Iran deal rejection may damage dollar, says US Kerry

The dollar may cease to be the global reserve currency if US lawmakers walk away from the Iran nuclear deal, Secretary of State John Kerry said Tuesday.

“That is a recipe, very quickly, my friends, business people here, for the American dollar to cease to be the reserve currency of the world, which is already bubbling out there”, Kerry told reporters at Reuters news agency’s offices in New York.

Congress has until Sept. 17 to endorse or reject the agreement that was reached in July between Tehran and the UN Security Council’s five permanent members — China, France, Russia, the U.K. and the US — plus Germany.

Defending the deal, Kerry said it would be impossible for Iran to follow a secret program for producing nuclear fuel without being detected by the US.

He said the US. had enough intelligence capacity to know what Iran would be doing and that the military option would always remain on the table if needed.

“I’m not going to tell you that Iran is definitely going to change,” Kerry said.

“There’s nothing in this agreement that is based on trust or an expectation of a change of behaviour. It is based on verification and the knowledge that we have the ability to enforce this regime.”

He said more engagement with Iran could also make it easier to eliminate Daesh and end the civil war in Syria, now in its fifth year.

“We will hope that Iran would change and we will certainly explore diplomatically — it would be diplomatic malpractice not to go out and try to explore that possibility, and we’ll do so with our eyes wide open,” he said.

“But we’re going to be very clear, in the meantime, through our additional efforts with Israel, with the Gulf states, that we’re not going to just stand by,” he added.

Asked what would be the response of the administration if the deal were rejected, Kerry said: “I’m not gonna discuss plan B, because we’re gonna be successful on plan A,” he said.

The Obama administration has been locked in a public battle with Congress about the agreement, amid fierce opposition from many Republicans as well as some key Democrats, including Sen. Chuck Schumer.

President Barack Obama has promised to use his veto powers to override a rejection of the deal by Congress.