Iran:

Creditless INSTEX Unacceptable

TEHRAN (defapress)- Iranian Deputy Foreign Minister Seyed Abbas Araqchi said that the EU-proposed Instrument in Support of Trade Exchange (INSTEX) is not adequate in itself, reiterating that Tehran will not accept the INSTEX so long as it has not received the required credit or used for crude sales.

News ID: 78015

Date: 08 July 2019 - 14:58

As a preliminary step, and a means for trade between Iran and Europe, the INSTEX is a good initiative, Araqchi said on Sunday, at a joint presser with Spokesman of the Atomic Energy Organization of Iran (AEOI) Behrouz Kamalvandi and Iranian Government Spokesman Ali Rabiyee, adding that Europe's efforts to help Iran thwart the US sanctions is valuable but not enough unless the INSTEX receives the required credit.

However, the implementation of the initiative has taken so long time, he added at a joint press conference with spokesmen of Government and Atomic Energy Organization of Iran.

The INSTEX will bring no income unless the European countries buy Iran's oil, or allocate credit to Iran, Araqchi said, noting that no such measures have been taken yet.

The INSTEX was made operational by both sides, and the two parties are in contact with each other, he said, confirming that a couple of minor pilot exchanges have been conducted.

"We believe that it will be no good unless there is enough credit," he said, welcoming the efforts made by Europe in defiance of US sanctions as a valuable "political move".

"We are communicating, making visits and phone calls, either officially or unofficially, and are hoping that they lead to a solution," he said, "Otherwise, we will take the third step after the next 60-day deadline."

Asked about Arak Reactor, Araqchi said, "As it was stipulated in the letters of Foreign Minister Mohammad Javad Zarif and President Hassan Rouhani, Arak is a separate issue, and because the process of modernization of the reactor has been delayed, if the remaining signatories to the JCPOA cannot rectify the process and lead Arak on the track as it was specified on schedule, we naturally will complete it according to our own formula and technology."

During the same presser, Kamalvandi announced the start of enriching uranium to a higher purity level than 3.67%, although he declined to mention any targeted figure for the final enrichment purity level.

"Based on an order we have received from the president and head of the Supreme National Security Council (SNSC) the second step (to modify the nuclear deal undertakings) was taken today. Now, we have presented a copy of the changes to the representative of the International Atomic Energy Agency (IAEA) and the process to enrich (uranium) over the level of 3.67% will start within the next few hours," Kamalvandi told reporters in Tehran.

He said that Iran could continue enrichment to the levels that it needs for fueling its power plants, or its research reactor like the one in Tehran University or to fuel nuclear propulsion systems, explaining that each of these needs requires enriching uranium to specific levels.

He said Iran at present wants to produce the needed fuel for its nuclear power plants, but if a new order is issued by the high-ranking officials, the AEOI can further increase the level of enrichment.

Kamalvandi, meantime, said that Iran for now is not in need of 20% enriched uranium for Tehran research reactor to produce radio drugs, noting, "We have the needed fuel for several years and are not concerned about the fuel."

Asked about the heavy water reactor in the Central city of Arak, he said that Iran can revive the reactor which was sealed after the nuclear deal but prefers to have a new reactor.

"A number of contracts which had been suspended for several months were signed (recently) and this has made us hopeful to have a new reactor," Kamalvandi said.

Later on the day, Iranian Foreign Minister Mohammad Javad Zarif posted a tweet, where he said Tehran will keep revising its commitments based on paragraphs 26 and 36 of the JCPOA, but meantime stressed that Tehran’s measures can be reversed if the European parties to the agreement deliver on their commitments.

Referring to Iran’s second round of remedial steps under paragraph 36 of the nuclear deal of 2015, officially known as the Joint Comprehensive Plan of Action (JCPOA), Zarif said, adding that all such steps are reversible only through E3’s (France, the UK and Germany) compliance.

“Today, Iran is taking its second round of remedial steps under Para 36 of the JCPOA. We reserve the right to continue to exercise legal remedies within JCPOA to protect our interests in the face of US economic terrorism. All such steps are reversible only through E3 compliance,” highlighted the Iranian top diplomat.

“Having failed to implement their obligations under the JCPOA—including after US withdrawal—EU/E3 should at minimum politically support Iran’s remedial measures under Para 36, incl at IAEA. E3 have no pretexts to avoid a firm political stance to preserve JCPOA and counter US unilateralism.”

Washington withdrew from the internationally-endorsed 2015 nuclear deal with Iran on May 08, 2018, and then re-imposed the toughest-ever sanctions against the country and started a plan to zero down Tehran's oil sales.

Under the nuclear agreement reached between Iran and six world powers in July 2015, Tehran undertook to put limits on its nuclear program in exchange for the removal of nuclear-related sanctions.

Yet, Iran continued compliance with the deal, stressing that the remaining signatories to the agreement, specially the Europeans had to work to offset the negative impacts of the US pullout for Iran if they want Tehran to remain in compliance. The Iranian officials had earlier warned that the European Union’s failure in providing the needed ground for Tehran to enjoy the economic benefits of the nuclear deal would exhaust the country's patience.

Almost a year later, however, the EU failed to provide Tehran with its promised merits. Then, the US state department announced that it had not extended two waivers, one that allowed Iran to store excess heavy water produced in the uranium enrichment process in Oman, and one that allowed Iran to swap enriched uranium for raw yellowcake with Russia.

Until May, Iran was allowed to ship low-enriched uranium produced at Natanz to Russia before it hit the 300-kg limit and the US measure leaves no way for Tehran other than exceeding the ceiling for storing the enriched uranium in violation of the 2015 nuclear deal.

Also, the United States would no longer waive sanctions that allowed Iran to ship heavy water produced at its Arak facility beyond a 300-ton limit set in the 2015 nuclear deal to Oman for storage which again forces Tehran to store it inside country in violation of the nuclear deal.

In return, Iran's Supreme National Security Council (SNSC) announced in a statement on May 8 that the country had modified two of its undertakings under the Joint Comprehensive Plan of Action in return for the US abrogation of the deal and other signatories’ inability to make up for the losses under the agreement, warning that modifications would continue if the world powers failed to take action in line with their promises.

"The Islamic Republic of Iran declares that at the current stage, it does not anymore see itself committed to respecting the limitations on keeping enriched uranium and heavy water reserves," the statement said.

Then Iran gave Europe 60 days to either normalize economic ties with Iran or accept the modification of Tehran’s obligations under the agreement and implement the Europe's proposed Instrument in Support of Trade Exchange (INSTEX) to facilitate trade with Iran.

Iran set up and registered a counterpart to INSTEX called Special Trade and Financing Instrument between Iran and Europe (STFI) to pave the way for bilateral trade.

Then on June 28, Secretary General of the European External Action Service (EEAS) Helga Schmid announced that INSTEX has become operational.

"INSTEX now operational, first transactions being processed and more EU Members States to join. Good progress on Arak and Fordow projects," Schmid wrote on her twitter account after a meeting of the Joint Commission on JCPOA ended in Vienna following three and a half hours of talks by the remaining signatories to the deal (the EU3 and Russia and China).

It was the 12th meeting of the Joint Commission on JCPOA in Vienna.

Meantime, seven European countries--Austria, Belgium, Finland, the Netherlands, Slovenia, Spain and Sweden--in a joint statement expressed their support for the efforts for implementation of the INSTEX.

Later, Iranian Deputy Foreign Minister Seyed Abbas Araqchi described the nuclear deal joint commission meeting with the Europeans as "a step forward", but meantime, reminded that it did not meet Iran's expectations.

“It was a step forward, but it is still not enough and not meeting Iran’s expectations,” said Araqchi, who headed the Iranian delegation at the JCPOA joint commission meeting in Vienna.

Despite their non-commitment to undertakings under the JCPOA, the Europeans took a step against Iran's interests last Thursday by seizing an Iranian oil tanker by Britain at the US request.

Acting Spanish Foreign Minister Josep Borrell said Gibraltar detained the supertanker Grace 1 after a request by the United States to Britain.

Borrell was quoted by Reuters as saying that Spain was looking into the seizure of the ship and how it may affect Spanish sovereignty as it appears to have happened in Spanish waters.

Spain does not recognize the waters around Gibraltar as British.

Experts believe that the measure taken by the British government in seizing the Syria-bound Iranian tanker is illegal and can have serious consequences for the government in London as it would mean a lethal blow to the JCPOA.

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