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Twenty five years ago, I arrived in Iran as part of the team that reopened our Embassy in Tehran, which had closed for some eight years following the escape of the Americans that had sought refuge with Canada. Following the end of the Iran-Iraq war in 1988, we had essentially been invited by the Iranian government, in part because of their interest in having access to North American oil and gas technology.

Given all the current commentary, for and against the Iran nuclear interim agreement, it is useful to think ahead about some of the possible implications for Canada about its current rhetoric on Iran in general, and the agreement in particular. We do not know whether the agreement will be implemented – both the U.S. and Iran have difficult domestic constituencies to deal with, and Ronald Reagan's expression, "trust but verify" clearly applies and is shared by all parties to the agreement.

But should the agreement be implemented, and lead to either a series of further agreements or a final agreement, Canada should be prepared for that possibility. In that light, while the government and Foreign Minister John Baird have, in their terms, dialled down the rhetoric somewhat – and Iran is sophisticated enough to pick up on this – the government should develop an exit strategy for its current approach to Iran.

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This is not unprecedented. The Conservative government started off with strong rhetoric on China, focussing on human rights, not trade, and was forced, given Canadian interests, to refocus on trade. Similarly, the government's harsh rhetoric in 2012 over the Palestinian Authority's statehood bid at the UN was similarly toned down following the renewed U.S. peace plan initiative, given that it was counterproductive for our relations with Israel, the United States and the PA.

The unveiling last month of the Global Markets Action Plan, focussing diplomatic efforts on economic diplomacy, suggests that "principles-based" foreign policy is either becoming an empty slogan, or at least only applicable to markets of marginal importance to Canada.

Should the interim agreement hold, and be followed by subsequent agreements further relaxing sanctions, Canada will need to review its sanctions policy to ensure that Canadian firms are not disadvantaged in comparison to our competitors. In contrast to 1988, when one of the main incentives for Iran was that Canada offered North American oil and gas technology without going through the United States, any removal of Canadian sanctions would likely be in lock-step with U.S. policies, with Canadian firms having no special advantages.

But easing of sanctions, without a coherent foreign policy aligned to our economic interests, is unlikely to be enough. We can expect pressure from the Canadian business community, particularly from Alberta oil and gas equipment suppliers, to ensure a level playing field, not only on the easing of sanctions, but on the broader foreign policy front.

The elements are not complex in theory, but are in practice:

Further dialling down of rhetoric on Iran.

Yes, prudence is required, but "huff and puff" language is unhelpful. Language used by the U.K. and U.S. strikes the right tone between given space for the interim agreement while expressing appropriate caution;

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Some public recognition that there are signs of change in Iran's approach.

Yes, these are tentative, and yes, given the complexity of the Iranian regime's internal politics, the messages are mixed, but most Iranians, both inside Iran and in the diaspora, understand the significance of Hassan Rouhani's election. We should too.

Use our strong relationship with Israel to encourage Israel to tone down its rhetoric and reflect some of the more nuanced discussion within Israel itself.

While Israeli fears and caution are legitimate, the language and approach appears to have been largely counterproductive in shaping the US and world approach to Iran.

Start informal discussions with the Iranian government on normalization of relations.

We may have closed our Embassy but as the U.S. and others have shown, that does not preclude discussion. These informal discussions should allow us to follow the U.K. lead in reopening its Embassy in Tehran. The standard diplomatic caution of starting with representation at the chargé d'affaires level, as we did in 1988, reinforces the "trust but verify" of the interim agreement.

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At present, we do not know if the interim agreement will be implemented, given all the internal and external constraints. However, to be prudent, the government should be prepared for the possibility that the interim agreement will succeed, and lead to further agreements. Given our economic interests, particularly in Alberta, and the sizeable Iranian Canadian community, sooner or later, we will likely be forced to move in that direction. Better to start preparing now and send appropriate signals now.

Andrew Griffith was posted to Iran 1988-90. He is the former director general for Citizenship and Multiculturalism at Citizenship and Immigration Canada (CIC). He has worked at Canadian Heritage, Service Canada, Industry Canada and Privy Council Office, in addition to Foreign Affairs and International Trade Canada, where he had a number of domestic and international assignments. He is the author of Policy Arrogance or Innocent Bias: Resetting Citizenship and Multiculturalism.

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