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Here’s Why Trump and Rouhani Have Little Incentive to Meet

David Wainer and Glen Carey

(Bloomberg) -- Iranian President Hassan Rouhani -- beset with an unhappy populace struggling under an economy crippled by U.S. sanctions -- made clear Tuesday that he’s not interested in sitting down with Donald Trump.

And he’s not the only one facing pressures that would discourage such a meeting. Trump, too, would risk angering some political allies at home and abroad.

Before departing the Group of Seven summit in Biarritz, France on Monday Trump said he would meet with Rouhani “if the circumstances were correct or were right" to discuss their standoff over the 2015 nuclear deal that the U.S. president abandoned.

Rouhani rebuffed that idea on Tuesday, saying the U.S. must lift sanctions on Iran if it wants to negotiate. “We are interested in solving problems in a reasonable way, but we’re not interested in taking photos,” Rouhani said in a televised speech to officials in Tehran.

The Iranians’ stance makes the prospect of talks look bleak but it also could just be their opening gambit, a firm no in hopes of extracting concessions from Trump, and greater economic guarantees from Europe, before saying yes. Trump himself has been known to bargain that way -- set out an impossibly high bar and work back from there to compromise -- and may still do so himself on the way to agreeing to a meeting.

Trump’s dramatic shift echoed his initial outreach to North Korea -- which has since resulted in three meetings with leader Kim Jong Un but no breakthrough deal.

But direct talks between Trump and Rouhani would be more complicated than those the president has had with North Korea’s leader. Kim and Rouhani both face complications at home, though Kim has moved to neuter some threats since coming to power, including having potential opponents executed, and seemingly has key generals on his side. Rouhani must deal with Iranians disappointed over an economy that’s sputtering under the weight of U.S. sanctions and senior politicians often divided on whether to engage with Washington.

Rouhani would need approval to enter talks from Supreme Leader Ayatollah Khamenei, who so far hasn’t signaled a willingness to engage with Trump. While Khamenei, Iran’s ultimate arbiter on all matters of state, is ideologically more aligned with hardline conservatives, Rouhani’s two election victories show the top cleric understands the need to be pragmatic at times of economic crisis.

The American president’s top aides, including Secretary of State Michael Pompeo, have argued that Khamenei, not Rouhani or Foreign Minister Javad Zarif, must address U.S. demands if a lasting deal is to be struck.

North Korea is “not a state of complex bureaucracies and contending groups, like Iran,” said Paul Sullivan, an expert on energy and the Middle East at National Defense University in Washington. “It is really one-man rule.”

Another key difference: North Korea already has nuclear weapons, giving it leverage in a negotiation that Iran so far lacks.

Trump’s Political Risks

Trump would have to overcome considerable political hurdles as well to reach a deal. Isolating and weakening the Islamic Republic is one foreign policy issue Republican lawmakers and conservative national security experts agree on. It’s also a rallying cry for conservative Jewish supporters of Israel and key Trump backers, such as casino magnate Sheldon Adelson.

Any move to improve ties would also face stiff opposition in Congress and among key American allies such as Saudi Arabia and Israel. Trump has proclaimed himself Israel’s closest ally and has worked to bolster Prime Minister Benjamin Netanyahu. And Trump made his first trip as president to Saudi Arabia, which he has counted on to help isolate Iran.

If Trump did sit down for talks it would be groundbreaking. No American president has met with a top Iranian leader in more than four decades, since the 1978 Islamic Revolution and the U.S. hostage crisis that followed.

Trump, however, has long signaled a willingness to break political convention on a range of issues, though it’s too early to know if his comments on Iran reflect a genuine shift or whether hard-liners in his own administration, such as National Security Advisor John Bolton, will lure him away from talk of diplomacy.

“If he seems to be softening on Iran there is a good chance that some of his staff who are hard-liners will bring him back to a hard-line position,” Sullivan said.

Tensions between the U.S. and Iran have spiked in recent months, with Trump saying he called off military strikes on the country at the last minute in July following Tehran’s downing of an unmanned American drone over the Persian Gulf. The U.S. has blamed Iran for being behind a spate of attacks on oil tankers. Iran has also detained a U.K. ship in apparent retaliation for the British seizure of an Iranian tanker, which has since been released.

‘Worst Deal’

Trump imposed harsh sanctions on Iran after abandoning the nuclear deal last year, an approach that has helped fuel inflation and undermined domestic support for Rouhani’s government. He called the 2015 accord the “worst deal ever,” in part because it didn’t permanently ban Iran’s nuclear program and even eased United Nations limits on its ballistic missile program.

His comments Monday marked his most expansive offer yet to meet with Rouhani and perhaps to ease restrictions so the Islamic Republic can use some of its oil wealth to access credit.

“Iran is a country of tremendous potential. We’re not looking for leadership change, we’re not looking for that kind of change,” Trump said. “We can have it done in a very short period of time, and I really believe that Iran can be a great nation. I’d like to see that happen, but they can’t have nuclear weapons.”

The remarks came at the close of a summit where he was surrounded by European leaders eager to find a negotiated solution to rising tensions with Tehran and still committed to salvaging the 2015 accord. French President Emmanuel Macron, the event’s host, went so far as to invite Zarif, the Iranian foreign minister, to a meeting on the sidelines of the G-7. Trump and other foreign leaders were given little advance notice of the visit.

Before Trump spoke in France, Rouhani reiterated a willingness to engage, saying in televised comments that “we have to negotiate, we have to find a solution, and we have to solve the problem.”

Signaling continuing European interest in building momentum toward a breakthrough, Macron said during a joint news conference with Trump on Monday that he hoped to arrange a meeting between Trump and Rouhani within weeks. One opportunity could be the annual United Nations General Assembly next month in New York.

Underscoring the message that France can act as a mediator on improvements to the 2015 nuclear accord, Macron recalled that French negotiators “hesitated most to sign this agreement” because it had “drawbacks and compromises.” Obama administration negotiators, led by Secretary of State John Kerry, chafed at French criticism at the time.

Broaching an issue -- oil sanctions -- that the Trump team has touted as among its greatest achievements in pressuring Tehran, Trump said he’d support extending what he called a “letter of credit” to Iran, secured by oil, to help the country meet short-term financial obligations. “It would be from numerous countries,” Trump said of that Macron proposal, and “it would be paid back immediately.”

--With assistance from Kathleen Hunter.

To contact the reporters on this story: David Wainer in New York at dwainer3@bloomberg.net;Glen Carey in Washington at gcarey8@bloomberg.net

To contact the editors responsible for this story: Bill Faries at wfaries@bloomberg.net, Larry Liebert, Elizabeth Wasserman

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