Threat of sanctions are key to Iran maintaining agreement

As nuclear talks reach a conclusion with Iran, Tehran needs to know that if it cheats, economic pain will return in full force, Elizabeth Rosenberg and Peter Harrell report

IN THE concluding week of nuclear talks among the United States, other members of the UN Security Council, plus Germany and Iran, negotiators are struggling with key details on one of the most contentious matters: How sanctions would be re-imposed, or quickly snapped back into place, if Iran cheated.

Critics of the emerging deal contend that re-imposing sanctions is unlikely, and thus Iran will have little incentive to adhere to a deal. But snapback could be a credible deterrent to cheating if the US and the other international negotiators insist on four key principles: Disproportionality, autonomy, automatic response and innovation.

A successful agreement is by far the best way to reduce Iran’s nuclear threat. But for any deal to work, Tehran needs to know that if it cheats, economic pain will return in full force.

US President Barack Obama has said the international community should not have to “jump through a whole bunch of hoops” to again shut Iran out of the global economy. The world powers have reportedly agreed to use the UN Security Council sanctions as a framework for snapback. But that is not enough.

Disproportionality is the first principle required to make the threat of re-imposed sanctions credible. Even a small Iranian violation should trigger a massive re-imposition of sanctions. If Iran were to cheat, it would likely start small, as Tehran tested the resolve of the international community.

The US and its allies cannot accept a situation in which Iran whittled away at its nuclear obligations while avoiding economic costs. Snapback provisions should make clear that even one-off violations would result in cutting off Iran’s banks from the global financial system and curtailing all oil sales.

Autonomy is the second principle that must be followed. Washington policymakers must make clear to Tehran that US sanctions would be re-imposed if Iran cheated — even if Iran’s allies manage to block re-imposition of UN sanctions.

Though other negotiators, including Russia and China, are on the same page on snapback, the diplomatic reality is that UN processes are often slow and subject to political pressure.

The United States and its European Union allies must signal a willingness to go it alone on sanctions if necessary. This can be an effective deterrent, even if Iran can persuade an ally on the Security Council to delay or block UN sanctions snapback.

Iran would understand this economic threat. Security Council resolutions put key limits on Iran’s nuclear procurement, but Iran’s economic pain is largely due to the oil and financial sanctions that the United States and the European Union have imposed since 2010.

An automatic response is the third principle. Sanctions should be re-imposed automatically as soon as a violation is identified. US negotiators have said they recognise the importance of a rapid response.

In this case, Washington and its allies would need to fight on two fronts: Make the re-imposition of UN sanctions as swift as anything can be in the United Nations, and ensure that US and EU sanctions would automatically be in place within weeks after an Iranian violation is detected.

Innovation is the fourth point. Imposing the multilateral sanctions against Iran required complex negotiations, and no international coalition can exactly replicate this pressure strategy. Nor should it. Sanctions must not be merely re-imposed if Iran cheated — new sanctions must go further.

Iran’s economy has adapted under the sanctions regime, and Iran is always learning new potential evasive techniques. The restrictions that successfully cut off financial flows and investments five years ago would likely not have the same effect today. Keeping the pressure of sanctions credible means updating all threatened restrictions to match Iran’s evolving economic landscape.

The United States has a compelling interest in reaching a nuclear deal that curtails Iran’s nuclear-weapons capability. Sanctions relief, particularly early sanctions relief, can be a fair price to pay for a deal that actually rolls back Iran’s nuclear ambitions.

But the insurance policy is the plausible threat of painful sanctions and economic isolation. Building the mechanism for an overwhelming sanctions snapback, and the political support to act disproportionately, autonomously, automatically and innovatively, is crucial for success.