US President Joe Biden wants to dial down tensions with Iran through diplomacy. AP Photo
US President Joe Biden wants to dial down tensions with Iran through diplomacy. AP Photo
US President Joe Biden wants to dial down tensions with Iran through diplomacy. AP Photo
US President Joe Biden wants to dial down tensions with Iran through diplomacy. AP Photo

Joe Biden in no hurry to find compromise as Iran ramps up nuclear programme


Ahmed Maher
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For Iran, Joe Biden's presidency presents an opportunity to end what officials have denounced as the scorched-earth policy of the previous administration.

But whether Mr Biden's administration revives the nuclear deal or re-negotiates it, close US regional security partners need to be part of the discussion.

That was the view of US and regional analysts who spoke to The National.

Without those two ingredients, diplomatic rapprochement will likely be short-lived and will not produce sustained results, in a region where minor confrontation risks snowballing into wider conflict.

“The Arab states were sidelined in the talks that preceded the [2015] nuclear deal with Iran, despite the fact that they should have been part and parcel of it,” said Dr Ebtesam Al Ketbi, president of the independent think tank, the Emirates Policy Centre.

US negotiators, including Robert Malley, then a member of the US National Security Council, speak with Iranian Deputy Foreign Minister Abbas Araghchi, head of the Iran Atomic Energy Organisation Ali Akbar Salehi, and Iranian Foreign Minister Javad Zarif in 2015. Reuters
US negotiators, including Robert Malley, then a member of the US National Security Council, speak with Iranian Deputy Foreign Minister Abbas Araghchi, head of the Iran Atomic Energy Organisation Ali Akbar Salehi, and Iranian Foreign Minister Javad Zarif in 2015. Reuters

“It’s high time Iran became disillusioned with the idea that it was superior to US partners in the region when it comes to international affairs.”

Former US president Donald Trump abandoned the nuclear deal in 2018 and Iran has since gradually breached the agreement's main limits, building up a stockpile of low enriched uranium, and later enriching uranium to higher levels of purity – approaching the threshold for a bomb.

The US then re-imposed sanctions on Tehran that significantly affected its economy.

Mr Biden, who took office on January 20, has said the US will re-join the pact, which includes restrictions on Iran's nuclear work, if Tehran resumes strict compliance.

  • An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
    An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
  • An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
    An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
  • An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
    An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
  • An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP
    An overview of Iran's Natanz nuclear facility, south of the capital Tehran. Maxar Technologies / AFP

Iran, however, insists the US must drop sanctions before it returns to compliance – something complicated by American legal systems that Trump-era officials are confident will prevent the new administration from abandoning the network of measures.

In her first press briefing last week, White House spokeswoman Jen Psaki said that Mr Biden would also discuss a conditional US re-entry to the deal as part of his first round of phone calls with foreign leaders, including close American allies.

Mr Biden has also appointed Rob Malley, a key negotiator of the original nuclear deal in 2015, as an envoy for talks on Iran.

US allies under threat 

Regional heavyweights, such as Saudi Arabia and Israel, are on the frontline of the threats that Iran has posed to the region for years.

Iran possesses a domestically produced military arsenal with long- and medium-range range missiles such as the Khorramshahr ballistic missile, which can fly as far as 2,000 kilometres with a warhead weighing 1,800kg. More advanced weapons, such as the Soumar cruise missile, require particular vigilance to defend against.

The ranges are far enough to reach Israel and US military bases in the region.

Iran has also displayed an interest in modernising its drone programme and purchasing the advanced Russian S-400 air defence system. The UN arms embargo from 2007 expired in October and the UN Security Council rejected Mr Trump’s attempt to expand the ban.

The Security Council restrictions expired in line with conditions agreed to under the 2015 nuclear deal. The objective was to keep Iran from developing nuclear capabilities in exchange for economic sanctions relief.

“Today, the missile file and the ideological regional expansion of Tehran are no less important to the world than the nuclear programme. Rather, they should be considered as the most important files from the perspective of the interests of the Gulf states,” said Dr Al Ketbi, who leads a team of senior researchers and analysts exploring current and future issues affecting the UAE and the region.

Iranian soldiers sit next to the tomb of Iran's late founder of the Islamic Republic, Ayatollah Ruhollah Khomeini during a ceremony on the occasion of the 42nd anniversary of Khomeini's return from exile from Paris, at his mausoleum in southern Tehran. EPA Photo
Iranian soldiers sit next to the tomb of Iran's late founder of the Islamic Republic, Ayatollah Ruhollah Khomeini during a ceremony on the occasion of the 42nd anniversary of Khomeini's return from exile from Paris, at his mausoleum in southern Tehran. EPA Photo

She suggests a proposal to establish a "missile demilitarised zone" on the shores of the Gulf.

“It is natural for regional and international calls to continue to place restrictions on the Iranian missile programme, including the number of missiles, the map of their deployment, their range and their destructive capacity, in a way that ensures that they do not threaten the fundamental interests of the countries of the region,” Dr Al Ketbi said.

  • Russian contractors work at the Bushehr nuclear reactor site in 2007. The plant opened four years later. Bloomberg
    Russian contractors work at the Bushehr nuclear reactor site in 2007. The plant opened four years later. Bloomberg
  • An Iranian technician at the International Atomic Energy Agency inspects the country's Isfahan plant in 2007. Tehran is no longer co-operating with the agency at nuclear sites across the country. EPA
    An Iranian technician at the International Atomic Energy Agency inspects the country's Isfahan plant in 2007. Tehran is no longer co-operating with the agency at nuclear sites across the country. EPA
  • Workers wait to begin constructing a second reactor at the Bushehr nuclear power plant in 2019. AFP
    Workers wait to begin constructing a second reactor at the Bushehr nuclear power plant in 2019. AFP
  • A metal-encased rod with 20 per cent enriched nuclear fuel is inserted into a reactor in Tehran in 2012. AFP
    A metal-encased rod with 20 per cent enriched nuclear fuel is inserted into a reactor in Tehran in 2012. AFP
  • Fomer Iranian President Hassan Rouhani and the country's Atomic Energy Organisation chief Ali Akbar Salehi speak at the Bushehr nuclear site in 2015. AFP
    Fomer Iranian President Hassan Rouhani and the country's Atomic Energy Organisation chief Ali Akbar Salehi speak at the Bushehr nuclear site in 2015. AFP
  • Iran's Bushehr nuclear plant has been restarted. EPA
    Iran's Bushehr nuclear plant has been restarted. EPA
  • Mehdi Abrichamtchi, chairman of the Peace and Security Committee at the National Council of Resistance of Iran, shows journalists the location of a secret nuclear site in Iran in 2013. AFP
    Mehdi Abrichamtchi, chairman of the Peace and Security Committee at the National Council of Resistance of Iran, shows journalists the location of a secret nuclear site in Iran in 2013. AFP
  • Workers prepare to begin the construction of a second reactor at the Bushehr site. AFP
    Workers prepare to begin the construction of a second reactor at the Bushehr site. AFP

Tehran has stayed on good terms with some neighbours, like Oman, and prefers to engage with its neighbours on a bilateral basis.

Oman, which is strategically located on the Strait of Hormuz – the narrow seaway through which about 20 per cent of the world's oil supply passes – maintains good relations with Tehran and fellow member states at the Gulf Co-operation Council in what has become known in foreign policy circles as ‘Iran’s bilateralism’ to de-escalate crises.

The sultanate’s diplomats are regularly involved in shuttle diplomacy with Iran, and mediated between Tehran and Washington for prisoner releases, including the freeing of three US hikers jailed in Iran on suspicion of being spies after they strayed across the border in 2009.

Brian Katulis, senior fellow at the Washington-based Centre for American Progress think tank, said the Biden team should learn from the mistakes of the last two US administrations.

“The Obama administration held a meeting in early 2015 with Gulf countries at Camp David and started a discussion about joint measures to deal with regional security issues, but that discussion did not result in a comprehensive strategy, but rather a piecemeal approach," he said.

"The Trump administration talked a lot about a regional security initiative, sometimes under the banner of an 'Arab Nato,' but this did not result in serious multilateral initiatives," Mr Katulis told The National.

Mr Katulis, who for more than a decade has advised senior US policymakers on foreign affairs and provided expert testimony to key congressional committees, added that Washington should consider encouraging co-ordination between regional allies alongside taking its own role.

“Republicans and Democrats alike in Congress – the mainstream in both parties – share a deep concern that Iran is no longer in compliance with the 2015 deal and that Iran continues to threaten close US security partners in the region,” Mr Katulis said.

“The Biden administration will likely seek to engage Congress more closely than the Obama administration did in 2014 and 2015 – it should do so in order to build confidence and support in Congress,” he added.

The nomination hearings of Mr Biden’s top national security nominees last week offered a preview of what could be to come – an ongoing discussion that will widen the range of issues that may be included in possible discussions with Iran.

His ultimate aim, according to his policy advisors, would be a deal that also limits Iran’s missile programme and support for regional proxies. But the team has made it clear that a swift return to the deal is unlikely.

Tehran, in return, has warned the Biden team that the new administration will not have an indefinite time period to rejoin the nuclear deal. The window of opportunity will not be open forever, it said.

Monday's results
  • UAE beat Bahrain by 51 runs
  • Qatar beat Maldives by 44 runs
  • Saudi Arabia beat Kuwait by seven wickets
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Islamophobia definition

A widely accepted definition was made by the All Party Parliamentary Group on British Muslims in 2019: “Islamophobia is rooted in racism and is a type of racism that targets expressions of Muslimness or perceived Muslimness.” It further defines it as “inciting hatred or violence against Muslims”.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”