Wednesday, October 31, 2012

Eye on Iran: Iranian Car Industry Crippled by Sanctions








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The Times of London:
"Iranian car manufacturers have begun laying off thousands of workers as production grinds to a halt, the latest setback to strike an economy nearing collapse under pressure from international sanctions. The mass redundancies in one of Iran's biggest industries has added to the sense of crisis in the country. Inflation is soaring and the rial slumped to an all-time low against the US dollar last month. Unemployment in some parts of the country has reached 40 per cent. The Iranian car industry has a turnover of about $38 billion a year and employs nearly a million people. Car manufacturing contributes 10 per cent of the country's gross domestic product and is Iran's most lucrative industrial sector after oil and gas... Iran was the 13th biggest carmaker in the world last year, producing 1.6 million vehicles. But as sanctions bite, production has collapsed this year, down by 66 per cent in September. The country's exclusion from international capital markets and payment systems has left businesses unable to purchase raw materials. After months of falling demand and production, carmakers have bowed to the inevitable and started cutting jobs. Alongside redundancies, the manufacturers have also reduced work times. At most plants, three daily shifts have been cut to one. At some companies, where production lines once operated around the clock, the remaining staff work a solitary six-hour shift." http://t.uani.com/SvwrUD

NYT: "Israel's defense minister said Tuesday that the country had interpreted Iran's conversion of some enriched uranium to fuel rods for civilian use as evidence that Iran had delayed ambitions to build a nuclear weapon. The assertion, by Defense Minister Ehud Barak in an interview with The Daily Telegraph, a British newspaper, amounted to the first explanation from him as to why he and Prime Minister Benjamin Netanyahu softened their position in September over the possibility of a military strike to thwart what they called Iran's drive toward imminent nuclear weapons capability... Mr. Barak, who was visiting London, was quoted by the newspaper as saying an immediate crisis had been averted this summer because Iran had chosen to use a third of its enriched uranium for use as fuel rods in a medical research reactor. The conversion of that uranium, which was reported by the International Atomic Energy Agency in August, makes it much more difficult to use militarily. The Iranian decision, Mr. Barak said, 'allows contemplating delaying the moment of truth by 8 to 10 months.'" http://t.uani.com/TT8zGp

WSJ: "Amid an economy in turmoil, the Tehran Stock Exchange index has provided Iranians with a rare dose of relief. On Saturday, the stock market's All-Share-Price Index, or TEPIX, surpassed the 31,000-point threshold for the first time in its 45-year history. It continued rising on Tuesday, closing up 0.4% to 31,331.6 points. Conventional wisdom would assume that a country's stock market mirrors broader macroeconomic sentiment-even when magnified by speculation. Not in Iran, where the more the economy worsens, the more the stock market improves. The mood could hardly be gloomier outside the Iranian bourse. International Sanctions against Iran's contested nuclear program, which it says is peaceful, have more than halved oil exports, its largest source of revenue." http://t.uani.com/TtpSS6
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Nuclear Program

AP: "The U.S. and the European Union said Tuesday they'll press on with sanctions against Iran, even as they hope the promise of new negotiations could lead to a diplomatic solution ending the nuclear standoff. Appearing together at a news conference in the Bosnian capital of Sarajevo before continuing a joint tour of the Balkans in Serbia and Kosovo, U.S. Secretary of State Hillary Rodham Clinton and EU foreign policy chief Catherine Ashton said both diplomacy and pressure would continue until Iran makes significant concessions over its disputed uranium enrichment activity... Clinton said the U.S. message to Iran is clear. 'The window remains open to resolve the international community's concerns about your nuclear program diplomatically and to relieve your isolation, but that window cannot remain open indefinitely. Therefore, we hope that there can be serious good-faith negotiations commenced soon.'" http://t.uani.com/Tmd9wk
Sanctions  

Reuters: "Iranians can no longer export gold without approval by the central bank, an official was quoted as saying on Wednesday, in a new effort by the government to restrict outflows of wealth. The move follows media reports on Tuesday that Iran had banned the export of some 50 basic goods, as the country moves to secure supplies of essential items in the face of tightening Western sanctions which have destabilised its rial currency. 'The export of gold and coins without permission from the central bank has been banned,' said customs official Mohammad Reza Naderi, according to the Mehr news agency. 'According to law, (the export of) coins made from precious metals has until now not needed a permit from the central bank, but current economic conditions have resulted in a decision to require a licence from the central bank for the export of these goods.'" http://t.uani.com/Sk5MHu

Reuters: "EU sanctions on Iran's natural gas have unintentionally also brought its exports of liquefied petroleum gas to a near halt, industry sources say, starving Tehran of yet more dollar revenue and threatening to push European winter fuel bills yet higher. LPG, which comprises propane and butane, comes mainly from oil rather than natural gas, but shippers and insurers are steering clear of Iranian supplies due to uncertainty over the scope of the new European Union sanctions. 'It's a grey area if natural gas includes LPG or not,' said one LPG trader. 'Not many want to take a risk on that.'" http://t.uani.com/TWUU7f

Reuters: "South Africa suspended all imports of crude oil from Iran for a fourth month in September, data showed on Wednesday, as Pretoria continued to steer away from Iranian shipments because of European insurance sanctions. In May, imports from Iran stood at 285,524 tonnes, but since June Africa's biggest economy has replaced shipments from Iran with crude from other suppliers, especially Saudi Arabia. South Africa used to import a quarter of its crude from Iran but has come under Western pressure to cut the shipments as part of sanctions designed to halt Tehran's suspected pursuit of nuclear weapons. The major supplier in September was Saudi Arabia, with shipments from the Middle East country at 759,643 tonnes. Other crude imports originated in Angola, Nigeria and the United Arab Emirates, with shipments totalling 1.76 million tonnes." http://t.uani.com/V9hVni

AP: "The Iranian national symphony orchestra has been disbanded for lack of funds, musicians said Monday, another sign of the effects of Western economic sanctions. Orchestra members told the semiofficial ILNA news agency Monday that they have not rehearsed together and have not been paid for three months... The step is likely tied to heightening economic woes in Iran because of government mismanagement and Western sanctions over Iran's nuclear development program. Another key effect of the sanctions has been the collapse of the Iranian currency... Kamkar said the shutdown shows that Iran's rulers are not favorable to the orchestra, because its budget is a 'small portion of Iran's income from oil.'" http://t.uani.com/PkCaf7

AP: "Israeli Prime Minister Benjamin Netanyahu says he will urge French leaders to help strengthen sanctions against Iran and efforts to fight terrorism. Netanyahu is visiting France on Wednesday and Thursday and will pay homage to a rabbi and three Jewish schoolchildren killed in France's worst terrorist attack and worst anti-Semitic attack in years. It is his first visit to France since the March attacks in Toulouse. In an interview with Paris Match magazine, he is quoted as saying he wants to talk to French President Francois Hollande about 'concrete ways to intensify sanctions against Iran. We also need to work together to fight terrorism.'" http://t.uani.com/PGVWmv 

Syrian Uprising

WashPost:
"Among the many global reactions to Hurricane Sandy's impact on the U.S. East Coast, this one might be the most amusing. Syrian Army News, a pro-regime Facebook page, announced that anti-Western 'resistance' forces working under President Bashar al-Assad and under the Iranian government secretly engineered the natural disaster using 'highly advanced technology.' It describes the hurricane as a punishment for threatening Assad's Syria." http://t.uani.com/SvUXUv

Regional Meddling

WSJ:
"Iranian naval commanders met Tuesday with their counterparts in Sudan to discuss joint training exercises, in the wake of explosions at a weapons factory that Sudan blamed on Israeli jets. New before-and-after satellite images that have emerged following the blast, meanwhile, indicate an attack there could have targeted a large shipment of arms, the images' provider said. The Iranian commanders were part of a delegation from two Iranian warships that docked at Port Sudan on Monday. The visit and the training exercise were planned, Sudanese officials said, and the ships departed from Iran in September. But the meetings take on a new significance after Sudan alleged that Israeli aircraft bombed a weapons factory in its capital, Khartoum, on Oct. 24." http://t.uani.com/TT6zxJ

Reuters: "Two Iranian warships left Sudan on Wednesday after a visit that drew attention to the countries' military ties less than a week after Khartoum accused Israel of bombing a Sudanese arms factory. Israel accuses the Muslim East African country of channeling weapons to the Gaza Strip, controlled by Iran's ally Hamas, via Egypt's Sinai desert - a charge Khartoum denies. Last week, a fire at the Yarmouk munitions plant in the south of Khartoum killed four people, and Sudan said an Israeli air strike was behind the blast. Israel has not commented on the fire. Two Iranian warships docked in Port Sudan several days after the blast, triggering speculation the events were related. Sudan denied this, saying the warships were on a 'routine' visit." http://t.uani.com/RqQKOJ

Human Rights

Economist:
"Following a harrowing three-day hearing at the Peace Palace in The Hague, the Iran Tribunal delivered its interim judgment on October 27th. According to the tribunal, which has no legal standing, the Islamic Republic of Iran committed crimes against humanity and gross violations of human rights against its citizens during 'the bloody decade' of 1980s. The tribunal was set up in 2007 by survivors and families of victims living in exile and comprises leading jurists from around the world. It heard statements from experts and witnesses on how the Islamic Republic systematically crushed political and religious dissent in the decade following the 1979 revolution, executing 20,000 of its citizens. During the summer of 1988 alone, 5,000 political prisoners were hanged from cranes or shot by firing squad under a direct fatwa issued by Ayatollah Khomeini, the supreme leader. The victims were leftists, students, members of opposition parties and ethnic and religious minorities-many originally sentenced for non-violent offences, such as distributing leaflets or taking part in demonstrations." http://t.uani.com/UfQAKE

Domestic Politics 

AP: "Iran's Supreme Leader has warned government officials and politicians against turning their disputes into a public discussion, calling it 'treason' against the state. Ayatollah Ali Khamenei's comments were a jab at embattled President Mahmoud Ahmadinejad, who publicly lambasted Iran's judiciary chief last week for rejecting his request to visit Evin prison. Ahmadinejad accused the judiciary of 'unconstitutional' behavior, claiming that as Iran's president he did not need permission to visit the prison. Judiciary chief Ayatollah Sadeq Larijani fired back, saying Ahmadinejad does not understand his constitutional powers." http://t.uani.com/TWVuBT

Opinion & Analysis

Daily Telegraph Editorial Board:
"The suggestion by Ehud Barak, Israel's Defence Minister, that Iran has pulled back from the brink of its confrontation with the West over its nuclear programme is intriguing. In his interview with The Daily Telegraph today, Mr Barak argues that Iran's decision to consign a proportion of its enriched uranium stockpile to civilian use has averted a crisis that could easily have led to Israel launching air strikes to destroy Iran's nuclear facilities. By converting its enriched uranium to fuel rods used for medical isotopes, Iran has helped to reassure the International Atomic Energy Agency (IAEA) that its intentions are peaceful. But that is only half the story. Iran still possesses significant quantities of enriched uranium, which could be used for a nuclear weapons programme. At a time when the Iranian economy is under severe pressure from the wide-ranging sanctions that have been imposed for Tehran's non-compliance on nuclear matters, the ayatollahs may have decided to give themselves some breathing space by playing along with the IAEA's demands, with the aim of returning to their nuclear weapons programme once the international pressure has eased. But, as Mr Barak makes clear, that would be a grave miscalculation. The stand-off between Iran and the Western powers is unlikely to be resolved so long as Tehran fails to provide satisfactory guarantees that its remaining stockpiles of enriched uranium are for peaceful purposes, and not for making atomic bombs. Mr Barak believes that Israel now has the military capability to launch unilateral air strikes against Iran - and the Jewish state will not hesitate to use them while its existence remains under threat." http://t.uani.com/YnbGLm

David Albright, Christina Walrond, William Witt &Houston Wood in ISIS: "The Wall Street Journal published an editorial on October 19, 2012 titled 'Tick-Tock Tehran,' which referenced our recent ISIS report, Iran's Evolving Breakout Potential. We would like to point out a central conclusion of our report, namely that the chance Iran will 'break out' and build a nuclear weapon in the next year remains low.  A straightforward method to help keep this probability low is to increase the frequency of International Atomic Energy Agency (IAEA) inspections of Iran's main uranium enrichment plants.  In addition, while we did not explicitly discuss this subject in our report, Iran is unlikely to build a gun-type nuclear weapon like the type that destroyed Hiroshima. If Iran decided to build a nuclear weapon, it would not be able to build a gun-type significantly faster than the other type of crude fission weapon, an implosion type that was used to destroy Nagasaki and has already been pursued by Iran, according to evidence assembled by the IAEA. Our estimates provide the length of time that Iran would need to produce enough weapon-grade uranium for a nuclear weapon, if Iran decided to do so. At this time, it is widely accepted that Iran has not made a decision to actually build a nuclear weapon, although it appears to be furthering its capability to make them. Our estimate that Iran can currently break out in as little as 2-4 months provides adequate time for the United States to both detect and respond to the breakout before Iran accumulates enough weapon-grade uranium for one nuclear weapon.  Because Iran fears a military response, it is unlikely to breakout.  We assessed in our study that breakout times could reduce to about one month during the next year.  But in all the scenarios we considered, the breakout would remain detectable to provide time for U.S. action. As a result, during at least the next year, our estimates support that the likelihood of an Iranian breakout will also be low. We share the WSJ's concern for Iran's growing nuclear weapons capability. Because of significant uncertainties in charting Iran's nuclear progress, we do not know what additional nuclear capabilities Iran may have in place one year from now. As a result, we did not estimate breakout times in late 2013 or afterwards, and statements suggesting that breakout times are bound to shrink significantly by then are just speculation at this point.  Depending on what technical obstacles Iran encounters, how much of its enriched uranium it converts to fuel plates for the Tehran Research Reactor, and other variables, breakout times may not shrink at all. But we believe that even if breakout is detectable during the next year in a timely manner, every effort should be made to improve the speed at which it would be detected and reduce the time needed for a U.S. response.  Moreover, Iran may decide to improve its breakout capability by increasing the number of its centrifuges. In either case, one simple way to improve the chance of detection is to increase the frequency of inspections by the International Atomic Energy Agency at the Natanz and Fordow centrifuge enrichment sites. The inspectors are the most credible witnesses to Iran's activities at these sites.  Currently, inspections occur on average about once every two weeks, and some of them are unannounced.  The IAEA can increase the frequency of both regular and unannounced inspections, improving the likelihood of prompt breakout detection. If the inspection frequency became weekly-even if the Iran were to increase its number of centrifuges significantly compared to current quantities-the chance of detecting a breakout would be at least as good as, or even better than, it is today."  http://t.uani.com/VDq3YT

Eye on Iran is a periodic news summary from United Against Nuclear Iran (UANI) a program of the American Coalition Against Nuclear Iran, Inc., a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code. Eye on Iran is not intended as a comprehensive media clips summary but rather a selection of media elements with discreet analysis in a PDA friendly format. For more information please email Press@UnitedAgainstNuclearIran.com

United Against Nuclear Iran (UANI) is a non-partisan, broad-based coalition that is united in a commitment to prevent Iran from fulfilling its ambition to become a regional super-power possessing nuclear weapons.  UANI is an issue-based coalition in which each coalition member will have its own interests as well as the collective goal of advancing an Iran free of nuclear weapons.

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