Nuclear Talks: Regional Implications
BMI View : A breakdown or a breakthrough in nuclear talks between Iran and the P5+1 will have immense regional implications. Increased economic opportunities from a breakthrough would significantly benefit Gulf Cooperation Council states, although Saudi Arabia would see its geopolitical clout reduced. A positive conclusion of talks would also facilitate a political solution to the civil war in Syria over the next five to 10 years, with positive implications for stability in Lebanon and Iraq.
We reaffirm our core view that the interim agreement between Iran and the so-called P5+1 (United States, Russia, China, United Kingdom, France and Germany) countries on the former's nuclear programme, which was signed in November 2013, will be extended for another six months following its expiry on July 20 ( see 'Nuclear Talks: Protracted Negotiations Likely', February 26). The most recent round of talks ended in Vienna on May 16 with downbeat statements from both sides. Iran's chief negotiator Abbas Araqchi that no tangible progress had been made, while an unnamed Western diplomat reportedly declared that huge gaps remain between the two sides.
The next round of nuclear talks between Iran and the six world powers will take place in Vienna on June 16. Significant incentives for all sides to continue talks will likely impede an early breakdown in negotiations. However, elevated political and technical challenges make it unlikely that a long-term agreement will be reached over the next few months. As a result, we continue to see a 45% chance that talks will continue over the next one to three years. Although a degree of scepticism is to be warranted, we continue to see potential for a long-term agreement to be reached over the next five years.
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