RCEM: Views on Energy News

Election results, resembling an earthquake, with the moderates making a strong gain at the expense of their arch-rivals, the hardliners, have shaken up Iran for the second time in its post- Shah status of an Islamic state. The astoundingly big win for reformers and independents marks a watershed in the on-going tug-of-war between the two wings of the political class. Soft-speaking, smiling, spectacled, with a convincing image of an intellectual, Iranian President Hassan Rouhani has essentially secured a vote of confidence for his long-term pragmatic policies.

In a landmark warning, coming just a couple of days after the vote, former President Akbar Hashemi Rafsanjani, classified in the West as “moderate” reform-minded politician, punched the air with a strong-worded message: “No one is able to resist against the will of the majority of the people and whoever the people don't want has to step aside.” Will any hard-liner voluntarily “step aside” or back off ?

It is hardly conceivable that the conservative clerics would give up the battlefield without mounting a fierce resistance. After all, the adepts of the ideological orthodoxy did it in the past.

Looking back, it is worth to be reminded that after the 1997 election President Mohammad Khatami pursued a flexible policy based on “positive engagement” approach to adversaries.

Three years later, the voters propelled reformers to the parliament where they formed a majority demanding to soften the rigidity of Islamic social regulations, as well as granting the citizens more political and civil rights (namely, freedom of expression entailing freedom of the media), and on foreign track – improving relations with the West.

The pendulum swung in the opposite direction prior to the 2004 elections because most of the reform-leaning candidates were barred from taking part in it. After the presidency was won in 2005 by three-fisted fighter Mahmoud Ahmadinejad, the reformers were legally ostracised, blacklisted, and banished from political process.

The tables were overturned only in 2013 with the arrival of Hassan Rouhani with the mandate to free the nation from the grips of the crippling international sanctions’ regime. Today, President Rouhani has every reason to celebrate: The people have spoken and they have spoken in favour of breaking out of isolation by using the force of wise diplomacy and flexible negotiation tactics.

For the moment, it is fair to conclude that the reformers have won the battle, but not yet the entire war. Irrespective of the setbacks, which cannot be counted out, the outcome of the parliamentary elections illustrates a drastic change of mood of the nation, ready to re-invent itself but without betraying its inherent national identity.

With the elections results paving the way for a smooth re-apportioning of power within the divided political class, it also serves, coming as a surprise for quite many outside onlookers, as solid evidence that Iran is a rather mature democracy.

So, what is the core reason of the remarkable swing toward a reformist agenda? Essentially, it is worth examining two factors.

First, just like many other nations in the region, Iranian society is predominantly young: Almost two out of three citizens are under 30. This type of “angry young men”, clustered in big cities, who have reached the level of civil and psychological maturity under the heavy yoke of international sanctions, and today are seeking jobs, lifts to go up the social ladder, improvement in the standard and quality of living, could be termed Generation of Change. They are the actual driver of reforms, the pillar of public support for President Rouhani and his team of like-minded post-crisis managers.

Second, the reformists’ camp was emboldened by the exemplary compromise hammered out in the summer of 2015 by the 5+1 world powers and Iran, which, in simple terms, amounted to a bargain: Tehran abandons its ambitious nuclear program, suspected of having at least a military component aimed at building A-bomb production facilities, in exchange for the lifting of international economic and financial sanctions. It worked, if viewed against the flurry of business trips to Iran by European and Asian CEOs seeking lucrative deals, estimated to be worth billions of euros and dollars.

In anticipation of the arrival en masse of foreign businesses, offering investments, technology, know-how, expertise, all of this to be converted into new local jobs, the rank-and-file Iranian voters, without taking sides in the confrontation between the rightist and the leftist groupings (there are no formal political parties in the country), simply endorsed those whom they associated with the opening up and ending isolation.

It meant casting votes for those who promoted and implemented President Rouhani’s foreign policy of engaging rather than disengaging the West. This balancing act has already started to pay off, and a significant share of the 55 million eligible voters felt instinctively that Rouhani’s policy it is the best option. Eventually, so they thought, engagement with the West would help ordinary folk, using an old English expression, “bring the bacon home”.

What now? The direct effect of balance of power tilting in favour of Generation of Change will be the enhanced support for the pragmatic foreign policy course with a clearly articulated demand to ‘open up” and welcome closer cooperation with the outside world.

Hopefully, the immediate consequence of the reformists coming to forefront in the parliament would be an accelerated process of sweeping “change of guard” in other government institutions. It would open career opportunities for the new breed of Persians, open-minded, creative, and with an appetite for modernizing the state and the society. Nevertheless, this is pure theory, so far.

The previous 290-seat parliament was dominated by the so-called principlists, or dyed-in-the-wool conservatives, who enjoyed a privileged position due a political system pegged on the clerical supremacy. This supremacy is still embodied in the omnipotent Guardian Council, which has the right to veto laws passed by parliament. For the record: this year Guardian Council has disqualified all but 200 of the 3,000 reformist candidates who hoped to run. Yet, it did not prevent the Rouhani-type politicians to come on top. Besides, it has also created a pool of dedicated reformists to capitalize on if there is a need to fill in vacancies.

Generation of Change will shape the political and economic agenda in order to meet their long-deferred demands and wants. On the one hand, it would mean an upgrade in the status of economic interaction with international trade partners, especially those eager to buy Iranian crude and natural gas (to be supplemented with LNG, once the production facilities are put on stream.

“Re-formatted” Iran opens new vistas for foreign investors and traders, making them feel more welcomed than ever on a market of 80 million clients. Local young urban professionals would be the most sought-after purchasers of Western consumer goods, from trendy cars to hot-selling and just out of the oven IT gadgets. Motive? To make up for years of forced austerity. They will act out of self-interest, inspired by impulses coming from their “hip pocket”, from the wallet where they keep the money.

On the other hand, the change in the mood of the urban population would, under certain circumstances, entail a more self-centred and even introvert Iran. The pragmatism-preaching leadership would be less inclined to get involved in “overseas” adventures, and less bent on projecting its military might across borders.

Yet, once again, this is a hypothetical option limited by a multitude of ”ifs”, as well as “supposing” and “in case of”. Iran is stuck on a strategic crossroad. Nothing is written. And a lot is hidden.
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George Hatziioannou

George is Editor of the "Energy International Risk Assessment" (EIRA) independent monthly newsletter, a specialised on-line publication, originally launched in May 2103 as a digital edition to a wide audience of readers. Together with the eiranews.com website, they focus on risk assessment and the geopolitics of energy in South East Europe, the Middle East, North Africa, and adjacent  regions. A retired diplomat, he has worked for 35 years as a Press Counsellor at the Greek Embassies in Washington DC, London, Moscow, Prague, and the UN Greek Mission  in New York City.

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