By Tim Receveur
Washington File Staff Writer

Washington - The incentive package offered to Iran in June to abandon its controversial uranium enrichment program would benefit the people of Iran, bringing new opportunities for economic growth and “reintegrating Iran into the world economy,” says the chief U.S. representative to the International Atomic Energy Agency (IAEA), Ambassador Gregory Schulte.

In June, the five permanent United Nations Security Council members - China, France, Russia, the United Kingdom and the United States - along with Germany (the P5+1) offered Iran a proposal with incentives and penalties to persuade it to abandon its uranium enrichment program, which Iran claims is strictly for peaceful use.

“A framework for increased trade and foreign direct investment will help create jobs and offer hope for a better life to the two-thirds of Iranians who are under 30” and those who are unemployed, said Schulte, the U.S. permanent representative to the IAEA and the U.N. Mission in Vienna, Austria.

His August 28 remarks are part of an ongoing U.S. Department of State online dialogue with Iranians in Persian that began on August 14 and is scheduled to run through September 15. The program is reaching the large online community in Iran and engaging their questions and opinions about the nuclear issues in their country. (See related article.)

“Reintegrating Iran into the world economy would increase energy security and availability, increase regional security in the Middle East and facilitate upgrades in Iran’s infrastructure relating to agriculture, telecommunications, transportation and basic science,” Schulte said.

He said that Iranian membership in the World Trade Organization (WTO) would also make a “major contribution” toward increasing trade and foreign direct investment in Iran.

“One result of WTO membership would be more high-quality goods in Iranian stores at competitive prices.  Another would be well-paying jobs with foreign companies who invest in Iran,” he said.

According to Schulte’s statement, Iran also would receive several benefits, including fuel for civil nuclear reactors, international support for the construction of new power plants and international cooperation in medicine, agriculture and civil aviation.

“New investment in Iran’s petroleum sector and in associated industries would lead to substantial increases in oil production and support the creation of thousands of new jobs.  Oil accounts for a large portion of Iran’s export revenues, and increased production will make more funds available for social services and economic development,” said Schulte.

Iran formally replied to the package of incentives on August 22. In an August 23 statement, acting State Department spokesman Gonzalo Gallegos said the Bush administration is reviewing the response, but Iran’s proposal “falls short” of the conditions set by U.N. Security Council Resolution 1696. (See related article.)

According to Resolution 1696, Iran has until August 31 to suspend enrichment in exchange for incentives, or it risks possible sanctions. (See related article.)

Schulte said the U.N. Security Council is awaiting the report of the IAEA Director-General Mohamed El Baradei on Iran's nuclear activities.

“If the director general reports that Iran fails to suspend these activities, we cannot be convinced that Iran's leaders intend to negotiate seriously and respect their international commitments. The U.N. Security Council agreed that, if Iran's leaders fail to suspend uranium enrichment, the council would move to implement sanctions,” he said.

Schulte said the Iranian government now has an important decision to make.

Government officials can choose to “continue their current course of ignoring the concerns of the international community and further isolating Iran politically and economically or to suspend these activities that have given the world such concern and seize on this opportunity to improve the living standards of the Iranian people.”

More information on Schulte’s chat can be found on the U.S. Department of State’s Persian Web site. The English version of his views on the P5+1 incentive package is also available on the USINFO Web site.

The full text of Gallegos’s statement on Iran’s nuclear program is available on the State Department Web site.

For additional information, see Arms Control and Non-Proliferation.