Markets often appear to be wrong, but the truth is that they rarely are. The investor that fails to listen, or to learn how to read markets, is the one that is to be considered the fool. Markets have today rightly welcomed the interim nuclear deal that was established with Iran in Geneva over the weekend. At best this interim deal should freeze, or at worst merely stall, part of Iran’s wider nuclear ambitions for a while. My eyes are wide open on this and I speak of someone who visited Iran during the 1980’s.
I understand the desire for peaceful co-existence on the part of the majority of Iranians, just as I do the mistrust between Iranian politicians and their neighbours let alone nations in the west. But I do believe at this stage, so long as he can sell the notion to his own people as well as America’s allies and friends in the Middle East, that there is a good case to argue that Secretary of State John Kerry has done a fine job of work moving a geo-political process approaching to one which seems to be taking steps in the right direction.
The interim six month agreement signed over the weekend that also allows for a second six month extension should be seen as a very small part of a process that we may hope will eventually lead to a normalisation of relations between Iran and the west. I do not underestimate the challenge and difficulties ahead, or that many will see this as appeasement that is just as likely to be found wanting over the coming months as it is likely to succeed. The building and securing of a new found trust with Iran is not what has occurred but at the very least the west should see this interim nuclear deal as having overcome at least one hostage to fortune – that the Iranian leadership have shown in their new found quest to engage with the rest of the world that they are prepared to listen and accept the views of others.
Whether others, who we must accept are also major stakeholders in the long and difficult process of establishing a true and lasting Middle East peace, choose to see the interim nuclear deal in quite the same way remains to be seen. That the Israeli leadership should condemn the Iranian deal is hardly surprising and it gives a degree of credence as to why the US administration chose to keep Benjamin Netanyahu in the dark. Of critical importance in the days ahead will be any formal views that emerge from the Kingdom of Saudi Arabia plus major Middle East stakeholders. The West must listen to the views of Iran’s neighbours, who for years have felt Iran to be a threat to their very existence. In return for the freezing of certain nuclear development activities Iran gets access to around $7bn of sanctions release. No one is in any doubt that with this deal, the clock can be turned back by the parties to this agreement but I believe we have no option but to give it a chance.
The potential for rebuilding of trust with the Iranian leadership was deemed impossible until March this year but now we do at least have a small marker that suggests a narrow path to Tehran – one that still contains more than a few nasty obstacles – has at least been opened. Given that the interim nuclear deal signed in Geneva this weekend has been fully endorsed by our own Foreign Secretary we must give it a chance and hope that it really does turn out to be the first stage of a long and very difficult road in the re-establishment of trust.
Howard Wheeldon, FRAeS
Wheeldon Strategic Advisory Ltd.
M: 07710 779785