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C O N F I D E N T I A L SECTION 01 OF 02 TEHRAN 08980 E.O. 12065: GDS 8/12/85 (TOMSETH, VICTOR L.) OR-P TAGS: PEPR, IR SUBJECT: NEGOTIATIONS 1. (C - ENTIRE TEXT). 2. INTRODUCTION: RECENT NEGOTIATIONS IN WHICH THE EMBASSY HAS BEEN INVOLVED HERE, RANGING FROM COMPOUND SECURITY TO VISA OPERATIONS TO GTE TO THE SHERRY CASE, HIGHLIGHT SEVERAL SPECIAL FEATURES OF CONDUCTING BUSINESS IN THE PERSIAN ENVIRONMENT. IN SOME INSTANCES THE DIFFICULTIES WE HAVE ENCOUNTERED ARE A PARTIAL REFLECTION ON THE EFFECTS OF THE IRANIAN REVOLUTION, BUT WE BELIEVE THE UNDERLYING CULTURAL AND PSYCHOLOGICAL QUALITIES THAT ACCOUNT FOR THE NATURE OF THESE DIFFICULTIES ARE AND WILL REMAIN RELATIVELY CONSTANT. THEREFORE, WE SUGGEST THAT THE FOLLOWING ANALYSIS BE USED TO BRIEF BOTH USG PERSONNEL AND PRIVATE SECTOR REPRESENTATIVES WHO ARE REQUIRED TO DO BUSINESS WITH AND IN THIS COUNTRY. END INTRODUCTION. 3. PERHAPS THE SINGLE DOMINANT ASPECT OF THE PERSIAN PSYCHE IS AN OVERRIDING EGOISM. ITS ANTECEDENTS LIE IN THE LONG IRANIAN HISTORY OF INSTABILITY AND INSECURITY WHICH PUT A PREMIUM ON SELF-PRESERVATION. THE PRACTICAL EFFECT OF IT IS AN ALMOST TOTAL PERSIAN PREOCCUPATION WITH SELF AND LEAVES LITTLE ROOM FOR UNDERSTANDING POINTS OF VIEW OTHER THAN ONE'S OWN. THUS, FOR EXAMPLE, IT IS INCOMPREHENSIBLE TO AN IRANIAN THAT U.S. IMMIGRATION LAW MAY PROHIBIT ISSUING HIM A TOURIST VISA WHEN HE HAS DETERMINED THAT HE WANTS TO LIVE IN CALIFORNIA. SIMILARLY, THE IRANIAN CENTRAL BANK SEES NO INCONSISTENCY IN CLAIMING FORCE MAJEURE TO AVOID PENALTIES FOR LATE PAYMENT OF INTEREST DUE ON OUTSTANDING LOANS WHILE THE GOVERNMENT OF WHICH IT IS A PART IS DENYING THE VAILIDITY OF THE VERY GROUNDS UPON WHICH THE CLAIM IS MADE WHEN CONFRONTED BY SIMILAR CLAIMS FROM FOREIGN FIRMS FORCED TO CEASE OPERATIONS DURING THE IRANIAN REVOLUTION. 4. THE REVERSE OF THIS PARTICULAR PSYCHOLOGICAL COIN, AND HAVING THE SAME HISTORICAL ROOTS AS PERSIAN EGOISM, IS A PERVASIVE UNEASE ABOUT THE NATURE OF THE WORLD IN WHICH ONE LIVES. THE PERSIAN EXPERIENCE HAS BEEN THAT NOTHING IS PERMANENT AND IT IS COMMONLY PERCEIVED THAT HOSTILE FORCES ABOUND. IN SUCH AN ENVIRONMENT EACH INDIVIDUAL MUST BE CONSTANTLY ALERT FOR OPPORTUNITIES TO PROTECT HIMSELF AGAINST THE MALEVOLENT FORCES THAT WOULD OTHERWISE BE HIS UNDOING. HE IS OBVIOUSLY JUSTIFIED IN USING ALMOST ANY MEANS AVAILABLE TO EXPLOIT SUCH OPPORTUNITIES. THIS APPROACH UNDERLIES THE SOCALLED "BAZAAR MENTALITY" SO COMMON AMONG PERSIANS, A MIND-SET THAT OFTEN IGNORES LONGER TERM INTERESTS IN FAVOR OF IMMEDIATELY OBTAINABLE ADVANTAGES AND COUNTENANCES PRACTICES THAT ARE REGARDED AS UNETHICAL BY OTHER NORMS. AN EXAMPLE IS THE SEEMINGLY SHORTSIGHTED AND HARASSING TACTICS EMPLOYED BY THE PGOI IN ITS NEGOTIATIONS WITH GTE. 5. COUPLED WITH THESE PSYCHOLOGICAL LIMITATIONS IS A GENERAL INCOMPREHENSION OF CASUALITY. ISLAM, WITH ITS EMPHASIS ON THE OMNIPOTENCE OF GOD, APPEARS TO ACCOUNT AT LEAST IN MAJOR PART FOR THIS PHENOMENON. SOMEWHAT SURPRISINGLY, EVEN THOSE IRANIANS EDUCATED IN THE WESTERN STYLE AND PERHAPS WITH LONG EXPERIENCE OUTSIDE IRAN ITSELF FREQUENTLY HAVE DIFFICULTY GRASPING THE INTER-RELATIONSHIP OF EVENTS. WITNESS A YAZDI RESISTING THE IDEA THAT IRANIAN BEHAVIOR HAS CONSEQUENCES ON THE PERCEPTION OF IRAN IN THE U.S. OR THAT THIS PERCEPTION IS SOMEHOW RELATED TO AMERICAN POLICIES REGARDING IRAN. THIS SAME QUALITY ALSO HELPS EXPLAIN PERSIAN AVERSION TO ACCEPTING RESPONSIBILITY FOR ONE'S OWN ACTIONS. THE DEUS EX MACHINA IS ALWAYS AT WORK. 6. THE PERSIAN PROCLIVITY FOR ASSUMING THAT TO SAY SOMETHING IS TO DO IT FURTHER COMPLICATES MATTERS. AGAIN, YAZDI CAN EXPRESS SURPRISE WHEN INFORMED THAT THE IRREGULAR SECURITY FORCES ASSIGNED TO THE EMBASSY REMAIN IN PLACE. "BUT THE CENTRAL COMMITTEE TOLD ME THEY WOULD GO BY MONDAY," HE SAYS. AN MFA OFFICIAL REPORTS THAT THE SHERRY CASE IS "90 PERCENT SOLVED," BUT WHEN A CONSULAR OFFICER INVESTIGATES HE DISCOVERS THAT NOTHING HAS CHANGED. THERE IS NO RECOGNITION THAT INSTRUCTIONS MUST BE FOLLOWED UP, THAT COMMITMENTS MUST BE ACCOMPANIED BY ACTION AND RESULTS. 6. FINALLY, THERE ARE THE PERSIAN CONCEPTS OF INFLUENCE AND OBLIGATION. EVERYONE PAYS OBEISANCE TO THE FORMER AND THE LATTER IS USUALLY HONORED IN THE BREACH. PERSIANS ARE CONSUMED WITH DEVELOPING PARTI BAZI--THE INFLUENCE THAT WILL HELP GET THINGS DONE--WHILE FAVORS ARE ONLY GRUDGINGLY BESTOWED AND THEN JUST TO THE EXTENT THAT A TANGIBLE QUID PRO QUO IS IMMEDIATELY PRECEPTIBLE. FORGET ABOUT ASSISTANCE PROFERRED LAST YEAR OR EVEN LAST WEEK; WHAT CAN BE OFFERED TODAY? 7. THERE ARE SEVERAL LESSONS FOR THOSE WHO WOULD NEGOTIATE WITH PERSIANS IN ALL THIS: - --FIRST, ONE SHOULD NEVER ASSUME THAT HIS SIDE OF THE ISSUE WILL BE RECOGNIZED, LET ALONE THAT IT WILL BE CONCEDED TO HAVE MERITS. PERSIAN PREOCCUPATION WITH SELF PRECLUDES THIS. A NEGOTIATOR MUST FORCE RECOGNITION OF HIS POSITION UPON HIS PERSIAN OPPOSITE NUMBER. - --SECOND, ONE SHOULD NOT EXPECT AN IRANIAN READILY TO PERCEIVE THE ADVANTAGES OF A LONG-TERM RELATIONSHIP BASED ON TRUST. HE WILL ASSUME THAT HIS OPPOSITE NUMBER IS ESSENTIALLY AN ADVERSARY. IN DEALING WITH HIM HE WILL ATTEMPT TO MAXIMIZE THE BENEFITS TO HIMSELF THAT ARE IMMEDIATELY OBTAINABLE. HE WILL BE PREPARED TO GO TO GREAT LENGTHS TO ACHIEVE THIS GOAL, INCLUDING RUNNING THE RISK OF SO ALIENATING WHOEVER HE IS DEALING WITH THAT FUTURE BUSINESS WOULD BE UNTHINKABLE, AT LEAST TO THE LATTER. - --THIRD, INTERLOCKING RELATIONSHIPS OF ALL ASPECTS OF AN ISSUE MUST BE PAINSTAKINGLY, FORECEFULLY AND REPEATEDLY DEVELOPED. LINKAGES WILL BE NEITHER READILY COMPREHENDED NOR ACCEPTED BY PERSIAN NEGOTIATORS. - --FOURTH, ONE SHOULD INSIST ON PERFORMANCE AS THE SINE QUA NON AT ESH STAGE OF NEGOTIATIONS. STATEMENTS OF INTENTION COUNT FOR ALMOST NOTHING. - --FIFTH, CULTIVATION OF GOODWILL FOR GOODWILL'S SAKE IS A WASTE OF EFFORT. THE OVERRIDING OBJECTIVE AT ALL TIMES SHOULD BE IMPRESSING UPON THE PERSIAN ACROSS THE TABLE THE MUTUALITY OF THE PROPOSED UNDERTAKINGS, HE MUST BE MADE TO KNOW THAT A QUID PRO QUO IS INVOLVED ON BOTH SIDES. - --FINALLY, ONE SHOULD BE PREPARED FOR THE THREAT OF BREAKDOWN IN NEGOTIATIONS AT ANY GIVEN MOMENT AND NOT BE COWED BY THE POSSIBLITY. GIVEN THE PERSIAN NEGOTIATOR'S CULTURAL AND PSYCHOLOGICAL LIMITATIONS, HE IS GOING TO RESIST THE VERY CONCEPT OF A RATIONAL (FROM THE WESTERN POINT OF VIEW) NEGOTIATING PROCESS. LAINGEN CONFIDENTIAL