The US-Iran Peace Memorandum of Understanding (MOU) outlines a comprehensive framework aimed at ending military confrontation, opening the Strait of Hormuz, freeing Iran’s frozen assets and providing $300 billion for reconstruction, and opening the door to long-term negotiations. Although the agreement still requires a final agreement within 60 days, both sides will receive significant strategic, economic and diplomatic benefits.The 14-point memorandum of understanding (MOU) signed by US President Donald Trump and Iranian President Masoud Pezeshkian on Thursday sets out a roadmap to end military hostilities, restore commercial movement through the Strait of Hormuz and launch a 60-day negotiation process towards a final agreement on sanctions relief, economic cooperation and Iran’s nuclear programme.However, the parties may still walk away from the memorandum of understanding they are due to sign on Friday, and upcoming talks are likely to focus on the exact sequencing of steps previewed in the initial agreement, Reuters reported, citing a US official.“I think the meeting in Switzerland will be really important to see how we get to the next stage,” he said.He added, “It should be a situation where both sides… agree on what both sides are going to do, and then come up with a sequential agreement on who is going to do what, and that’s really the crux of the negotiation.”
What does Iran stand to gain?
Relief from sanctions, economic recovery
A major benefit for Tehran would be the removal of comprehensive US and international sanctions. The MOU states that Washington will work towards ending all sanctions, including unilateral US measures and sanctions involving the UN Security Council and the International Atomic Energy Agency (IAEA).The agreement also provides for the issuance of exemptions allowing the resumption of Iranian crude oil exports, petroleum products and related banking, insurance and transportation services.“The United States pledges to end all forms of sanctions against the Islamic Republic of Iran, including United Nations Security Council resolutions, IAEA Board of Governors resolutions, and all unilateral U.S. sanctions, primary and secondary,” the MOU said.For Iran, sanctions relief could open up access to frozen funds, revive trade and attract foreign investment after years of economic isolation.
access to frozen assets
Under the agreement, the US will make Iran’s frozen or restricted funds and assets available for use after the memorandum of understanding comes into force. The two sides will negotiate procedures for releasing these funds, which can be used to make payments specified by the Central Bank of Iran.“The United States commits to make fully available for use the frozen or restricted funds and assets of the Islamic Republic of Iran upon implementation of this MOU. The United States and the Islamic Republic of Iran will mutually agree on procedures related to the release of these funds during negotiations,” it said.
$300 billion for reconstruction
The MOU includes a commitment by the US and regional partners to develop a plan worth at least $300 billion for Iran’s reconstruction and economic development.Arrangements to implement the investment plan will be finalized as part of the final deal within 60 days, the outline said.The MOU states, “The United States is working with regional partners to develop a definitive, mutually agreed upon plan of at least $300 billion for the reconstruction and economic development of the Islamic Republic of Iran. Mechanisms for implementation of this plan will be finalized as part of the final deal within 60 days.”
Lifting of the US naval blockade
America expressed commitment to lift the naval blockade against Iran. It also said it would withdraw its troops from close proximity to Iran within 30 days of the final agreement.“Immediately after the signing of this Memorandum of Understanding, the United States will begin to lift its naval blockade and any embargoes or obstructions against the Islamic Republic of Iran, and within 30 days will completely end the naval blockade. During this period, vessel traffic will be in proportion to the number of pre-war traffic being restored by the Islamic Republic of Iran. The United States will, within 30 days after the final agreement, approach the Islamic Republic of Iran “Pledges to withdraw his army from.” It is stated in the MOU.
Security assurance, military pressure reduced
Iran would benefit from a commitment by both sides to end military operations and avoid threats or use of force against each other in the future.
nuclear talks without immediate increase
The memorandum of understanding acknowledges Iran’s commitment not to develop nuclear weapons, while allowing discussion of its nuclear program, including the management of enrichment and enriched material.Until a final agreement is reached, both sides will maintain the status quo – Iran will freeze its nuclear activities at current levels, while the US will refrain from imposing new sanctions or deploying additional forces to the region.
What does America stand to gain?
Limits on Iran’s nuclear program
A major objective of the US is to ensure that Iran does not develop nuclear weapons. Under the memorandum of understanding, Tehran affirmed that it will not pursue nuclear weapons and agreed to negotiate mechanisms to deal with its stockpiled enriched materials under IAEA supervision.A final agreement would also establish a framework to address Iran’s enrichment activities and broader nuclear needs.The MOU read, “The Islamic Republic of Iran affirms that it will not acquire or develop nuclear weapons. The United States of America and the Islamic Republic of Iran have agreed to resolve the disposal of stockpiled enriched material in accordance with a mechanism to be mutually agreed upon in accordance with the schedule outlined in paragraph seven, with the minimum method being mixing on site under the supervision of the IAEA.”
Hormuz opens
The deal includes arrangements to restore commercial shipping through the Strait of Hormuz, one of the world’s most important energy routes.Iran has committed to facilitating safe passage for commercial vessels for an initial period of 60 days, while discussions continue on future maritime arrangements involving Oman and other Gulf states.“Upon the signing of this MOU, the Islamic Republic of Iran will arrange, using its best efforts, for the safe passage of commercial vessels from the Persian Gulf to the Sea of Oman and vice versa, without any charges, for 60 days only. “Commercial vessel traffic will begin immediately, and considering the need to remove technical and military barriers, and decommissioning by the Islamic Republic of Iran within 30 days,” the MOU said.“The Islamic Republic of Iran will negotiate with the Sultanate of Oman to define the future governance and maritime services in the Strait of Hormuz in consultation with other coastal states of the Persian Gulf in line with applicable international law and the sovereign rights of coastal states in the Strait of Hormuz,” it said.
diplomatic alternative to protracted conflict
The MoU also proposes an executive mechanism to monitor implementation and ensure compliance with the final deal.“The United States and the Islamic Republic of Iran agree that an executive mechanism will be established to monitor the successful implementation of this MOU and future compliance with the final deal,” it said.Despite the broad commitments, the agreement leaves many details to be negotiated. Both sides have agreed to work towards a final agreement within 60 days, which will cover issues including sanctions relief, nuclear restrictions, economic cooperation and security guarantees.The success of the agreement will depend on whether Washington and Tehran can move from commitments on paper to verifiable actions on the ground.