Tuesday, December 11, 2012

Eye on Iran: Sanctions Push Iran into Recession








For continuing coverage follow us on Twitter and join our Facebook group.
  
Top Stories

Reuters:
"Sanctions imposed on Iran over its nuclear program have pushed the country into recession, a global association of financial services said on Monday. Crude oil exports have dropped sharply, the Iranian rial has plummeted and inflation has soared in 2012, the Washington-based Institute for International Finance said in its report on the Middle East and North Africa. GDP in 2012 is expected to shrink by 3.5 percent, from 1.2 percent positive growth in 2011, it added... During the 2012/2013 fiscal year 'with crude oil prices holding at around $110 per barrel, government revenues from oil (which accounted for about half of its total revenues in previous years) could drop by at least 40 percent,' it said. The Iranian government has started consolidating public spending to offset a fall in revenues, it added. The rial has been 'steadily depreciating this year as foreign currency inflows have been garnered by the central bank for use in payment for government imports and to meet essential import needs,' it said. Inflation will average around 50 percent this year, up from 26.5 in 2011... 'As the economy enters a recession, the regime faces pressures from rising public unrest and discontent within Parliament,' the report said." http://t.uani.com/SNvSnI

Bloomberg: "HSBC Holdings Plc, Europe's largest bank, agreed to pay $1.92 billion to settle U.S. probes of money laundering in the largest such accord ever. The settlement includes a deferred prosecution agreement with the U.S. Department of Justice, the London-based bank said in an e-mailed statement today. HSBC also said it expects to complete an undertaking with the U.K. Financial Services Authority soon, without giving details.  Chief Executive Officer Stuart Gulliver's attempts to reduce costs and improve profitability have been hurt by the U.S. probes and by compensation claims from U.K. clients. A Senate committee said in July that lax oversight by top HSBC executives gave terrorists and drug cartels access to the U.S. financial system. The settlement is the biggest reached in the U.S. over such allegations, topping the $619 million in penalties paid in June by the Netherlands' ING Groep NV... HSBC has been in talks with U.S. regulators over allegations it laundered funds of sanctioned nations including Iran and Sudan, prompting Standard & Poor's to question whether the lender is too big to be managed effectively. In a deferred prosecution agreement, the government allows a target to avoid charges by meeting certain conditions -- including the payment of fines or penalties -- and by committing to specific reforms, either under the guidance of a monitor, or the creation of an internal compliance panel. 'We accept responsibility for our past mistakes,' Gulliver said in the statement. 'We have said we are profoundly sorry for them, and we do so again. The HSBC of today is a fundamentally different organization from the one that made those mistakes.'" http://t.uani.com/SOexLi

Reuters: "Standard Chartered Plc agreed to pay $327 million to resolve allegations that it violated U.S. sanctions against Iran, Sudan and two other countries, capping months of legal headaches for the British bank. The U.S. Justice Department and the New York District Attorney's office said on Monday the bank moved millions of dollars through the U.S. banking system on behalf of customers in the four sanctioned countries. The fine came on top of a separate payment of $340 million made in August by Standard Chartered to New York's state banking regulator over Iranian sanctions. Taken together, the two penalties could almost wipe out the bank's profit growth this year... The Justice Department and the New York District Attorney both agreed to defer charges against the bank, and drop the charges if the bank improves its sanctions compliance and forfeits $227 million. Standard Chartered entered into a separate $100 million agreement with the U.S. Federal Reserve to resolve allegations that the bank provided 'inadequate and incomplete responses' to bank examiners and provided insufficient oversight of its sanctions compliance program. Adam Kaufmann, the chief of investigations for the New York District Attorney's office, said the $227 million forfeiture was based on Standard Chartered's conduct and did not take into account the $340 million the bank already paid to Lawsky's agency... In similar settlements over sanctions violations, Lloyds TSB Bank Plc has forfeited $350 million, Credit Suisse AG $536 million, Barclays $298 million and ING Bank NV $619 million." http://t.uani.com/VA69NM
MTN Banner 
Nuclear Program

Reuters: "Iran is getting ever closer to being able to build a nuclear bomb and the problem will have to be confronted in 2013, Israeli Prime Minister Benjamin Netanyahu said on Monday. Israeli officials would like the United States to take the lead in a military assault on Iran's nuclear sites, but say in private they would go it alone if necessary, describing a nuclear-armed Iran as an existential threat to the Jewish state. Speaking to foreign journalists, Netanyahu said Israel was sticking to the red line he laid down in September, when he told the United Nations Iran should not have enough enriched uranium to make even a single warhead. 'I made clear that once Iran crosses that enrichment threshold, the chances of us effectively stopping Iran's nuclear weapons program would be reduced dramatically,' he said. 'Iran is two and a half months closer to crossing this line and there is no doubt that this will be a major challenge that will have to be addressed next year.'" http://t.uani.com/X3UiJa

AFP: "Iran is ready to discuss issues of 'concern' about its disputed nuclear programme with UN atomic watchdog experts during their planned visit to Tehran this week, the foreign ministry said on Tuesday. The visit by International Atomic Energy Agency experts on Thursday will focus on discussions regarding 'Iran's nuclear rights as well as its peaceful nuclear activities,' ministry spokesman Ramin Mehmanparast told a weekly briefing. But 'certain issues that have possibly become a source of concern for (IAEA) officials can also be discussed,' Mehmanparast said, without elaborating. The IAEA has urged Iran over the past year to clarify a number of issues that could point to a possible covert military dimension in Iran's nuclear activities. The watchdog has also tried in vain to gain access to Parchin military base near Tehran, where it suspects that experiments with explosives capable of triggering a nuclear weapon could have been carried out." http://t.uani.com/125lZXr

AP: "Iran's Revolutionary Guard on Monday said it has decoded all of the data from an advanced CIA spy drone captured last year. The Guard's aerospace chief, Gen. Ami Ali Hajizadeh, told state-run Press TV that that the RQ-170 Sentinel craft had not carried out missions over nuclear facilities before it went down in December 2011 near the eastern border with Afghanistan. Tehran had previously said it recovered information from the top-secret stealth aircraft, but Monday's announcement suggests technicians may have broken encryptions." http://t.uani.com/UyXxs6

Sanctions

WSJ: "Washington warned Moscow that the activities of a sanctioned Iranian bank in Russia could affect Russian banks that do business with the U.S., a Treasury official said. The bank, Moscow-based Mir Business Bank CJSC, has become a conduit for Iranian businessmen looking to keep trade flowing despite severe restrictions on Iran's financial system, according to trade records and Iranian businessmen who use the bank. 'Treasury is concerned about Mir's operations in Russia,' the Treasury official said. 'We have raised concerns about the risk that the presence of this bank poses to Russian financial institutions.' The U.S. has sanctioned Mir Business Bank's parent company, state-owned Bank Melli Iran, the country's largest commercial bank, because, the U.S. says, the bank is aiding the development of the Iranian nuclear program. Bank Melli denies it is aiding the program. 'Since Mir is a designated bank as a subsidiary of Bank Melli, financial institutions that choose to do business with it could face sanctions...which include being cut off from the U.S. financial system,' a second U.S. Treasury official said... In the first quarter of 2012, Mir Business Bank registered a 150% rise in net assets to 36.4 billion rubles ($1.1 billion)-faster growth than any other of Russia's 200 largest banks, according to the Interfax Centre of Economic Analysis. For the first time, Mir joined the ranks of Russia's top 100 lenders, at No. 96 during that period." http://t.uani.com/VOWOrp

Reuters: "Turkish authorities have shut down a small pipeline built by smugglers to carry illegal oil from Iran, officials said on Monday, a new twist as Western sanctions against Tehran bite. Along with the 3-km (1.9-mile) pipeline, Turkish security forces dismantled a rudimentary, hillside refinery with storage capacity of 25,000 liters of crude near the town of Semdinli in Hakkari province, the governor's office said in a statement... 'A 3,000 meter pipe was installed to the facility from Iranian territory,' it said. 'Rooms with generators behind the storage facility were discovered.'" http://t.uani.com/Uvs8oa

Human Rights

AP: "The Committee to Protect Journalists said in a report Tuesday that a record-number 232 journalists are imprisoned worldwide and that Turkey has the highest number with 49 journalists behind bars... CPJ said the second-worst jailer of the press is Iran, with 45 behind bars. The group cited news reports that said Iranian blogger Sattar Beheshti was arrested in October and died after being beaten and hung by his limbs from the ceiling." http://t.uani.com/UyXoF5

AP: "Tehran's chief prosecutor says authorities have arrested 28 Iranians for alleged links to foreign-based TV networks advocating the Baha'i religion, which is banned in the Islamic Republic. A Tuesday report by semi-official Mehr news agency quotes Abbas Jafari Dowlatabadi as saying intelligence officers arrested the members of 'counterrevolutionary networks' in 10 buildings across the city of Tehran. The detainees were in close contact with TV networks that advocate the Baha'i faith, Dowlatabadi said. Baha'i practitioners are frequently prosecuted in Iran, prompting outcry among international human rights groups." http://t.uani.com/T4Arts

Opinion & Analysis

Chicago Tribune Editorial: "Sen. Mark Kirk, who has been recovering from a stroke, is expected back at the Capitol in January. That's welcome news. We're also happy to report that Kirk hasn't let his focus slip on one vital national security issue: stopping Iran from building a nuclear weapon. For years, Kirk has led the effort in Congress to impose crippling sanctions on Tehran. Kirk and Sen. Robert Menendez, D-N.J., recently filed an amendment to tighten significantly the economic squeeze on Tehran. The sanctions would cover many companies linked to Iran's government, even if they are not involved in nuclear work. Iran's energy, port, shipping and shipbuilding industries would be blacklisted. Such an embargo would tell the world: If you want to do business with the U.S., you can't do business with Tehran. A popular move in Congress? We'd say. The amendment cleared the Senate on a 94-0 vote and is likely to find broad support in the House. But the Obama administration is balking. 'We do not believe additional authority to apply more sanctions on Iran is necessary at this time,' the National Security Council legislative affairs office said in a recent email to Senate Democrats. 'We are concerned that this amendment is duplicative and threatens to confuse and undermine some of the (existing) provisions.' The White House apparently believes sanctions included in the amendment could undermine its overtures to Iran for direct talks on its nuclear program. Never mind that Iran has stalled negotiations for the better part of a decade. Last week, Iran's foreign minister hinted that direct talks between the U.S. and Iran were possible, but that the country's supreme leader, Ayatollah Ali Khamenei, would make that decision. In other words: We'll get back to you. Don't wait by the hotline. President Barack Obama, like his predecessors, bristles when Congress tries to tell him how to conduct foreign policy. But 94-0 is a loud, bipartisan message to increase the chokehold on Iran's economy. The president should welcome this." http://t.uani.com/W1TZ2x

Abbas Milani in Advancing a Free Society: "Dear President Obama: Congratulations on winning a second term. Iran, as you have often said, will present a major challenge to your foreign policy in the coming months. Two follies have long haunted US policy on Iran. Some critics of the Islamic regime have offered 'no negotiation with the regime' as policy. The other side is the view that just negotiating with the regime is the panacea for the nuclear issue, and also for an end to all the regime's shenanigans. And if past attempts at negotiation have not worked, it is only because American policy makers have not tried hard enough. The second folly has been the view that 'solving' the nuclear impasse should be the sole goal of US policy. This view misjudges the nature of the regime by assuming that it will actually abide by any promises it makes. This is a regime that has broken virtually every promise it made to its own people, one whose theology is founded on the notion of Tagiyeh-where an expedient lie to 'infidels' is the duty of the Shiite faithful. Focusing only on the nuclear issue has played into the hands of the regime, allowing it to rally nationalist sentiments, and shifting the focus of US policy away from the no less important issues of human rights and democracy in Iran. For almost two decades, Ayatollah Khamenei has said that America's 'soft power' and its 'culture war'-the power of its ideas, its defense of the right of religious freedoms for all Iranians, whether of Bahai faith, or Muslims wishing to convert to other religions, equality for women, and the power of its information technology to breaking what you called a new Iron Curtain of ideas-is the most serious threat to his regime. And for almost as long, the US has surprisingly not fully played in the field the regime is in fact most vulnerable. Carrying the anti-American and anti-Israeli banner had been the sole tool of the Shiite, non-Arab clerics of Iran to claim the mantle of leadership of the proverbial Arab or Muslim Street. Another obstacle to serious negotiations with the US has been the IRGC's realization that tensions with America have been instrumental in its success in becoming an economic and political juggernaut, dominating directly or indirectly an estimated sixty to seventy percent of the economy. But in spite of the regime's designs and desires, the regime is left with little alternative but to negotiate with the US. For America, the policy foundation of any negotiations should be that only a more democratic, transparent and law-abiding power in Iran can solve the nuclear issue. I know you have long believed that the US can't, and should not, export democracy to Iran; but it is no less true that America can help create a more favorable context for transition to democracy. Another corollary to this policy is that military action on Iran to retard the regime's nuclear program will be the best gift to the troubled Islamic regime. Its recent bellicosity in claiming to 'hunt down' at least three US drones is sure proof that at least some in the regime are pining for such an attack." http://t.uani.com/URM8G8

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.

No comments:

Post a Comment