N-deal brings little economic relief for Iran - The Buffalo News

Share this article

print logo

N-deal brings little economic relief for Iran

TEHRAN, Iran – When Iran’s leaders signed a preliminary nuclear deal with world powers in November, they promised that the six-month agreement would quickly start “melting the iceberg” of Western sanctions, lead to new trade ties and improve the lives of ordinary Iranians.

Opponents of the deal in the United States and the Middle East said much the same thing, warning that it would rapidly erode the international sanctions that have crippled Iran’s economy.

It hasn’t worked out that way. More than four months into the deal, many Iranians think the interim accord has done little to help them.

“The deal has not brought any economic breakthrough for the common people,” said Mohammed Hydari, editor of Khandani, a political and economic journal. The “meager” funds released by world powers each month under the deal, he said, “are not helping the people, but the government.”

Dwindling popular support in Iran for the preliminary accord, coupled with continuous resistance to any nuclear compromise from hard-liners, raises doubt about how long Iranian President Hassan Rouhani can push ahead with his effort to reach a final deal.

It also builds pressure on negotiators for Iran and six world powers to complete the complex diplomacy before the July 20 deadline.

Under the Nov. 24 agreement, which took effect Jan. 20, Iran and the six world powers – the United States, Britain, China, France, Germany and Russia – must all consent to a six-month extension of talks. But diplomats fear that skepticism in Iran and the West will make it tough to win an extension because both sides may demand a better deal than they got in the first round.

The interim deal gave Iran limited relief from some sanctions in exchange for freezing most uranium enrichment for six months. The goal was to buy time while negotiators worked out a long-term agreement aimed at ensuring that Iran doesn’t gain the ability to produce nuclear weapons.

Rouhani portrayed the interim deal as a big win for Iran that would set off a “gold rush” of foreign investment. Many Iranians initially echoed his excitement. Big Iranian companies began discussions with Western corporations eager to return to the country, as smaller merchants tried to figure out how to cash in on any impending boom.

But while foreign business executives have streamed into Tehran, they haven’t made many deals. Most of the sanctions remain in place, and international companies don’t want to risk U.S. and European penalties by moving too soon.

Although the interim accord will release an estimated $7 billion into the Iranian economy, the benefits are “not enough to help the general population,” said Djavad Salehi-Isfahani, an expert on the Iranian economy at Virginia Polytechnic Institute. “The result is malaise.”

There are no comments - be the first to comment