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INSTEX doomed to fail, many Iranian officials say

The EU-Iran special payment mechanism, INSTEX
The EU-Iran special payment mechanism, INSTEX

Analysis by PMOI/MEK


Feb. 9, 2019Pursuant to Sadegh Larijani's negative comments on INSTEX, dispute and despair rose over the matter. Considering the fact that the new European initiative for trade with the Iranian regime hinges on Tehran’s adoption of the Financial Action Task Force (FATF) conventions and setting aside its missile program, the mullahs’ regime will not accept Europe’s new INSTEX blueprint, said judiciary chief Sadeq Larijani, who is also head of the regime’s Expediency Council.

Iran daily, a newspaper with strong ties to the government of Hassan Rouhani, had an opposing view. However, due to its weak position, it had to be very careful and expressed its position in the form of some questions. It wrote on February 5, 2019:

"The positions on JCPOA and INSTEX should be future oriented. They must unambiguously respond to certain questions… What should be done? Who should make the decision? Who should announce that? Who is taking responsibility for possible negative ramifications of leaving JCPOA?"

Rouhani is clearly trying to drag Iranian regime supreme leader Ali Khamenei into assuming responsibility for the regime's deadlock.

However, Khamenei's faction is far more vocal in expressing concern over dangers of complying with the requirements and preconditions of INSTEX.

The discrepancy between the public statements of the regime's officials and the actual course of their actions about INSTEX (as well as JCPOA and FATF) is yet another strong indication of their impasse.

On February 5, Mohammad Hossein Ghorbani, deputy chair of Health Commission in Majlis, acknowledged the crippled state of the regime. He said, "The Europeans planned INSTEX very cleverly, requiring Iran to join FATF as a precondition to its implementation. This has produced a dangerous atmosphere.” Ghorbani also expressed concern that "with the lack of transparency we have seen from Europe, if there are suggestions to return the dossier to the Security Council, one should not be surprised to hear of Europe supporting the US." (Majlis News Agency, February 5, 2019)

Hanif Ghaffari, another analyst from Khamenei faction spoke of the same concern only with different words. He wrote, "European officials connected this financial vehicle to issues such as missile capabilities, regional power, as well as FATF. This proves that they do not view this vehicle as an independent legal variant, but a means of further pressuring Iran to impose their will." (Young Reporters Club, February 5, 2019)

The clearest expression of disappointment came from Abolfazl Zohrehvand, a former diplomat of the Iranian regime (Ambassador to Italy and Afghanistan) who summarized what INSTEX would mean for the regime:

"They have set up an office of financial unit with a group of retired personnel. The registered capital is just 3,000 euros. Their function is confined to the domain of non-sanctioned goods. INSTEX, can go bankrupt or shut down. On the other hand, [EU foreign policy chief Federica] Mogherini and some European officials who are active on JCPOA, will be out of office in a matter of few months. If we implement this model, we will deprive ourselves of an independent identity in the regional and international commerce. Russia and China, the two serious players against the U.S. and the West, will not even consider us a third-hand entity, because our destiny is at the hands of an unimportant office called INSTEX with no resolve whatsoever." (Fars News Agency February 5, 2019)