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The presidential elections in Iran assured incumbent Hassan Rouhani of a second term after he gained approximately 57 percent of the vote, far ahead of Ebrahim Raisi, the main rival and representative of the conservative camp (who earned approximately 38 percent of the vote).

Two aspects of the election deserve special attention: one is the higher rate of voting than in the past (71.4 percent), which reflects the determination of pragmatic and reformist elements to ensure the victory of the more moderate candidate. The second is that Rouhani won in 23 out of 31 provinces, and specifically in central provinces, traditionally identified with the reformist camp; of these, the capital Tehran is the most prominent. Rouhani also won in outlying provinces such as Baluchistan and Kurdistan, whose residents are ethnic minorities, where he earned over 65 percent of the vote.

Raisi, by comparison, won a significant victory only in Khorasan Razavi – he is a resident of Mashhad, the capital of the province – and in Qom, the religious stronghold. In the six other provinces won by Raisi, he did not have a significant margin of votes. Moreover, in the local council elections held at the same time, the reformists also recorded a sweeping victory, winning all the main cities, including Mashhad. In Tehran, the reformists, including six women, won all 21 seats.

The presidential elections were to some degree a referendum on the future of the Islamic Republic: closure versus openness, conservatism versus pragmatism. Rouhani's landslide victory is an unequivocal expression of support by Iranian citizens of their serving president. Notwithstanding disappointment with his limited achievements, particularly with regard to individual freedoms and the economic situation, he still enjoys broad public support, particularly among the educated urban middle class, young people, women, and ethnic and linguistic minorities.

For the general public, the focus of the elections was the economy, with the emphasis on the high unemployment, particularly among the educated young. The two candidates dealt with this subject at length, but while Raisi repeated populist promises to increase government support – a policy that was adopted by former President Ahmadinejad and did a great deal of economic damage  Rouhani presented an agenda that included opening the economy to outside investment; improvements to the banking system, which has begun adjusting to the requirements of the international community; and reduced involvement of the Revolutionary Guards in all areas of the economy.

The elections were dominated by the issue of the nuclear agreement, identified with Rouhani, who supported it while a candidate in the previous elections in 2013. While the conservative camp attacked Rouhani persistently for the negligible economic benefits of the agreement and for what they consider the excessive concessions by Iran to achieve it, Rouhani stressed Iran's improved international status, the improving macro-economic data, and his success in removing the threats to Iran's national security. On this issue too, the clear message from the public was support for Rouhani's lead and a desire to continue cooperation with the West and the international arena as a whole, as part of its economic improvement process.

Raisi's defeat is no less important than Rouhani's victory. Running for office as president amounted to a political gamble for this conservative religious figure. Last year, Raisi's name came up as one of the possible candidates to eventually succeed Supreme Leader Ali Khamenei, whose health has declined in recent years. Yet the open support he received from the religious establishment, and apparently also from the Revolutionary Guard, did not help him gain wide public support. Raisi's controversial past in the judiciary, particularly as the Deputy Attorney General of Tehran during the mass executions of political prisoners in 1988, presumably played a part in the opposition among sections of the public.

Yet Raisi's failure is not limited to the candidate himself, but also reflects a deeper trend in Iranian society, namely, the public's growing alienation from the values of the Revolution and its yearning for the chance of domestic change. Over several years, large segments of the Iranian population have moved away from the policy dictated by the Supreme Leader and implemented by the religious establishment and the Revolutionary Guard. This sentiment is reflected in criticism of the resources allocated to external elements, such as Syria, Hezbollah, and Palestinian groups, in hopes of further exporting the revolution, instead of investing in improvements to the country's citizens; in the demand for greater openness to the West, involvement of women and ethnic and religious minorities in public life, and freedom of expression; and in the demand to remove restrictions on social networks. These demands in fact constitute a clear challenge to the regime's policies that could erode the power of those who currently control the establishment.

On May 22, 2017, in his first public press conference after his victory, Rouhani stressed the improvements during his first term of office in the status of women and in areas of culture. However, his real test will be the extent of the economic improvements he manages to bring to the lives of the citizens. A failure in this regard could widen the gap between the public and the regime, create a crisis of expectations, and even lead to renewed public protests.

There is no doubt that the high rate of voting for Rouhani, who is not a typical reformist in his views but won the support of the reform camp and is identified as the more pragmatic option, requires the senior regime figures to do some soul searching regarding public support for the values of the revolution in general, and the regime in particular. The Supreme Leader appears to grasp the widespread public trends, and even if they trouble him, presumably estimates that struggling against them could provoke public protests like those in Iran in 2009. Therefore he has avoided any interference in the attempt to tamper with the election results. For their part, the Iranian people are currently playing the political game; they are not exceeding the well defined limits imposed by the regime, and are currently not inclined to take significant risks to change the regime. This behavior helps the existing regime, and to some extent maintains it. Even if there is no guarantee that this situation will prevail in the long run, the last election campaign could be seen as evidence that at this stage, not only the regime but also many Iranian citizens prefer stability over political upsets.

In the longer term, the election results could have important implications for the internal arena in Iran. It is still too early to assess how far Raisi's failure will hurt his future chances of succeeding Khamenei as Supreme Leader. At the moment, it seems that the hopes among his supporters that his presidential candidacy would act as a springboard in the forthcoming battle for succession have been quashed. Rouhani, however, has improved his chances of being a strong contender, particularly if the change comes over the next four years, during his term as President.

Certainly initially it appears that the elections will not change the face of Iran, and Supreme Leader Khamenei, who controls the main centers of power, will continue to dictate the foreign and security affairs agendas. On the issues directly relevant to Israel, such as continuation of the surface-to-surface missile development program, ongoing aid to the Syrian regime, and Hezbollah, Hamas and Palestinian Islamic Jihad, no immediate change is expected. At his press conference, Rouhani adopted a tone of strength ("Whenever we need to test missiles, we will do so") while avoiding harsh words. In response to attacks heard from Saudi Arabia during President Trump’s visit to Riyadh, he stressed that Iran was interested in close relations with other countries in the region. Rouhani repeated that Iran would not be the first to breach the nuclear agreement; he showed support for Syria, while stressing that the solution must be political and that Iran was a partner of Turkey and Russia on this level. Moreover, Rouhani did not rule out dialogue with the United States, but clarified, apparently in response to criticism of the nuclear agreement from Secretary of State Rex Tillerson, that he would have to examine the direction of the new administration.

Indeed, an important variable in this context will be the policy adopted toward Iran by Trump's administration. The review currently underway has not yet yielded any operative policy, and at this stage the main effort is focused on harsh rhetoric against Iran, such as expressed by President Trump during his visit to Saudi Arabia and Israel. However, elements in Congress have already begun promoting hearings toward the formulation of a resolution for sanctions in non-nuclear areas, which could greatly increase the tension between Iran and the United States.  From this aspect, the congratulations to Rouhani on his election from Federica Mogherini, High Commissioner for Foreign Affairs of the European Union, and from the new President of France, Emanuel Macron, reflect their support for maintaining the nuclear agreement and for the possibilities of economic cooperation with Iran that it opens up. In this situation, it will be difficult for the Trump administration to oppose the agreement.

The Israeli government, whose position on the nuclear treaty is close to that of the United States, may find itself in opposition to most European countries, Russia, and China. However, Israel must recognize that the consequences of growing hostility between Washington and Tehran could be reflected in Iranian conduct in the Middle East in ways that might not necessarily benefit Israel’s security interests.