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TOP STORIES
Former Iranian president Akbar Hashemi Rafsanjani died
on Sunday at the age of 82, a big blow to moderates and reformists
deprived now of their most influential supporter in the Islamic
establishment. He had been described as "a pillar of the Islamic
revolution". His pragmatic policies - economic liberalisation,
better relations with the West and empowering elected bodies -
appealed to many Iranians but were despised by hardliners. Few have
wielded such influence in modern Iran but since 2009 Rafsanjani and
his family faced political isolation over their support for the
opposition movement which lost a disputed election that year to
President Mahmoud Ahmadinejad. Rafsanjani headed the Expediency
Council, a body which is intended to resolve disputes between the
parliament and the Guardian Council. He was also a member of the
Assembly of Experts, the clerical body that selects the supreme
leader, Iran's most powerful figure. His absence from that debate,
whenever it happens, means the chances of a pragmatist emerging as
the next supreme leader are reduced. His death ahead of May's
presidential elections is a blow to moderate president Hassan Rouhani
who allied himself with Rafsanjani to win the 2013 election and went
on to resolve Iran's long standoff with the West on the nuclear
programme.
A U.S. Navy destroyer fired three warning shots at
four Iranian fast-attack vessels after they closed in at a high rate
of speed near the Strait of Hormuz, two U.S. defense officials told
Reuters on Monday. The incident, which occurred Sunday and was first
reported by Reuters, comes as U.S. President-elect Donald Trump
prepares to take office on Jan. 20. In September, Trump vowed that
any Iranian vessels that harass the U.S. Navy in the Gulf would be
"shot out of the water." The officials, speaking on the
condition of anonymity, said the USS Mahan established radio
communication with the Islamic Revolutionary Guard Corps boats but
they did not respond to requests to slow down and continued asking
the Mahan questions. The Navy destroyer fired warning flares and a
U.S. Navy helicopter also dropped a smoke float before the warning
shots were fired. The Iranian vessels came within 900 yards (800
meters) of the Mahan, which was escorting two other U.S. military
ships, they said.
Iran is to receive a huge shipment of natural uranium
from Russia to compensate it for exporting tons of reactor coolant,
diplomats say, in a move approved by the outgoing U.S. administration
and other governments seeking to keep Tehran committed to a landmark
nuclear pact. Two senior diplomats said the transfer recently agreed
by the U.S. and five other world powers that negotiated the nuclear
deal with Iran foresees delivery of 116 metric tons (nearly 130 tons)
of natural uranium. U.N. Security Council approval is needed but a
formality, considering five of those powers are permanent Security
Council members, they said... Tehran already got a similar amount of
natural uranium in 2015 as part of negotiations leading up to the
nuclear deal, in a swap for enriched uranium it sent to Russia. But
the new shipment will be the first such consignment since the deal
came into force a year ago... The natural uranium agreement comes at
a sensitive time. With the incoming U.S. administration and many U.S.
lawmakers already skeptical of how effective the nuclear deal is in
keeping Iran's nuclear program peaceful over the long term, they
might view it as further evidence that Tehran is being given too many
concessions... David Albright, whose Institute of Science and
International Security often briefs U.S. lawmakers on Iran's nuclear
program, says the shipment could be enriched to enough weapons-grade
uranium for more than 10 simple nuclear bombs, "depending on the
efficiency of the enrichment process and the design of the nuclear
weapon."
IRAN NUCLEAR DEAL
The chair of the U.S. Senate Foreign Relations
Committee said that abrupt rejection of the Iran nuclear deal by the
incoming Trump administration could create "a crisis" and
that he did not expect such an approach. "To tear it up on the
front end, in my opinion, is not going to happen. Instead, we will
begin to radically enforce it," Senator Bob Corker told
reporters on Friday at a breakfast sponsored by the Christian Science
Monitor... "To me the prudent course of action is to make sure
you enforce it, that you hold the UN Security Council
accountable," Corker said. "And in the event the agreement
falls apart, it's someone else that is causing it to fall apart, not
a president coming in on day one and ripping up the agreement."
The United Nations chief expressed concern to the
Security Council that Iran may have violated an arms embargo by
supplying weapons and missiles to Lebanese Shi'ite group Hezbollah,
according to a confidential report, seen by Reuters on Sunday. The
second bi-annual report, due to be discussed by the 15-member council
on Jan. 18, also cites an accusation by France that an arms shipment
seized in the northern Indian Ocean in March was from Iran and likely
bound for Somalia or Yemen. Most U.N. sanctions were lifted a year
ago under a deal Iran made with Britain, France, Germany, China,
Russia, the United States and the European Union to curb its nuclear
program. But Iran is still subject to an arms embargo and other
restrictions, which are not technically part of the nuclear
agreement. The report was submitted to the Security Council on Dec.
30 by U.N. Secretary-General Ban Ki-moon before he was succeeded by
Antonio Guterres on Jan. 1. It comes just weeks before U.S.
President-elect Donald Trump, who has threatened to either scrap the
nuclear agreement or seek a better deal, takes office.
The Obama administration has paid Iran more than $10
billion in gold, cash, and other assets since 2013, according to
Iranian officials, who disclosed that the White House has been intentionally
deflating the total amount paid to the Islamic Republic. Senior
Iranian officials late last week confirmed reports that the total
amount of money paid to Iran over the past four years is in excess of
$10 billion, a figure that runs counter to official estimates
provided by the White House. The latest disclosure by Iran, which
comports with previous claims about the Obama administration
obfuscating details about its cash transfers to Iran-including a $1.7
billion cash payment included in a ransom to free Americans-sheds
further light on the White House's back room dealings to bolster
Iran's economy and preserve the Iran nuclear agreement.
MILITARY MATTERS
Iranian lawmakers approved plans on Monday to expand
military spending to five percent of the budget, including developing
the country's long-range missile program which U.S. President-elect
Donald Trump has pledged to halt. The vote is a boost to Iran's
military establishment - the regular army, the elite Islamic
Revolutionary Guard Corps (IRGC) and defense ministry - which was
allocated almost 2 percent of the 2015-16 budget. But it could put
the Islamic Republic on a collision course with the incoming Trump
administration, and fuel criticism from other Western states which
say Tehran's recent ballistic missile tests are inconsistent with a
U.N. resolution on Iran... Tasnim news agency said 173 lawmakers
voted in favor of an article in Iran's five-year development plan
that "requires government to increase Iran's defense
capabilities as a regional power and preserve the country's national
security and interests by allocating at least five percent of annual
budget" to military affairs.
U.S.-IRAN RELATIONS
Soon after Mattis was tapped to lead U.S. forces in
the Middle East in August 2010, Obama asked the general to spell out
his top priorities. Mattis replied that he had three: "Number
one Iran. Number two Iran. Number three Iran," said a senior
U.S. official who was present. The general's singular focus unnerved
some civilian leaders, who thought he should pay attention to a
broader range of threats. His style and Marine swagger often struck
the wrong chord in a White House that was focused on diplomacy and
that was notably short of top officials with military experience.
Mattis and his aides relentlessly drilled the U.S. military's war
plan for Iran. During one planning session, which focused on the
war's aftermath and included senior officials from Washington, Mattis
repeatedly joked that Iran's navy would be at "the bottom of the
ocean," participants said.
CONGRESSIONAL ACTION
The Obama administration misled top lawmakers about
the transfer of billions of dollars in assets to Iran, according to
sources in and out of Congress who spoke to THE WEEKLY STANDARD, and
a range of questions remain about the mechanics of the payments. The
United States gave certain banks permission to transfer roughly $700
million monthly in unfrozen funds to Iran as part of the negotiations
that produced the nuclear deal. Iran eventually received more than
$10 billion in cash and gold through such transfers-highly liquid
forms of payment that critics have said could be used to finance
Iranian terrorist entities. A congressional GOP aide told TWS that
the administration misled lawmakers about such details of the
transfers. "We discussed the $700 million monthly payments
[made] during the interim agreement. The State Department official
never mentioned cash or gold," the aide told TWS. "This was
deceptive. ... They had every opportunity to say these payments were
being made in cash and gold, and they did not do so." The
administration has not provided a full account of the transfers,
according to the aide.
SANCTIONS RELIEF
Iran has sold more than 13 million barrels of oil that
it had long held on tankers at sea, capitalizing on an OPEC output
cut deal from which it is exempted to regain market share and court
new buyers, according to industry sources and data. In the past three
months, Tehran has sold almost half the oil it had held in floating
storage, which had tied up many of its tankers as it struggled to
offload stocks in an oversupplied global market. The amount of
Iranian oil held at sea has dropped to 16.4 million barrels, from
29.6 million barrels at the beginning of October, according to
Thomson Reuters Oil Flows data. Before that sharp drop, the level had
barely changed in 2016; it was 29.7 million barrels at the start of
last year, the data showed. Unsold oil is now tying up about 12 to 14
Iranian tankers, out of its fleet of about 60 vessels, compared with
around 30 in the summer, according to two tanker-tracking sources.
Denmark's Danske Bank A/S said on Monday it was in
talks with the Iranian central bank on arranging credit to clients
with business activities in the country. "To a limited extent
and within the international framework, we are open to supporting our
clients with activities in Iran financially," a Danske Bank
spokesman said in an email. "We are in dialogue with Iran's
central bank about this, but no deal has been reached at this
point," he said. An Iranian central bank official said that the
bank had received $7.2 billion in financing from three foreign banks,
including Danske Bank, Iran's Financial Tribune daily reported on
Sunday.
Airbus said on Sunday Iran's state airline IranAir had
accepted its first new jet, marking a key step in opening up trade
under a nuclear sanctions deal between Iran and major powers. The
Airbus A321 jetliner has been painted in IranAir livery and is
expected to be delivered later this week. "The technical
acceptance has been done with formal delivery still to be done,"
a spokesman for the European planemaker said. Iranian regulators said
the aircraft had been placed on the country's aircraft register,
indicating IranAir had taken ownership of the aircraft: the first of
around 200 Western aircraft ordered since sanctions were lifted.
"The registration has been done, and the delivery should be by
the end of the week," Reza Jafarzadeh, a spokesman for Iran's
Civil Aviation Organization, told Reuters by telephone. The 189-seat
jet was assembled in Hamburg, Germany. From there, it is expected to
be transferred to Airbus headquarters in Toulouse, France, for a
formal handover on Wednesday. IranAir Chairman Farhad Parvaresh told
state news agency IRNA there would be an official ceremony to mark
the arrival of the Airbus jetliner in Tehran later this week.
Iran is seeking investment to build 25 petrochemical
projects, an official at the state-run National Petrochemical Company
(NPC) was quoted on Saturday as saying. The NPC is proposing joint or
individual investor participation in building the projects, Farnaz
Alavi, NPC's director for planning and development, was quoted as
saying by the oil ministry's news website SHANA. Providing feedstock
for five more projects were also being studied Alavi said, without
giving further details. In July, Alavi told SHANA that $32 billion in
foreign investment was needed to build 28 petrochemical projects. The
projects include factories to produce ammonia and urea, as well as
gas-to-olefins (GTO) and gas-to-propylene (GTP) plants.
HUMAN RIGHTS
A U.N. expert focusing on human rights in Iran is
warning about the health risk of prisoners who have been conducting
prolonged hunger strikes to protest against their detention. Special
rapporteur Asma Jahangir says at least eight prisoners of conscience
have been on life-threatening hunger strikes in recent weeks, and
called on Iranian leaders to release all people "arbitrarily
detained" for exercising their rights to freedom of opinion and
expression. Jahangir said in a statement Monday that the eight
"are left with no other option but to put their life at risk to
contest the legality of their detention."
DOMESTIC POLITICS
Mourners from all walks of life in Iran - from the
country's president to passers-by on the street - paid their respects
on Monday to the late Iranian leader Akbar Hashemi Rafsanjani
following his death over the weekend at the age of 82. President
Hassan Rouhani and his administration visited the mosque in northern
Tehran where Rafsanjani's body was brought. Mourners, including
Rafsanjani's family members, wept at the sight of his coffin,
reaching out to touch it. Newspapers in Iran published front-page
photographs of Rafsanjani, who died Sunday after suffering a heart
attack, while state television aired archival clips of his comments
and speeches. The country is observing three days of mourning, and
Rafsanjani's funeral is set for Tuesday. At the start of a parliament
session Monday, parliament speaker Ali Larijani paid tribute to the
late leader, describing Rafsanjani as "a man for hard days whose
name has been always been tied to the revolution and it will always
be so."
Iran's President Hassan Rouhani has clashed with the
country's powerful and conservative judiciary, in a rare public row
as tensions rise ahead of this year's presidential election. The
moderate Rouhani, who is expected to stand for a second four-year
term in the May vote, has targeted the judiciary in a series of
public statements over the case of a billionaire businessman on death
row for corruption. Judiciary chief Ayatollah Sadegh Larijani has hit
back with accusations of his own, and on Sunday supreme leader
Ayatollah Ali Khamenei made reference to the dispute. In a speech to
thousands of people in the religious city of Qom, Khamenei alluded to
"recent arguments" among powerful figures, adding:
"This will be resolved with the help of God." ... In his
speech on Sunday, Khamenei appeared to urge the two sides to overcome
their differences. "The existence of an independent and
courageous judiciary must be appreciated by everyone," he said.
"What defeats the enemy in its objectives is to have a strong
judiciary and a government that is both brave and can plan
accurately."
OPINION & ANALYSIS
Akbar Hashemi Rafsanjani was the original Mr.
Moderation. Western observers saw the former Iranian president as a
sort of Deng Xiaoping in clerical robes: a founder of the Islamic
Republic who was destined to transform the country into a normal
state. Rafsanjani, they thought, was too corrupt to be an ideologue.
Yet Rafsanjani, who died Sunday at 82, consistently defied such
hopes. His life and legacy remind us that fanaticism and venality
aren't mutually exclusive. It's a lesson in the persistence of
Western fantasies about the Iranian regime. Born to landed gentry in
southeast Iran, Rafsanjani entered seminary at the holy city of Qom.
There the Ayatollah Ruhollah Khomeini adopted him as a protégé and
revolutionary companion. The totalitarian theocracy that replaced the
Peacock Throne after the 1979 revolution was as much Rafsanjani's
creation as Khomeini's. Khomeini provided the theological
underpinnings for his model of absolute clerical rule. But it was
Rafsanjani who fleshed out the ideas, as speaker of Parliament in the
1980s and president for much of the '90s. Rafsanjani delivered the
wake-up call to Iranian liberals and leftists, who still dreamt of
sharing power with the Islamists. "Until we had our people in
place," he told one such liberal in 1981, "we were ready to
tolerate [other] gentlemen on the stage." But now the regime would
brook no faction but those that followed the "Line of the
Imam"-Khomeini. A decade of purges, prison rapes and executions
followed.
With the death of Ayatollah Ali Akbar Hashemi
Rafsanjani on Sunday, Iran's political factions knew immediately that
any space by reformers to maneuver had just significantly decreased.
Change had come, and it did not favor those seeking to turn Iran into
a less revolutionary country with more tolerance and outreach to the
West - especially the United States. Mr. Rafsanjani, a former
president who helped found the Islamic republic, had been the one man
too large to be sidelined by conservative hard-liners. Now he was
suddenly gone, dead from what state media described as cardiac arrest
- and with no one influential enough to fill his shoes. Iran's
long-marginalized reformists and moderates, who would use Mr.
Rafsanjani's regular calls for more personal freedoms and requests to
establish better relations with the United States to advance their
political agendas, suddenly felt exposed and weakened. Who would now
warn publicly against "Islamic fascism," when the
hard-liners sought to influence elections? Who would state openly
that there should be a nuclear compromise? Mr. Rafsanjani said things
others would not dare to say, all agreed, and his voice had at least
created some tolerance for debates. "Hard-liners will be happy,
but this is the start of a period of anxiety for many," said
Fazel Meybodi, a cleric from the holy city Qum who supports reforms
in Iran. "His death disturbs the fragile balance we had in
Iran." There simply are no replacements for Mr. Rafsanjani,
analysts from all factions say... With the demise of his mentor and
protector, Iran's president will find it hard to gather the same
level of support he received four years ago with the backing of Mr.
Rafsanjani, analysts say. "He was a very powerful figure for Mr.
Rouhani to rely upon," said Mohammad Marandi, a professor at
Tehran University who is close to Iran's leaders. "Many worked
with him because of that support. The passing of Mr. Rafsanjani
complicates the president's position and makes his re-election less
certain."
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