Iran: Trump’s election will give the hardliners more power

Iran: Trump's election will give the hardliners more power

The election of Donald Trump as the new US president has put the US-Iran relations under threat, the case that will empower hardliners in Iran who are pushing for global isolation and discourage already wary foreign investors.

Barack Obama, The former US leader, was behind the historic Iran nuclear deal with P5+1 powers, agreed upon last year, which saw Tehran agree to amend its nuclear output in order to lift all nuclear-related economic sanctions, freeing up tens of billions of dollars in oil revenue and frozen assets.

After lifting the sanctions, Iranian president Hassan Rouhani visited Europe and made deals that worth billions of dollars. European companies started looking for investment opportunities in the growing Iranian market.

The Iranian government also sought deals with western companies to develop and maintain its natural resources such as Oil and Gas. The last deal was signed on 8 November with the French company, Total, to further develop its part of the world’s largest gas field, avoiding the US sanctions by financing the deal with euros, to become the first western energy company to sign a major deal with Tehran since the lifting of international sanctions earlier this year.

However, Trump’s election might change the whole game and threaten the development that was built in the past months.

Trump has said during his election campaign that the deal as “disastrous” and said it would be his “number one priority” to dismantle it.

“It is hard to believe a president of the United States would actually put his name on an agreement with the terrorist state Iran that is so bad, so poorly constructed and so terribly negotiated that it increases uncertainty and reduces security for America and our allies, including Israel,” Trump said last year.

“When I am elected president, I will renegotiate with Iran — right after I enable the immediate release of our American prisoners and ask Congress to impose new sanctions that stop Iran from having the ability to sponsor terrorism around the world,” Trump added in the same statement.

Western companies’ investments threatened

Some Western companies had been hoping Democrat Hillary Clinton would defeat Trump in the election because of concern over the fate of the nuclear deal.

If Trump was really able to cancel the nuclear deal and out sanctions again in Iran, all the European investments in Iran may be canceled too.

“Now with Trump’s victory, even the European companies will be reluctant to invest in Iran … in the best-case scenario they will adopt the policy of wait and see,” said a senior Economy Ministry official.

“With Trump’s victory, major and even medium-sized foreign companies, banks and other investors will be more cautious … to invest in Iran,” said Tehran-based businessman Reza Sardari.

“This will harm the economy just when we were hoping to attract foreign investors.”

And the biggest winners after this move will be only Iran’s supreme leader Ali Khamenei and the Iranian hardliners, who can put their hands firmly on both the economy and the people’s minds again.

Controlling both the people and the economy

The nuclear deal was divisive in Iran, with hardliners opposed to better relations with the West arguing that pragmatist President Hassan Rouhani was giving up too much of the country’s nuclear infrastructure for too little relief.

Iranian Supreme Leader Ali Khamenei regularly criticizes the United States and the deal, saying it should not be trusted and it wasn’t doing its part of the deal.

Khamenei has already promised to “set fire” to the nuclear deal if the West violates it. and has repeatedly complained it has not received benefits promised.

Trump’s change of the US policy would just prove him right and will strengthen his hold on the Iranians’ minds, who will just see the west as the devil their leader always spoke about.

“The big winner in the aftermath of a Trump victory is Iran’s Supreme Leader,” said Suzanne Maloney, a foreign policy expert at the Brookings Institution.

“He will have the most cartoonish American enemy, he will exult in the (hopefully brief) crash of the American economy, and he will be able to walk away from Iran’s obligations under the JCPOA while pinning the responsibility on Washington.”

The hardliners in Iran refused also the nuclear deal and the trade ties with the west.

Hardliners believe it is offering overly generous terms to overseas energy companies that can exploit Iran’s natural resources.

The Iranian Revolutionary Guards and their conservative supporters remained always distrustful of the West, professing no need for foreign companies and emphasizing security and social conservatism over international engagement. They hew to what Supreme Leader Ali Khamenei calls a “resistance economy” of self-reliance.

During years of sanctions that kept away many foreign companies, the Islamic Revolutionary Guard Corps stepped into the void, building a network of companies that came to dominate Iranian industries from energy to telecommunications.

The Revolutionary Guards first secured an economic foothold after the Iran-Iraq war of the 1980s when Iran’s clerical rulers allowed them to invest in leading Iranian industries. Their economic influence grew after former guardsman Mahmoud Ahmadinejad was elected president in 2005.

After lifting the sanctions, Rouhani tried to limit their dominance in the economic area.

The Revolutionary Guards should “be limited to those areas that the private sector is incapable of or uninterested in,” a spokesman for the Rouhani government has previously said.

“The government believes that the private sector should gain the opportunity to present its capability. The government itself shouldn’t compete with it. Other sectors like [the IRGC] should not compete with it.”

But Trump’s victory can just put the economy in their hands again

“With Trump’s victory, Iran needs the Guards … they will gain more economic and political power,” the official said.

Tehran could turn to the Guards for help with the economy if Western companies decide to stay away from Iran, and their hands will be over everything. They will use this dominance as a tool to finance their intervention in the region. Trump will be giving them just the present they always needed.