Hardliners renew attacks against Rouhani administration following reimposed U.S. sanctions

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Key takeaway: Hardliners renewed their political attacks against senior members of President Hassan Rouhani’s administration following the reimposition of U.S. sanctions against Iran.

Foreign Minister Mohammad Javad Zarif will appear before the Parliamentary National Security and Foreign Policy (NSFP) Committee on November 18 to defend comments he made describing money laundering as a “reality” in Iran. Hardline parliamentarians criticized Zarif’s characterizations and threatened a parliamentary interpellation against him. They may call for Zarif’s interpellation if the Parliamentary NSFP Committee is unsatisfied with his explanation. Hardliners are capitalizing on the November 5 reimposition of U.S. sanctions against Iran and the Rouhani administration’s failure thus far to secure “economic guarantees” from Europe.

The IRAN FILE will resume on the week of November 26, 2018

DOMESTIC POLITICS

  • Parliament summons Zarif over money laundering comments. Parliamentary National Security and Foreign Policy (NSFP) Committee head Heshmatollah Falahatpisheh *announced that Foreign Minister Mohammad Javad Zarif will appear before the committee to explain his comments on money laundering. Zarif stated during an *interview on November 11 that a high level of money laundering is a “reality” in Iran benefiting many people. Zarif did not accuse any particular individual or organization during the interview. Hardliner parliamentarians severely criticized Zarif’s comments in response. Hardline Parliamentarian Alireza Salimi *called Zarif’s claims “unsubstantiated.” Parliamentarian Hossein Ali Hajji Deligani *called on Zarif to name the individuals and organizations who allegedly benefit from money laundering. Deligani warned that if Zarif fails to present names to support his claim then Parliament will move to interpellate Zarif. Zarif will *appear before the Parliamentary NSFP Committee on November 18. Zarif’s remarks followed the Expediency Discernment Council’s and Guardian Council’s *rejection of a parliamentary-approved bill that would necessitate Iran’s compliance with key Financial Action Task Force (FATF)-related items. Adherence to the action items would foster transparency in the Iranian economy and make conducting business with Iran more attractive and reliable for international banks.

  • Hanachi elected as new Tehran City mayor. The Tehran City Council *elected Pirouz Hanachi as mayor on November 13. Hanachi received 11 votes from the 21-member council, whereas his opponent, former Roads and Urban Development Minister Abbas Akhoundi, received 10 votes. The Interior Ministry has until November 17 to confirm Hanachi’s “qualification” as the new Tehran City mayor. Hanachi will replace Mohammad Ali Afshani. Afshani *served as mayor for only six months, after he replaced former mayor Ali Najafi in May 2018. Hanachi’s election follows *legislation barring retirement-age people from holding certain government positions.
    • Senior energy officials relinquish executive authority to respective deputies. National Iranian Oil Company (NIOC) Managing Director Ali Kardar, National Iranian Petrochemical Company Managing Director Reza Nowruz Zadeh, and National Iranian Gas Company (NIGC) Managing Director Hamid Reza Araghi *delegated their executive authorities to their respective deputies in response to recently implemented retirement laws.

REGIONAL DEVELOPMENTS & DIPLOMACY

  • Iran and Syria discuss economic ties and reconstruction. A Syrian parliamentary delegation *met with Senior Foreign Policy Advisor to the Supreme Leader Ali Akbar Velayati, Parliament Speaker Ali Larijani, Economic Affairs and Finance Minister Farhad Dejpasand, and Deputy Roads and Urban Development Minister for Planning and Resource Management Amir Amini during an official visit to Tehran on November 14 - 15. The officials discussed bilateral economic ties and Iranian reconstruction efforts in Syria. Amini *called for the expansion of “construction and economic cooperation” between Syria and Iran. Amini has been in negotiations with Syrian officials over contracts for Iranian companies to *construct 30,000 residential units in Syria and to *connect Iranian rail line infrastructure to Syria since August 2018.

  • Army of Justice releases five Iranian captives. IRGC Commander Maj. Gen. Mohammad Ali Jafari *announced on November 15 that the Pakistan-based, anti-regime militant organization Army of Justice will release five Iranian captives. The Army of Justice raided a border outpost in the southwestern Sistan and Baluchistan Province on October 16, kidnapping 12 Iranians, including IRGC, Law Enforcement Forces (LEF) border guards, and local Basij members. The Army of Justice stated that the release demonstrated the group’s “good will.” The group also noted that it agreed to release the five captives to encourage Tehran to meet the Army of Justice’s October 27 demands, which include the release of “innocent Baloch youngsters” and to stop the discrimination of Iran’s ethnic minorities. IRGC spokesperson Brig. Gen. Ramazan Sharif *stated that Iran will continue its efforts to secure the release of all of the captive Iranians. The release of the five Iranians followed a series of high-level military and diplomatic engagements between Tehran and Islamabad, including IRGC Ground Forces Commander Brig. Gen. Mohammad Pakpour *visiting Pakistan on October 22.

NUCLEAR DEAL DEVELOPMENTS

  • Iran lobbies European nations to host EU bartering mechanism. Foreign Minister Mohammad Javad Zarif discussed the EU’s special purpose vehicle (SPV) in phone calls with senior *British, *German, and EU officials in early November. Strategic Council on Foreign Relations head Kamal Kharrazi met with former Austrian President Heinz Fischer in *Vienna, Austria, on November 9 and former French Prime Minister Dominique de Villepin in *Paris, France, on November 12 to discuss the Joint Comprehensive Plan of Action (JCPOA) and the Yemen conflict. Zarif and Kharrazi likely lobbied European officials to host the SPV in order to allow Iran to export oil to European buyers. The EU failed to implement the SPV before the November 5 reimposition of U.S. sanctions against Iran’s energy sector. Unidentified EU officials have expressed doubt that the EU will identify a host country for the bartering mechanism.