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Mercantilist USA and Determined Europe

Mercantilist USA and Determined Europe

Saturday، 23 June 2018 | Article Rating
With US president Donald Trump's decision to withdraw from Iran nuclear deal (JCPOA), Europe has an important and role to play in influencing the rest of the world towards peace or war.
The world order is shifting from a unipolar structure lead by the US, to one of scattered poles of power. Of these power centres, it seems that only Europe is uncertain about where its allegiances lie. This uncertainty is likely to harm both Europe’s own security and interests and those of other nations, particularly my own and others in the Middle East and North Africa.

The world is facing a set of profound challenges. Two trends are occurring simultaneously. While the US becomes increasingly mercantilist, inward-looking and regressive, other old and emerging powers such as China are strengthening their positions. It seems that the US is no longer capable of retaining its place at the top of the world order, partly because of the unsustainable nature of unipolar world order as well as the weak and illogical stance of the Trump administration. After the fall of the Soviet Union some American thinkers expressed worries that the US could not do it alone — that it would grapple with internal dissent. Now we are watching this happen and, at the same time, seeing the regeneration of other old and new powers and their allies.

The US used to think of itself as the guardian of the liberal order and market freedom; this was its distinctive characteristic during the Cold War. But its current behaviour, including the provocation of a trade war with China, implies a regressive return to mercantilism. Mr Trump does not speak about the benefits of a free-market economy. Rather his rhetoric recalls the mercantilist trade model of the 15th to the 18th century. That era was accompanied by war and bloodshed and such violence may occur once again. Can anyone really say the US’s current policies respect liberal and free market theory and the standards of the World Trade Organization?

Meanwhile, Russia, India, and China are growing stronger and must now be considered influential powers. They have their own ambitious objectives and their determination is backed up by clear policies that are paving the way for new social and economic opportunities and Iran benefits from dealing with them.

In this context, we Iranians are aware of our historical, geopolitical and economic position as heirs to a long-established IranShahr and Islamic Civilizations, which held a position of global influence. Despite some shortcomings, Iran has successfully revived this position. The country is comprised of diverse ethnicities. Tolerance, acceptance and understanding have always been practiced through our several-thousand-year history. We can maintain peace and harmony with our neighbours in a turbulent region. Basically, we believe in compliance with international rules and conventions.

Now we are determined to take advantage of Iran’s potentials and, set to overcome barriers by lawful dialogue from a fair and equal stance. At this very sensitive stage, we expect Europe to fulfill its historical role and provide support. Yet Europe remains undecided. It cannot ignore its fruitful trading partnership with the US, but at the same time EU leaders understand the dangers posed to global peace and stability by Mr Trump’s mercantilist approach. Can Europe continue supporting US policies and still safeguard its own economic interests? It may well find the two in conflict.

Now there are two proposals to offer. In the aftermath of the 2015 nuclear accord, there were two series of negotiations and initiatives; political and economic. We in the Ministry of Roads and Urban Development were actively involved in the latter, achieving aircraft deals and infrastructural financing agreements. The problem with Europe, from the very beginning, was some sort of hesitation to provide political support to economic negotiations. Europe has always been worried about punitive response from the US.

Once in 2017, I told Sigmar Gabriel, then Vice-Chancellor of Germany, that the destiny of JCPOA has been left in the hands of conservative compliances. They are not concerned about success of the agreement and should not. This is our duty to safeguard it.Still this is still a major concern that needs continued dialogue in order to review the past two years’ experiences. We need some banking and trade formulas that are supported by a political will of the EU to overcome current challenges. We should not get tired and abandon this course of action; since negotiations and developments at this level naturally take a long time.

The second suggestion is that Iran needs to proceed with a horizontal economic discussion and deal with the EU. This can be achieved with a firm political will.

by Abbas Akhoundi
Iran’s Minister of Roads and Urban Development

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