Armen Vardanyan
AIISA expert on Iranian affairs
Iran-West relations entered a new phase after signing of the historical accord between Islamic Republic and the six leading world powers 14 July 2015 in Vienna. Tehran gradually came out of international isolation.
If formerly the Islamic Republic of Iran was perceived as a state threatening to international security, and along with Iraq, South Korea, Libya and a few other countries was included in the list of so-called “axis of evil” by the USA, currently the status of this Middle Eastern state is step by step growing on international arena, and it is no more a “rogue state.”
Figuratively speaking, after July 14 the era of Iran’s demonization is over, and improvement of Tehran’s positions and authority on international arena has begun.
Until mid-2013 the West, particularly the USA, had been pursuing a policy of deterrence towards Iran, striving to isolate it from international arena by all means, while adopted a policy of its engagement after Hassan Rouhani was elected as president. By de-isolating Iran, integrating its economy in world economy, the country is becoming more predictable for the international community.
Iran’s utmost role in the war on Islamic state, as well as realization in the West that solution of regional conflicts, especially in Syria, is impossible without engagement of that country, were not less important among incentives. Not accidentally, Mohammad Javad Zarif, Minister of Foreign Affairs of Iran, participated in negotiations on Syrian conflict 29 October 2015 in Vienna for the first time. Earlier, due to objections by Saudi Arabia and the USA, the Iranian side didn’t take part in previous talks in Geneva respectively in 2012 and in 2014.
Currently Iran is regarded as regional power in the Middle East. A conviction is being formulated, that in near future its positions will be more strengthened not only in the Middle East, but in the Central Asia, the South Caucasus, Afghanistan and other regions as well. If Central Asia and South Caucasus countries were limited to deepen ties with Iran before, now, in the post-sanction period, Iran takes serious steps to develop relations with them.
At the moment, Iran possesses all necessary preconditions—large political, military, economic, demographic and ideological resources, to appear as a regional power.
Iran is one of the leading states of the Islamic world, which provides a huge political impact for this country. Presently Tehran enjoys greater influence on Iraq, Lebanon, Bahrain, Yemen (Shiite Houthis), and Shiites of Kuwait. In Syria Iran supports a Shiite branch—Alawites, led by Bashar al-Assad’s regime. About 4 million Shiites live even in Saudi Arabia, which is Iran’s main ideological, military, economic and political adversary in the Middle East and in the Islamic world. They also display utter sympathy for Iran and a hostile attitude towards Saudi Arabia. Iran-led Shiites of the above mentioned countries shape a “Shiite arc” or a “Shiite crescent.”
Iran also has great military potential, i.e. one of the most powerful armies of the world. Iranian army comprises personnel of about 500.000, from which 350.000 is the Iranian army, and 125.000—Islamic Revolutionary Guard Corpse. Iranian army is ranked the 8th in the world by number of soldiers. There is also Basij paramilitary force, a branch of Islamic Revolutionary Guard Corpse, which obeys country’s spiritual leader Ayatollah Khameini. Besides ground forces, Iran also possesses powerful naval and air forces. A few hundreds of warplanes, a few submarines, a few thousands of tanks, helicopters and etc. are recorded in its armament.
Economically Iran is a country of big potential as well. Despite many years of sanctions, as per GDP it’s the second country after Turkey with greatest economy of the Middle East and the Islamic world, in general.
International Monetary Fund estimated Iran’s GDP for 2015 as USD 393.5 billion. GDP growth comprised about 1% for the same year, while in the period of 2016-2017, after lifting sanctions, it’s expected to reach 4-5,5%, and will be stabilized at the level of 4% in mid-run. Iran’s GDP per person is USD 5.100. Currently the country negotiates over its membership in the World Trade Organization (WTO).
However, despite Iran’s economic hardship, it’s assumed, that, from January 2016, when Iran is totally unsanctioned, its economy will record positive growth. First and foremost it’ll be possible through increasing export of Iranian oil and gas by a few times. Iranian high-ranking officials have repeatedly announced on it.
Demographically, Iran is also a country of immense potential. Currently the number of its population is around 80 million, yearly increasing by 1 million. Moreover, birth rate has noticeably gone down in recent years and the state is taking serious measures to stimulate it. It’s noteworthy, that the youth comprise the majority of Iran’s population. People aging 15-64 form country’s 70,9%. Hence, Iran is one of the world countries with youngest population.
Thus, obviously Iran is becoming powerful day by day with its increasing place and role in contemporary international relations. The country has already achieved a great impact in the wider Middle East, therefore, Armenia should strive to deepen ties with southern neighbor. The more are interrelated economies of the two, the higher the level of political relations between them will be.
If formerly for certain objective and subjective reasons official Yerevan was unable to have closer ties with Tehran, currently, after the July 14 agreement wide perspectives open before Armenia to deepen its ties with Iran.
However, certain obstacles are still existent for deepening Armenia-Iran relations and strategic programs. Dependence of Armenia’s authorities on Russia is the first obstacle. Armenia can’t take steps that might contradict Russia’s interests. In that context Yerevan is not considered a fully reliable partner for Tehran.
The second hindrance to develop Armenia-Iran relations are high customs tariffs applied for the goods of the two. Although Iranian officials have repeatedly announced that they’re ready to deepen cooperation with Armenia both within the Eurasian Economic Union (EEU) and beyond it, the fact is, that after Armenia’s membership to EEU, the latter’s common customs dues, set in the country, complicate access of Iranian goods into Armenian market. Export tariffs of Iranian goods to Russia and EEU reach 20%, which, in terms of competition pretty complicates the condition of private sector.
Currently Iran negotiates with Armenia, as well as with Russia, to decrease customs tariffs. The same can be said on the opposite—high customs dues and non-tariff payments defined by Iran, practically makes export of Armenian goods impossible.
The issue has been repeatedly raised by authorities of the Republic of Armenia, however, didn’t reach its positive solution yet. Another issue is visa regime between the two countries. Armenian authorities should take measures to lift visa regime with Iran. The number of Iranian tourists visiting Armenia will radically grow as a result.
Armenia’s authorities also should rapidly accomplish construction of North-South road, which joins Armenia’s north to south. Finding investors for the construction of Armenia-Iran railway is important, too. Implementation of these two projects of strategic importance will enhance Armenia’s export of goods to Iran and countries of Persian Gulf, as well as enable Iran to export its goods through Armenia to Georgia, Russia and Europe.
Thus, after Iran’s complete unsanctioning, favorable preconditions will open for Armenia, to mitigate the impact of Armenia’s isolation by Turkey-Azerbaijan tandem. Obviously, in near future, Iran will become a powerful regional actor with growing impact in the South Caucasus, where it’s weak yet. To that end Armenian authorities should exert maximum efforts to more deepen the level of Armenia-Iran political and economic ties.
“Improving Security Policy Debates in Armenia” Program (NED)
The Armenian Institute of International and Security Affairs (AIISA)
