News : Sanctions

The big debate on sanctions and Iran rages on

By Iran News Update Staff 

Ben Smith of the Weekly Standard accused the Obama administration of being “incapable of understanding the nature of the regime in Tehran.” The considerable sanctions relief that has been offered as an incentive for nuclear talks is a symptom of that incapability, in the minds of Obama’s opponents. At hearings of the House Foreign Affairs Committee last week, American lawmakers emphasized concerns that recently released Iranian funds may be used to directly fund terrorism. And administration officials were unable to say that this could not be the case.

Nevertheless, sanctions relief continues to be implemented, and it continues to have a broader effect on the Iranian economy and the attractiveness thereof to outside investors. And if the Obama administration fails to understand the true nature of the regime, then the same must be said of other governments and business executives who have expressed interest in working with Iran. There are reportedly many of them. The Wall Street Journalsays that Iranian officials have reported a doubling of requests for business contacts and information from German callers.

Germany is currently looking at Iran with particular interest because it is pulling away from its economic relations with Russia, now that Russia has been linked with the downing of Malaysian Airlines Flight 17 over the skies of the Ukraine. Iran is a charming alternative because German officials are reportedly expecting the market to explode if sanctions are permanently alleviated and the Islamic Republic opens to international business. 

Dailer AG Chief Executive Dieter Zetsche. “Peace and stability and every measure that contributes to that has priority over everything else,” Dailer AG Chief Executive Dieter Zetsche told the newspaper Bild am Sonntag, explaining the decision to limit relations with Russia. But this sentiment seems to assume that these qualities will be more readily available from Iran. The above accounts of Iran’s influence in several war zones, however, belie that assumption.

What’s more, the decision to attempt to trade with Iran may worsen the situation. Another Reuters article explains that sales of food and medicine to Iran, which are permitted as humanitarian goods even under sanctions, are being delayed by banks that wish to be particularly vigilant about avoiding scrutiny from sanctions enforcers. This is necessary because there is apparently a larger volume of illicit trade being done between Iran and traditionally compliant countries including Germany and France.

Interestingly, this allows proponents of sanctions relief to argue that enforcement is harming the people of Iran more than it is putting pressure on the government. Thus illicit trade may increase the impulse for Western nations to make that trade lawful again.

 

 

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