An agenda for the Federal Reserve’s review of its monetary policy framework


An agenda for the Federal Reserve’s review of its monetary policy framework



Russia is Crucial to Action over a Nuclear Iran

Philip H. Gordon
Philip H. Gordon Former Brookings Expert, Mary and David Boies Senior Fellow in U.S. Foreign Policy - Council on Foreign Relations

December 4, 2007

Last month’s International Atomic Energy Agency report that Iran continues to violate its nuclear commitments has renewed U.S. hopes further to tighten international diplomatic and economic sanctions against Tehran.

The IAEA report was hardly the full-throated condemnation of Iran that some in Washington had hoped for, but Mohamed ElBaradei, the chairman, made clear that Iran has not provided credible assurances about its nuclear activities and that it has failed to meet the United Nations Security Council’s demand that it suspend its uranium enrichment programme. Along with China’s announcement this weekend that it would support new sanctions against Iran, the report has boosted expectations in Washington that the U.N. will now act.

This U.S. diplomatic goal is laudable. New U.N. sanctions would send a message to Iran (and other potential nuclear proliferators) that there is a price to be paid for pursuing nuclear weapons, demonstrate that the Security Council is determined to enforce its own resolutions and, by keeping diplomatic options open, reduce pressure in Washington for military action that would be disastrous for all. While pursuing this goal, however, America needs to prepare for another contingency – that Russia will block action at the Security Council despite the IAEA report. That outcome would be a severe blow not only to efforts to contain the Iranian nuclear programme but also to U.S.-Russia relations and American support for multilateral action in general.

In the frustrating effort to win support for U.N. sanctions against Iran, the once-reluctant Europeans are now the least of Washington’s problems. Britain, France and Germany have gradually cut economic and diplomatic ties with Iran in response to Tehran’s refusal to compromise. European banks have largely stopped doing business with Iran and new export credit guarantees have fallen by more than 50 per cent over the past two years.

Big investments in the Iranian energy sector have been delayed repeatedly, in part at the behest of European governments. European countries such as Germany still have significant commercial relationships with Iran and doubts about sanctions, but they are coming around to the view that such measures may be the only way to avoid what Nicolas Sarkozy, the French president, calls a choice between “an Iranian bomb and the bombing of Iran”.

China has been a greater problem. As Europeans have cut ties and divested, Chinese companies have stepped in, making China Iran’s largest commercial partner with annual trade at $14bn. Unlike the Europeans, moreover, China appears not to see a national strategic interest in preventing an Iranian bomb and has shown little interest in any economic sacrifice to help with others’ geopolitical problems. For this reason, Beijing’s support for new sanctions is encouraging – even if it is for now limited to extending the travel ban on Iranian officials and shunning certain Iranian companies and banks.

These developments put the spotlight on Russia and what it shows is not promising. Since agreeing to the last Security Council sanctions resolution in March, Moscow has been unwilling to step up pressure on Iran. Russia claims to be determined to prevent an Iranian nuclear weapon, but appears to care more about denying Washington a diplomatic victory and preventing American hegemony in the Middle East. Some argue that it is a matter of making a deal whereby the U.S. would agree, for example, to compromise on issues such as Kosovo, Nato enlargement and missile defence in exchange for Russian co-operation on Iran. Such “linkage” is worth exploring, but there is another, more troubling explanation for Russia’s behaviour: Moscow may welcome the status quo.

Not only does blocking action at the Security Council frustrate the U.S., but the spectre of crisis with Iran also drives up the oil price, to Russia’s benefit. Even the threat of a U.S. military strike on Iran, which inspires Europeans to tougher diplomatic action, might from a Russian perspective be seen as “win-win-win”: it would raise the oil price further, seriously isolate the U.S. globally and set back the Iranian nuclear programme, simultaneously.

It is too soon to rule out Russian agreement to further Security Council action on Iran – indeed, it is time to intensify efforts to produce it. The U.S. should urgently engage Russia to find out whether or not there is an accept-able diplomatic price for Moscow’s co-operation. It should reiterate its support for incentives for Iranian cooperation – coupled with a willingness to negotiate directly with Iran – making clear that if Iran refuses, it and not Washington is responsible for the stalemate. It should applaud China’s step forward and demonstrate to Beijing that co-operation on an issue of critical importance can have positive consequences for China’s image in the U.S. and for bilateral relations and trade.

If Russia then helped enforce the Security Council’s resolutions on Iran, Moscow’s own image as a potential global partner of the US would be enhanced, the U.N.’s role as an important player salvaged and the prospects for containing Iran’s nuclear programme improved. If not, the opposite will be the case on each point. Washington might conclude that Russia is not a constructive partner and that it is running out of peaceful options for dealing with Iran. The result would be a more dangerous world.