04 June 1998
TRANSCRIPT: IRAN: ONE YEAR AFTER PRESIDENT KHATEMI'S ELECTION
(Observers says election signals voters' desire for change) (7230) Washington -- The election of Iranian President Khatemi one year ago was a clear signal that a majority of people in Iran want change and an end to their islolation from the international community, according to two Middle East observers. "Iran is passing through (a period of change) at present," says Hisham Melhem, a Washington-based correspondent for Middle East dailies in Lebanon and Kuwait, and Radio Monte Carlo. "There are many Iranians at this time that have been born after the revolution. They are trying for a better life. They have expressed their wishes through the election of Mr. Khatemi, and also they have accepted the Islamic system. But there is a need for -- they see a need for reform," Melhem said. "I think that Hisham accurately characterized the discontent inside Iran with the Islamic Republic," says Patrick Clawson, research director for the Washington Institute for Near East Policy. "Many young people, and many women and many intellectuals are very discontent with the restrictions on cultural life. And certainly an awful lot of ordinary Iranians are upset that their income has declined so much in the last 20 years," Clawson said. "Mr. Khatemi is someone who represents the wish for change on the part of these people, but we don't know how far Mr. Khatemi wants to go in the direction of bringing change." Melhem and Clawson made their remarks June 3 as guests on the Worldnet call-in program, "Global Exchange." The two men also praised Khatemi as a "skillful and savvy" politician who has succeeded in consolidating his power and isolating his opponents. "He does not seek confrontation with his opponents," Clawson said. "But he is striving to implement his political vision and his own program. After the arrest of the mayor of Tehran, he demonstrated that he is very astute. He also demonstrated in the Islamic Summit in September that he is far-sighted, and he played a major role in extending bridges to the Islamic and Arab world." Another issue Melhem and Clawson discussed was the current status of relations between Iran and the United States, including U.S. sanctions on Iran, and U.S. concern over Iran's support for terrorism, its weapons of mass destruction program, and opposition to the Middle East process. Following is the transcript of the Worldnet "Global Exchange": (Begin transcript) WORLDNET "GLOBAL EXCHANGE" UNITED STATES INFORMATION AGENCY Television and Film Service of Washington, D.C. GUESTS: Patrick Clawson, Director of Research, Washington Institute for Near East Policy Hisham Melhem, Washington-based Correspondent (Through Interpreter) TOPIC: Iran One Year After President Khatemi's Election HOST: Sheemam Rassan (Through Interpreter) DATE: June 3, 1998 TIME: 09:00 - 10:00 EDT MS. RASSAN: Hello, I'm Sheemam Rassan, and welcome to "Global Exchange." It's been a year now since Iran held a free and most competitive election since the Iranian revolution almost 20 years ago. In what some call a landslide, the people of Iran elected a moderate, Mohammed Khatemi to be their president. May 26th marked the one-year anniversary. Our program today will take a look at President Khatemi's first year in office. And we will try to gauge the current status of relations between the United States and Iran. Joining me to discuss this topic is Patrick Clawson. Mr. Clawson is a director of research at the Washington Institute for Near East Policy, and the author of many publications on the Middle East and Iran. And joining me is also Hisham Melhem. Mr. Melhem is a Washington-based correspondent for -- (inaudible) -- the Lebanese daily -- (inaudible) -- the Kuwaiti daily, and Radio Monte Carlo. Gentlemen, welcome to "Global Exchange." If we may change, Mr. Melhem, and allow us to take a look at the first year of the rule of Mr. Khatemi. MR. MELHEM: I believe that the election of Mr. Khatemi by a landslide, by a majority, is an indication that the Iranian people want a change, and they would like to leave their isolation. They have entered a new period. And besides the ideological content of the revolution at the outset, it moves on to realize that the isolation and providing education and social services requires more than ideological positions. It requires an opening to the world. Iran is passing through this stage at this present time. There are many Iranians at this time that have been born after the revolution. Those are trying for a better life. They have expressed their wishes through the election of Mr. Khatemi, and also they have accepted the Islamic system. But there is a need for -- they see a need for reform. Khatemi has expressed this need among the youth, among the liberal, and opening the door to the world. Those have stood behind Khatemi. The minister of culture is able to also fulfill these wishes. Mr. Khatemi has relaxed all the restraints on the media. There has been an increase in the level of political discussion. There is more opening in that. There is of course a resistance towards these movements. Therefore we see now that Iran is in a stage -- not a boiling stage, however a state where there is an increased discussion among the different trends. We do not want to call it the moderate and the other trends. However, we would like to, because these labels do not apply and are not understood well here in the U.S. However, in his first year Mr. Khatemi has succeeded in what he has attempted. He has proven this new trend while protecting and keeping in place the existing situation. Before we listen to Mr. Clawson, we would like to allow -- invite our guests to call in their questions. If they would like to ask in English, please call at 202-260-7403 -- in Arabic at 202-260-3727. Dr. Patrick Clawson? You heard the question that I addressed to Mr. Melhem. What do you think about that? MR. CLAWSON: I think that Hisham accurately characterized the discontent inside Iran with the Islamic Republic. Many young people, and many women and many intellectuals are very discontent with the restrictions on cultural life. And certainly an awful lot of ordinary Iranians are upset that their income has declined so much in the last 20 years. Income today is probably only about half of what it was before the revolution. And Mr. Khatemi is someone who represents the wishes for change on the part of these people, but we don't know how far Mr. Khatemi wants to go in the direction of bringing change. Khatemi is a cleric. He seems quite committed to the Islamic republic. He wants to revitalize it, to make it more popular. And it's not clear that that's really what the 20 million people who voted for him, what they want. They may want a more profound change. We don't really know yet how much change, how far they want to go with change. But Mr. Khatemi himself clearly wants to bring new life into the Islamic republic. And there is a certain amount of tension, therefore, between his agenda and the agenda of the many people who voted for him. We have seen this several times in the last year when Khatemi has been interested in pulling back from open confrontation, while many of the people who voted for him are eager to have some kind of a confrontation with the hard-liners who they so hate and detest. Interestingly enough, there are some clerics who are even more than Mr. Khatemi want to bring about a change in the existing system. Many of the most pious and senior ayatollahs are worried that in the minds of ordinary Iranians Islam has been come to be identified with the government, and people who are upset with the government aren't fulfilling their Islamic obligations. So we find some of the most senior clerics who are supporting some of the people out there on the street in their calls for a disassociation, a break between the government and religious power. MS. RASSAN: Of course we know that the term for President Khatemi is four years. Now that one year has elapsed from this term and so far he has not yet achieved any of the aspirations of the vast majority that voted for him, let me ask you what is the reason for that. Is he waiting for another opportunity? Is what happened recently, the reelection of his opponent Nateq Nouri to parliament and the loss -- the candidates who supported Khatemi lost in those parliamentary elections. And are all these obstacles? Do you consider them obstacles? MR. CLAWSON: What Khatemi is doing is to slowly consolidate his power, so indeed he has moved systematically and slowly to gather more power and more authority and to isolate his opponents. Quite cleverly -- he's a skillful politician. For instance, that CNN interview was a master stroke in domestic political terms. Building upon his successes at the Islamic Organization Conference meeting in December, this CNN interview brought Khatemi into the field of foreign affairs, which previously he had not been involved in. So perhaps what Khatemi is doing is preparing the way for him to make more bold changes later on, and perhaps instead what he is doing is creating a coalition for more moderate and smaller-scale changes. We don't really know. We don't have the measure of the man yet, of whether he is going to go as far as many of his supporters want in bringing about changes. He seems to want quite a lot of change, but he may be someone who in the end compromises instead of having confrontations. That's something of a tradition of people from that clerical background -- they don't force an open break with their fellow colleague clerics. And so we just don't know how far he is going to go with this program. I must say that I am impressed with how clever he has been as a politician in isolating his opponents. He used this whole confrontation about the arrest of Tehran's mayor for instance to make his opponents in the judiciary look a little silly and look rather weak. And if he keeps up this pace he may within another year or so really have an awful lot more power than I would have ever expected when he was first elected. MR. MELHEM: I believe that President Khatemi's performance in the last year expresses his political savvy. It is true that he is a religious man, but he is also a very clever politician. He does not seek confrontation with his opponents, but he is striving to implement his political vision and his own program. After the arrest of the mayor of Tehran he demonstrated that he is very astute. And he also demonstrated in the Islamic Summit in September in Tehran -- showed that he is far-sighted, and he played a major role in extending bridges to the Islamic world and to the Arab world. And he presented Iran in the image of a responsible state that can be in a position of leadership among Islamic countries. This was demonstrated in the statements he made about the peace process, about the peace in Lebanon, and about terrorism. Despite the fact that he is doing all of this, he is giving a different image about Iran, showing it as a responsible state, as a state of laws. And this is something quite revolutionary in a country like Iran, which has now revolutionary traditions. And this -- his demeanor shows that he has popular support, and that popular support is giving him immunity from criticism by his opponents. As Patrick Clawson said, there are some religious clerics who want to reduce the power, the direct power of religion in government -- are indirectly supporting him. There are various forces in Iran, and there is a certain amount of social unrest in that country, and this is reflected in some demonstrations that are sometimes characterized by violence. But everything that is happening is reflecting the state of transition that Iran is going through right now. Khatemi does not want confrontation with the hard-liners. He wants to contain those hard-liners and to weaken them in order for him to be able to carry out his program. We cannot really make a judgment or an evaluation of his term in one year, but we can draw some conclusions. MS. RASSAN: Of course I want to call attention to our viewers that if they wish to call us and ask an Arabic question they can call us collect at 202-260-3720. If they have a question in English, please call us collect at 202-260-7403. Can we now say that in the Iranian parliament we are seeing some rapprochement towards the West? Is this something that we can -- is this a reasonable conclusion? MR. CLAWSON: I would say that we have not seen that really yet. The issues which have been most of interest to Mr. Khatemi, to his followers in the Iranian parliament, those have been domestic issues, especially issues about cultural matters, educational matters -- to some extent economic matters. Foreign policy matters have not been the biggest concerns. And the question of relationships with the United States in particular remains very controversial -- very controversial in Iranian society. The paradox is that the Iranian people are in fact very friendly towards the United States, U.S. culture, even to be honest the U.S. government. Perhaps more friendly than in many parts of the Arab world. And yet there is clearly a group of people in Iranian society who are viciously opposed to the United States and everything it represents. So this -- the question of relations with the United States -- any kind of relation with the United States -- is very controversial. And, similarly, a number of the other issues that are of most concern to the West about Iran's behavior remain very controversial. For instance, Iran's weapons programs. MS. RASSAN: Can I interrupt you, Mr. Clawson? We have a call from Suma. Hello? Please go ahead. Q: Yes, I'm calling from Ghana. I want to ask presently under the Clinton -- what is the relationship between the United States presently and Iran with respect to all sectors in the economy? My name is Reverend -- (inaudible) -- thank you very much. MR. CLAWSON: There's a ban on U.S. trade with Iran and U.S. investment in Iran. The United States also has tried to discourage investment by companies from other countries in Iran's oil and gas industry. And the measures the United States took to discourage such investment have been quite controversial, because the European countries in particular thought that the U.S. measures were imposing U.S. laws on European companies -- what they call extraterritoriality, the U.S. trying to apply its laws outside the U.S. territory. And the Europeans got very upset about that feature of the U.S. pressure. The United States government has more or less abandoned its attempt to pressure European companies against investing in Iran. But the United States continues to have a ban on U.S. companies investing in Iran. I don't think that that is likely to change soon, in part because the U.S. action, the U.S. ban on companies investing in Iran, has had quite an effect on the Iranian economy. It has complicated the efforts of Iran to get investment for its oil and gas industry, and that has really hurt Iran's plans to expand its oil and gas industry. Those plans have gone much, much slower than the Iranians had hoped. So I think the United States will keep this ban on until such time as Iran agrees to make some changes in its behavior. We heard nice words from President Khatemi on a number of issues, but the behavior of Iran hasn't changed very much, and the U.S. is going to insist on that change in behavior before the U.S. softens its ban on U.S. investment or U.S. trade with Iran. MR. MELHEM: I feel that the penalty has had a negative impact on the Iranian economy. However, it has not forced Iran to modify its foreign policy or changing the basic issues in Iran. However, in regard to the economic relations between the U.S. and Iran, Iran has attempted to establish relations, economic relations with the U.S. in the beginning of the '90s, and it was able to reach an agreement with Conoco, the American company Conoco, for oil exploration. However, the American company has put an end to that. There was also an attempt to buy planes from Boeing. The American agreement put an end to that. However, the ILSA, these penalties, have created many difficulties for the U.S. with its allies in Europe. This issue has not prevented large companies, such as Total, the French company Total, or others, in entering in agreements to develop energy in Iran, which forced the American administration to give Total a waiver. That means that the U.S. government will realize that the penalties imposed on Iran will become a point of friction and confrontation with its allies in Europe. It is true that Iran is in need of foreign investment, American and otherwise, to develop its energy sector. However, we begin to find certain fissures in the penalty system that the U.S. has put around Iran. MS. RASSAN: (?) Also, I would like to hear your opinion in regard to a statement by -- (inaudible) -- about a month ago in regard to oil. He said within a year -- within a month there will be an opening to oil and gas companies for investment in Iran. Is this a challenge to the American penalties? MR. CLAWSON: Yes and no. The Iranians have for some time been interested in attracting foreign investment in their oil and gas industry. After many years of opposing such foreign investment on ideological grounds, Iran decided about three to four years ago that it would open up its oil and gas industry to foreign investment. But the Iranians have not offered very attractive terms, and they have been very difficult on negotiating partners. So they've had very little success attracting this international investment to their oil and gas industry. The Iranians have been extremely difficult in negotiations. I think for instance of the deal with Kazakhstan to import into Iran Kazakh oil, and then to export Iranian oil on behalf of Kazakhstan. This kind of a swap for Central Asian oil was something that got an enormous amount of high political attention and publicity of Iran serving as a gateway to Central Asia, and yet the Iranians in the negotiations were so tough that the deal in fact has never worked out. And it's because the Iranians are insisting on every last dollar that they can possibly extract from these deals. Similarly, Iran has not been able to attract much investment because it's insisted on very tough terms. Now, in this atmosphere the U.S. government pressure on international oil companies not to invest has been quite successful, because the companies were not that interested in investing on the kind of terms that Iran was offering. So Iran has been in many ways its own worst enemy in attracting this investment. And the oil minister may be optimistic that he is going to announce all kinds of deals, but he's been optimistic or his predecessors have been optimistic for several years now, and these deals have just not really happened very much. There have only been two deals since Iran opened up. By contrast, Venezuela opened up at about the same time as Iran, and Venezuela has had billions of dollars in investment, and its oil capacity is going to double pretty soon. Meanwhile in Iran not much has happened. MS. RASSAN: Viewers and listeners, you are tuned into "Global Exchange." In this edition of "Global Exchange" we are talking about Iran and the course of President Khatemi one year after his election as president of the country. We would like to invite our viewers to call us to ask us questions. If you are calling -- if you are talking in Arabic, please call us collect at 202-260-3727. And if you wish to address a question in English, call us collect at 202-260-7403. Here in the studio we have Dr. Patrick Clawson, who is director of the Washington Institute for Near East Policy. And he is also the author of many books on U.S.-Iran relations. Also wish us we have Mr. Hisham Melhem, journalist of -- (inaudible) -- a daily newspaper, and also another daily newspaper -- (inaudible) -- a Kuwaiti newspaper, and also a correspondent for Monte Carlo Radio. I would like to draw the attention of our viewers, and tell them that our guests in the studio do not represent the American government. They only represent themselves. We have a call from Ghana. Welcome. Please go ahead with your question. Q: My question is I want to know if the American government has a policy or is interested in this fatwa issued -- slapped on Dr. Salman Rushdie by Ayatollah Khomeini. And if it is interested, what is it doing in terms of policy to help resolve the issue? I am -- (inaudible) -- calling from Ghana. Thank you. MS. RASSAN: Forgive us, we were not able to hear the question. Can we hear the question once again please? Q: Yes, my question is I want to know the American government policy towards Iran as regards the fatwa issued -- slapped on writer Salman Rushdie. And it's been creating a lot of problems for a long time. So I want to know if the American government is interested in the issue, and if it is interested what is it doing with regard to its foreign policy towards Iran in a bid to resolve the issue. Thank you. MR. CLAWSON: Thank you. The Rushdie question is a very difficult one for the United States government, because the United States government clearly would like to see the ban on Salman Rushdie lifted -- excuse me, the fatwa against Salman Rushdie lifted. Yet at the same time the U.S. government has to decide on its priorities vis-a-vis Iran. The U.S. government has to decide which issues matter the most in reaching agreement with Iran, and which issues the U.S. is prepared to disagree with Iran about. And the U.S. government has placed emphasis on three questions: the question of terrorism, of weapons of mass destruction and the Arab-Israeli peace process. So the U.S. government has not put the question of Salman Rushdie and of human rights in Iran at the same level as these other three issues. Now, interestingly enough, the European countries which on the whole are less hard-line about Iran as the U.S., they put more emphasis on the Salman Rushdie question. Indeed, the Norwegian government for instance has called for international economic sanctions against Iran because of Iran's threats against Salman Rushdie. So the Rushdie question is one where the U.S. government has decided that much as it dislikes Iran's actions, the U.S. isn't going to insist on a change in Iranian policy as a precondition for better relations, whereas the European governments raise the Rushdie matter with Iran more vigorously perhaps than the U.S. does. MR. MELHEM: The issue of Salman Rushdie anyway has a lot of media coverage worldwide. He has refused to take pictures with Rushdie to indicate his support. But however he did not want to make this a point of friction. With regard to the fatwa regarding Salman Rushdie and terrorism, which is another issue between the U.S. and Iran and its accusation of carrying out terrorism, the interest of the Europeans in Rushdie is because he is a British citizen. However, with regard to the fatwa itself the problem is that we hear conflicting positions in Iran. Some say that the fatwa still stands. Others say that it only nominally stands, however it will not be carried out. Others say just forget the fatwa. I do not want to enter into an ideological religious argument here, however maybe the best way to deal with this issue is to have statements by the Iranian government officially saying that the fatwa cannot be implemented at this time. And I've heard myself an author on Islamic history say that the best way for these fatwas is to be forgotten after a certain period of time, and that this decision against Galileo by the Catholic Church has been -- was not withdrawn, however was forgotten. MS. RASSAN: I directed a question -- I addressed a question in regard to the American and Iranian relations. Let us take a look at that now. (Break for film.) MS. RASSAN: As we have observed in the film, and seen also the Secretary of State Albright declaring that the United States would like to work not only with the Iranian side toward improving American-Iranian relations. However, if we return to the question that I posed to Dr. Clawson, with the opening that Khatemi would like, is there some hesitation because the final authority, religious authority, Khatemi, is still condemning the U.S. in his statement, which put President Khatemi in an untenable position maybe? MR. CLAWSON: Well, there's been a lot of political tension in Iran ever since the revolution. It's in fact been a relatively open political system. Within the narrow confines of the clerical rule there has been a lot of debate. The debate can't go beyond the narrow confines of the existing Islamic republic. But within those who accept the Islamic republic there is a vigorous debate. And it's clear right now that the supreme religious guide, Khameini and the President Khatemi place different emphasis on many issue, and that Khameini for instance is more supportive of a hard line against the West than is Khatemi. And I don't think we should however necessarily exaggerate the extent of this difference. Khatemi is interested in very small little steps, especially on the economic front, without necessarily changing that much about the policies that the United States most disagrees with. We haven't seen yet what he is prepared to do. He is using much friendlier words, much less confrontational rhetoric, but we don't know how much he is prepared to change. And in fact in some areas, for instance Iran's missile program, has actually accelerated Khatemi, and Iran is now more vigorously than before developing long-range missiles which would give Iran the ability to hit Riyadh, Cairo, Tel Aviv and Ankara, the capitals of all the U.S. allies in the region. So we don't really know how much of a difference there is in practice between these two individuals. And, in any case, the supreme religious guide, Khameini, he is not the one who is most vigorously opposed to the program of President Khatemi. The one most opposed to Khatemi, the people most opposed to Khatemi, are the head of the judiciary, Ayatollah Yazdi (sp), and to some extent the speaker of the parliament, Mr. Nateq Nouri, who was the man that Khatemi defeated. And it's the judiciary chief Yazdi (sp) and the parliamentary speaker Nateq Nouri who in fact have been leading all kinds of campaigns against Mr. Khatemi's programs on domestic issues -- questions like cultural matters. There's been a big campaign recently about whether or not men doctors can treat women patients -- these sorts of issues. MR. MELHEM: And I would like to talk a little bit about the American conditions that have been placed on opening a true dialogue with Iran -- terrorism, weapons of mass destruction and the peace process. As far as terrorism is concerned, we cannot vindicate any kind of terrorism of course. But what we notice, that Iran's involvement in terrorism, especially recently, was directed against the Iranian -- the armed Iranian opposition, specifically Mujahedi Haulk (sp) who have bases in Iraq. And if we were to look at the State Department's annual report on terrorism, they focus on this matter. With regard to the weapons of mass destruction, I believe that Iran, after the nuclear tests in Pakistan and in India, asserted that it does not seek nuclear weapons. It is a signatory to the treaty banning nuclear weapons, and it realizes that if it delves into this area there will be sanctions, international sanctions, against it. But when it looks around it it finds that to the north Russia has nuclear weapons, Pakistan now and India have nuclear weapons, and Israel also has nuclear weapons. I cannot justify a weapons of mass destruction in Iran, but we have to remember that Iran was victimized by weapons of mass destruction during its war with Iraq. The question of weapons of mass destruction has to be considered from a regional perspective, and we cannot discuss this subject seriously and effectively until the political tensions in the region are reduced. I think that the extension of bridges in the area among the countries of the area -- when we think about reducing tensions in the Gulf and with the United Arab Emirates, we see there are early steps to accomplish that. And we look at during the Islamic Conference in September President Khatemi announced publicly that all the forces that are working in Lebanon must be subject to the central government of Lebanon, and this was a direct reference to the activities of Hezbollah in Lebanon. When the minister of foreign affairs visited Beirut recently, he said that when Israel withdraws from South Lebanon the matter will be finished and done. This means that Hezbollah's activities in Lebanon will be brought to an end. And this means also that Iran is willing to end its involvement in terrorism. But we cannot deny Iran the ability to defend itself by its missiles program, because it needs to defend itself. Iran acted responsibly in the Caucasian area, and also in Central Asia. And its position regarding the conflict in Afghanistan is a very reasonable one. MR. CLAWSON: I would quite agree with Hisham that Iran's statements about Hezbollah and Lebanon are quite encouraging, and offer a prospect that indeed the Israeli occupation of southern Lebanon might come to an end. So that's hopeful, and I hope that Iran will continue to say the same kind of things and to carry them out. I am not as hopeful, however, as Hisham about Iran's weapons of mass destruction program. I am concerned that Iran says nice things but hasn't done very much. For instance, Iran signed and ratified the Chemical Weapons Convention, but Iran has not yet declared what chemical weapons it has, which is an obligation it has under the Chemical Weapons Convention. And that would be an important step that Mr. Khatemi ought to take, is to make a full and honest declaration. For instance, the Indian government last year made a full and honest declaration about its chemical weapons after denying for many years they had any. And that was a very positive step. Iran could do something similar. Also, Iran could stop making purchases of specialized equipment and specialized parts that are really only useful for making nuclear weapons. That would reduce the suspicions that we in the West have about their intentions considerably. Furthermore, if Iran is worried about its neighbors' military capabilities, then one thing Iran could do is stop cooperating with Iraq in the smuggling of Iraqi oil out of Iraq, that the Iranian Navy protects. And this is really quite disturbing. There is a U.N. resolution against these exports of Iraqi oil, and the Iranian navy provides protection for these smugglers. Again, that's not very helpful. It was very encouraging in January and February when Iran stopped cooperating with these smugglers. Unfortunately they've resumed cooperating with them since April. That was not a good idea. I urge them to go back to the policy that was so encouraging in January and February when they stopped cooperating with the smuggling. That smuggling of course gives Saddam Hussein more money, and also provides him a route by which he can smuggle things back into the country -- things like weapons that are forbidden him under the U.N. resolution. MS. RASSAN: Of course there are many questions that come to my mind. However, I know that Dr. Clawson in less than 10 minutes will be headed toward Capitol Hill. What are some of the main points that you will be discussing there? MR. CLAWSON: I am discussing there the U.S. sanctions on Iran, and what effect those U.S. sanctions have had. And I'll be saying that the sanctions have had a number of positive effects for the United States, but they have also had some cost. The cost has primarily been in the U.S. relationships with Europe, that the European countries got upset at what they saw as the U.S. applying U.S. law against European firms. And the United States has had to back down from a threat against a sanctions against European companies that was built into the ILSA law, the Iran-Libya Sanctions Act. However, the positive effects of the U.S. sanctions have been to limit Iran's income with which Iran can buy advanced weapons. So for instance if Iran was purchasing all kinds of anti-ship missiles with which it was acquiring quite an impressive capability to threaten shipping that went through the Strait of Hormuz. And Iran doesn't have really the money to pay for those missiles, so China stopped selling Iran the missiles because Iran was a billion dollars in debt in paying for them. And that I think is because the U.S. sanctions. Also, the U.S. sanctions have had an effect in showing to ordinary Iranians that the isolation from the West comes at a high price, a high cost, that Iran has not been able to develop its oil and gas industry as much as Iran had hoped, and that that has contributed to Iran's economic problems. By contributing to Iran's economic problems, this has made people upset about the political situation, and I think that was a factor in the vote for President Khatemi as president. Many Iranians were upset about their economic circumstances, and realized the economic circumstances would not improve until relations with the United States improved. So I think that President Khatemi's election, one small part of it, was due to these economic problems caused by the sanctions. MS. RASSAN: Mr. Melhem, do you have any comments? MR. MELHEM: On principle I believe that the experience points out that the unilateral sanctions do not change the -- or lead to the desired changes in policy, and the U.S. has applied this toward many -- more than one country. There are many companies and countries who have asked the United States to review this policy in regard to putting sanctions on any government that has opposing policies. The U.S. has sanctions now against more than 73 countries around the world. These sanctions against Pakistan did not prevent Pakistan from its nuclear experiment. These sanctions rarely lead to the desired results. However, there is also a contradiction in the American position. The Clinton administration focuses on the American officials playing a role in calling for marketing American products overseas. The American ambassadors overseas are required to promote and market their products. They lecture the Arab world to normalize their relations with Israel. On the other hand the U.S. uses the economic weapon with countries such as Iran, and it is difficult to influence Iran economically. If it has allowed Iran to buy the Boeing airplanes -- these economic incentives are important, and there are effective forces in Iran that can use this bridge with the West in order to empower itself against the isolationist trend. What is exciting in Iran is that there is a political life. This I cannot say with regard to many other countries in the area -- Arab and otherwise. There is an economic life. There is also certain forces that would like to build bridges with the West. So creating these economic incentives will allow for changes. MS. RASSAN: We have discussed partially -- we have discussed the American-Iranian partially, and we can discuss now the opening of Iran towards the Arab nations. In a declaration that dealt with the three islands, and referring this issue to the international court, Iran did not accept or refuse or reject. Dr. Clawson, what is your opinion? When will Iran accept or refuse these? MR. CLAWSON: One of the most discouraging aspects about dealing with revolutionary Iran is that they have really been not interested in give and take. They haven't been interested in negotiations in the traditional sense. And this has been the experience of the United Arab Emirates, it's been the experience of the United States, that there have been any number of issues on which we have been prepared to deal. If Iran wants to have a compromise, the United States is quite ready to do that. We do that with regimes we don't like all the time. For instance, with the North Korean regime the United States was prepared to give them billions of dollars to get North Korea to change its policies in certain areas. And if Iran were interested in negotiating about the three islands, I think that the United Arab Emirates would be prepared to deal. But the Iranians have taken a very hard stand and a very firm line against any kind of a deal. I suspect the UAE would be prepared to accept even a pretty generous offer from Iran, so long as there is some face-saving element for the United Arab Emirates. But Iran has not been interested. And that's very discouraging, because if they showed that they were willing to change their behavior in return for some agreement with other sides, then I think we could start talking about lots of deals -- about the deal for instance over Iran's nuclear power plant, about many other issues. At one point last fall there was some talk about perhaps Iran would agree to give back the small sea island, Little Tunb (sp), while keeping the other two islands. And then Iran immediately rushed to say, No, no, no, no, no. That was very discouraging, because frankly Little Tunb (sp) is -- it's a rock -- no one lives there -- whereas Abu Musa is a real island where people live. And this deal would have been very favorable to Iran, but even that they're not prepared to talk about. MS. RASSAN: Of course before we hear more from Mr. Melhem, I would like to thank Dr. Patrick Clawson for his participation in today's edition of "Global Exchange." We know that Dr. Clawson is going to Capitol Hill to testify on U.S.-Iran relations. Thank you very much for joining us today. We continue our conversation with Mr. Melhem, and ask him what do you think about what Dr. Clawson said about the three islands? MR. MELHEM: I agree completely with what he said. These islands were occupied by force, and Iran can't say that the regime that occupied it was the shah regime, and it can therefore come to a reasonable and an acceptable understanding about these islands. I think there is not only Arab support for the UAE's position, but there is international support for it. The UAE has shown and affirmed that it is a patient country and that it is seeking a political resolution. It does not want to embarrass Iran, but it wants to insist on its own rights, and this is acceptable and understandable. That is why I think that the ball is in Iran's court, and it is up to Iran to comply with -- to respond to the UAE's request to negotiate. Of course they cannot negotiate forever, but that's why I see that if a just solution is sound for this problem, Iran will be able to have better relations with different countries of the Gulf, with the exception of Iraq, because that situation is different -- they have differences about the borders and they have political differences and geopolitical differences, et cetera. But solving a just and a fair solution to the problem of the islands will open doors to Iran and to other countries of the Gulf to open a new page. MS. RASSAN: We have a call from Ghana. Welcome. Please go ahead. Q: Hello, I want to know if the U.S. (sanction ?) against Iran is still enforced. MR. MELHEM: Of course the American sanctions against Iran are still being enforced, in spite of the fact of what is happening. And also the United States is continuing to encourage its allies to continue those sanctions. It has also legislated laws -- enacted laws that allow the government to punish those companies that cooperate with Iran and that work with it. Congress enacted this law in '96, and it is against Iran and Libya. It is called the Iran-Libya Sanctions Act. This act has become an issue of contention between the United States and Europe. Europe does not want to deny the companies that they have -- to deny them the opportunity to work in the Iranian market. And in spite of the differences that Europe has with Iran, it does not want to deny itself the opportunity to benefit from the Iranian market. MS. RASSAN: Mr. Melhem, I think we have only one minute. Very briefly: What about the rapprochement between Iran and Saudi Arabia? Has that achieved some stability for Iran to enter into cooperative arrangements with the Gulf Cooperation Council? MR. MELHEM: Ever since Khatemi was elected the Saudi Arabian reaction was moderate and flexible. When the Saudi representative was received at the Islamic Summit it was positive, and he felt that he was at home in Iran, and that was significant and important. Saudi Arabia said that those responsible for the Khobar explosion -- it did not come from Iran. And that was a very sensitive issue for them, and also for the United States. So with regard to the Saudi-Iranian relations I think we are entering into a new stage, and I think there is a clear desire in Saudi Arabia to open a new page of relations. But, nevertheless, there still remains some worry in Saudi Arabia, because it wants Iran to have more consistency and more congruence between what Iran says and what it does. But I think we have still achieved some progress in relations. MS. RASSAN: I am truly sorry, our dear listeners and viewers, we no longer have enough time. I would like to thank our guests, Patrick Clawson and Hisham Melhem. And I would like to thank all those who have called us from around the world. Next week we will take a closer look at some of the important current issues facing the Middle East. With my greetings, I am Sheemam Rassan. (End transcript)
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