Russia without US contribution, due to the extension of US sanctions for another 10 years.

Since geography matters, Iran is very important from the Eurasian perspective. It is a littoral state on both the Caspian Sea and Persian Gulf, and an important source of energy for Asian giants such as China and India. Indeed, Iran has already overtaken Saudi Arabia as the top supplier of oil to India.

It is also key for both Russia and China’s Eurasian integration projects, especially on China’s OBOR as a strategic hub in the Middle East and Central and South Asia.

In fact, some of Trump’s advisors are considering having the US join the AIIB to become a stakeholder and participate in OBOR projects, and on November 30 helped launch the inaugural US-China Belt and Road Forum. How the US can de-conflict its desire to potentially cooperate on China’s OBOR and yet isolate the key node of Iran remains to be seen.

But should the new administration decide to oppose or ignore the OBOR, and adopt a combative stance towards Iran, then this would likely impel the EU, Iran, China and Russia to quicken the pace of Eurasian integration.

Which brings us back to the Cloverleaf world.

As this author had previously discussed, in 1581 German Pastor Heinrich Bunting portrayed the world that mattered was comprised of the three continents of Europe, Asia, and Africa, with each depicted as a cloverleaf.  They converged in Jerusalem, and the rest of the world was irrelevant.

With the US increasingly focused on domestic infrastructure and job creation, scaling back on its military presence overseas, and absence from the Eurasian integration project, we may indeed witness a wider US-EU rift.

Along with this, a return to the Cloverleaf map as the likely depiction of the unfolding global geopolitical architecture of the 21st century.

Christina Lin
Dr. Christina Lin is a Fellow at the Center for Transatlantic Relations at SAIS-Johns Hopkins University where she specializes in China-Middle East/Mediterranean relations.
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