The notion of a Western rapprochement with Tehran has been in play since mid-2013, when Hassan Rouhani replaced Mahmoud Ahmedinejad as president. At a stroke, instead of a firebrand religious hardliner, Iran was represented by a seemingly moderate cleric, English-speaking and with a doctorate in law from a British university.

Within months of taking office, Rouhani was at Davos, Alpine hob-nobbing with the best of them, doing his bit to charm the Western and West-leaning global elite.

“Our country has never sought, nor seeks, anything other than peaceful technology,” he opined in early 2014, securing not only the start of this latest thaw in Iranian-US relations, but also an interim agreement to access much-needed foreign exchange reserves. “Iran is open for business,” Rouhani has said, at a string of international summits since, using a near identical text each time.

“Come and visit us and see the investment opportunities for yourselves.” Over the last 18 months, the Iranian president has consistently argued that his country, “within the next three decades, could become a top-10 global economy”. Funnily enough, he is right.

In 2012, the year before Rouhani took office, Iranian GDP shrank by over 5pc, the economy gripped by sanctions and enduring its worst financial crisis for at least two decades. Since then, growth has returned, in part because sanctions have slightly eased. Independent Western analysts now estimate 2014 GDP at around $450bn (£304bn), placing Iran comfortably among the world’s 30 largest economies – ahead of both Austria and Taiwan.

But this country is still massively under-achieving. Along with its natural commodities, Iran also boasts a highly-skilled, near-universally literate population, with a vigorous median age of just 28. Its numerous universities, while far from gender-friendly, have long-produced a steady stream of well-qualified scientists and engineers.

In the mid-1950s, real per capita GDP was just four-fifths that of Turkey, Iran’s ancient rival. Over the 20 years that followed, free trade and economic dynamism meant growth was strong, with GDP per head soaring to more than two-and-a-half times that of Turkey.

Then came Ayatollah Khomeini’s 1979 revolution, with its theocratic clampdown on enterprise, which sent the economy spiralling downward.

As such, Iran missed the emerging markets revolution that, from the 1980s onwards, ignited the rapid expansion of economies like China, India and Turkey.

Iranians are now, once again, much poorer than their Turkish neighbours. Rouhani has pledged to reverse that, stating repeatedly that he wants to “join the rest of the global economy”, positioning Iran as, potentially “the most exciting emerging market on earth”.

David Fuller's view

Using history as our guide, we know that it can take just one key leader to either make or break a country’s fortunes for many years.  This is especially true in non-democratic societies where there is no orderly mechanism for removing the unreliable.

President Hassan Rouhani of Iran is an interesting case in point, who replaced the deeply unpopular and aggressively hostile Mahmoud Ahmedinejad in mid-2013.  A smiling, English speaking and apparently mild mannered cleric with a law degree from a British University, he has been a likely candidate for negotiations, although he is not the Supreme Leader.  That is 75 year old Ali Khamenei, who succeeded Ruhollah Khomeini in 1989. 

After all, their economy has been hobbled for many years by sanctions, yet it is capable of prospering without them.  Even if Iran succeeded in developing a nuclear weapon which it might be able to use against an enemy, it would almost certainly be devastated by international retaliation.  This looks like a choice between lose-lose versus win-win, the latter which I would define as a recovering economy and normal relations with most of the global economy.  There is also the not insignificant issue of what most of Iran’s educated population would prefer, if given the choice.

I credit President Barack Obama for opening this door with Iran, and US Secretary of State John Kerry for his considerable efforts.  Inevitably, the devil remains in the details of negotiations with Iran, as I have said before.  Nevertheless, the international community has much to gain and little to lose by pursuing these negotiations.