March 4, 2019 / 9:49 AM / 3 months ago

UPDATE 3-Iran's Khamenei doubted Europe could help Tehran against U.S. sanctions

* Release of 2018 Khamenei speech hints at foreign policy feuds

* Comes a week after brief resignation of foreign minister

* Khamenei forecast EU wouldn’t shield benefits of nuclear deal

* Trump’s reimposition of Iran sanctions puts deal in doubt

* (Adds Zarif comment, context)

LONDON, March 4 (Reuters) - A closed-door speech last year by Iran’s Supreme Leader voicing doubt about the Iranian government’s diplomatic overtures to Europe was released on Monday in a sign of feuding over foreign policy that led to a brief resignation by the foreign minister.

Ayatollah Ali Khamenei’s address in mid-2018 appeared to forecast European difficulties in honouring pledges to protect trade with Iran from new U.S. sanctions after Washington’s repudiation of world powers’ 2015 nuclear deal with Tehran.

The publication of Khamenei’s speech eight months after the fact showed that while President Hassan Rouhani was trying to save the nuclear deal with European powers, who remained committed despite the U.S. exit, Khamenei was not optimistic.

The Europeans would naturally say they are protecting Iranian interests with their package but the Iranian government “should not make this a main issue”, Khamenei, an anti-Western hardliner, was quoted as saying by his official website.

He said the nuclear deal did not resolve “any of the economic problems” of Iran. He predicted that a mechanism proposed by the EU to shield business with Iran against the U.S. sanctions would also be no panacea for Iran’s economic hardship.

“(The Europeans) are bad. They are really bad. I have a lot to say about the Europeans; not because of their current policies, but their mischievous nature over the last few centuries,” said Khamenei. “Do not tie the Iranian economy to something that is out of our control.”

BRIEF RESIGNATION

His speech, made in a meeting with the cabinet, were published a week after Rouhani rejected the resignation of Foreign Minister Mohammad Javad Zarif, a U.S.-educated veteran diplomat who championed the nuclear deal.

Khamenei’s comments cast doubt on the efficiency of Zarif’s past and present efforts to keep the agreement alive.

Zarif, who retracted his resignation after Rouhani refused to accept it, said on Monday he had acted in order to preserve the dignity and credibility of the Foreign Ministry, according to the semi-official Fars news agency.

“It should be sensed in the world that the words of the Foreign Ministry are the words of the entire country and its leaders,” Zarif said, according to Fars news agency.

“And this ministry is responsible for the foreign relations of the whole country. It’s not that any body inside or outside the government has its own foreign policy, and we’re only responsible for the foreign policy of the foreign ministry. In that case, there would be no need for a foreign ministry.”

Iran and six big powers struck the nuclear deal in 2015 after over a decade of negotiations. Sanctions imposed by the United States, European Union and United Nations were lifted in return for Iran agreeing long-term curbs on a nuclear programme the West suspected was geared to developing an atom bomb.

ROWS OVER RELATIONS WITH WEST

Iranian politics has long been riven by factional struggles, especially on fraught relations with the West.

While Rouhani and his moderate camp still back the nuclear deal and seek rapprochement with the United States and Europe, hardliners, echoing Khamenei’s stance, reject any yielding to foreign pressure as inimical to Islamic revolutionary values.

Khamenei, who has the final say on all major Iranian domestic and foreign policy and only reluctantly backed the nuclear negotiations, warned Rouhani’s government on Monday not to be deceived by European countries and their “smiles”.

France, Germany and Britain opened a new channel for non-dollar trade with Iran in January, although diplomats say it is unlikely to enable the big transactions Tehran says are needed to keep a nuclear deal afloat.

On Monday, Iranian Foreign Ministry spokesman Bahram Qasemi praised the proposed EU mechanism, known as Instrument in Support of Trade Exchanges (INSTEX), as a “late but important step”. Qasemi, however, warned that the Islamic Republic would accept no conditions from the EU.

“The European countries know we do not accept conditions and we do not seek permission for our foreign policy.”

France has called on Iran to stop all activities linked to its ballistic missile programme or face sanctions.

Iran has threatened to pull out of the 2015 deal itself unless EU powers demonstrably protect its economic benefits. The Europeans have promised to help companies do business with Iran as long as it abides by the deal.

The new sanctions imposed by U.S. President Donald Trump have largely succeeded in persuading European companies to shelve business projects with Iran.

The Trump administration says that although Iran has met the deal’s terms, the accord was too generous, failing to rein in ballistic missile testing or to curb Iranian involvement in regional conflicts such as Syria and Yemen. (Reporting by Bozorgmehr Sharafedin and Babak Dehghanpisheh Editing by Mark Heinrich)

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