Iranians pour onto streets ( t-shirt shows Minister of Foreign Affairs), July 14, 2015. Demotix/Meysam Mim. All rights reserved.Europeans hope that diplomatic success on the nuclear issue will have a spin-off effect, allowing broader engagement with Iran. For the past decade, Europe has adopted a containment policy on Iran, which has been pursued through a mixture of sanctions, threats of military strikes by the US and Israel, and a diplomatic freeze with Iran on regional conflicts. This has given Europe leverage in the nuclear negotiations, while allowing it to reduce Israeli fears and prevent the risk of a long and costly military confrontation with Iran.

But the deliberate exclusion of Iran has been counterproductive to Europe’s strategic objectives. Iran’s striking absence from the Geneva conferences on Syria has shrunk Europe’s options for constructive progress and de-escalation in Syria. In some instances, the containment policy exacerbated Tehran’s fears and paranoia about a western plot for regime change and, as a result, caused the Iranian Revolutionary Guard Corps (IRGC) to intensify its anti-western regional action. Moreover, given the lack of alternatives, Europe has been forced to side consistently with its traditional regional allies, even when their proposals proved less effective than Iran’s or further fractured the region.

It has been difficult for political actors in Europe to think outside the “containment box” about a possible role for Iran on non-nuclear issues – and, in any case, it would have been futile to do so, given the nuclear-centric orientation of Europe’s relations with Iran. In formulating expectations on regional security, Europe will need to consider Tehran’s priorities as well as the current geopolitical realities. Iran’s regional priority is to create sufficient stability to prevent direct attacks at its borders from extremist groups that would threaten the Iranian state system and the country’s majority Shia population, while at the same time working to strengthen its influence abroad. Tehran is first and foremost concerned with its neighbours, Iraq and Afghanistan, seeking at a minimum that leaders in those countries are unthreatening to Iran and to some degree dependent on Tehran’s support. On its border with Pakistan, Iran is actively tackling hostile Sunni extremists and working to prevent the “Talibanisation of Pakistan”. Iran wants to preserve the Axis of Resistance against what it believes to be a US and Israeli plan for regime change in Tehran. Maintaining access routes to Hezbollah, and consequently a loyal security apparatus in Syria and Lebanon, is critical to this strategy.

As part of implementing these priorities and expanding its influence in areas with power vacuums, Iran has become entangled in a zero-sum battle with other regional powers. After the succession in January 2015 of its new king, Salman bin Abdulaziz Al Saud, Saudi Arabia has taken a much more assertive position in uniting a “Sunni front”, including Turkey, to overturn what it perceives to be Iran’s hegemonic goals, particularly in Syria. This has placed Tehran and the House of Saud in a more violent state of proxy war than ever before. It is likely to be years before any significant rapprochement between Iran and Saudi Arabia takes place; in fact, the two countries’ relations are likely to deteriorate in the short term after the Joint Comprehensive Plan Of Action (JCPOA). Even the ISIS surge, and the existential threat that it represents to the region, has not raised the threshold enough for either Iran or Saudi Arabia to abandon the current approach in order to fight a common threat. It is likely that anything Iran could realistically offer would be dismissed as too little by Saudi Arabia, and vice versa. Given Iran’s relative position of strength after the endorsement of the JCPOA, Europe would like to see Tehran making a more meaningful outreach to Riyadh – if not directly, then either through impartial European member states or through Oman.

The proxy war between Iran and Saudi Arabia has had a toxic effect on the situation in Syria. The future of Assad, a longstanding ally of Tehran, will be the most challenging and slow-moving frontier for diplomacy with Iran. Tehran’s support for Assad has extended Damascus a lifeline that has enabled it to continue fighting moderate and extremist opposition groups, which has had grave humanitarian costs for the Syrian people and caused destruction in the country. Even though Iran plays a critical role in Syria, it has neither been invited to nor participated in United Nations-brokered political tracks where these have been preconditioned on endorsing Assad’s departure. For member states that have backed Syrian opposition groups, it will be extremely difficult to forgo the precondition of Assad’s removal in order to accept Iran’s inclusion in such talks.

So far, Europeans have not sufficiently tested the possibility that Iran might be able to cause the Assad regime to change its behaviour in advance of a comprehensive political settlement. After a nuclear deal, this should be investigated, albeit with the understanding that progress might require trade-offs and is likely to be incremental at best. One method would be to ascertain whether and how far Iran can provide the UN with humanitarian access into Syria by instructing Hezbollah forces and IRGC personnel on the ground to allow deliveries through. Europeans would like to see Tehran exerting pressure on Damascus to halt the use of barrel bombings and other egregious methods being used by the regime in civilian-populated areas. As part of exploratory dialogue on the broader political arrangement in Syria, Iran could perhaps be persuaded to narrow its goals to focus on maintaining strategic access routes into Lebanon and protecting Shia shrines and Alawite areas as a way of reducing sectarian tensions with Sunnis.

Including Iran in a serious diplomatic initiative on Syria could increase the prospects for a durable solution. However, two factors complicate any such effort. The first relates to whether Tehran is willing to cooperate on piecemeal efforts without agreement on an overarching political settlement. It is true that Iran is likely to postpone the grand Assad question until it can be assured that any group hostile to Iran, such as ISIS, Jabhat al-Nusra, and the Jaish al-Fateh, would not be able to take hold of Damascus or the critical resupply routes to Hezbollah. But four-plus years into the fighting, Europeans remain divided as to the endgame in Syria and are unable to make assurances on behalf of extremist opposition groups. Secondly, in spite of Iran’s leverage and ability to halt critical aid to Syria, its sway over the elite decision-making circle of the Syrian regime is far from absolute – especially at a time when the leadership in Damascus is focused on survival. Nevertheless, some consider that a political track would be worth revisiting in light of recent blows to the Syrian regime. There are also indications that, in order to prevent the dissolution of Syria’s Tehran-friendly security apparatus, Iran would be willing to accept the eventual replacement of Assad with a figure that is not hostile to Tehran.

The military campaign against ISIS in Iraq has triggered a more pragmatic Iranian approach towards the west, somewhat similar to their tactical cooperation in defeating al-Qaeda and the Taliban after the 2001 invasion of Afghanistan. Some European member states have joined the US-led anti-ISIS air coalition, while others have provided training and arms to Iraq’s central army and to Kurdish Peshmerga forces. In private, western officials say that Iran has been the most willing and effective force in coordinating ground troops with the coalition’s air campaign against ISIS. Europeans would have preferred a strong Iraqi security force that could act independently of Iran, but they recognise that no Iraqi or foreign actor has the appetite or ability to replace Iran.

However, the west faces a real dilemma in cooperating with Iran on a counter-ISIS strategy. Iran’s role in mobilising Iraqi Shia militias has been integral to recapturing ISIS-held territories and preventing further ISIS gains. But the excesses of Shia militia have also fuelled the Sunni buy-in to ISIS. Tehran agreed to the removal of Iraq’s divisive prime minister, Nouri al-Maliki, which was a positive step in addressing the legitimate grievances of Sunni communities. But the change in the administration has not brought about shifts in state policy sufficient to reduce sectarian strife. The abuses carried out by Shia militia groups after entering ISIS-held territories have been a major factor in causing some Sunni tribal leaders to declare allegiance to ISIS. Another matter for concern is the possibility that the Popular Mobilisation Units (PMUs), commanded by IRGC advisers, could one day become a resistance force to government control, like Hezbollah in Lebanon. This would increase Iran’s capacity to benefit from future security gaps in Iraq at Baghdad’s expense.

Europe can tolerate and, to a degree, welcome Iran’s operations against ISIS, as long as they do not weaken Iraq’s central government or ignite sectarian divisions. In theory, the Popular Mobilization Forces (PMUs) receive their mandate and payroll from Baghdad – but, in practice, the IRGC orchestrates their movements. To address Iraqi and western concerns, Iran is likely to continue to support the integration of Iraq’s Shia militias into the PMUs, which now include Sunni forces. If the majority of Shia militias can be fully integrated into the PMUs and kept loyal to the state structure, their ability to challenge the central security forces would be reduced. In addition, Europe will want to see Iran taking a more active part in tackling the actual and perceived sectarian tensions associated with its role in Iraq. One way that might be acceptable to Iran would be for its high-ranking political, military, and religious figures to follow the example set by Iraq’s Grand Ayatollah Ali al-Sistani in condemning sectarian acts and working with Baghdad to shape inclusive political representation for Sunnis and other minorities.

Hezbollah, under the IRGC’s guidance, has stepped up its military involvement in Iraq and Syria, and in doing so it has proven loyal to implementing Iranian regional policies. Although the group has suffered fatalities and is stretched in Syria, it sees both fights as crucial to its preservation and self-interest in preventing the spill-over of ISIS- or al-Qaeda- allied groups into Lebanon. Europeans are concerned about Hezbollah’s expanded regional involvement and particularly about the threat it poses to Israeli security. In the early 2000s, Europe initiated a candid discussion with Iran on reducing its backing for Hezbollah’s military wing; at that time, Iran reportedly made a secret offer to the White House to halt its support for Hezbollah. But Iran will not now enter discussions with Europe on downgrading its relationship with Hezbollah, at a time when the two have become interdependent in managing parallel regional conflicts.

Nevertheless, Tehran is likely to try to avoid provoking new military confrontation in the region; to achieve this, it could be willing to control Hezbollah’s tit-for-tat exchanges with Israel, particularly in the Syrian-controlled Golan Heights, as long as someone asserts reciprocal control over the Israeli side. As a precondition to continued engagement with Europe, Iran will have to prevent Hezbollah attacks from being carried out inside Europe. On the political track, Iran and Europe have a shared interest in solidifying the Lebanese state through supporting Hezbollah’s political wing in becoming more deeply integrated into official structures, thus increasing its accountability. Iran is likely to continue assisting Hezbollah in consolidating its power base within Lebanon’s political structure and in maintaining order by working with the Saudi-backed March 14 alliance. The Europeans have broadly supported both sides.

Any shift in Hezbollah’s hostility towards Israel will have to await a broader change in Israeli-Iranian relations and a shift in Israeli policy – but this is unlikely to happen for some time. For now, the Iranian administration is likely to continue distancing itself from former president Mahmoud Ahmadinejad’s outlandish Holocaust denial, which contributed to the breakdown of Iran’s relations with Europe. Iran may also endorse future positive developments on Palestinian reconciliation or an Arab League peace initiative. Ironically, if escalation between Hezbollah and Israel seems likely, then Iran could be encouraged by the West to play the external guarantor role for Hezbollah – effectively substituting for Damascus, which took a similar position in ending 1996’s Operation Grapes of Wrath.

Yemen is the site of the latest proxy conflict in the rivalry between Iran and Saudi Arabia, and tensions have considerably worsened since March 2015 as a result of the Saudi-led coalition airstrikes. Many saw this mission as a kneejerk reaction to the seizure of Sana’a by the Houthi opposition in alliance with ex-president Ali Abdullah Saleh, because the group has been deepening its links with Iran. Some European member states have voiced concerns about the prospects for and humanitarian costs of this airstrike campaign, but others have either turned a blind eye to or been complicit in Saudi behaviour. The warring sides in Yemen are now further away from returning to a political track – and meanwhile, al-Qaeda in the Arabian Peninsula, one of the al-Qaeda affiliates that has proved most harmful to western interests, is gaining territory and consolidating its power base in Yemen.

Unlike in Syria or Iraq, Iran has few interests at stake in Yemen and may therefore be willing to aid western efforts at conflict resolution, which could set a useful precedent. The Houthis are far from being Iran’s proxies, although its leaders have good relations with Tehran and have sought, but not necessarily followed, the IRGC’s guidance. Iran could play a constructive role in pressing the Houthis to agree to a permanent ceasefire, and to accept a middle-way political outcome if the west can encourage Saudi Arabia to do the same. In the longer term, Iran could encourage the Houthis to integrate into a political track aimed at instituting power-sharing in Yemen. There has already been some convergence between Europe and Iran on coordinating humanitarian aid in Yemen so as to prevent further tension with Saudi Arabia. 

Thanks go to the author and to the European Council on Foreign Relations for permission to publish this excerpt. For the full ECFR briefing, Engaging with Iran: a European Agenda and its recommendations, see here.