Moon of Alabama Brecht quote
June 16, 2008

The "generous offer" to Iran

Big powers to offer Iran "generous" deal in atom row

The EU's top diplomat said he would hand Iran a generous offer on Saturday aimed at resolving a deepening dispute over its nuclear ambitions that has helped push up oil prices to record highs.
"I am traveling to Tehran to present a generous and comprehensive offer," [European Union foreign policy chief Javier Solana] said in a statement on Friday.

Thanks to the Tehran Times, we can now read the "generous" offer (slow link):

In order to seek a comprehensive, long-term and proper solution of the Iranian nuclear issue consistent with relevant UN Security Council resolutions and building further upon the proposal presented to Iran in June 2006, which remains on the table, the elements below are proposed as topics for negotiations between China, France, Germany, Iran, Russia, the United Kingdom, and the United States, joined by the High Representative of the European Union, as long as Iran verifiably suspends its enrichment-related and reprocessing activities, pursuant to OP 15 and OP’ 19(a) of UNSCR 1803. In the perspective of such negotiations, we also expect Iran to heed the requirements of the IJNSC and the IAEA. For their part, China, France, Germany, Russia, the United Kingdom, the United States and the European Union High Representative state their readiness:

  • to recognize Iran’s right to develop research, production and use of nuclear energy for peaceful purposes in conformity with its NPT obligations;
  • to treat Iran’s nuclear program in the same manner as that of any Non-nuclear Weapon State Party to the NPT once international confidence in the exclusively peaceful nature of Iran’s nuclear program is restored.

The "generous offer" is to recognize rights that Iran, as a member of the Non Proliferation Treaty, already has. As sweetener to the "generous offer" some fluffy material and immaterial promisses are added.

Some immaterial points are:

  • Support Iran in playing an important and constructive role in international affairs.
  • Promotion of dialogue and cooperation on non-proliferation, regional security and stabilization issues.

Ain't that "generous"?

The material points all have one common attribute. They do not include any prices:

  • Support for construction of LWR based on state-of-the-art technology.

Nice offer - but how much will those Light Water Reactors cost? That is of course still to be negotiated. The costs turn out to be prohibitive? Oh, too bad. But the offer to talk about them was really "generous".

This offer is exactly the same that was made two years ago. It is nothing but a public relation ploy to justify further sanctions, especially by the EU, against Teheran.

Solana will say: "See, we did give it a try." But that is incorrect. The offer contains nothing that is specific enough to be valuable. Most importantly it does not contain any security guarantees by the U.S.

Posted by b on June 16, 2008 at 5:17 UTC | Permalink


Text of the "offer" is also here.

Posted by: b | Jun 16 2008 5:22 utc | 1

Two can play the game:

Iran withdraws $75 billion from Europe: report

TEHRAN (Reuters) - Iran has withdrawn around $75 billion from Europe to prevent the assets from being blocked under threatened new sanctions over Tehran's disputed nuclear ambitions, an Iranian weekly said.
"Part of Iran's assets in European banks have been converted to gold and shares and another part has been transferred to Asian banks," Mohsen Talaie, deputy foreign minister in charge of economic affairs, was quoted as saying.
Iran is making windfall gains from record global oil prices and said in April its foreign exchange reserves stood at more than $80 billion.

Iran's foreign reserves figure has been climbing steadily. Some analysts say that, alongside rising oil revenues, Iran has been helped by its decision to shift away from the U.S. dollar into other currencies as the dollar has weakened.

Posted by: b | Jun 16 2008 11:28 utc | 2

I'm not too sure that the price-tags are that relevant for the purposes of this document - it's the kind of detail that can get fleshed out when Iran submits ( should it bother to do so ) its requests for clarifications and more concrete details.

What the document notably suggests is that much of the "promise" is probably inoperable, as there is no detail regarding ILSA - effectively, for the offer to be taken seriously there has to be some concrete discussion as to how the extraterritorial provisions will be modified or neutralised in the event of an Iranian suspension/agreement to forego enrichment.

This is particularly evident in the para on Civil Aviation - the "possible" removal of restrictions on manufacturers. There are no formal EU restrictions that prevent the export of civil aircraft to Iran at present that I'm aware of - there is only US extraterritorial legislation that defines an Airbus as a US product under the 10% rule that would penalise their sale.

I particularly enjoyed the locution "steps towards the normalisation of cooperation" - one can easily parse that as meaning that final/actual normalisation of cooperation isn't on the agenda, and that there would be further demands made in completely unrelated areas to achieve that.

FWIW, I would expect that the Iranians will "study" this document and then, just as the global civil service/political elite goes on its hols for the summer, submits a very lengthy request for clarification; this will then sit in the appropriate departmental in-trays until the end of August, and by the end of September, the Iranians get their reply.

Broadly speaking, I've always had the impression that the EU/Solana-Iran track has been an exercise in running down the clock on the Bush administration.

Posted by: dan | Jun 16 2008 14:24 utc | 3

Posted by: b | Jun 16 2008 16:25 utc | 4


The BBC has been running the "news" of oil and gas sector sanctions as a strapline for much of the afternoon. Still, good news for the oil bulls today I guess.

I wonder what the effect on European banks solvency margins will be if Iran really has withdrawn 110+ billion euros in assets.

Posted by: dan | Jun 16 2008 16:48 utc | 5

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