February 2007 Monthly Forecast

Posted 1 February 2007
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MIDDLE EAST

Iran

Expected Council Action
Council action on Iran is not expected in February. The EU3+3 (France, Germany and the UK, plus China, Russia and the US) is likely to caucus once the Director General of the International Atomic Energy Agency (IAEA) presents his report on Iran’s compliance with resolution 1737. (His report is due by 21 February.) However, it may take this group some time before it is ready to present a unified position to the Council.

Key Recent Developments
The Council on 23 December unanimously adopted resolution 1737 calling on Iran to suspend all proliferation-sensitive nuclear activities, including all enrichment-related and reprocessing activities and work on heavy water-related projects. The resolution also banned trade with Iran of all items, materials, equipment, goods and technology that could contribute to Iran’s proliferation-sensitive nuclear activities. The resolution listed those specific items considered as “proliferation-sensitive” using the guidelines of the Nuclear Supplier Group (NSG) and the listings of the Missile Technology Control Regime (MTCR).

The resolution also required all states to prevent the provision to Iran of any technical or financial assistance or training, and the transfer of resources or services related to the supply, sale, transfer, manufacture or use of the prohibited items. Although the resolution does not include a travel ban for individuals engaged in proliferation-sensitive activities, it calls upon states to exercise vigilance regarding their entry into their territory. Furthermore, the resolution contains a list of those persons and entities subject to a freeze on their financial assets.

The resolution also established a sanctions committee to monitor compliance, maintain the lists and rule on any exemptions. On 18 January it was agreed that Belgium would chair the committee (S/2007/20).

By 21 February, 60 days after the resolution, the Director General of the IAEA must report to the Council on whether Iran has suspended uranium-enrichment activities. The Council threatened “further appropriate measures” under Chapter VII, article 41, of the UN Charter in event of non-compliance.

The sanctions committee held its first meeting on 23 January. The resolution also requested that all states report to the committee on steps taken to implement the measures within 60 days. The reports are therefore due by 21 February. The committee is also expected to report to the Council on the fulfilment of its mandate every 90 days; its first report is due on 21 March. At press time, it had yet to adopt its guidelines.

Iran was critical of the resolution. However, although Iran had previously threatened to withdraw from the Non-Proliferation Treaty and terminate its IAEA membership, Iranian officials only said that was still an option. But there were reports on 22 January that Iran denied entry of 38 IAEA inspectors and subsequently expelled the leader of the IAEA mission.

Pursuant to resolution 1737, the IAEA has suspended some technical aid projects in Iran.

EU foreign ministers on 22 January announced a decision to ban trade with Iran in all the goods on the NSG and MTCR lists. Although there is already a de facto embargo on all these goods in the EU, the EU may make this measure legally binding. Also noteworthy is that the full NSG and MTCR lists are slightly wider in scope than what is required under resolution 1737.

Results of recent local elections in Iran have been interpreted as a setback for President Mahmoud Ahmadinejad, perhaps linked to unhappiness over the handling of the nuclear issue.

The US seems to be active in persuading international banks and energy companies to pull out of Iran and is encouraging the EU to follow suit.

Tensions between Iran and the US rose further when US forces on 11 January raided an Iranian facility in Iraq. US forces detained five Iranians accused of helping to supply cash, weapons and training to Shiite militias on behalf of the Iranian regime. Iran complained that the facility was a consular one and complained to the Council in a letter (S/2007/28). US officials responded that Iranian officials assisting attacks on US troops or civilians in Iraq would be targeted.

In addition, the US dispatched a second aircraft carrier to the Gulf.

The UN Secretary-General made unusually strong statements on 24 January, saying that he was “very worried” by the Iranian nuclear programme, that Iran’s nuclear ambitions were a “serious threat to international security” and that the international community should prevent Iran “from further advancing its nuclear technology.”

In a bid to revive a diplomatic solution to the current standoff, IAEA Director General Mohammed ElBaradei suggested on 26 January a “timeout” on the Iranian nuclear issue, which would include a freezing of Iran’s nuclear programme while the Council would temporarily suspend sanctions. This would allow a return to negotiations. Both Iran and the US have rejected the proposal.

Options
Given Iran’s responses to date, it seems likely that the IAEA will report that Iran has failed to comply with the resolution. Indeed, Iran’s denial of entry to inspectors may also be reported as a violation of the Safeguards Agreement (for more details on the safeguards agreement, please see our February 2006 Forecast). In these circumstances, the Council would have two primary options.

The first option would be to follow the logic of incremental pressure and further tighten the sanctions regime by limiting the scope of exemptions. This could also include imposing a travel ban on the individuals involved in proliferation-sensitive activities, adding more names to the list of persons and entities, effectively prohibiting the training of Iranian nationals in any proliferation-sensitive subject and adopting broader economic sanctions, perhaps initially including items such as luxury goods.

The second option would be to explore other routes, including new diplomatic initiatives, such as ElBaradei’s proposal. Past practice suggests that these initiatives would be options for the EU3+3, not the Council. Recent history suggests that, on the Iran issue, few options will remain open by the time the substance of the issue comes before the Council for consideration.

Key Issues
In the short term, the main issue is that the stakes are likely to rise significantly if Iran fails to make some concessions. Agreement on resolution 1737 proved very hard to reach. In a tenser environment, adopting further measures under Chapter VII could prove even more difficult for the EU3+3 to negotiate.

A related issue, therefore, especially given the new composition of the Council, is whether the elected members may seek to play a larger role, including by helping to find common ground in the Council.

The sanctions committee will be the focus of another test of the Council’s ability to maintain consensus on Iran. All committee decisions are adopted by consensus, and the committee is not yet fully operational because it has not yet adopted its procedural guidelines. However, since the list of individuals and entities subject to sanctions is contained in the resolution, the absence of guidelines is unlikely to prevent these measures from being implemented.

Resolution 1737 does not request that a group of experts be established. However, some of the issues the committee will have to handle are very technical and there may be a need for experts at some future point. Another issue that may appear over time is how the committee will oversee the implementation of measures that are at the discretion of states. Such measures include vigilance required for the travel of people suspected of taking part in proliferation-sensitive activities and the embargo on other items deemed proliferation-sensitive, called for by the resolution. At present, both the US and to a lesser extent the EU seem to be interpreting this rather widely.

Council Dynamics
Among Council members fundamental differences in approach remain. Perceptions of when and how “incremental pressure” should be applied vary among the P5 and the elected 10. Some new members, such as South Africa and Indonesia (who as members of the IAEA Board of Governors in February 2006 abstained on the resolution requesting the Director General to report to the Council), seem likely to prefer that negotiations with Iran be reactivated promptly.

With respect to the sanctions committee, it seems that there is a wide consensus among members on the programme of work of the committee. The chair of the committee, Belgium, has emphasised the need to interpret resolution 1737 scrupulously.

Selected Documents

 Security Council Resolutions
  • S/RES/1737 (23 December 2006) imposed measures under Chapter VII, article 41, of the UN Charter against Iran and expressed its intention to adopt further measures under article 41 in case of Iranian non-compliance.
  • S/RES/1696 (31 July 2006) demanded that Iran suspend all enrichment-related and reprocessing activities, requested a report from the IAEA and expressed its intention to adopt measures under article 41 of the UN Charter in case of Iranian non-compliance.
 Security Council Presidential Statement
  • S/PRST/2006/15 (29 March 2006) called upon Iran to take the steps required by the IAEA Board of Governors, in particular full suspension of all enrichment-related and reprocessing  activities, in order to build confidence in the peaceful purpose of its nuclear programme.
 Last IAEA Board Resolution
  • GOV/2006/14 (4 February 2006) underlined the necessary steps that Iran should take to re-establish confidence in the peaceful nature of its nuclear programme and reported the issue to the Security Council.
 Last IAEA Report
  • GOV/2006/64 (14 November 2006) noted that enrichment related activities have continued in violation of previous IAEA Board resolutions and Security Council resolution 1696.
 Selected Letters
  • S/2007/28 (19 January 2007) was a letter from Iran strongly condemning the US military attack on the Iranian consulate in the Iraqi city of Erbil and the abduction of the Iranian officers.
  • S/2007/20 (18 January 2007) was a note by the president of the Council listing the newly elected chairmen and vice-chairmen of the subsidiary bodies for 2007.
  • S/2006/1024 (23 December 2006) was a response from Iran to the adoption of resolution 1737.
  • S/2006/1008(19 December 2006) was a letter from Iran drawing attention to unlawful possession of nuclear weapons by Israel.
  • S/2006/985 (7 December 2006) was a letter from the UK containing the guidelines for sensitive missile-relevant transfers.
  • S/2006/815 (13 October 2006) was the letter from France containing the NSG list of items, material, equipments, goods and technology related to ballistic missiles programmes.
  • S/2006/814 (13 October 2006) was the letter from France containing the MTCR list of items, material, equipments, goods and technology related to nuclear programmes.

For historical background, please see our February 2006 Forecast.

Useful Additional Sources

Full forecast