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Why a terror designation is the last sticking point in Iran-US talks

By Mostafa Salem and Nadeen Ebrahim, CNN

After weeks of signals from Iranian and Western officials that a deal to revive the 2015 Iran nuclear agreement was imminent, an escalation in rhetoric between Tehran and the United States over the weekend dampened hopes for a breakthrough.

US special envoy for Iran Robert Malley told CNN’s Becky Anderson in Doha on Sunday that a nuclear deal “is not around the corner and is not inevitable” due to outstanding issues that “matter deeply” to parties involved in the talks, one of which is Tehran’s demands regarding the elite Islamic Revolutionary Guard Corps (IRGC).

Iran’s insistence on reversing the designation of the IRGC as a Foreign Terrorist Organization (FTO) appeared to be the last major sticking point in talks, with neither side showing new signs of compromise.

Beyond nuclear compliance, what Iran is offering in return for the delisting remains unclear. US State Department spokesman Ned Price refused to answer a question last week on an Axios report claiming that Tehran would publicly commit to a de-escalation in the Middle East if the IRGC are removed as an FTO.

Saudi Arabia and the United Arab Emirates have both been struck by Yemen’s Iranian-backed Houthi rebels and most recently, drones hit an oil depot in the kingdom’s second largest city Jeddah, 20 miles away from a Formula 1 track during a practice session.

But on Saturday, the Houthis said they were suspending missile and drone strikes on Saudi Arabia for three days in a peace initiative they said could be a lasting commitment if the Saudi-led coalition stopped air strikes and lifted port restrictions in Yemen.

An elite wing of the Iranian military, the IRGC was established after the country’s 1979 revolution and is today at the forefront of Iran’s military operations in the region, including in Iraq and Syria. Its animosity to the US is deeply entrenched.

The group was designated an FTO by the US in 2019 under then-President Donald Trump’s “maximum pressure” campaign, which aimed to curb Tehran’s power in the region after the US withdrew from the nuclear agreement in 2018.

Iranian Foreign Minister Hossein Amir-Abdollahian appeared to hint at compromise on Saturday before walking back. He said in an interview with state television that senior IRGC officials urged him not to delay a nuclear agreement over “the issue of the IRGC.” It would be a “self-sacrifice” the group is making, he said.

Amir-Abdollahian’s remarks were met with a strong backlash in Iranian media. He later appeared to backtrack, saying “there is no crossing or compromise on the red lines [on delisting as an FTO] at all.”

When pressed to do so on Sunday, Malley didn’t rule out a delisting, only saying that sanctions on the group will remain “no matter what happens.”

Some analysts said that the terror designation has little more than symbolic value for both sides.

The implications of delisting the IRGC are only symbolic as sanctions predating the 2015 deal will continue to economically stifle the group, said Mehran Haghirian, director of regional initiatives at the Bourse & Bazaar Foundation.

“The FTO designation is superfluous,” added Ali Vaez, Iran project director for the International Crisis Group. “It doesn’t help the US; it doesn’t hurt Iran.”

“This is an absurd non-issue,” he said. “There is no other entity that is as sanctioned by the US as the IRGC,” he said.

Mohammad Marandi, a professor at the University of Tehran, said the designation matters because it gives the US a pretext to militarily target the group.

“When the United States and Iran both have a presence [in the Persian Gulf] and the two sides consider the other navy to be a terrorist organization, then are no lines for communication, and that could create major problems,” he said.

The Trump administration killed the head of the IRGC’s elite Quds Force Qassim Soleimani in a military operation in Iraq in 2020, less than a year after designating the IRGC as an FTO. Soleimani himself was designated a “global terrorist” by the US in 2011.

“The US murdered a senior Iranian military official… then for them to keep Iran on some terrorist organization list — that’s unacceptable for Iran,” said Marandi.

Tehran is unlikely to accept anything short of a full reversal of the FTO designation, said Vaez and Marandi. “There’s no middle ground on the issue,” added Vaez.

Iran realizes that the sanctions and the FTO designation are separate issues, the latter of which was a legacy of the Trump era, analysts said. “It was imposed symbolically by Trump,” said Haghirian. “They knew it wouldn’t have much of an impact.”

The Iranian foreign minister’s comments on state TV that later warranted a clarification were likely meant to say that the IRGC “have no problem about being remaining sanctioned — they’ll do what they need to do,” said Marandi. “The FTO is a different issue.”

With additional reporting from Adam Pourahmadi and Abbas Al Lawati, CNN

Other top Middle East news

UAE says energy market needs Russian oil; says to stick to OPEC+

UAE energy minister Suhail al-Mazrouei said on Monday that Russian oil is needed by energy markets and no producer can substitute its output. He said that OPEC+, an alliance of major crude oil producers that includes Russia, needed to stay together, stay focused and not allow politics to distract the group.

  • Background: The UAE sent confusing messages earlier this month on whether it supported higher output or not when its ambassador to Washington said his country would encourage OPEC to consider higher output. The energy ministry has since repeatedly said it endorsed OPEC+ decisions and only acts within it.
  • Why it matters: The minister’s comment comes just days before the OPEC+ group meets on Thursday to discuss the renewal of a deal to gradually increase production. Consuming states have called for a faster ramping up of output to tame the rise in prices.

Yemen warring parties discuss possible prisoner swap including 16 Saudis

Houthi official Abdul Qader al-Mortada said on Twitter that a deal could free 1,400 Houthi prisoners in return for 823 prisoners from the Saudi-led coalition fighting in the country. It could include 16 Saudis and three Sudanese prisoners. Releasing the brother of Yemeni President Abd-Rabbu Mansour Hadi and the country’s former defense minister is also under discussion, he said. An official in Hadi’s Saudi-backed government said no final agreement had been reached.

  • Background: On Saturday, the Houthis said they were suspending missile and drone strikes on Saudi Arabia for three days. Saudi Arabia is also due to host a meeting on Tuesday with several Yemeni parties attending.
  • Why it matters: A deal between the Saudi-led coalition and the Iran-aligned Houthi movement could help de-escalate violence and boost UN efforts to broker a truce during the Muslim holy month of Ramadan, which starts in April.

ISIS attack kills two and injures six in Israel

ISIS operatives killed two people and injured six in a shooting attack Sunday in the Israeli city of Hadera, some 31 miles north of Tel Aviv, Israeli officials said. It was the second attack of its kind in a week.

  • Background: On Tuesday, an Arab-Israeli assailant killed four people in a stabbing attack in Israel’s southern city of Beersheba before he was fatally shot by a passer-by, according to Israeli police. The assailant had previously been arrested for supporting ISIS, according to the Israeli judiciary.
  • Why it matters: The attack coincided with a landmark regional summit in Israel’s Negev desert, where top diplomats from the UAE, Bahrain, Morocco, Egypt, Israel and the US were meeting to discuss security issues. It was the first time since June 2017 that ISIS has claimed responsibility for an attack in Israel, according to SITE.

What to watch

Turkey’s Presidential Spokesperson Ibrahim Kalin speaks to Becky Anderson about the sticking points between Russia and Ukraine ahead of talks between the warring parties in Istanbul on Tuesday.

Around the region

From leftovers on our plates to an environmentally friendly product. Shrimp shells have found a new purpose in organic farming.

In a small lab in Giza, Egypt, researchers found a way to use shrimp to create organic farming products using its shell.

Every year, the nation discards thousands of tons of shrimp waste that pollutes the environment. Shrimp is abundant in the country, and it holds the key ingredient for a product that could potentially change the way Egyptians farm.

That ingredient is chitosan, the sugar that comes from the outer skeleton of shellfish.

Shahira Yehia’s biotech startup, Chitosan Egypt, gathers shrimp waste from around five or six local hubs across the nation, extracts chitosan and turns it into unique formulas that can replace manmade synthetic fertilizers that can be harmful for the environment.

It does so by separating the minerals from the shells, drying them and grinding them into an organic product for farming.

It works as a natural resource that is an immunity booster for plants, Yehia said. “It targets over 70 pests in 20 strategic crops, ranging from potatoes, peppers, tomatoes, strawberries.”

Like many developing countries, the agriculture sector is a significant contributor to gross domestic product in Egypt, accounting for more than 11%. Yehia says aside from being environmentally friendly, her product is 20% cheaper that what farmers in Egypt are used to.

By Yara Enany, CNN

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