Focus on Germany London Office The Chandlery Office 609 50 Westminster Bridge Road GB London SE1 7QY Tel 00 44 20 77 21 87 45 Fax 00 44 20 77 21 87 46 feslondon@dial.pipex.com www.fes.de/london June 2006 Iranian Attitudes to the Nuclear Question Impressions and Assessments following Discussions in Teheran Volker Perthes The following evaluation of the development of Iranian policy in the nuclear question is based on discussions held in Teheran and Isfahan in the first half of May. It included conversations with two deputy foreign ministers, a former Secretary of the Supreme National Security Council(SNSC), a current deputy secretary of the SNSC as well as professors, staff of the IPIS and CSR research institutes, journalists, clerics and other observers. In general terms, the impression is confirmed that there is by no means a uniformity of opinion among the Iranian political elite, not even when it comes to the issue of the country's nuclear programme. This elite is on the whole visibly concerned about American regime-change rhetoric, even when this is concealed beneath a "you-can't-touch-us" attitude. The great majority of the leadership is still very interested in doing business with Europe and not least with Germany(whose role in the EU-3 and the 3+3 is most often misinterpreted). That said, there is absolutely no doubt that co-operation with the EU would have to include acceptance of the"right of Dr. Volker Perthes is director of the German Institute for International and Security Affairs( Stiftung Wissenschaft und Politik SWP) that advises the Bundestag and the federal government on foreign and security policy issues. He is one of Germany’s leading experts on the Middle East. Iran to uranium enrichment within the framework of the NPT" although there is some evidence of room for negotiation on this point within this elite consensus. Three opinions on Nuclear Research In somewhat simplified terms, there are three trends or groups emerging within the Iranian political elite with regard to the nuclear debate; the margins of these are somewhat fluid and in some cases they cut across political parties and alliances: 1.) Quite a large group, which could be called the Globalisers: their prime aim is commercial and technological progress. Nuclear energy is seen as key to this progress. Prestige is another factor involved for this group; they point to the country's size, impor-tance and level of development in order to demonstrate why Iran simply cannot do without this technology and how it would gain in status if it had the technol-

Focus on Germany ogy. At the same time, supporters of this group are at pains to emphasise their interest in a solely peaceful use of nuclear power and when it comes to discussions they have answers at the ready to questions about the necessity for a heavy water reactor or for the Iranian rocket programme(in this context they also point to the experiences of the Iraq-Iran war, when rockets with conventional warheads struck terror in the population). This group in particular also sometimes refers to the fatwah issued by the religious leader Ayatollah Khamene’i, which is said to forbid the manufacture or use of weapons of mass destruction. It should not be underestimated that in a state which has its internal legitimisation through a religious form of government, such a fatwah carries considerable weight. Western negotiating partners should perhaps more often request Iran to provide them with a written copy of this fatwah. This group encompasses politically and commercially liberal, reformist powers including many supporters of Chatami and of the old government, but also individuals in or close to the new government, all of them people interested in commercial interdependence and close commercial and trade relations with Europe and therefore in a trade and cooperation agreement (TCA) with the EU and in the acceptance of Iran into the WTO. 2. Another group, possibly equal in size to the first, which we would designate as Realpoliticians or proponents of Realpolitik: they want to keep as many options as possible open- including that of military use- but would be willing, if offered corresponding propositions and opportunities, to limit their own options("wide-ranging guarantees") and probably, if the price were acceptable, particularly from a political and security point of view, they might also be willing to forego the military development option. This group comprises members of the Khatami camp, followers of Rafsanjani and also members of the present government, and priorities within this group vary: regime security, economic development, national Page 2 security, etc. Rohani and other members of the National Security Council probably represent this group the best. 3) The Islamic-nationalist Right is undoubtedly the smallest group, though it can claim some politically important members: the group definitely wants the option of military use(not necessarily a bomb, but at least the ability to produce one in a short space of time). Members of this group are from the President's entourage, as well as from more national-liberal circles which want less to do with the President's general internal and external politics. Supporters of Ahmadinejad in particular like to claim, especially through their domestic media, that Iran is stronger and the USA weaker than the world perceives. The political situation on the world stage, they say, with its increase in conflicts between the USA and other forces in a multipolar system, is especially favourable for forcefully implementing Iranian interests. They maintain that they can withstand sanctions and military strikes and that in any case, they know how to defend themselves. Threats of regime change from outside the country are seen as empty threats, since the USA would soon find that they could not impose such a change. Ahmadinejad's populist base may be susceptible to such propaganda. What is certain is that the regime has emerged from the crisis-ridden developments of the past months in a stronger position, at least financially: every time the oil price rises, the patronage capability of the President and his regime is strengthened. The costs of economic and political isolation, which Iran must expect if it continues to develop the capacity to build an atomic bomb, is initially of no interest to this bedrock support. There are also individuals who are sceptical about the decision in favour of peaceful use of nuclear energy, especially if Russian technology is used. They see better opportunities in renewable energy sources and view the government's nuclear course as purely prestige politics, but they are practically bereft of influence.

Focus on Germany Expectations of the EU Of the three groups outlined above, the Globalisers and Realpoliticians are interested in greater cooperation with Europe and are aware of the costs and the loss of opportunities which would accompany the isolation of the country. Representatives of these groups are however of the opinion that in previous negotiations, Europe simply engaged in time-wasting. One often hears the view expressed here that people have lost faith in Europe or that Europe is too"dependent" upon the USA. Just as the representatives of the Islamic-nationalist Right make it clear that they expect nothing from renewed negotiations with Europe (just as they expect nothing from direct negotiations with the USA), the representatives of Realpolitik do at least deliberate over what they might expect or wish from Europe: they do see the right to uranium enrichment as an absolute prerequisite and the right of carrying out their own research and development is nonnegotiable. Nevertheless, they do want to renew negotiations and they feel that these should therefore concentrate on the problems linked to possible diversion of atomic fuel, and on the question of"objective guarantees", provided that these would not simply be translated on the European side into suspension. They judge as feasible the ratification of the supplementary protocol, guarantees not to exceed levels of enrichment as laid down by the IAEO, and acceptance of any international partner as a member of a consortium undertaking enrichment on a commercial scale in Iran. Individual voices critical of nuclear power are more likely to insist that Europe should support Iran in its development of its oil and above all its gas industries if it really wants Iran to concentrate on these energy sources(and not on nuclear power). Starting Points and Development of Positions In the discussion about possible positioning or even about hypothetical ideas, the Globalisers and Realpoliticians demonstrate possible starting points for further Page 3 European efforts to find a constructive solution: 1. Energy partnership: Ideas in relation to a long-term infrastructural link of the prospectively most important region containing natural gas reserves in the world (Iran, Qatar) to the largest consumer region(Europe) are met with keen interest. Some partners to the discussion speak explicitly of a link to the European pipeline network as a step towards a strategic partnership with Europe. My own comment, which I always raised in this context, that I find this topic interesting because it implicitly signals a will to"think beyond Ahmadinejad" was never openly acknowledged, but was occasionally taken on board with an indication of basic agreement. 2. The"Russian proposal" and (western) European technology: The various elite groups are not happy about the"Russian proposal"(enrichment of Iranian uranium in Russia) for a number of reasons. Ideas about a possible"Europeanisation" or a"Urenco"-isation of the Russian proposal have generated some interest without the emergence of any definite or unified opinions. Usually, they point to negative experiences with Eurodif. Any suggestion of enrichment of Iranian uranium in Europe that involved Iranian scientists is however worth discussing (Rohani). The Iranians, not least the Realpoliticians among them, are aware that Russian nuclear technology is not necessarily up to the mark. In particular, the Deputy Secretary of the SNSC made it very clear that they felt the Europeans were pushing them into the arms of the Russians and towards Russian technology while the Iranians would naturally prefer to have German, French or even American reactors rather than Russian ones. Apart from the fact that the willingness of Germany to get involved in this issue has been hopelessly exaggerated, it is interesting how some Iranians like this representative of the SNSC see the possibility of a tradeoff deal emerging: if Germany were willing to deliver some of the fifteen to twenty reactors that Iran has scheduled for its twenty-year plan, then they could con-

Focus on Germany versely envisage, for instance, having fuel made exclusively in Germany/the EU for a period of five years and to thereafter form a joint consortium to produce such fuel in Iran. 3. Direct talks between the USA and Iran: The efforts of the Europeans to convince the US government of the necessity of direct talks with Iran have received positive comment, although even the Realpoliticians do not seem to see a great necessity on the part of Iran to actively and publicly seek such a dialogue with Washington. In discussions at the SNSC and other“realists”, discussion partners all agreed that direct talks with the USA would no doubt be useful, but at the same time they pointed to the difficulties: the Americans are not willing to speak with them as equals, they would impose preconditions and have already postponed discussions with the Iranians on their own initiative. In this connection, the SNSC representative made a very convincing case for the internal political situation: Ali Larijani, his direct superior in the SNSC, now had a mandate from the spiritual leader for direct talks with the USA- despite internal(unspoken) opposition from the Islamicnationalist right camp. Even President Ahmadinejad, who did not believe in the success of such talks, agreed to the talks after learning of the spiritual leader's decision. The postponement of the talks by the USA on the other hand had now caused some people in Iran to question the protalks decision. Objections to talks with the USA are clearly being nurtured by the concern that Washington is really only interested in regime change and not in negotiating political issues at all:"If Rice and Bush were not set on regime change, if they simply said to us'stop your activities for two years', we would not be expending so much effort on precisely those activities"(note that my conversations in Iran took place in May, before the announcement that the US government was itself prepared to join into the talks on the nuclear issue). The SNSC member, when questioned on this point said:"Yes, if the USA were to declare'we do not seek regime change, we respect you', then we Page 4 could progress much further; then it would be easier to talk about a moratorium." Ahmadinejad's letter to George Bush, seen by the Iranian President's supporters as a strong message, is not even mentioned by the Globalisers and Realpoliticians and even when asked about it, they reluctantly characterise it as not particularly relevant. 4. Regional Security: What is surprising and interesting is that both the Globalisers and the Realpoliticians are keen for the topic of regional security to be put on the table in direct and indirect connection with the nuclear question. This is new to the extent that in previous discussions, our Iranian partners were unable to make the intellectual link between the nuclear dispute and questions of national or regional security because it would have undermined their argument that the Iranian nuclear programme was solely geared to energy creation(and not to security or military options). It would appear that in this connection, they do seem to be more willing to allow pragmatism to prevail over the intellectual angle; there is also undoubtedly a real fear of use of American strikes against the regime. Many of our discussion partners point out that Iran is not threatening anyone, but that the country is clearly threatened by the USA and Israel. When there is talk of constructive solutions, regional security is quickly brought up in connections with security assurances for Iran. In a nutshell:"with security assurances from the great powers, there would be no reason whatsoever for Iran to divert" (Rohani). Three Concluding Remarks 1. Ahmadinejad's Position: Undisputed as president; even his opponents within the political leadership emphasize that he was elected by a sizeable majority and that he enjoys popularity. The Realpoliticians in particular also stress that responsibility for foreign affairs and security policy and especially for the nuclear dispute lies not with the President, but with the head of the SNSC(Larijani). Although

Focus on Germany Page 5 reluctant to clearly admit to any internal gulf to outsiders, many are keen to distance themselves from the President's foreign policy statements. Some even see Ahmadinejad's pronouncements on Israel and the Holocaust as well-aimed disruptive action against the pragmatists in the foreign ministry and in the SNSC. At the same, time the President has succeeded, as a result of personnel policy, in strengthening his own position in various institutions- including some institutes subordinate to the Foreign Ministry. 2. Enrichment as a"line drawn in the sand": In an almost mirror image, enrichment is a sort of"line in the sand" both for the EU 3 and for the Iranian elite either as something which should not be allowed or conversely as the option without which there will be no agreement. It is therefore interesting for future discussions to consider the various angles on the option of a moratorium. Our Iranian partners seem more able to live with the word"interruption" or"break" than with the concept of a moratorium or the recent(and therefore less popular) term"suspension". If Europe were to insist on a suspension which was not clearly limited in terms of time, then it is my view that Iran's political leadership will ultimately, despite the anticipated economic and political costs, decide in favour of continuation of their plans and therefore accept the prospect of international isolation. 3. Germany's role: Even though the Iranian leadership has misjudged German motives and interests in the nuclear dispute(because it is convinced for example that Germany is willing to work as a mediator between Iran on the one side and France, the UK and the USA on the other), Germany can make use of the relatively high level of trust which it enjoys- and continue to contribute ideas for a constructive solution. In particular, the opening up of new suggestions in the field of energy partnership and regional security could contribute considerably. It was made very clear to me from within the SNSC that there is considerable interest in second tracks with Americans in Germany, and above all in direct bilateral negotiations between Larijani and the upper political echelons in Germany. This may no longer be a priority for the Iranian side, however, with the prospect of direct talks with representatives of the US government. “Focus on Germany”- Recent publications by FES London Slaving away in the Engine Room-The SPD in the Grand Coalition http://feslondon.org.uk/documents/SlavingawayintheEngineRoom.pdf Ernst Hillebrand Islamic Education in German State Schools http://www.feslondon.org.uk/documents/IslamicEducationinGermanStateSchools_000.pdf Prof. Friedhelm Kraft The Way Out of The EU Constitutional Crisis http://www.feslondon.org.uk/documents/TheWayoutoftheEUConstitutionalCrisis.pdf Angelica Schwall-Düren, MdB Public Funding of Parties in Germany http://www.feslondon.org.uk/documents/PublicfundingofpartiesinGermany_000.pdf Ernst Hillebrand Solar Energy in Germany http://www.feslondon.org.uk/documents/SolarEnergyinGermany_000.pdf

Focus on Germany Page 6 Which Way Europe? Recent Publications by FES on the future of the European Integration Working Group"European Integration" The EU Needs a New Economic Policy! – Kick off to the Debate (January 2006) The crisis of the European Union is the result of an economic policy which is solely aimed at the enhancement of competition. In contrast, the EU needs an economic policy in which the interplay of monetary, fiscal and wage policy is coordinated in a way that enables a rise in demand. To achieve this, a wide debate on the prevailing economic policy in Europe is necessary. http://fesportal.fes.de/pls/portal30/docs/FOLDER/POLITIKANALYSE/PUBLIKATIONEN/AGEI_ENGL.PDF Marie-Janine Calic The Western Balkans on the Road Towards European Integration (December 2005) Today, the Western Balkans are in much better shape than they have been for a decade. Nonetheless, the region still suffers from a number of structural problems. Against this background and in view of an assumed"enlargement fatigue" in Member States, a number of alternative models to full membership have recently been suggested. However, giving up the project of South-Eastern enlargement would seriously endanger the considerable efforts that the EU has invested in the stabilisation of the region. What is rather needed is an intelligent combination of political incentives within the framework of EU integration and an adequate and refocused assistance package for the Western Balkans. http://fesportal.fes.de/pls/portal30/docs/FOLDER/POLITIKANALYSE/PUBLIKATIONEN/CALIC.PDF Alexander Petring& Christian Kellermann: New options for European Economic and Social Policy (October 2005) The European Union is currently facing a severe crisis of legitimacy due to growing ambivalence concerning the economic and social consequences of European integration. With the proceeding enlargement of the EU the number of conflicting reform proposals for a European Economic and Social Model increases even further. Consensus building in the European Union is getting more and more complex and difficult. We discuss all major policy fields to trace common ground for a new legitimacy of the EU. http://fesportal.fes.de/pls/portal30/docs/FOLDER/POLITIKANALYSE/PUBLIKATIONEN/PETRING_KELL ERMANN.PDF Siegfried Schultz The EU`s Medium-Term Financial Perspective and the Potential Slice of Turkey (October 2005) Given Turkey's size and level of economic development, its accession to the European Union would undoubtedly have an important impact. Any estimate of the budgetary impact of the country's accession is difficult to give and will be attended by numerous uncertainties. http://fesportal.fes.de/pls/portal30/docs/FOLDER/POLITIKANALYSE/PUBLIKATIONEN/SCHULTZ_AKT.PDF