One Year After the Iran Deal, Is Canada Falling Behind in Reengaging with Iran?

Here is an opinion piece by Bijan Ahmadi, Pouyan Tabasinejad and Mehdi Samadian:

This article was originally published on New Canadian Media.   

The historic nuclear agreement reached between Iran and the P5+1 countries on July 14, 2015, officially known as the Joint Comprehensive Plan of Action (JCPOA),marked a milestone in the history of world diplomacy. The final agreement, which was a result of 20 months of arduous negotiations, was implemented on January 16, 2016 by which a formal easing of sanctions imposed on Iran began to unfold in exchange for limits on the country’s nuclear program. However, while many of Canada’s allies have already begun to reap the rewards of the deal by reengaging with Iran economically and diplomatically, Canada has not reengaged as quickly and is lagging behind her allies.

A recent report by the International Atomic Energy Agency (IAEA) confirms that Iran has complied with the terms of the JCPOA. This means that it is likely that Iran’s reintegration into the international community and economy will likely continue to accelerate. Since implementation of the nuclear deal several international companies have been able to conclude contracts in a variety of fields with Iran. This includes deals Iran has signed with Boeing and Airbus worth billions.

Reintegration has also taken place in the diplomatic realm. The British embassy in Tehran was opened in August 2015 after 4 years of closure. Over the last 12 months several countries have started to reengage economically with Iran and further economic and trade deals are expected in near future.

In Canada the government of Prime Minister Justin Trudeau (brought to power in the federal election of October 2015) lifted some of Canada’s sanctions on Iran in February 2016, leaving mainly those sanctions related to arms, Iran’s ballistic missiles program and restrictions on a list of designated individuals.

With a large Iranian Canadian community (a population of around 300,000), who have links with Iran and familiarity with Iranian culture and business norms, there are enormous opportunities for Canada to engage and collaborate with Iran in a variety of fields including economic trade, cultural exchanges and collaboration in science and research. The Iranian diaspora in Canada have also been in the vast majority supportive of the nuclear deal with Iran and reengagement. Last year in two surveys conducted by the Iranian Canadian Congress (ICC) close to 80% of the respondents reported that they were positive about the outcome of the nuclear deal and expressed their hope for rapprochement between Canada and Iran.

All indications point to great potential for trade between Canada and Iran. Canada’s exports to Iran peaked at $772 million in 1997. This number declined precipitously to $67 million in 2014 after Canada imposed sanctions on Iran. While Canada lifted most of its sanctions in February 2016, Canadian companies and institutions have lagged behind that of our allies. A major barrier preventing further economic engagement today is the lack of diplomatic relations between the two countries. Since the last federal election, Foreign Minister Stéphane Dion has repeatedly expressed Canada’s intention to reengage with Iran and has confirmed that talks between the two countries have begun; however, there is still significant uncertainty about the timeline and progress of this reengagement process.

While the benefits of reengaging with Iran are enormous and clear, it is important to recognize the challenges and hurdles in this process. The international banking system has been reluctant to reconnect with Iran in fear of punishment by U.S regulators, an issue which has even affected the services some Canadian banks are willing to offer Iranian-Canadians. These systematic problems may undermine the nuclear deal and the economic benefits Iran expects to receive from the deal. There have however been positive steps in this regard, with governments and financial organizations expressing positivity over Iran’s reincorporation into the banking system.

Secondly, the deal’s fate is contingent upon the political will of the leadership of the countries involved. Given the rhetoric from U.S. presidential candidates and the repeated attempts of the Republicans in U.S. Congress to block the continuation of JCPOA, there is significant uncertainty about the future of the Iran deal in this respect.

Another threat to the process of rapprochement with Iran is the issue of human rights. The United Nations has consistently criticized Iran for its human rights situation. Though this issue is not a direct threat to the JCPOA, it has become a subject of controversy in terms of expanding relations with Iran in Canada and other countries.

While there are significant challenges in the path forward, there is hope that continued dialogue and engagement with Iran will address these hurdles. The future of Canada-Iran relations looks positive based on the expressed intention of the government to re-establish ties with Iran and the great opportunities that this reengagement offers both countries. Canada must partake in this momentous opportunity in the history of world diplomacy and side with peace, dialogue, and constructive and mutually beneficial engagement.