LONDON — A newly signed Iran-Venezuela cooperation deal will see the two pariah states further integrate their economies, but experts say one oil-rich and legitimacy-poor state can’t fix another’s problems.
On Saturday, embattled Venezuelan President Nicolas Maduro appeared on Iranian state media in northern Tehran to sign a 20-year “cooperation agreement” with his Iranian counterpart, Iranian President Ebrahim Raisi.
According to Raisi, the agreement sees the two countries working together in the oil, petrochemical, defense, agriculture, tourism and culture sectors. But more than economics, a major factor in the signing of the accord – an unlikely agreement between a Shia theocratic regime on the one hand and a communist dictatorship on the other – was the US and its regime of sanctions against each country, as well as the two nations’ relations with the broader international community.
“Venezuela has shown exemplary resistance to sanctions and threats from enemies and imperialists,” Iran’s Raisi said. “The 20-year cooperation document shows the will of the two countries to build relationships.”
“In the past 40+ years, there have been numerous sanctions and threats against the Iranian nation, but the Iranian nation has turned these sanctions into an opportunity for the country’s progress.”
But for Yossi Mekelberg, an associate fellow of the MENA program at Chatham House, the deal fails to address the fundamental problem in both countries: “bad governance.”
“Iran and Venezuela might be two of the richest countries in the world, but they aren’t,” he told Arab News. “If you look at their natural resources, let alone Venezuela with its natural reserves, their oil industry is collapsing.”
Now that oil and gas demand is skyrocketing, both Venezuela and Iran should be thriving – but their governments have thwarted the “gold rush” that other energy-exporting countries are now experiencing and are using to prepare for the post-fossil age to prepare fuels.
“Iran and Venezuela are countries that could prosper – their problem is bad governance. Whether from the left or the clerical parties, it doesn’t matter, they are failed states,” said Mekelberg.
He pointed out that both countries also have confrontational relations with the US and the broader international community.
“Their alliance is the alliance of those who under sanctions can’t really take care of their own domestic problems and then got into conflict with their own regions, so they try to find a way out by supporting each other,” he said .
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“There’s an internal logic to the whole thing, but I don’t think that’s going to help them much. You have to deal with the world. Two unsuccessful economies do not make a successful one.”
Specifically with regard to energy – each country’s main export – does the agreement signed in Tehran contribute to the growth of their economies?
Both Iran and Venezuela are major oil and energy producers, “they will not export to each other,” Mekelberg said.
However, the two countries have made some progress in sharing expertise. Iranian engineers have been involved in repairing run-down Venezuelan facilities and will soon begin work on Venezuela’s largest refinery.
“But what they really need is investment,” Mekelberg said — something he believes neither country is capable of delivering on the volumes required.
While the economic aspects of the deal are likely to raise few eyebrows — the two have been collaborating for years in illicitly swapping oil and other commodities — the potential for further defense cooperation is perhaps of greater concern to those in South America’s Middle East and the US.
Venezuela and Iran cooperated militarily as early as 2006. In a 2009 speech at the Brookings Institution, a New York district attorney sounded the alarm about Iran’s training of Venezuelan fighters to become Hezbollah-like terrorists.
“It has been reported that Iranian military advisers have been embedded in Venezuelan troops since 2006,” the late Robert Morgenthau had said. “Asymmetric warfare, taught to members of Iran’s Revolutionary Guards, Hezbollah and Hamas, has superseded US Army field manuals as standard Venezuelan military doctrine.”
And perhaps of further concern is the potential for nuclear cooperation. According to a 2008 report by the Carnegie Endowment for International Peace, Venezuela has an estimated 50,000 tons of uranium deposits that can be mined.
While the potential for nuclear cooperation has been warned for years, stalled progress in nuclear talks with Iran underway in Vienna, accompanied by ever-shortening breakout times experts are predicting, mean the new deal has an outsized role in development could play Iran’s nuclear weapons.
“Venezuela’s support for Iran’s nuclear program has fluctuated in recent years, with intelligence sources previously indicating that (the late President Hugo) Chavez was discussing buying uranium from Iran at the same time he was beginning talks to buy a nuclear reactor from Argentina said Rhiannon Phillips, associate analyst MENA at political risk consultancy Sibylline, told Arab News.
“Cooperation on ‘defense projects’ could allude to Iranian partnerships in offensive and combat drone technology, raising significant concerns among Western allies. Again, this is not a new trend as Israeli Defense Minister Benny Gantz earlier this year expressed concern about Iranian MoHajjer UAVs in Venezuela with reported ranges of up to 200km.”
Phillips added: “Iranian support for terrorism is already a major factor in geopolitical hostilities in the Middle East, namely between Tehran (on the one hand) and Saudi Arabia and Israel (on the other). But it could raise concerns among Latin American countries if Venezuelan capabilities cross or violate regional security thresholds.
“Notably, Diego Molano, Colombia’s defense minister, has already expressed concern about the presence of Iranian proxies in Venezuela, namely Hezbollah fighters, and the likelihood of these groups attempting to use Iranian military technology to launch domestic attacks.”
Phillips also said that Iran has long been implicated in terrorism in the Middle East – the specter that the Iran-Venezuela cooperation deal threatens to resurrect.
The 1994 AMIA suicide attack on a Jewish cultural center in Argentina killed 85 and wounded hundreds more. In 2006, Argentine prosecutors formally accused the Iranian government and Hezbollah of carrying out the bombing. And it seems that Argentina has not forgotten this attack.
On Sunday, Argentine authorities grounded a Boeing 747 that had been sold to Venezuela by Iran’s Mahan Air – an airline closely linked to the IRGC and sanctioned by the US government.
According to an Interior Ministry document shared with Reuters by Argentine lawmaker Gerardo Milman, 14 Venezuelans and 5 Iranians were traveling on the plane. Milman warned, “Our intelligence is that this is a plane that came to operate intelligence in Argentina.”
It’s not clear what the agents were investigating. What is clear, however, is that Argentina, intimately and tragically familiar with Iranian terrorism, is unwilling to risk waiting too long when national security is at stake.