Iran’s deputy foreign minister and British ambassador, Seyed Mohammad Kazem Sajjadpour, tried to dismiss concerns, claiming that his country was able to “manage” sanctions, having seen them before during the Iran-Iraq war and the lead up to the 2015 nuclear.
However, regional politics and economics experts saw this as mere posturing, citing that these claims do not reflect reality.
Dr Lina Khatib, head of the Middle East and North Africa program at the Royal Institute of International Affairs, said: “Iran is already under financial strain due to both its adventurism in Syria and the US withdrawal from the nuclear deal, which reduced the Western private sector’s interest in Iran. The reinstated sanctions will further erode Iran’s economic stature despite its claims of resilience.”
Indeed, the renewed US sanctions that have come into play since Donald Trump withdrew from the Joint Comprehensive Plan of Action (JCPOA) – also known as the Iran nuclear deal – have plunged Iran into economic crisis.
The Gulf nation has hardly any purchasing power and can hardly find any foreign suppliers willing to risk US sanctions to work with them, which has led to rising cost of goods, high inflation, and decreased employment. The Iranian currency has lost 70% of its value, while the country’s banking system has basically stagnated. The situation has gotten so bad that there’s a growing trade in human organs.
But the pain isn’t over, with US National Security Adviser John Bolton warning of additional sanctions and US Special Representative on Iran Brian Hook warning that countries who continue to do business with Iran could be liable to penalties from the US, including being cut off from the US financial system, as well as the financial and environmental costs for any accidents in their territorial waters as insurance firms cut ties with Iran.
Still, Sajjadpour, who is also president of the Institute for Political and International Studies, claims that everything is going well, even while businesses and other countries bail on Iran at record rates.
Gulf expert Dr Neil Quilliam said: “Times have changed and the Iranian economy is more fragile than at any time before, so the government will come under considerable domestic pressure to negotiate with the US.”