November 23, 2011 | The 37th Interparliamentary Meeting Between European Parliament and Knesset

Common Threats, Different Approaches

Israel, the EU and the U.S. confront the challenge of a nuclear Iran

Mr President of the European Parliament’s Delegation to the Israeli Knesset,
Honourable Members of the European Parliament,
Members of Knesset,
Ladies and Gentlemen,

It is a great honour to be here today to address you on a topic that concerns us all – Iran’s slow but steady march towards nuclear weapons’ capability.
The prospect of a nuclear Iran has kept the policy community of the United States, Europe and Israel awake at night for many years. It is a daunting prospect – because its implications for regional security are grave.

If Iran were to acquire nuclear weapons, or even just the capability to build them, whether it uses them or not becomes largely irrelevant. The outcome is, at a minimum, that Iran will be able to radically destabilise and alter the regional and global balance of power. Its nuclear arsenal – or presumed arsenal – will threaten not only its Middle East and Gulf neighbours. The effect will be dramatic for Europe, too.

It is difficult to see how Iran, with its revolutionary zeal protected by a nuclear arsenal, will play a constructive role in pacifying the regional tensions it is currently fomenting. The Iranian proxies would then be able to shelter under the destructive power and diplomatic prestige of Iran’s nuclear umbrella. And their capabilities might actually be enhanced by the acquisition from Iran of radiological weapons and longer-range missile systems that will be able to strike deep inside Israel. This is not a hopeful scenario for Europeans who seek peace at home and aspire to stability in the Levant.

Iran’s revolutionary ideology is not necessarily tinged with a yearning for the End of Days, though it would be foolish to dismiss the existence of such feelings among Iran’s ruling elites. In spite of their rhetoric, Iran’s leaders may be guided by a rational calculation – the desire to ensure the survival of the Islamic Revolution and to strengthen it, both internally and regionally, in order to achieve the regional hegemony that some in Iran believe is rightfully theirs. But the revolutionary nature of the regime means that, at a minimum, Iran aspires to redefine the regional order of power in its favour and remake it in its own image. Nuclear weapons would exponentially increase Iran’s ability to achieve that goal, setting the Shi’a regime on a dangerous collision course with most of its Sunni neighbours. Given such premises, it does not even take a leadership driven by visions of religious utopia to slip into a war.

Its revisionist ambitions are enough to set it on a collision course with the other regional powers – and given how little Western nations have done to countenance Iran, despite decades of stern warnings, deadlines and ultimatums, there is little reason to believe that, once Iran achieves nuclear capability, Western governments will somehow get tougher. Their failure to stand up to Iran before it gets the bomb will put them at a terrible disadvantage if Iran has the bomb, because Iran will feel emboldened to provoke them even further, in the belief that it’s added strength allows Iran to punch harder and that their proverbial meekness warrants impunity for the bullying.

What can be done?

With Russian and Chinese opposition to new international sanctions, and time running out, there is a need for Europe, the United States and their Western allies, to come together with more effective policies.

And what would these policies look like?

The EU has relied on a dual-track approach, hoping that incentives through diplomacy and pressure through sanctions would eventually bring the Iranian regime to a compromise. Nine years of this policy, however, have yielded little. Iran suffered some setbacks. Its economy has suffered – and so have the means by which Iran sought to procure its nuclear technology in the past. But Iran has steadily progressed towards its goal of nuclear weapons’ capability and is so far impervious to pressure.

The U.S. has sought to use extraterritorial measures and its influence to dissuade and discourage governments, financial institutions and the corporate world from doing business with Iran. It has sought to implement measures aimed at targeting the most strategic sectors of Iran’s economy. And it has given its full weight behind all diplomatic efforts aimed at Iran in recent years.

Israel, for its part, has played a helpful role on this challenge, sharing intelligence and resources with allies in Europe and the Western world for the purpose of slowing down, thwarting, delaying, and sabotaging Iran’s progress.

Ultimately though, Iran can only be stopped if a much more aggressive campaign of measures is adopted than the existing ones.

Efforts on both sides of the Atlantic must be praised for moving forward the sanctions’ route with more measures. The EU is expected to dramatically expand its list of travel bans against individual Iranian officials and of proscribed Iranian entities because of their link to proliferation activities.

However, European efforts to restrict sanctions to those areas of economic activities in Iran that can be directly linked to proliferation have now been proven to be insufficient.

A concerted effort now needs to recognise that Iran is unlikely to renounce its ambitions unless there is a clear and present danger for the survival of the regime.
Such a danger can materialize in two ways:

  1. The regime must be isolated; and
  2. The current sanctions’ architecture is dramatically strengthened through additional, broad and aggressive sanctions.

High profile symbolic actions would not be useless if they created embarrassment for Tehran, focused public attention on the regime's true nature and helped to isolate Iran on the international stage. Among possible actions, here are some examples:

  • Western officials (ministers, parliamentarians, undersecretaries and deputy ministers) rarely travel to Iran any more, but if and when they do, they should make a habit of visiting prominent Iranian human rights dissidents. It should be an official part of their visit so that if Iran tries to block such meetings, visits would be cancelled. And if such events take place, they should be given broad exposure through joint press conferences, perhaps convened inside Western embassies.
  • When they meet their Iranian counterparts, Western dignitaries should insist on raising human rights as the first item on the agenda for bilateral discussion.
  • These exchanges should be concrete, specific and practical. And they should be recorded in any statement, communiqué or protocol issued. Discussions on human rights should not be mere gestures or generic condemnations. Western officials must provide a detailed list of specific abuses, with requests for action.
  • Such issues could include, say, a demand for the reopening of the many daily newspapers and magazines that the regime has closed down in recent years, as well as the freeing of political prisoners. Western diplomats should come to meetings equipped with lists of names, not a generic demand for more press and political freedom.
  • Western diplomats should also provide a timeline for implementation, with a clear statement of the punitive economic and diplomatic measures it will impose for lack of compliance.
  • Western countries that still have relations with Iran should signal their displeasure to Tehran. First, they could downgrade diplomatic relations by recalling ambassadors in Tehran, leaving chargés d’affaires to represent their countries. There would be little immediate fallout for trade, but it would have significant diplomatic impact.
  • Other types of bilateral contacts should be affected. EU parliamentarians could stop their frequent parliamentary delegations to the Iranian Majlis, while invitations to Iranian parliamentarians should be conditional on improvements on human rights issues. The composition of the Majlis and the way its members are selected are an insult to Europe’s democratic standards. Iranian parliamentarians should not be granted equal status with European MPs and MEPs. It does not mean suspending all contacts, but some contacts may not be worth maintaining for the sake of dialogue. Dialogue should continue, but it should not be ‘business as usual’.
  • When Iranian dignitaries visit Western capitals – and they still visit often – European hosts should severely limit the scope and extent of their visits. For example, there is no need to roll out the red carpet and offer them high-level meetings; nor is there any reason to grant visas to accompanying business delegations.
  • Even if some visits are still allowed in the name of dialogue, it should be made clear that specific figures among Iran’s ruling elites are not welcome.
  • Europe should ban travel to or through Europe for all Iranians who are suspected of involvement in the Buenos Aires bombing of 1994. Interpol did not issue an international warrant for all seven Iranians whom Argentina named as suspects, presumably for political reasons. Those who are not on the Interpol wanted list – former president Rafsanjani in particular – should not be granted permission to set foot on European soil under any circumstances.
  • The already existing lists produced by UNSCR 1737, 1747, 1803 and 1929 of Iranian individuals who are subject to restrictions should be extended to lower levels of the political hierarchy and of the IRGC.
  • When visits are unavoidable – for example, when Iran’s foreign minister or Iran’s nuclear negotiator come to Europe – European cities should mark their arrival with additional high-profile symbolic gestures. They could, for example, rename streets or districts where Islamic Republic embassies are located after prominent Iranian dissidents. The USA, under the late president Ronald Reagan, named the street where the USSR embassy was located after late Soviet dissident Andrei Sakharov. Similarly, the plight of famous dissidents could be highlighted in newspaper campaigns giving a human face to the suffering Iran visits upon its own citizens.

Activism in support of isolating Iran should neither begin nor end with government action. It is important, of course, that governments use the instruments of state – diplomatic channels, multilateral forums, international organisations, domestic legislation and other channels. Activities aimed at raising public awareness need not always have the official backing of

The following are examples of initiatives that NGOs and other organisations could initiate, sponsor, undertake and promote:

  • mobilising national unions and European federations of unions to support labour rights in Iran by embracing, for example, the plight of individual Iranian dissident unionists;
  • mobilising women’s rights groups in support of women’s rights in Iran;
  • mobilising the gay and lesbian community, through their organisations, activists, cultural centres and magazines, to highlight the persecution of homosexuals in Iran;
  • mobilising professional and trade organisations to promote people-to-people contacts in their particular areas of specialisation;
  • organising conferences and workshops on Iran’s human rights record under the auspices, and with the sponsorship, of national and local authorities;
  • organising awareness campaigns on specific themes through the national media to highlight incidents of on-going abuses, such as the absence of rights for religious minorities;
  • launching media campaigns in support of individual dissidents, for example with newspapers ‘adopting’ individual dissidents by telling their stories and launching campaigns on their behalf.

Such measures would transcend relations between governments, involving European civil society as a whole in the struggle for human rights in Iran. It is not only a worthy battle in its own right but it also has the advantage of imposing formidable pressure on the regime when it comes to the other contentious issues that divide Europe and Iran, from Iran’s support for terrorism to the nuclear issue.

When criticised for its human rights record, Tehran has shown weakness. It is easily embarrassed. European officials should exploit this vulnerability and contemplate a number of symbolic measures to signal their displeasure with Tehran while also demonstrating to the Iranian people that Europe is concerned about their plight no less than about their government’s relentless nuclear ambitions. Dialogue can continue, then, but not as it was.

Such embarrassments should become the rule, rather than the exception. The regime’s loss of face as a result of such events should not be dismissed as gesture politics. A country that holds national honour and pride so high will not be indifferent to regular displays of contempt to their leaders.

Clearly, symbolic gestures can only go so far.

Alongside this important aspect of public diplomacy, Europe and its allies need to set differences aside and recognize that the three pillars upon which the current sanctions' architecture is built need to be dramatically expanded.

Sanctions have so far targeted: the Iranian entities and individuals involved in the missile and nuclear programmes; the procurement networks and the Iranian corporate facilitators overseas that seek to acquire illicit technology for the programmes; the financial institutions responsible for facilitating these transactions; and the commercial vectors that Iran uses to transport its illicit technology. These measures are vital and have been successful in making Iran's efforts more costly and time consuming.

But they have not made a decisive dent in Iran's ability to move forward.

The EU, in particular, needs to stop the somewhat artificial distinction between entities linked to proliferation – which it considers to be legitimate targets – and entities that have no such proven link.

Sanctions have targeted the main sea and air transport vectors the regime uses for its proliferation activities. But many other shipping lines and at least one additional airline have eluded sanctions. This has to change.

But ultimately, if sanctions are to make an impression on Iran's rulers, they must go after the sources of revenues of the regime – in particular the Revolutionary Guards and their vast and growing network of companies and economic interests.

The IRGC is not only the regime’s sword and shield against domestic opposition forces. It is also a vital instrument of Iranian foreign policy. In Lebanon, the IRGC operates through its proxy, the Lebanese Shi’a terror group Hezbollah, an organization it helped establish. In Iraq, it works through a host of Iran-sponsored Shi’a militias, as well as Iraq’s powerful ministries of defense and interior. Elsewhere in the region, IRGC Special Forces and instructors have supplied weapons, training, and financing, and built a web of alliances with pariah governments like Omar al-Bashir’s Sudan, terrorist organizations like the Palestinian Islamic Jihad and Hamas in Gaza, and other deadly groups, such as the Taliban in Afghanistan.

The Guards’ role, however, is not limited to military and security matters. Since the end of the Iran-Iraq War, the IRGC has gradually become one of the biggest economic interests in the country, growing into an enormous conglomerate of hundreds of companies and financial holdings spanning every sector of Iran’s economy. From auto manufacturing to port logistics, from public works such as dams, tunnels, jetties, and highways to petrochemical factories and pipelines, the Guards’ work increasingly makes the IRGC the key stakeholder in Iran’s economy.

This wealth serves three important goals. First, it generates revenue to finance the IRGC’s military-oriented activities—including the nuclear program at home and sponsorship of terrorism abroad. Second, it offers the Guards a network of companies, enterprises, banks,
offices, holdings, and joint ventures that can execute the regime’s procurement efforts in its quest for advanced weaponry and sensitive technology. And third, it generates personal affluence, which the Guards can translate into political influence.

The Guards’ rising riches go hand in hand with their increasing power in the political system. In recent years, the IRGC gained more visibility inside Iran’s power structure, especially since Mahmoud Ahmadinejad’s election as Iran’s president in 2005. The number of former IRGC officers sitting in the Majles-e Shura-ye Eslami, or Majles, the popularly elected assembly charged with enacting national legislation, is just one part of their success story. IRGC former officials sit in the cabinet, rule as provincial governors, represent Iran abroad as ambassadors, run government-owned companies overseas, and fill key positions in or around the office of the Supreme Leader—the country’s final arbiter and commander-in-chief.

The interaction among military, economic and political power is critical in understanding the centrality of the IRGC to Iran’s current system; the IRGC takes advantage of its influence and capabilities in one realm in order to increase its involvement in another. Its growing economic clout is both an end in and of itself and a tool to advance other agendas. Thus, IRGC revenues from economic activities yield political leverage and the resources needed to advance its loyal members in positions of power. Its power, conversely, serves the economic enterprises it owns. But the profits inevitably fund its military activities, its involvement in the procurement and development efforts in the nuclear and ballistic missile programs—which in turn enhance its prestige and power within the system. Meanwhile, the Guards’ growing political and economic influence enables them to bank on the willingness of public companies to lend their services—both at home and abroad—to aid in the Guards’ efforts to procure forbidden technologies and raw materials, and to finance their purchases through middlemen on foreign markets.

The IRGC is an elite military force, a business, an organized crime syndicate, and a political actor at home and abroad. However, to finance its activities, the IRGC needs access to the international financial system, and it owns or controls several banks for this purpose. They include, but are not limited to:

  • Bank Sepah and all its affiliates, holdings, investments, and management companies, including foreign branches in London, Paris, Frankfurt, and Rome. This also includes investment affiliates Omid Investment Management Company (OIM Co) and Bank Sepah Brokerage Company (BSB Co). Together with OIM Co and BSB Co, Sepah Bank also owns 62.46 percent of outstanding shares of the Sepah Investment Company;
  • Post Bank, a financial institution created after Bank Sepah was hit by international sanctions, to handle all overseas transactions formerly conducted by Bank Sepah;
  • Bank Ansar, a newly established bank that was created by the Ansar Foundation (an IRGC entity);
  • ToseyeTa’avon Bank, created in July 2009, an offshoot of the IRGC Cooperative Foundation—an instrument established in 1988 to provide support and funding to IRGC companies in securing lands, legal aid and financing for projects.

Going after these banks is imperative. And sanctions should not limit themselves to monitoring the nature of their transactions. These banks’ activities in the international financial market should be shut off.

The Guards have also used Iran’s energy and heavy industry branch offices abroad—such as Kala Naft, the National Iranian Oil Company’s overseas procurement company, and Mobarakeh Steel, Iran’s biggest steel conglomerate—as fronts to acquire dual-use technologies and forbidden raw materials.

Such covers become critical when it comes to Iran’s nuclear program. For example, the Guards use Imam Hossein University to provide academic cover for illegitimate nuclear activities. Imam Hossein, the IRGC military college, is funded jointly by Iran’s Ministry of Research and Technology, the Ministry of Defense, and the IRGC. Its scientific endeavors include a nuclear physics program and comprehensive research on laser enrichment. Many of its activities are linked to Iran’s WMD program; the Government of Australia designated the university in 2010 for its role in proliferation activities. Other Western governments should now do the same.

The Guards’ economic interests also include a number of important manufacturing companies. Iran is the Middle East’s largest producer of cars. It is believed that the IRGC owns an important share of the Bahman Group, which produces Mazda cars under license.

IRGC companies are also prominent in the services and logistics sectors, where energy consulting companies, shipping, and harbor logistics (such as bunkering services and containers) have also fallen under the purview of the IRGC.

As if all of this were not enough, the IRGC runs additional illicit economic activities through airports and harbors—including an almost complete monopoly over the commercial port of Shahid Rajai, the reported use of Iran’s Payam International Airport near Karaj and of Payam Air for smuggling of goods, the sale of refined petroleum products abroad, the smuggling of cars, electronics, and a wide range of house commodities that are either scarce or costly on the U.S.-embargoed and internationally sanctioned domestic market.

I could go on.

Instead, I wish to make a final point.

The current debate about Iran’s nuclear programme revolves around a false choice – living with Iran’s bomb or bombing Iran.

This is a false choice because those who oppose military action in the hope of averting a regional war fail to realize that both options, in fact, lead to war. A nuclear Iran will push the region to the brink of war just as easily – only, this time, war will be fought under the shadow of an Iranian nuclear bomb.

If you think about it you realize how this is not a dilemma that Israel, Europe or their Western friends and allies should ever wish to confront.

Sanctions have been presented as a third way – and yet, so far, this is almost the road not taken, since so much more should be done to make sanctions work.

The hour is late – but not too late to put aside our reservations and adopt a new, tough and comprehensive set of crippling sanctions that will make the regime in Tehran tremble and, hopefully, crumble too.

Thank you.