The big Iran story is no longer congressional sniping at the deal worked out by the United Nations Security Council to monitor Iran’s civilian enrichment of uranium for reactor fuel. It is the coming gold rush of countries and companies long strong-armed by the United States to stay away from Tehran. Iran has a population of 78 million, nearly the size of Germany’s, and a gross domestic product (GDP) similar to Poland’s, a market robust enough to make any investor’s mouth water. But it also has significant future industrial potential and trillions of cubic feet of untapped natural gas, both locked up by years of sanctions and both of which could make it one of the wealthiest countries in the world in coming decades. One puzzle about the Republican Party leadership is why it wants to prevent Americans and American businesses from benefiting from a lucrative new investment arena.
Even before President Obama prevailed in the Senate last week, with his Democratic Party loyalists blocking a GOP-backed resolution condemning the Joint Comprehensive Plan of Action (JCPOA), European government officials and businessmen were crowding into Tehran’s few nice hotels with memoranda of understanding in the breast pockets of their tailored suits. The great significance of the failure of Congress to block the deal is not so much that US sanctions will be rapidly lifted (the process will likely take years) but that Obama is highly unlikely to direct the Treasury Department to punish foreign firms or states that deal with Iran. The threat of those third-party sanctions had been potent, given that the United States has a $17 trillion economy and represents over a fifth of the global GDP. No one wants to be excluded from this dynamic market.
Any such threat is now receding, however, and the rush to Iran is on in earnest. If Iran meets its obligations, UN-backed sanctions will begin being lifted this fall and be gone in the first half of 2016. The Iranian public, moreover, is ready for business. In recent years, some 400 modern malls have been opened, and consumers are hungry for international brands. Paris newspapers crow that Iranians want “French fashion.” And boy, are Gallic CEOs ready to give it to them. French secretary of state for exterior trade Matthias Fekl noted, on his way to Tehran, that there is a strong demand for investment in “infrastructure, consumer goods, foodstuffs, transport, energy and health.” In the largest invasion of the Middle East by the French since Napoleon Bonaparte set off for Egypt in 1798, some 134 CEOs and company representatives from that country are in Iran this week, along with two government ministers. In an interview Fekl demanded that uncertainties with regard to American retaliation be completely removed by Washington (French banks are notably absent from the delegation, having been burned by the $8.9 billion fine assessed last year by the United States on BNP Paribas for flouting the Iran sanctions).