By Eileen Kannengeiser Contributing Writer 8 March 2019

At the Munich Security Conference, the United States and European Union faced off again in a battle over the fate of the Iran nuclear deal. U.S. Vice President Mike Pence’s call to abandon the Iran deal contrasted with Chancellor Angela Merkel’s defense of it. Their argument repeats the U.S.-EU debate, ongoing since President Donald Trump withdrew from the Iran nuclear deal last year. But for all the times the Trump administration demanded that the EU follow its lead on Iran, our allies have firmly stood their ground. The United States is not winning this fight.

The United States should end its secondary sanctions policy and allow European trade with Iran. This policy change is necessary to salvage our European alliances and retain U.S. credibility to negotiate a better agreement.

The United States, Russia, China, Britain, France, and Germany signed a nuclear deal with Iran in July 2015. The agreement restricted Iranian nuclear development for ten years, in exchange for lifting sanctions. Following Donald Trump’s election, the EU lobbied the United States to remain committed to the Iran nuclear deal. Despite European efforts, President Trump formally withdrew from the agreement in May 2018 and re-imposed sanctions on Iran.

Iran promised to abide by the deal if the other signatories continued to uphold their trade agreements. However, the United States issued secondary sanctions, which prohibit any company that does business with Iran from trading in the U.S. market. But our European allies established a work-around. On January 31, 2019 the EU announced a “special purpose vehicle” to protect European companies trading with Iran from U.S. secondary sanctions.

The United States must scrap its secondary sanctions policy to preserve European relations. The EU was a central player in the Iran deal negotiations and is committed to ensuring the agreement succeeds. Germany, Britain, and France will continue to circumvent U.S. sanctions. They will not abandon the deal they helped make without first trying to save it, even if it risks undermining the transatlantic alliance.

Continued European trade is our best hope of keeping Iran in compliance with the nuclear deal. Adoption of the Iran nuclear deal was contingent upon sanctions relief. If Iran does not experience economic gains from foreign investment and trade, Iran’s extremists may win political support and make future negotiations impossible. Worse, Iran may decide to actively pursue nuclear weapons development. Iranian Foreign Minister Mohammad Javad Zarif proclaimed to the Munich Security Conference that popular support for the nuclear deal is waning, which makes these outcomes more likely.

The U.S. intelligence community confirms that Iran is currently abiding by the nuclear deal. Director of National Intelligence, Dan Coats, testified to Congress in January that Iran is not violating the terms of the agreement. However, Coats acknowledged both the rise of Iranian extremists and threats to defy the deal if Iran does not experience a financial payoff. Continued European trade with Iran would mitigate these threats.

Permitting European trade with Iran will not further undermine U.S. credibility. Allowing the world to watch as our closest allies circumvent U.S. sanctions is the true threat to our credibility. Although we may not gain the leverage to negotiate the “better” Iran deal that President Trump demands, we will not unravel the modest progress of the existing agreement. But just maybe, in the best-case scenario, the United States will retain enough credibility and leverage with our allies to propose additional negotiations for a stronger deal.   

The United States must abandon its secondary sanctions policy to protect its partnership with Europe. As a world leader, we should never apologize for our desire to challenge the status quo, push for more progress, and expect more of other nations. Yet we cannot do so alone.  As the United States and its allies strive for a safer, more stable world, we are more likely to get there if we work together.

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Eileen Kannengeiser is a master’s candidate at the George Washington University, Elliott School of International Affairs. She is specializing in U.S. Foreign Policy and National Security.