Is Moscow Playing a Double Game on Iran's Nukes?

Why the Russians see Tehran's atomic ambitions as an opportunity, not just a threat.

This week, diplomats from China, France, Germany, Russia, Britain, and the United States, now called the Group of Six, met to discuss next steps to prevent Iran from acquiring nuclear weapons. U.S. Secretary of State Hillary Clinton signaled Russia's importance to this effort by consulting with her Russian counterpart Sergei Lavrov on the matter ahead of time. Despite U.S. and Western European preferences, any serious discussion of new sanctions apparently fizzled when Iran signaled that it had a new proposal, without delivering it.

The U.S. approach to Iran's nuclear program has long been built on the assumption that Russia's influence in Iran is key to reaching a solution. Indeed, as Iran's primary nuclear technology supplier, and one of its leading trade partners, Moscow would appear to have powerful leverage in Tehran. But the United States may be basing its policy on an illusion, for the Russians could be playing a double game.

With Russia's grudging support, the United Nations Security Council has passed three rounds of sanctions on Iran, aimed at halting its uranium enrichment program, which Tehran claims is for peaceful purposes, but could be used to make fissile material for weapons. The sanctions, however, have not halted the Iranian enrichment program and show little prospect of doing so soon. The International Atomic Energy Agency (IAEA) reported last February that Iran has produced sufficient low-enriched uranium for a nuclear weapon, if Tehran were to take the additional step of enriching it further. Meanwhile, centrifuges continue to spin at Natanz, and Iran has yet to convince the IAEA that its intentions are peaceful.

Although Moscow talks a good game on Iran's nuclear program, since Iran's clandestine uranium enrichment program was first exposed in 2002, Russia has consistently impeded effective action. The problem is not that the Russians doubt Iran's nuclear potential. In 2005, a Russian diplomat told me that compared with the Iranians, North Korean nuclear engineers (who have since conducted two nuclear tests) are "children," and warned that Russia's assessments of how soon Iran might attain a nuclear weapon are more pessimistic than those reported in the U.S. media. There are, however, reasons why keeping the issue alive is in Russia's interest, and therefore Moscow would prefer not to solve the problem anytime soon.

First, Russia benefits economically from a crisis with Iran. Not only is Russia Iran's leading nuclear vendor, it is also its foremost arms dealer, and demand for those arms increases with tensions. In 2007, Iran bought a $1 billion defense system from Russia and is now seeking even more sophisticated interceptors, likely to defend its nuclear sites. More significantly, even the possibility of military action against Iran and the probable consequences -- including attacks on oil shipments through the Strait of Hormuz -- inflates the price of oil. This matters to Moscow. Oil and gas accounted for almost two-thirds of Russia's export revenues at the peak of energy prices.

Second, the issue keeps Russia at the head table in international relations. Moscow's influence in the Middle East has waned for decades, with reversals of fortunes in Libya, Egypt, Syria, and Iraq. Relatively good relations with Iran give Moscow a toehold to influence events in a strategically vital part of the world. Membership in the Group of Six accords Russia significant influence on an important issue.

Third, the Iran nuclear issue creates leverage over the United States. Washington has already made clear that the matter is of vital interest -- all the better for Moscow to demand rewards for cooperation. Russia got a long-sought civil nuclear cooperation agreement from the George W. Bush administration (though it stalled in Congress over the invasion of Georgia), and is angling to pocket concessions on missile defense and arms control from the Barack Obama administration. The Kremlin may wish to prolong this happy circumstance to extract further gratuities.

Finally, do not discount the power of spite. Moscow is still smarting over the end of the Cold War and the rise of the United States as a "hyperpower." U.S. setbacks in Iraq and Afghanistan may have dulled, but did not deaden, that pain. Witness the sharp response to Vice President Joseph Biden's recent comments about Russia's weakening international position. If the United States is taken down a peg by Iran, it may well serve the Kremlin's purposes.

U.S. negotiators may yet convince the Group of Six to take more effective action on Iran, but only if they do not assume Russia's interests on the matter to be aligned with their own. It will require hard bargaining, not just appeals to reason, to persuade Moscow to be constructive. Moscow must understand that the absence of effective international action on Iran's nuclear program will drive other policies in directions anathema to the Kremlin. It will strengthen NATO unity. It will make missile defense deployments more imperative. Most of all, it will cause countries throughout Europe and the Middle East again to turn to the United States for protection and leadership. In short, Russia must be convinced that a diplomatic double game on Iran is not worth the candle.



No Exit?

Despite a valiant start, impoverished, oil-rich Chad has succumbed to the resource curse. But it's not too late to escape.

When oil was first discovered in Chad, analysts reacted with reserved optimism. The country, they knew, did not have the infrastructure or political maturity to absorb the promised revenue in a way that would benefit the people. The resource curse had already devoured the politics and economics of countless mineral and petrol-rich countries, and Chad looked next on the list.

So far, the skeptics have been right. Despite a promising start, more oil dollars are now being used to procure guns and buy off opponents than build schools and feed the country's most vulnerable. Maybe it was inevitable that Chad should continue down the path of other oil producers, where poor financial mismanagement and corruption have impoverished and destabilized states. Perhaps, as Moisés Naím writes in the current issue of Foreign Policy, "the suggested defenses [against the resource curse] are as utopian as the larger goal they are supposed to help achieve."

Still, Chad had a good chance to stave off the resource curse. And it might still -- if changes start now.

Confronted with its big oil break in 2003, Chad -- a vast country that spans West and Central Africa -- set out to do things right. The government in N'Djamena sat down with expert resource-curse fighters at the World Bank and set up a plan to fight poverty with oil. In exchange for the World Bank's help financing a $4.2 billion pipeline, the government agreed to dedicate oil revenues to improving the lives of Chad's present and future populations. Petrodollars would feed into a separate account meant for social spending projects on education and health care (instead of filling out the regime's coffers). The plan was meant to quash would-be temptations for corruption before they even began. And in a country where the United Nations estimates one out of five children will die before their fifth birthday, Chad's oil-funded development projects were not only promising -- they were essential.

But when oil exploitation began in 2003, things didn't go as planned. Several coup attempts offered the government the perfect excuse to renege on its commitments. President Idriss Déby raided the revenue jar for the first time in January 2006, taking money out for national defense programs; the World Bank reacted by suspending its programs. But instead of repentance from Déby's regime, the bank got obstinacy: N'Djamena passed regulations that stripped away World Bank and civil oversight of the oil revenues. The government gradually reduced the power of the Committee of Control and Supervision of Oil Revenues (Collège de contrôle et de surveillance des revenus pétroliers), an oversight body that included civil-society members and watched over the management of the funds.

Fast-forward to today, and oil has become a means to strengthen the country's armed forces, reward its cronies, and co-opt members of the political class -- all of which guarantee that no genuine political dialogue will take place and improve governance in Chad. This has fueled antagonism between the regime and its opponents and helped keep the country in a state of political crisis and its population in abject poverty.

Meanwhile, tensions continue to mount between Chad and its neighbor, Sudan. Each country supports rebels operating on the other's turf, which provides the government with a justification for beefing up its army (instead of funding schools and clinics). As Naím puts it, "concentrated power, corruption, and the ability of governments to ignore the needs of their populations make it hard to do what it takes to resist the resource curse."

The fate of Chad would seem to prove Naím's point. But a number of steps can still dig it out. First, the government should include the question of how to use oil revenues in the domestic dialogue started in 2007. This consultation should include political opposition, civil society, and representatives of the oil-producing regions.

Second, an independent, multidisciplinary body composed of representatives of Chadian and international civil-society leaders should be created to replace the International Consultative Group. With financial support from the World Bank, its role would be to undertake studies, make recommendations, and give technical support to the Committee of Control and Supervision of Oil Revenues. Stronger oversight should be put in place to address the plague of political patronage and favoritism.

None of this will be easy, and Chad could use some help -- namely from France, the United States, and China, all of which have significant petroleum and other interests in Chad. These countries will have to stand behind a national dialogue about oil revenues in order for the government in N'Djamena to get on board. Support for Déby should be contingent on his government's reform.

So can Chad escape the resource curse? If the country redirects oil revenues, it stands a good chance of proving that petrol can be a blessing, not a curse. Oil could go far in the fight to ameliorate Chad's dire humanitarian state. But so long as Chad's resources buy guns and benefit the political elite, the resource curse shall thrive.