Tuesday, October 1, 2013

Eye on Iran: Iran Staggers as Sanctions Hit Economy







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NYT:
"For years, Iran's leaders have scoffed at Western economic sanctions, boasting that they could evade anything that came their way. Now, as they seek to negotiate a deal on their nuclear program, the leaders are acknowledging that sanctions, particularly those applied in 2010 on international financial transactions, are creating a hard-currency shortage that is bringing the country's economy to its knees. This was evident in New York last week when Iran's new president, Hassan Rouhani, emphasized the need to act swiftly to resolve the standoff over Iran's nuclear program, perhaps in three to six months. While there may well be political reasons for him to be in a hurry, Mr. Rouhani and other officials admitted that the sanctions were hurting... Because of the sanctions, oil sales, which account for 80 percent of the government's revenue, have been cut in half. While Mr. Ahmadinejad had asserted that Iran had $100 billion in foreign exchange reserves, the total had shrunk to $80 billion by mid-2013, according to a new study by Roubini Global Economics, a research firm based in New York, and the Foundation for Defense of Democracies, a Washington group that advocates strong sanctions against Iran. But even that vastly overstates the amount readily available to Iran. Three-quarters of the $80 billion is tied up in escrow accounts in countries that buy Iranian oil - the result of an American sanctions law that took effect in February. Under that law, the money can be spent only to buy products from those countries. Even gaining access to the remaining $20 billion is difficult - it has to be physically moved in cash because of Iran's expulsion from the global banking network known by its acronym Swift, which had allowed the money to be transmitted electronically." http://t.uani.com/19eBxh4

NYT: "Neither President Obama nor Prime Minister Benjamin Netanyahu of Israel mentioned Hassan Rouhani after their meeting at the White House on Monday morning. They didn't have to: President Rouhani, whom Mr. Netanyahu has labeled a 'wolf in sheep's clothing' and whom Mr. Obama phoned last week in the first leader-to-leader contact between the United States and Iran in 34 years, was the obvious, if unspoken, subject of the discussion. Mr. Netanyahu said he was comforted to hear Mr. Obama declare that Iran's 'conciliatory words have to be matched by real actions.' The president said he would take no options off the table, including military action, to prevent Iran from obtaining a nuclear weapon. It was a disciplined show of unity by two leaders who have clashed in the past over how to deal with the nuclear threat from Iran, and may soon face further strains as the United States tests the diplomatic overture made by Mr. Rouhani last week at the United Nations... But on Monday, Mr. Netanyahu held his fire. He called for the sanctions to be kept in place until Iran showed 'verifiable' progress in the nuclear negotiations. And he credited Mr. Obama's pressure tactics, along with the threat of military action, for bringing Iran to the negotiating table. 'Iran is committed to Israel's destruction,' he said, 'so for Israel, the ultimate test of a future agreement with Iran is whether or not Iran dismantles its military nuclear program.'" http://t.uani.com/18ozQe7

Video: UANI President Dr. Samore appears on MSNBC's "Andrea Mitchell Reports" http://t.uani.com/15IqLty
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Sanctions

AP: "Vice President Joe Biden says U.S.-led sanctions against Iran have been the most effective sanctions regime ever. Biden says Iran has a choice. He says Iran can suffer deepening economic sanctions or negotiate its way back into the global community and economy. He says the U.S. doesn't know whether Iran is willing to do what's necessary to resolve concerns about its nuclear program." http://t.uani.com/15IlSAz

WT: "The European Union's foreign policy chief warned Monday against rushing to ease economic sanctions on Iran following last week's diplomatic breakthroughs between the Islamic republic's new leadership and the West. 'We should be ready to move if they are ready to move, but not ready to move until they are ready, they have done it and they have proved it and we are confident in them,' Catherine Ashton said at the Woodrow Wilson International Center for Scholars in Washington." http://t.uani.com/15IpPoM

Reuters: "India aims to cut Iranian crude imports by 15 percent this fiscal year, the oil secretary said on Tuesday, differing from the oil minister who recently said he wanted to hold the shipments at last year's levels. Ahead of Prime Minister Manmohan Singh's visit to the United States last week, Oil Minister M. Veerappa Moily said Iranian imports should be held steady at 260,000 barrels per day (bpd) to save as much as $8.5 billion in foreign exchange as Tehran accepts partial payment in rupees. However, Oil Secretary Vivek Rae, the Petroleum Ministry's top bureaucrat, said on Tuesday that India targets oil imports of around 220,000 bpd from Iran in the year through March 2014. It was not immediately clear what triggered the shift in stance... Rae said Mangalore Refinery and Petrochemicals and Essar Oil - the only Indian refiners currently importing Iranian crude - will import about 80,000 bpd each this fiscal year. Three other refiners - Hindustan Petroleum, Bharat Petroleum and Indian Oil Corp - can each import about 1 million to 1.5 million tonnes for the year, or about 20,000 bpd, Rae said." http://t.uani.com/18oyOyQ

Reuters: "The Vatican bank is likely to close all accounts held by foreign embassies, following concerns about large cash deposits and withdrawals by the missions of Iran, Iraq and Indonesia, according to people with knowledge of the situation... Withdrawing and depositing cash is not illegal, and embassies may legitimately transfer money in and out of the Vatican provided they offer sufficient details on the origin of the money and purpose of the transaction. But international financial standards require banks to carry out thorough checks on the origin of large cash transfers and on the effective beneficiaries to rule out the possibility of money laundering, tax evasion and other financial crimes. Checks are heightened if the transactions involve countries, such as Iran and Iraq, considered by international regulators to be at high risk for financial crimes, and if high-level diplomats are involved." http://t.uani.com/1dTZlGc

Terrorism

National Post: "A Vancouver dentist injured in a 1997 Hamas suicide bombing has filed a lawsuit against Iran - the first such case to be launched under a new Canadian law that allows victims to collect damages from state sponsors of terrorism. Dr. Sherri Wise, 43, filed the notice of claim in British Columbia Supreme Court on Friday. It names the Islamic Republic of Iran and the powerful ministry of security as defendants. It does not seek a specific dollar amount in damages. Dr. Wise was volunteering at a Jerusalem dental clinic for underprivileged kids when she was badly wounded when three bombs packed with nails and glass exploded. She is suing Iran because it has long armed, financed and trained Hamas to conduct terror attacks. The suit comes more than a year after the federal government enacted the Justice for Victims of Terrorism Act, which paved the way for such cases by lifting state immunity from countries that sponsor terrorism. Iran was designated a state sponsor last September, along with Syria." http://t.uani.com/15GFdHM

Foreign Affairs

AFP: "Iranian Foreign Minister Mohammad Javad Zarif accused Israeli Prime Minister Benjamin Netanyahu of lying in his rejection of Tehran's overtures to the West as a cosmetic 'charm offensive'. 'We have seen nothing from Netanyahu but lies and actions to deceive and scare, and international public opinion will not let these lies go unanswered,' Zarif said in an interview with Iranian television broadcast on Tuesday. Zarif was speaking from the United Nations, where Netanyahu was set to the address the General Assembly later Tuesday, the same forum where last year he used a cartoon bomb as a prop to underline how close he believed Iran was to producing a nuclear warhead. 'For 22 years, the Zionist regime has been lying by repeating endlessly that Iran will have the atomic bomb in six months,' Zarif said." http://t.uani.com/19k0guB

Opinion & Analysis

Jeffrey Goldberg in Bloomberg: "OK, if it's Monday, it must be skunk-at-the-garden-party time. There are two main reasons to doubt the possibility of an Iran-U.S. rapprochement, an idea that gained new life after Iran's charm offensive at the United Nations last week and a phone call between the presidents of the two countries on Sept. 27. The first is general to the Middle East, the second is specific to Iran. The general reason is easy to understand, and all-encompassing: Nothing at all works in the Middle East, so why should the U.S. find success convincing Iran to give up its nuclear program in exchange for lifting sanctions? ... Since nothing works in a zero-sum region where politics is defined by fanatics, I don't feel particularly optimistic about the current effort. I used to be more of an optimist, by the way, but this is what happens over time. It wouldn't be surprising, by next spring, if we saw the White House acquiesce to congressional demands for harsher sanctions on the Iranian regime, after several rounds of mostly fruitless negotiations. The second reason is specific to Iran's actions last week. Many people are forgetting that Hassan Rouhani, the president of Iran and the commander of Operation Offensive Charm, is a moderate only in comparison to his predecessor, the unhinged Mahmoud Ahmadinejad. Rouhani has been a superior soldier for Iran's supreme leader, Ayatollah Ali Khamenei, a defender of the regime, and an anti-American propagandist for much of his professional life. (Not often mentioned during last week's love-in was Rouhani's post-Sept. 11 commentary, in which he blamed the attacks on the 'wrongs and mistakes of American policies' and argued that the U.S. Air Force shot down Flight 93, which crashed in the Pennsylvania countryside.) There's no proof yet that Rouhani's ultimate goals for Iran are different than those of the hardliners. Let's look at what he didn't do at the UN last week: He not only refused to comply with the many Security Council resolutions demanding that Iran cease all uranium-enrichment activities, he also refused to endorse the idea that Iran is obligated to pay any attention to the Security Council's wishes. (Remember, the many resolutions demanding that Iran cease enrichment passed with the unanimous approval of the five permanent members.) Until proven otherwise, there's no reason to think that Rouhani, who is acting on Khamenei's behalf, is ready to shut down his country's nuclear program, despite airy statements to the contrary. The Iranian leadership wants to maintain its ability to produce nuclear weapons while at the same time convincing the West to lift sanctions. So far, Rouhani's difference is one of style, not of substance. Americans are easily charmed by smiling clerics, and Rouhani understands this. In 2007, he said, 'We should talk carefully so as not to provoke the enemy, we should not give them any excuses.' Who is the enemy? The U.S. is the enemy. According to the Washington Institute for Near East Policy's Steven Ditto, Rouhani wrote in 2003: 'The fundamental principle in Iran's relations with America -- our entire focus -- is national strength. Strength in politics, culture, economics, and defense -- especially in the field of advanced technology -- is the basis for the preservation and overall development of the System, and will force the enemy to surrender.' Ditto, who has read much of Rouhani's voluminous output, says the quotation 'encapsulates the overwhelming impression gleaned from Rouhani's history and writings: his identity as a revolutionary ideologue and defender of the Iranian System.' Ditto argues that Rouhani is simply a cleverer tactician than some of his colleagues. 'What separates Rouhani from traditional ideologues, however -- and what fuels perceptions of him as a `reformist' -- is his belief that certain kinds of political and social reform can facilitate the defense, upkeep, and legitimization of the Iranian regime.' In other words, a pleasant phone call with the president of his chief adversary -- and the prospect of extended negotiations -- are legitimate if they help advance the goals of the regime. 'In light of this background, there will be no moral, political, or intellectual meeting of minds between Rouhani and the West,' Ditto writes... President Barack Obama seems somewhat enthusiastic about the possibility of real rapprochement with Iran. But Gary Samore, who was until recently Obama's chief adviser on Iranian nuclear issues, does not. When I spoke to him this morning, he was acerbic: 'The Iranians are going to try to see how far they can get on charm alone.' That, for now, is the game." http://t.uani.com/19eGyWY

Alon Pinkas in Haaretz: "Contrary to what the punditocracy claims, and with much fanfare, there has not been a substantial shift in U.S.-Iranian relations. Not yet anyway. Yes, there was that phone conversation between Presidents Obama and Rohani, analyzed ad nauseaum.  But in reality, the new phase in this decade-old saga of 'What To Do About Iran's Nuclear Program' is only beginning. The U.S. did not - did not - offer new gestures, nor hinted in any way that sanctions may be eased. In fact, President Obama reiterated that a military option is no off the table. Iran, for its part, mellowed compared to the incendiary, inciteful and hateful rhetoric of the Ahmadinejad days (yes, we all miss him) but presented absolutely no new policy. Effectively, the Iranian 'charm offensive' is over. Those who accuse Prime Minister Netanyahu of party pooping the U.S.-Iranian temporary 'Entente Cordiale' are forgetting two things: First, you can't poop a party that ended before you showed up and secondly, this entente has been a U.S. policy objective ever since President Obama articulated it in 2009, calling it then 'engagement'. The multilateral approach, through the UN Security Council as a mechanism or as a group, with the addition of Germany, succeeded in pressuring Iran and generated sustained global awareness of the Iranian nuclear program, but could not alter the trajectory of Iran's ambitions and policy. Severe sanctions were imposed, exacting a high price on Iran's economy, but sanctions were but a means to coerce negotiations. It took the U.S. nearly five years (since President Obama enunciated the 'engagement' policy) and the election of Rohani this June to launch such talks, but here we are. Yes, Iran has an impressive and consistent track record of duplicity and deceit. Yes, it would be reckless to assume that Rohani is a born-again anti-proliferation wonk who will forgo Iran's nuclear aspirations. But the only way to reach a deal and install an intrusive inspections regime is through negotiations. Mr. Netanyahu is right to express his doubts. The cost of miscalculation is too high a price to pay, particularly for Israel. However, he is wrong to dismiss this casually as just an Iranian ploy. Rather than 'declare victory' and announce that while Israel has reservations, it welcomes negotiations and prefers a diplomatic path, Israel is turning the Iranian issue into an exclusively Israeli issue. This is not and should not be the case. Former Obama Administration arms control expert, Gary Samore, currently with UANI (United Against Nuclear Iran, an agile New York-based advocacy group that Iran itself concedes has caused it significant political and economic damage) said to Foreign Policy magazine: 'Nobody is fooled by the charm offense; everybody understands the Supreme Leader is seeking nuclear weapons. No matter how many times Rohani smiles, it doesn't change the basic objective of the program.' Samore is right, but direct negotiations, coupled with a credible, serious, tacit and quiet military threat is the only modality that can work." http://t.uani.com/GzAPiS

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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