Thursday, March 31, 2016

Eye on Iran: Officials: US Mulls New Rules on Dollars to Help Iran








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AP: "The Obama administration may soon tell foreign governments and banks they can start using the dollar in some instances to facilitate business with Iran, officials told The Associated Press, describing an arcane tweak to U.S. financial rules that could prove significant for Tehran's sanctions-battered economy. While no decision is final, U.S. officials familiar with internal discussions said the Treasury Department is considering issuing a general license that would permit offshore financial institutions to access dollars for foreign currency trades in support of legitimate business with Iran, a practice that is currently illegal. Several restrictions would apply, but such a license would reverse a ban that has been in place for several years and one the administration had vowed to maintain while defending last year's nuclear deal to skeptical U.S. lawmakers and the public... Dropping the prohibition would go a long way to meet Iran's complaints that the West hasn't sufficiently rewarded it for taking thousands of uranium-spinning centrifuges offline, exporting its stockpile of the bomb-making material and disabling a facility that would have been able to produce weapons-grade plutonium. But it surely would prompt intense opposition from critics of last July's nuclear accord. If approved, the new guidance would allow dollars to be used in currency exchanges as long as no Iranian banks are involved, according to the officials, who weren't authorized to speak publicly on the matter and demanded anonymity. No Iranian rials can enter into the transaction, and the payment wouldn't be able to start or end with American dollars. The ban would still apply if the final payment is intended for an Iranian individual or business on a U.S. sanctions blacklist. The administration has hinted the U.S. could introduce new sanctions concessions, but has confirmed nothing... Members of Congress are crying foul. The 2012 National Defense Authorization Act instructs the president to 'block and prohibit' all Iranian assets if they 'come within the United States, or are or come within the possession or control of a United States person.' In a letter to Lew on Wednesday, Republican Sens. Marco Rubio and Mark Kirk said any Iranian access to dollars 'would benefit Iran's financiers of international terrorism, human rights abuses and ballistic missile threats.' They cited testimony last year by Treasury Department's sanctions chief, Adam Szubin, who told lawmakers Iran wouldn't be allowed 'even to execute a dollarized transaction where a split second's worth of business is done in a New York clearing bank.'" http://t.uani.com/1Rs0sTr

NYT: "Iran's supreme leader backed the country's missile program on Wednesday, criticizing a prominent ayatollah who had suggested that in the future, negotiations were far more important. Defending the military's recent tests, which critics, particularly in the United States, say are a violation of the recently concluded nuclear agreement, the supreme leader, Ayatollah Ali Khamenei, said that both negotiations and the testing of missiles were important to Iran. 'If the Islamic system pursues technology and negotiations without defense power, then this will be a retreat in the face of threats from other insignificant countries,' Ayatollah Khamenei was quoted as saying in an address in Tehran. 'Enemies continue strengthening their military and missile sectors. How can anyone say that the era of missiles has passed?' Ayatollah Khamenei was responding to a comment posted on Twitter over a week ago by Ayatollah Ali Akbar Hashemi Rafsanjani, a former president and influential supporter of Iran's moderate president, Hassan Rouhani. Ayatollah Rafsanjani wrote that the 'world of tomorrow is one of negotiations, not the world of missiles.' Ayatollah Khamenei, in a rare open criticism, reacted harshly, though he referred only indirectly to Ayatollah Rafsanjani's remark. 'People say that tomorrow's world is a world of negotiations and not a world of missiles,' he said. 'If they say this thoughtlessly, it shows that they are thoughtless. However, if this is intentional, then this is treachery.'" http://t.uani.com/1Y1WtgR

AFP: "Iran's defence minister has said he is 'certain' the UN Security Council will not take any action over its ballistic missile tests despite calls from Western powers. Britain, France, Germany and the United States wrote a joint letter on Monday calling for action over tests they said violated last year's landmark nuclear deal between Iran and major powers, and the Security Council resolution that enshrines it. They said the two kinds of missiles fired by Iran on March 8 and 9, the Shahab-3 and Qiam-1, were a breach of the resolution because they were 'inherently capable of delivering nuclear warheads', something Iran denies. 'I am certain that the Security Council and the United Nations will not respond as our actions are neither a breach of the Joint Comprehensive Plan of Action (the July nuclear deal) nor are they against Resolution 2231,' General Hossein Dehghan said." http://t.uani.com/1RrZHtm

Nuclear & Ballistic Missile Program

Reuters: "The chairman of the U.S. Senate Foreign Relations Committee said on Wednesday the U.N. Security Council's refusal to respond to Iran's ballistic missile tests defied Obama administration assurances that a ban on such tests would remain in place after the Iran nuclear deal. 'As many of us feared, now it appears Iran can defy those restrictions with impunity fearing no pushback from the U.N. Security Council,' Republican Senator Bob Corker said, in response to a report by Reuters that diplomats suggested Iran's tests do not technically violate provisions of Security Council Resolution 2231." http://t.uani.com/1Y1VH3q

WashPost: "Sens. Corker and Ben Cardin (D-Md.), are expected to soon release legislation stepping up sanctions against Iran over its ballistic missile program. But the United States and its partners cannot force the U.N. Security Council to take similar actions - and reports that the international community may not follow the United States' lead with anything more than a public rebuke have Corker crying foul, while other lawmakers are expressing concern. 'US & allies must respond w/ action,' Rep. Ted Deutch (D-Fla.) posted on Twitter Wednesday, citing the same Reuters report. Deutch was one of a small number of Democrats who opposed the Iran deal." http://t.uani.com/1M2Y9WE

U.S.-Iran Relations

NYT: "The Justice Department has appointed Kenneth R. Feinberg, the lawyer who administered compensation for victims of the Sept. 11 attacks, as special master to oversee a new fund to compensate victims of state-sponsored terrorism. The fund, created by Congress late last year, will provide compensation to victims of attacks like the bombings of American embassies in East Africa in 1998 and the bombings of the American Embassy and Marine Corps barracks in Lebanon in the early 1980s. It is also intended to compensate the Americans taken hostage at the United States Embassy in Tehran in 1979... The fund presents some unusual complications because it covers victims who in some cases have already been designated to receive compensation in various federal court rulings, as well as the Tehran Embassy hostages, who were long barred from seeking court-ordered damages from Iran because of the terms of the treaty that freed them in 1981. An additional complication is a lawsuit filed by the central bank of Iran seeking to overturn a law in which Congress designated that $2 billion in frozen Iranian assets should be available to compensate victims of terrorism. The Supreme Court heard oral arguments in that case earlier this year, and a ruling is due this spring." http://t.uani.com/1oo2JmM

Sanctions Enforcement

AP: "Treasury Secretary Jack Lew warned Wednesday against the overuse of financial sanctions against other nations and said the U.S. must be prepared to ease the penalties over time if they succeed in changing behavior... Lew gave his speech about lessons learned on decades of sanctions at the same time that some Republicans in Congress want to keep hard-hitting sanctions in place against Iran. They were against last year's nuclear agreement in which the U.S. and its allies agreed to ease sanctions against Tehran in exchange for its promise to curtail programs that would allow it to develop nuclear weapons. 'Since the goal of sanctions is to pressure bad actors to change their policy, we must be prepared to provide relief from sanctions when they succeed,' he said. 'If we fail to follow through, we undermine our own credibility and damage our ability to use sanctions to drive policy change. ... Since Iran has kept its end of the deal, it is our responsibility to uphold ours in both letter and spirit.'" http://t.uani.com/1Va4PUl

Reuters: "Overuse of harsh sanctions like those deployed against Iran to limit its nuclear program risks driving business activity from the United States and a move away from the dollar as the world's reserve currency, U.S. Treasury Secretary Jack Lew said on Wednesday... For example, the United States was able to induce buyers of Iranian oil to sharply curtail their purchases, and international banks cut ties with Iran for fear of losing access to the U.S. financial system. Iran reached a deal with the United States and other world powers last July that lifted the harshest measures in return for curbs on its nuclear program. But 'sanctions overreach' risks encouraging businesses to avoid the U.S. financial system and could erode the power of the U.S. dollar as the pre-eminent reserve currency, Lew said during a speech in Washington. 'The more we condition use of the dollar and our financial system on adherence to U.S. foreign policy, the more the risk of migration to other currencies and other financial systems in the medium-term grows,' Lew said. In particular, so-called secondary sanctions should be wielded in the most 'exceptional' circumstances, Lew said. Those measures bar even non-U.S. citizens from dealing with sanctioned individuals or companies, and were the type of sanctions levied against Iran. 'They are viewed even by some of our closest allies as extra-territorial attempts to apply U.S. foreign policy to the rest of the world,' Lew said, adding that the Iran nuclear sanctions should not be viewed as a 'starting point' for other sanctions programs." http://t.uani.com/1RMwIzB

Sanctions Relief

Reuters: "Asian imports of Iranian oil jumped nearly a quarter from a year earlier to a two-year high in February, as shipments into India and South Korea roughly doubled weeks after international sanctions were lifted on Tehran's disputed nuclear programme. International oil and shipping companies have been eager to renew business with Iran since sanctions related to its nuclear programme were lifted in January. Tehran's exports may also get further support as progress has been made on reinsurance issues that had been hampering its oil trade. Aside from the greater volumes taken by Asian buyers, Iran's oil flows to Europe have also begun to pick up after a slow start. An Iranian official said last week that exports had risen by 900,000 barrels per day (bpd) to 2.2 million bpd in the past two months. Imports by Iran's top four buyers - China, India, Japan and South Korea - came to 1.28 million bpd in February, up 24.6 percent from a year ago, government and tanker-tracking data shows. That was the highest volume taken by Tehran's four biggest oil clients since they bought 1.37 million bpd in February 2014... The following tables show Asia's Iran crude imports in bpd for last month and the year to date." http://t.uani.com/1PHwjdf

Iraq Crisis

WSJ: "In Iraq, there was also a spoiler: Iran. With money and bombs, Tehran's Shia Muslim regime was fueling frictions between Iraq's Shia majority and its Sunni minority, pushing the country into civil war. Mr. Khalilzad reports that the Quds Force, the elite overseas arm of Iran's Islamic Revolutionary Guard Corps, 'had an enormous number of Iraqis on its payroll, sometimes at low levels and other times at much higher levels.' He writes that in his efforts to thwart Iran's pernicious reach, 'I sometimes told Shia Islamist leaders, who were close to Iran, that I believed Tehran wanted to turn Iraq into a smoldering ruin that the Iranians could then control with ease.' Some Shia leaders quietly agreed, including, on at least one occasion, Prime Minister Nouri al-Maliki, who told Mr. Khalilzad that he believed Iran had been behind the 2006 terrorist bombing of a major Shia shrine in Iraq, the Golden Mosque." http://t.uani.com/1SBf9SU

Opinion & Analysis

Barack Obama in WashPost: "Of all the threats to global security and peace, the most dangerous is the proliferation and potential use of nuclear weapons. That's why, seven years ago in Prague, I committed the United States to stopping the spread of nuclear weapons and to seeking a world without them. This vision builds on the policies of presidents before me, Democrat and Republican, including Ronald Reagan, who said 'we seek the total elimination one day of nuclear weapons from the face of the Earth.' Thursday in Washington, I'll welcome more than 50 world leaders to our fourth Nuclear Security Summit to advance a central pillar of our Prague Agenda: preventing terrorists from obtaining and using a nuclear weapon. We'll review our progress, such as successfully ridding more than a dozen countries of highly enriched uranium and plutonium. Nations, including the United States, will make new commitments, and we'll continue strengthening the international treaties and institutions that underpin nuclear security... Beyond preventing nuclear terrorism, we've made important progress toward the broader vision I outlined in Prague... Second, we're strengthening the global regime - including the Nuclear Non-Proliferation Treaty - that prevents the spread of nuclear weapons. We've succeeded in uniting the international community against the spread of nuclear weapons, notably in Iran. A nuclear-armed Iran would have constituted an unacceptable threat to our national security and that of our allies and partners. It could have triggered a nuclear arms race in the Middle East and begun to unravel the global nonproliferation regime. After Iran initially rejected a diplomatic solution, the United States mobilized the international community to impose sanctions on Iran, demonstrating that nations that fail to meet their nuclear obligations will face consequences. After intense negotiations, Iran agreed to a nuclear deal that closes every single one of its paths to a nuclear weapon, and Iran is now being subjected to the most comprehensive inspection regimen ever negotiated to monitor a nuclear program. In other words, under this deal, the world has prevented yet another nation from getting a nuclear bomb. And we'll remain vigilant to ensure that Iran fulfills its commitments." http://t.uani.com/1Sp1qfz

Sen. Chris Coons (D-Del.) in The Hill: "This Thursday in Washington, President Obama will convene heads of state from around the world for a fourth Nuclear Security Summit, a conference of world leaders dedicated to preventing nuclear terrorism and securing stockpiles of nuclear material around the world. With terrorist organizations and rogue nations fomenting instability around the world, and as the international community's leading powers work to enforce the nuclear deal with Iran, the challenge of preventing the use of nuclear weapons is not an academic exercise. As a global community, we need to take real, tangible steps to meet this challenge. The best first step we can take is to support the International Atomic Energy Agency (IAEA) - the world's nuclear watchdog. Since 1957, world powers have tasked the IAEA with preventing the spread of nuclear weapons and making sure countries honor their international obligations to use nuclear technology and material for peaceful purposes. With the agreement reached between the U.S., five other global powers,and Iran last summer, also known as the Joint Comprehensive Plan of Action (JCPOA), ensuring the IAEA can do its job has never been more important. The JCPOA gives the IAEA unprecedented access to monitor Iran's nuclear efforts through highly intrusive physical inspections and 24-7 remote monitoring technology. Under the terms of the deal, the IAEA also has the authority to monitor and oversee every stage of Iran's nuclear fuel cycle, from the mines from which uranium is extracted from the ground, to the facilities that enrich it into material that can be used in a nuclear bomb. Conducting these inspections and maintaining this level of oversight is the IAEA's job - but world powers have a responsibility to make sure the agency has the resources it needs. Access alone is not enough: to turn that access into effective oversight, while still fulfilling its regular mission of ensuring nonproliferation around the world, the IAEA needs long-term, sustainable funding... It is no understatement to say that the IAEA's very credibility is on the line as it begins to monitor, inspect, and verify the status of Iran's nuclear program... That's why I've urged Congress to increase America's voluntary contribution to the IAEA to a level $10.6 million above the President's request, and to commit to sustained support in the future." http://t.uani.com/1VV70fd
       

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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