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EU Says Iran, World Powers To Continue Talks Aimed At Saving Nuclear Deal

European Union High Representative for Foreign Affairs and Security Policy Federica Mogherini reads a statement after a meeting in Vienna, Austria, July 6, 2018. REUTERS/Leonhard Foeger


EU foreign policy chief Federica Mogherini says world powers and Iran have agreed to continue talking, including on economic measures, over how to save the 2015 nuclear deal.

Foreign ministers and senior diplomats from Britain, China, France, Germany and Russia held talks on July 6 with their Iranian counterpart Mohammad Javad Zarif in Vienna for the first time since U.S. President Donald Trump announced he was abandoning the nuclear deal and moving to reimpose sanctions on Iran.

Speaking after the meeting between the remaining parties to the nuclear accord, Mogherini, who chairs the talks, read a statement saying all sides would continue to look at ways salvage the deal despite the reimposition of U.S. sanctions.

EU Foreign Policy Chief Federica Mogherini Speaks After Talks In Vienna
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Earlier in the day, Zarif said he was in Vienna “to listen to practical solutions, rather than slogans.”

Ahead of the talks, Iranian president Hassan Rohani told the leaders of France and Germany that a European package of economic measures to counter the effects of U.S. sanctions does not go far enough, Iranian news agencies are reporting.

Rohani told French President Emmanuel Macron in a phone call that the package "does not meet all our demands," the IRNA state news agency reported late on July 5.

In another phone call to German Chancellor Angela Merkel, Rohani said the European economic measures are "disappointing," the Tasnim news agency reported.

"Unfortunately, the proposed package lacked an action plan or a clear roadmap for continuation of cooperation. It only included some general promises like previous EU statements," Tasnim quoted Rohani as saying.
The Iranian leader said he hoped deficiencies Iran sees with the package can be addressed at the July 6 meeting in Vienna that comes two months after the U.S. left the nuclear accord.

Speaking on July 6, French Foreign Minister Jean-Yves Le Drian said it was unlikely European powers would be able to put together an economic package for Iran that would salvage its nuclear deal before November and warned Tehran to stop threatening to break its commitments to the accord.

"They must stop the threats so that we can find the solutions so that Iran can have the necessary economic compensations,” Le Drian told RTL radio before travelling to Vienna for the ministerial meeting on the agreement.

He said the European powers but also Russia and China were working on coming up with a financial mechanism to mitigate planned tough U.S. sanctions.

"We are trying to do it before sanctions are imposed at the start of August and then another set of sanctions in November. For the start August it seems a bit short, but we are trying to do it by November," he said.

Speaking also on July 6, German Foreign Minister Heiko Maas said world powers would not be able to fully compensate for companies leaving Iran due to new U.S. sanctions.

"We will not be able to compensate for everything that arises from companies pulling out of Iran," Maas told reporters before the new round of talks among the remaining parties to the deal.

"Abandoning The Deal Would Cause Even More Harm" Says German FM
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While the other signatories have vowed to stay in the accord, dozens of European, Russian, and Asian companies have announced plans to pull out of Iran for fear of incurring U.S. penalties when sanctions are reimposed in November.

The European Union has scrambled to find ways to counter the sanctions and ensure that Iran continues to enjoy the benefits of global sanctions relief under the deal, which was granted in 2016 in exchange for curbs on Iran's nuclear activities.

Infographic: Iran's Nuclear Program
Infographic: Iran's Nuclear Program

Iran has warned that it may walk away from the deal unless other signatories "guarantee" that it will continue to benefit. The principal benefit Iran has experienced under the deal is a doubling of its oil exports to around 2.8 million barrels a day.

But Washington has also warned European allies that they face possible penalties if they violate U.S. sanctions, which Washington says are aimed at reducing Iranian oil exports to "zero" -- a level that would deprive Iran's economy of its principal source of revenue and economic growth.

In light of Washington's push on sanctions, European leaders have said they would do their utmost of maintain business ties with Iran but it would be difficult for them to make any "guarantees."

Rohani did not specify what he found lacking in the EU package of measures to counter U.S. sanctions.

This week, the European Parliament approved a key component of the package, giving the European Investment Bank authority to invest in Iran despite the U.S. sanctions.

The measure authorizes the bank to work with Iran starting in August, but it does not require it to do so.

Reuters reports that whether the bank will invest in Iran is in doubt. The bank currently has a policy of not lending to Iran and other countries listed as high-risk by a global terrorism financing watchdog.

Also, the bank has expressed concerns that it will have difficulty raising money in financial markets if it defies the U.S. sanctions.

"Maintaining access to these markets is a quasi life-or-death issue for the [bank]" because it has $120 billion of bonds held by investors worldwide which must be continually rolled over and refinanced, Director General Bertrand de Mazieres said in May.

Beyond the European Investment Bank plan, other elements of the European economic package that Rohani criticized as insufficient include a special measure to shield EU companies from the U.S. sanctions, and a proposal for EU governments to make direct money transfers to Iran's central bank to avoid U.S. penalties.

Even before the United States moved to reimpose sanctions on Iran, Tehran complained that the surge in foreign investment and trade that was expected to come under the nuclear deal never materialized.

Now, the threat of U.S. sanctions has increasingly darkened the outlook for Iran's economy, helping to stoke a plunge in the Iranian rial this year that has driven up prices and provoked street protests and strikes.

Infographic Chart - Rial Problems
Infographic Chart - Rial Problems
With reporting by AFP, Reuters and dpa