“Iranian Foreign Policy: Prospects for Change”
Chatham House
London, May 9th 2018


In a meeting chaired by Nomi Bar-Yaacov, Associate Fellow, International Security, Chatham House, Professor Mahmood Sariolghalam of Shahid Beheshti University (former National University) in Tehran, and Dr. Sanam Vakil, Associate Fellow with the Middle East and North Africa Programme at Chatham House, discussed the current contours of Iranian foreign policy and its prospects for change in the aftermath of the January street protests that had highlighted a set of economic and political frustrations felt by the Iranian people.

While the government of President Rouhani is faced with serious challenges in addressing these frustrations with domestic policy, the country’s foreign policy stance and actions have remained largely the same since the 1979 revolution.

In the course of the meeting, both speakers discussed the different potential avenues and prospects for change in Iranian foreign policy, and the avenues for potential reform and change, especially in regards to relations with Iran’s regional neighbours and the US.

 Summary overview

  1. Professor Mahmood Sariolghalam

    Mahmood Sariolghalam. Photo: Flickr, World Economic Forum

Mahmood Sariolghalam began his presentation by focusing on 6 separate points:

  • It was his view that revolutions were about rigidities. He said that while some flexibility with regards to certain domestic issues (in fields such as culture, education and economy) had been exhibited in the post-1979 period, the contours of Iranian foreign policy had remained solid and constant (for example, persistent anti-American and anti-Israeli themes). So, while states like Brazil and China had embraced globalization, the Islamic Republic of Iran (IRI) had continued to cling on to the kind of 1970s anti-imperialist notions, in addition to political Islam, which had led to a situation of self-imposed isolation.
  • He said the reason why this policy had been practiced at such a high cost for the Iranian economy, and why successive governments had failed to ally Iranian foreign policy with economic policy had to do with two separate illusions:
    • That the Moslem world would support this – something that has clearly failed to materialize
    • The notion, which surfaced in the mid-1990s, that divisions could be created between Europe and the US
  • The reason why this consistency had lasted had to do with the following: For a time in the 1980s and the 1990s, Iranian foreign policy had been based on ideology grounded on political Islam, (which had come to highlight both sovereignty and isolation). However, from the mid-1990s onwards, when some American think tanks stared floating prospects for regime change, there came a surge on the part of Iranian decision makers to embark on a number of pro-active policies that included a nuclear program as well as greater regional activism. So anti-Western doctrine, regional activism and the nuclear option provided ample opportunities to maintain the configuration of power inside Iran. Hence, this course of action primarily helped the domestic political order. This foreign policy behaviour was substantiated by:
    • An ideological-religious narrative
    • A populous impulse pivoting almost to political isolation
    • “The ‘Sinatra Doctrine’ in Iranian foreign policy, of Iran wanting to do everything in its own way without any alliances at the regional and global levels”. Such a course of action no doubt would have adverse ramifications for the national economy that thrives with greater cooperation and suffers as a consequence of isolation.
  • According to Mahmood Sariolghalam, this narrative, which had separated foreign policy from economic policy and development, had survived because the income derived from oil had essentially been able to service some of the nation’s various demands. He said the small group of people involved in foreign policy decisions had been confronted with such issues as “calcification”, and noted that during the course of the 2017 presidential debates, there had been no discussion of any foreign policy issues.
  • Mahmood Sariolghalam said that the US had tried to focus on the IRI economy to bring about political concessions, and much was made of the nuclear issue as being the number one issue between the IRI and the US. This was why President Rouhani oversold the JCPOA two years ago to the public by promising that the economy would be opened up (and would bring about greater investments and technology transfers, and so on), despite the fact the nuclear issue was not the main bone of contention. But the conceptual centrality of US aims had always been to intensify internal contradictions in Iran in order to induce further concessions.
  • Sariolghalam took the view that in the aftermath of the US decision to leave the JCPOA, the IRI was facing a situation in which there would be no possible, tactical solutions, for resolving its economic policy problems. He said that it was no longer possible for the two-decade old strategy of “no relations, no-confrontations with the US” to function in the current atmosphere, especially if Donald Trump was to be re-elected for a second term. As a result, the message being sent from America was that Iran could no longer ride the world economy without political costs. In other words, Iran could not have its own way of conducting its regional policy, while at the same time having normal economic relations with the rest of the world. He suggested that Iran was an unsatisfied power, given that it had the potential and capability of disturbing regional order but not being able to shape regional order. In studying Iranian behaviour, it became clear that Iran was at heart a defensive country that had been involved in the region to sustain the homeland.

Sariolghalam concluded his speech by saying that Iran’s charm offensive was unlikely to work any more now that US-Iranian relations was entering a new phase, for Iran could not say that it wanted economic improvement while rejecting the world order.  This meant that the IRI’s behaviour needed to change if it wished to benefit in the economic spheres. He said that in Iran you had:

  • The State, which was constitutionally in charge of making policy
  • The government, which was responsible for conducting and managing the economy

Sariolghalam said that the US decision to leave the JCPOA might force Iran to think differently with regards to state priorities that focus on security and foreign policy, and government priorities that focus primarily on the economy.

Therefore, a new phase in US-IRI relations was being entered upon, which essentially disassociated the past from the future, paving the way for some tough decisions that Iranian leaders had to make in the next several months.

  1. Sanam Vakil

    Source: YouTube

Sanam Vakil began her remarks by focussing on the practical aspects of President Trump’s decision to withdraw from the JCPOA. She said that Trump’s decisive message, which she felt had been delivered with clarity, had also placed the ball in the court of both Tehran and Europe. She said that Trump, pursuing a belief shared by many ‘neo-cons’, had gambled on the notion that the IRI was likely to respond under pressure. The thought that Iran was currently in a weak position (with the January demonstrations often referenced to make the point), had also guided the making of this decision, which had been influenced by the newly arrived ‘Iran Hawks’ within the administration who are bolstered by positions advocated by both Saudi Arabia and Israel.

However, Sanam Vakil pointed out that pressure has not always worked in the case of Iran (for example, the 8-year war with Iraq), given that the country had in recent times demonstrated ‘strategic loneliness’. She noted that while the consummation of JCPOA was seen as a response to overwhelming pressure that had been exerted on Iran, it nevertheless took 2 years (which is a long time) before a final agreement was reached.

Sanam Vakil said that for the hard-liners in Iran,pressure was a good thing that played into their narrative. Moreover, she was of the view that the perception that the IRI was weak was wrong, despite a flurry of protests coupled with all kinds of challenges that continue almost on a daily basis. This was mainly due to the fact that there was no real opposition to the regime either inside or outside the country. Stating that the challenges posed to the regime in 1999 and 2009 had been bigger, she suggested that the Iranian state was a lot stronger than people thought.

Turning her attention to the situation inside Iran, Sanam Vakil said that factual debate within the country was quite vibrant. However, she noted that President Rouhani’s prospects of being delegitimized against a narrative of resistance were coinciding with a ‘told you so’ moment for the hard-liners and a newly found sense of nationalism on their part that could potentially bolster their position at the ballot box.

Finally, turning her attention to the region, Sanam Vakil said recent developments had placed those advocating the ‘resistance narrative’ (for example, IRI allies such as Hezbollah, Assad, Iraqi elements, and the Houtis) in a winning position. She concluded by saying that while there was a need to deal with regional issues through dialogue and diplomacy, it was nonetheless, difficult in the current atmosphere of distrust (due to the Americans having

changed the goal posts), to see the Supreme Leader and other hard-liners coming to the negotiation table.

Key Points from ‘Questions & Answers’

In response to a number of questions posed in the course of the ‘Q&A’ session, the speakers made the following key points:

  • In the short to medium term, the IRI would be likely to act in a calculated way to induce the Europeans to remain in the JCPOA.
  • Meanwhile, the region would be polarized further, while the IRI ramped up the regional cards in its hand (especially in the aftermath of the Lebanese and Iraqi elections).
  • The rift between Iran and the Arab Gulf neighbours would become wider as a consequence of a lack of dialogue with Saudi Arabia.
  • The Iran-Israel conflict would be played out in Syria, worsened by the likely US decision to pull its forces out of that country.
  • With the Russian role remaining ambiguous, the scenario in the Middle East would become more polarized with more actions that have adverse consequences for the economy of the region.
  • Any EU-US split from an IRI perspective would be unlikely to yield anything (for example, with companies such as Airbus, Total, and Nestle etc. all withdrawing their participation from the Iranian market).
  • However, the EU had a role, and Trump had passed the buck to them to keep the IRI on side and eventually broaden the scope of negotiations.
  • Iran could potentially lose a major share of its oil market with countries like South Korea and China, which had already reduced their purchases of Iranian oil.
  • The main issue between Iran and the US was not the nuclear issue. Iran’s attitude towards Israel was a major issue and as long as Iran does not address this issue, gaining support for meaningful dialogue with the US will remain a serious challenge.