Iran still has much to do

PUBLISHED : Wednesday, 26 August, 2015, 1:50am
UPDATED : Wednesday, 26 August, 2015, 8:23am

The landmark nuclear deal struck with Iran promised the lifting of sanctions that have for a decade frozen the nation's relations with much of the world. UN Security Council members have given their approval and governments are following suit, the most-watched being the US, where congress votes next month. In anticipation of the end of the thaw, a flurry of Western ministers have been visiting with sights on the economic deals that are in the offing. But the most symbolic sign of the thaw came at the weekend with Iran and Britain reopening embassies in each others' capitals.

Diplomatic ties and the lifting of sanctions will never erase the decades of bad blood between Iran and Britain. Former US president George W. Bush's naming of Tehran as part of his "axis of evil" in 2002 drew American allies, London the most prominent, into a sanctions regime that was the centrepiece of 10-year-long talks over the nuclear programme. The British position hardened on November 29, 2011, when Iranian protesters stormed its two main diplomatic compounds, prompting the closure of the embassy. The restoration of the links is a significant move towards Iran's global reacceptance.

Iran's economy has been hit hard by the sanctions and their removal is forecast to lift GDP growth to 6 per cent from the present 3 per cent. With the Middle East's second-biggest economy and population after Egypt and potentially the world's biggest oil reserves, investors are especially looking at the petroleum, vehicle production and internet sectors. But for all the optimism, there is much still to be done before the economic rewards can flow.

Strict rules on compliance were laid down by China, the US, Britain, France, Germany and Russia in negotiating the July 14 deal. At least six months will pass before there is full implementation and the benefits will be gradually rolled out with each stage of international oversight and verification that Iran is complying. Only when it meets its end of the bargain will sanctions on the energy, financial and trade sectors be lifted.

Even then, strong opposition to the agreement remains from rival nations Israel and Saudi Arabia, while Iran's support for Syrian President Bashar al-Assad in his four-year civil war is also a sticking point. As close as the lifting of sanctions may seem, they are still dependent on promises being followed up with actions. Even then, Iran has much to do to build the trust that is so necessary for its international acceptance.