Iran's Implementation Day Arrives And Harneys Is In The Thick Of It

The Joint Comprehensive Plan of Action (JCPOA), a milestone diplomatic agreement reached on 14 July 2015 between the US, UK, Russia, China, France and Germany (P5+1), and Iran, to tightly regulate Iran's nuclear development programme in exchange for sanctions relief, came into force to much fanfare on 16 January 2016. The implementation of the agreement, which occurs on "Implementation Day", means that Iran is no longer subject to crippling economic sanctions by the United Nations Security Council, the European Union and (to some extent) the United States. As a result its industries may now reconnect with the international community be that through the export of oil, gas and petrochemicals or, crucially, through the provision and receipt of financial services on a global basis.

Iran: the last frontier

In 2005, Goldman Sachs named Iran as a member of the "Next Eleven", a country with the potential of becoming one of the world's largest economies in the 21st Century. Iran is the second-largest economy in the MENA region after Saudi Arabia and the second-most populous nation in the MENA region, with a population of around 80 million people. With 60 per cent of its population under the age of 30, Iran is a country that is young, well-educated and upwardly mobile; a demographic dividend that brings with it enormous potential. It is estimated that Iran requires investment in excess of US$200 billion to develop its infrastructure, oil and gas, power, mining, construction, finance, automobile and aviation sectors.

Living in the shadow of world sanctions

The US has imposed sanctions against Iran for the last 35 years, ever since the 1979 Revolution and the ensuing Iran hostage crisis. In the 1990s, the US instituted an almost outright embargo on Iran, features of which continue to the present day. Conversely, Europe maintained positive relations with Iran until 2006-2007 when the International Atomic Energy Agency (IAEA) identified breaches of Iran's non-proliferation obligations. In response, the EU, in tandem with the United Nations, commenced a policy of ever tougher economic sanctions on Iran. In 2012, with the passing of Council Regulation (EU) No 267/2012 (EU Regulation 267), the EU imposed some of its toughest sanctions ever against a country and brought the EU position within a whisker of the approach adopted by the US.

The election of President Rouhani of Iran in August 2013 signalled a renewed desire to reverse crippling sanctions and, on 23 November 2013, the P5+1 agreed to an initial six month freeze and reduction of certain trade sanctions pending a final deal on the country's nuclear programme. This window began on 20 January 2014 and was extended a number of times up to Implementation Day under the JCPOA on 16 January 2016.

Iran, post sanctions

Under the terms of the JCPOA, as adopted in the EU by Council Regulation (EU)...