Rouhani: Iran citizens 'lost faith in Islamic republic'

The Iranian president has been summoned before parliament for the first time since he assumed office in 2013. Under pressure from allies and rivals alike, Hassan Rouhani has pledged to defeat reimposed US sanctions.

Iranian President Hassan Rouhani appeared before parliament on Tuesday, marking the first time he has been summoned by lawmakers since he assumed office in 2013.

Rouhani is under pressure from hardliners and even some in his reformist camp to reshuffle his cabinet over widening economic fallout from the US decision to withdraw from the Iran nuclear deal.

Here's what he said:

  • Anti-government protests in January "tempted" US President Donald Trump to withdraw from the nuclear deal.
  • "The economic problems are critical, but more important than that is that many people have lost their faith in the future of the Islamic Republic and are in doubt about its power."
  • "We are not afraid of America or the economic problems. We will overcome the troubles."
  • The Iranian government will show "the anti-Iranian officials in the White House" that US sanctions are bound to fail.

Read more: Iran: From theocracy to regional superpower

US sanctions against Iran are back in effect

Sanctions signed off

US President Trump signed an executive order on August 5 aimed at piling financial pressure on Tehran to force a "comprehensive and lasting solution" to Iranian threats, including its development of missiles and regional "malign" activities. Trump warned that those who don't wind down their economic ties to Iran "risk severe consequences."

US sanctions against Iran are back in effect

Where's the money?

The first phase, which took effect on August 7, targets the Islamic Republic's access to US banknotes, making transactions in a US-dollar dominated financial world difficult. A ban on Iran purchasing precious metals including gold further serves as an attempt to cut the country off from global markets.

US sanctions against Iran are back in effect

Planes, cars and carpets

Phase one also hits key industries including the purchase of commercial planes, cars and carpets. Iranian imports of graphite, aluminum, steel, coal, gold and some software are also affected. German automaker Daimler called off the production and sale of Mercedes-Benz trucks in Iran indefinitely after the sanctions came into force.

US sanctions against Iran are back in effect

Fuel to the fire

A second phase of sanctions — which is due to take effect on November 5 and will block Iran's oil sales — is due to cause more damage. Several countries, however, including China, India and Turkey have indicated they are not willing to entirely cut their Iranian energy purchases.

US sanctions against Iran are back in effect

'Psychological warfare'

Iranian President Hassan Rouhani said that the United States had launched "psychological warfare" against Iran to create division amongst its people. But he insisted that Iran still can rely on its allies China and Russia to keep its oil and banking sectors afloat. He has also demanded compensation for decades of American "intervention" in the Islamic Republic.

US sanctions against Iran are back in effect

EU protection

European Union foreign policy chief Federica Mogherini said the bloc is encouraging small and medium enterprises to increase their business with Iran. She said Tehran has been compliant with their nuclear-related commitments. The EU issued a "blocking statute" to protect European businesses from the impact of the sanctions.

US sanctions: Earlier this month, the US re-imposed a first-round of sanctions against Iran over Tehran's alleged failure to abide by a nuclear deal. US President Donald Trump earlier this year withdrew the US from the agreement, stunning allies who had negotiated the diplomatic milestone.

Read more: EU defiant in face of Trump threats over Iran trade

What is the Iran nuclear deal? It is an international accord with Iran, which was finalized in 2015 by several world powers, including Germany and the United States. Under the deal, Tehran curbed its nuclear program in exchange for an easing of sanctions, which were imposed amid fears that the Islamic republic was seeking to develop a nuclear arsenal.

Who is Hassan Rouhani? In Iran, Rouhani is a reformer who won the 2013 and 2017 presidential elections. Unlike his predecessor, Mahmoud Ahmadinejad, Rouhani had encouraged dialogue with the international community, including the US. His government helped negotiate the now-fragile nuclear deal, once considered a masterpiece of 21st century diplomacy.

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Growing insecurity over trading with Iran

Why is Rouhani under pressure? In the wake of the Iran deal, the Islamic republic once again opened its doors for international business. However, after the US withdrew from the nuclear deal and threatened penalties against countries that did business with Iran, the country has seen its currency nearly collapse, international companies pull out, rising unemployment and corruption spread.

Hardliners have called on Rouhani to reshuffle his government, with even some within his camp arguing for similar measures. On Sunday, the Iranian parliament impeached then-Economy Minister Masoud Karbasian, striking a major blow to Rouhani and his reformist agenda.

Read more: What is the Iran nuclear deal?

What happens next? Parliament referred the case to the judiciary, a display by lawmakers that they were unsatisfied with Rouhani's responses to their questioning, according to the private Iranian news agency Tasnim.

Iran nuclear deal — the timeline to Donald Trump's torpedo

The deal breaker

President Donald Trump announced on May 8 that he was pulling the United States out of the 2015 Iran nuclear deal, arguing that the international accord was not in America's "national interest." The decision threw a cloud of uncertainty over the future of the nuclear accord and raised tensions with US allies in Europe.

Iran nuclear deal — the timeline to Donald Trump's torpedo

Slap in the face

Britain, France and Germany lobbied the Trump administration and Congress to remain in the nuclear accord, arguing that the deal was working and a US violation without a follow up plan would be destabilizing. In European capitals, the Trump administration's withdrawal was viewed as a slap in the face of allies.

Iran nuclear deal — the timeline to Donald Trump's torpedo

A triumph of diplomacy

The Joint Comprehensive Plan of Action (JCPOA), better known as the Iran nuclear deal, was signed in 2015 by United States, China, Russia, France, Germany and Britain (P5+1) and Iran following years of negotiations. Under the international agreement, Iran agreed to dismantle its nuclear program and be subject to monitoring in exchange for the lifting on international nuclear related sanctions.

Iran nuclear deal — the timeline to Donald Trump's torpedo

Compliance and verification

The JCPOA includes a robust monitoring, verification and inspection regime carried out by International Atomic Energy Agency (IAEA). The UN watch dog has verified Iran's compliance with the deal in 12 quarterly reports. The JCPOA allows Iran to pursue a peaceful nuclear program for commercial, medical and industrial purposes in line with international non-proliferation standards.

Iran nuclear deal — the timeline to Donald Trump's torpedo

Obama's achievement

The Iran nuclear deal was President Barack Obama's signature foreign policy achievement. Seeking to undo nearly every Obama administration legacy, Trump came into office calling it the "worst deal ever." The Trump administration argues the nuclear deal doesn't address other unrelated issues such as Iran's ballistic missiles, regional influence, support for "terrorist" groups and human rights.

Iran nuclear deal — the timeline to Donald Trump's torpedo

Iranians approved

The nuclear deal and lifting of punishing nuclear related international sanctions created optimism in Iran after years of economic isolation. However, even before Trump pulled the US out of the deal, Tehran blamed the US for holding back international investment and not fulfilling its end of the bargain due to the uncertainty created by Trump's threats.

Iran nuclear deal — the timeline to Donald Trump's torpedo

The opponents

After eight years with Barack Obama, Israeli Prime Minister Benjamin Netanyahu found the US president he wanted in Donald Trump. The Israeli leader repeatedly slammed the deal despite his own military and intelligence chiefs' assessment the that JCPOA, while not perfect, was working and should be maintained. Saudi Arabia and the UAE are the other main opponents of the nuclear deal.

Iran nuclear deal — the timeline to Donald Trump's torpedo

Who's left?

The EU-3 (Britain, France, Germany) are scrambling to ensure that Iran receives the economic benefits it was promised in order to avoid Tehran pulling out of the deal. As EU businesses face retaliation from the US for doing business with Iran, many are opting to avoid Iran. This would likely be a present to Chinese and Russian businesses.

ls/rt (Reuters, AP, dpa)

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