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Iran’s membership in Asian security body won’t solve sanctions problem

While the news that Iran will gain full membership in the Shanghai Cooperation Organization is a psychological victory for the sanctions-hit country, it will take much more to achieve lasting economic impact.
A picture shows daily newspapers on sale at a kiosk in the capital Tehran, on Sept. 18, 2021. Conservative and reformist newspapers showed rare unity in welcoming results of a conference yesterday in Dushanbe, Tajikistan, where members of the Shanghai Cooperation Organisation endorsed Iran's future membership in the bloc.

The recent announcement that Iran would start the process of becoming a full member in the Shanghai Cooperation Organization was celebrated in the media. On the Iranian side, a heated public debate is taking place on what this development means and whether it was an achievement of the previous or the current administration. There are also debates about the potential economic upside of the step, which a number of parliamentarians have opined will open up new economic opportunities for Iran. Many inside and outside Iran may also see the development as more proof that Iran is pivoting East, but the key question is how this process will address the country’s highest priority: the economy.

In the absence of substantive policy shifts that could positively impact the economy, the administration of President Ebrahim Raisi has focused on “injecting positive news” into business and society. To put an economic spin on the development, upon his return from the SCO Summit in Tajikistan, Raisi criticized the government of former President Hassan Rouhani for “hinging vaccine purchases and SCO membership on the adoption of measures to exit the Financial Action Task Force (FATF) blacklist.” He is trying to create the impression that Iran has moved beyond the FATF hurdle and has achieved things that were considered impossible in the previous administration. However, Iran is still on the FATF blacklist and a failure to address that issue will limit Iran’s ability to benefit from any international agreement, including an SCO membership.

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