TOP STORIES
Until recently, an American phone in Iran would not
receive any signal. But that has quietly changed. This past week, a
spokesman for AT&T acknowledged that the company was providing
voice and data service in Iran to its customers with American phones
through a partnership with a local firm, RighTel. An employee at the
Iranian company, fully owned by a state entity, confirmed the
partnership. While the announcement that Airbus and Boeing will
provide dozens of jetliners to Iranian carriers garnered worldwide
headlines last month, the deal that AT&T clinched in March,
making it the only American provider to offer phone service in Iran,
flew under the radar... It remains unclear how AT&T and RighTel
will settle accounts. A representative for AT&T said the company
would not disclose information on financial arrangements made with
the Treasury or with its Iranian partner. One possible clue: RighTel
is owned by the Social Security Organization of Iran, a state entity
that has large stakes in several domestic banks.
The Obama administration further eased financial
sanctions on Iran through regulatory measures that could
significantly bolster Tehran's ability to access global financial
markets and attract foreign investment. The U.S. Treasury Department
on Friday evening released new guidelines for dealings with Iran that
loosen restrictions on the country's ability to trade in U.S.
dollars, according to the documents published on Treasury's website.
The Treasury also widened the potential business partners for
non-American investors in Iran by announcing that U.S.-sanctioned
Iranian entities can partake in projects provided they aren't the
controlling shareholder... The Treasury's decision to announce the
new guidelines on Iran at 6 p.m. on a Friday evening-ahead of the
three-day holiday weekend-was viewed by congressional officials as an
attempt by the administration to blunt further criticism from Capitol
Hill. Administration officials have hinted for months that the Obama
administration might take measures to ease Iran's access to U.S.
dollars. Current Treasury sanctions ban Iranian banks and companies
from conducting any business through the American financial system.
The Treasury announced on Friday, however, that Iran could legally
gain access to dollars through non-U.S. banks and institutions,
provided they have no direct contact with the U.S. financial system.
New U.S. guidelines on foreign investment in Iran
sparked concerns that the measures would benefit Tehran's elite
military unit, the Islamic Revolutionary Guard Corps... "The new
guidance overturns the long-running understanding that the U.S.
dollar cannot be used to facilitate international trade with any
Iranian entities, let alone sanctioned entities. And by allowing
foreign subsidiaries of U.S. companies to transact business with
Iranian entities, the president is ignoring the clear text of a law
passed by Congress," Sen. Tom Cotton (R., Ark.) said on Sunday.
Sen. Mark Kirk of Illinois, who chairs a Senate banking committee
with oversight over Iran sanctions law, said the new guidelines
amounted to the White House granting Tehran new concessions.
Meanwhile, Rep. Mike Pompeo (R., Kan.) said Treasury's changes
"green-light business with terrorists. The updated FAQs remove
barriers for foreigners to engage with firms the Islamic
Revolutionary Guard Corps controls. From this and other appeasements,
it appears the Obama administration has given up on any democratic or
pro-Western future for Iran." ... "The administration seems
to be doing everything possible-from roadshows to new interpretations
of regulations-to encourage business with Iran," said Juan
Zarate, who served as a senior Treasury and White House official in
the George W. Bush administration. "At a time of growing concern
about Iran's adventurism, support to terrorism, and clerical and IRGC
control of the economy, this seems to be a moment for the U.S. and
the world to be applying even more scrutiny-not less."
REGIONAL DESTABILIZATION
Iranian-backed Houthi rebels fired two missiles at a
U.S. Navy destroyer operating off the coast of Yemen in the Red Sea
on Sunday -- though neither missile hit the ship, the Pentagon said
in a statement. Though the American warship wasn't struck, the ship
was definitely targeted, a U.S. defense official told Fox News. This
dramatic escalation comes a week after the U.S. Navy sent warships to
the area when a United Arab Emirates flagged auxiliary ship was
destroyed off the coast of Yemen by the Houthis. "We assess the
missiles were launched from Houthi-controlled territory in
Yemen," Pentagon spokesman Capt Jeff Davis said. "The
United States remains committed to ensuring freedom of navigation
everywhere in the world, and we will continue to take all necessary
steps to ensure the safety of our ships and our servicemembers."
... U.S. officials have long accused Iran of supplying missiles and
other weapons to the Houthis.
A high-ranking U.S. official told Asharq Al-Awsat that
Iran is responsible for actions that are shaking the stability of
Yemen and that the U.S. along with its partners will cooperate to
restrain Tehran from these actions. The official, who preferred to
remain anonymous, affirmed that the U.S. is committed to the
navigation freedom in Bab al-Mandeb, decrying the assault of Houthis
on the UAE ship "Swift." These remarks came in response to
the accusations of Iran's spokesperson for the Ministry of Foreign
Affairs that the U.S. is delivering weapons to Yemen.
U.S.-IRAN RELATIONS
A Principlist parliamentarian has criticized Jason
Rezaian's filing of a lawsuit for his alleged unjust arrest as 'a
pretext to for a new wave of stealing nation's assets in the US.'
Hossein Naghavi Hosseini, the spokesperson of Parliament's National
Security and Foreign Policy Commission, told reporters on Thursday
that the court process which had led to Rezaian's conviction were
legitimate and he had accurately been convicted for spying; "his
freedom marks the Islamic mercy on himself lavished by the Islamic
Republic of Iran and a great achievement for us," he added.
"Rezaian's claim that during 18 months in prison, he has been
subject to spiritual and mental torture is an outright lie and the
Islamic Republic was by no means exchanging a hostage during nuclear
negotiations in order to hit a viable accord with the US; this is an
injudicious decision and definitely, the legal deputy of the
president and the Foreign Ministry will wage efforts to vindicate the
rights of the nation should a court hear Rezaian's case,"
Naghavi Hosseini emphasized.
CONGRESSIONAL ACTION
Senate Democrats are demanding Majority Leader Mitch
McConnell bring up a straight 10-year extension of key Iran sanctions
once lawmakers return to Washington next month. Seven Democrats - led
by Sen. Richard Blumenthal (Conn.) - sent a letter to the Kentucky
Republican asking that he "prioritize" a clean extension of
the Iran Sanctions Act during the Senate's end-of-year session.
"Passing this vital legislation before its expiration is crucial
to ensuring with the utmost certainty that the United States will
continue to have the sanctions enforcement mechanism our national
security demands," they wrote in Wednesday's letter, a copy of
which was also sent to Sen. Richard Shelby (R-Ala.) who chairs the
Banking Committee. McConnell said last year that any Iran proposal would
need to have 67 votes - enough to overcome a potential veto - before
he would allow it to get floor time. The Iran Sanctions Act will
expire at the end of the year without congressional action. Though
there is wide-spread support for extending ISA, lawmakers are deeply
divided over what should be included in an extension... Democratic
Sens. Debbie Stabenow (Mich.), Jeff Merkley (Ore.), Ron Wyden (Ore.),
Amy Klobuchar (Minn.), Martin Heinrich (N.M.), and Brian Schatz
(Hawaii) also signed Wednesday's letter.
Sen. Richard Blumenthal (D-Conn.) unveiled legislation
Thursday that would make it easier for terror victims to recover
court-awarded funds from Iran. The bill, according to Blumenthal,
closes two loopholes that have allowed Iran and other state sponsors
of terrorism to hide funds through illegal transfers to and from
foreign banks. "Victims of terrorism and their families have
waged courageous legal campaigns to hold state sponsors of terrorism
accountable for their atrocities, only to be thwarted,"
Blumenthal said in a statement. "My bill will ensure that state
sponsors of terrorism cannot hide from American justice." Under
U.S. law, victims of terrorist attacks can sue individual terrorists
and nations on the State Department's State Sponsors of Terror list -
but often struggle to collect any funds a judge may award if the
money is not housed in the United States. The so-called Terrorism
Victims Protection Act would change current law to direct that
blocked, in-transit funds are the property of the terrorist or state
sponsor of terror... Blumenthal announced the legislation on the
steps of the Hartford, Conn., District Court, alongside survivors and
families of Marines killed by a suicide bomber in Beirut, Lebanon, in
1983. The victims are seeking to collect $1.67 billion in damages
from Iran, awarded to them in a 2016 Supreme Court judgement.
Sen. Marco Rubio (R-Fla.) and Rep. Mike Pompeo
(R-Kan.) on Friday sent a letter to Attorney General Loretta Lynch
requesting more information on the Department of Justice's role in
$1.3 billion in payments to Iran. The letter said the Treasury Department
has informed Pompeo that the Department of Justice gave the
"appropriate approvals" for the payment. "What was
included in these approvals? Who from the Justice Department granted
these approvals?" the members of each Intelligence Committee
asked in the letter, first obtained by The Hill. They also asked
Lynch about reports that she personally approved several payments
from the Judgment Fund to Iran citing a rarely used statute, 28 U.S.
Code § 2414, which requires "certification by the Attorney General
that [the payment] is in the interest of the United States."
"Please explain how sending billions of dollars in cash to the
world's foremost state sponsor of terrorism is in our country's best
interest," they wrote.
BUSINESS RISK
A former top Treasury Department official told THE
WEEKLY STANDARD Thursday that major international firms still do not
want to do business with Iran, despite efforts by the Obama
administration to persuade foreign banks and businesses to reengage
there. Stuart Levey, the Treasury Department undersecretary for
terrorism and financial intelligence under the Bush and Obama
administrations, said that though some sanctions on Iran were lifted
after last summer's nuclear deal, firms remain wary of doing business
with the Islamic Republic due to the country's support for terrorism
and other illicit activities. "What you've seen more broadly ...
is the sanctions get lifted, [but] the major international financial
institutions will still resist doing business until the underlying
facts change," Levey, now the chief legal officer for
London-based HSBC Holdings, said during an event at the Foundation
for Defense of Democracies... "You're trying to persuade foreign
financial institutions to do business ... under a background where
American financial institutions are still forbidden, it's against the
law" Levey told TWS. "That's something which every European
bank and Asian bank is very well aware of."
SANCTIONS RELIEF
Royal Dutch Shell confirmed Monday that it had signed
an initial deal with Iran's National Petrochemical Company, paving
the way for its return to the Islamic republic. "We can confirm
that we have expressed our interest to further explore potential
areas of cooperation with the National Petrochemical Company through
a letter of intent," a spokesman for the Anglo-Dutch energy
giant told AFP. Iran's Shana news agency, which is linked to its oil
ministry, said the deal had been signed in Tehran on Sunday. Hans
Nijkamp, Shell's vice president, attended the signing ceremony and
told Shana that the company was seeking "a long-term presence in
Iran". "We first need to see what are the areas where we
think we can work together and then work out what commercial
structures we use, what technical solutions, and ultimately you will
indeed end up with a sort of a joint venture agreement," he
said. "But it is too early today to put any timeline on that. We
are very pleased that Iran is coming back to be a part of the global
community. But it is still a fragile situation," he added,
according to Shana.
Asian nations are stepping up their purchases of
Iranian oil, underscoring Tehran's deepening energy ties with the
region amid a slow rapprochement with European crude buyers. China,
India, Japan and South Korea are among big Asian oil consumers that
have sharply boosted their imports of Iranian crude this year. China
and India are looking to further lock down Iranian supply, with a large
planned investment in Iran's oil and gas infrastructure. Iran is
seeking $130 billion worth of investment to bring its energy sector
up to date after years of sanctions... In India, crude imports from
Iran in August nearly tripled from a year earlier to 576,000 barrels
a day, according to the National Iranian Oil Co. Exports to
China-Asia's biggest buyer of Iranian oil-in the same month grew 48%
from a year earlier to 749,000 barrels a day, and are up 7% this
year. Other Asian oil guzzlers have also brought in significant
amounts of new Iranian oil, with Japan's imports this year rising 45%
compared with a year ago, and South Korea's imports more than
doubling.
Trafigura Group Ltd., the second-biggest metals
trader, wants to increase business with post-sanctions Iran. The
Singapore-based trading house is seeking to hire a Persian-speaking
executive for its refined metals division to work with its traders to
"identify, analyze, assess and propose business opportunities in
the Arabian Gulf, especially within the rapidly changing Iranian
market," according to a job posting on Trafigura's website. The
candidate will be expected to "understand the opportunities
arising from the liberalization of the Iranian metals market,"
Trafigura said in the ad. The job will "involve significant
traveling to build relationships with key players in Iran," it
added. Trafigura and other commodity traders including Rotterdam's
Vitol Group, the largest independent oil trader, have re-entered Iran
after the U.S. and European Union lifted sanctions imposed over the
country's nuclear program.
PTB Perse International Forwarding Co. (Tehran), a
subsidiary of the Swiss TransInvest Group, has won the tender for the
concession to develop and operate Aprin Terminal, 20 kilometers from
Tehran. The contract was signed at Iranian Railway headquarters in
Tehran on September 18 at an official ceremony. The concession
comprises a 25-year license for a so-called BOT (Build - Operate -
Transfer) operator model, with a three-year construction phase and 22
years of operations. With an area of approximately 450 hectares,
Aprin is to become Iran's biggest dry port and a modern rail
logistics terminal with customs clearance and bonded warehouse. The
PTB Group was awarded the contract for the first phase, the
development and operation of a 55-hectare sector; the annual capacity
will be at 400,000 TEU, the sum invested in the infrastructure of the
area will amount to approximately USD 30 million... With a staff of
450 working at 15 locations, the PTB Group is today renowned as one
of Iran's leading logistics services providers.
Thailand aims to resume rice exports with Iran, the
Thai commerce ministry said on Monday, following a trade meeting
between the two countries in the Thai capital Bangkok. Trade leaders
from the two nations met on the sidelines of the Asia Cooperation
Dialogue meeting, a Thai-led meeting aimed at fostering dialogue
among various regional organisations. Thailand and Iran agreed to
resume bilateral trade and aim to increase their shared market from
$310 million to $3 billion by 2021, said Thai commerce minister
Apiradee Tantraporn, following a meeting with her Iranian counterpart
Mohammad Reza Nematzade. Thailand, the world's second-largest rice
exporter, also aims to export 700,000 tonnes of rice to Iran per
year, Apiradee told reporters, the same level as before increased
economic sanctions were imposed in 2012... On Sunday, Iranian
president Hassan Rouhani arrived for the summit in Bangkok, marking
the first Iranian presidential visit to the Southeast Asian nation...
Thai Airways and Thai AirAsia X started selling direct flights
between Bangkok and Tehran this year in a bid to attract wealthy
tourists from the Middle East.
HUMAN RIGHTS
The United Nations human rights investigator for Iran
called on Friday for the immediate release of three Iranians with
dual nationality whose health is a matter of concern. Ahmed Shaheed,
U.N. special rapporteur on the situation of human rights in Iran, in
particular highlighted the case of the Iranian-British aid worker
Nazanin Zaghari-Ratcliffe, who was arrested in April with her
2-year-old daughter and tried in August. An Iranian revolutionary
court sentenced her to five years in prison on charges that remain
secret, her family said last month. "Sentencing individuals for
charges that are kept secret from defendants and their defense
lawyers is a mockery of justice," Shaheed, a former foreign
minister of the Maldives, said in a statement. He said her health had
"seriously deteriorated" since her arrest.
Iran has temporarily released a journalist for medical
treatment after he became sick following a hunger strike, local media
reported Sunday. Ehsan Mazandarani, who runs reformist daily
newspaper Farhikhtegan, was arrested in late 2015 and sentenced in
April to seven years for "acting against national
security". "The health of my client, due to a hunger strike
he was on, turned bad and he was transferred to hospital," his
lawyer Hooshang Pourbabayi told the ISNA news agency.
DOMESTIC POLITICS
Details of the military operation were scant: there
were "antirevolutionary and terrorist groups", a
"tense battle" and 12 militants killed. That Iran's elite
Revolutionary Guards released any information at all about the clash
this week was highly unusual, and suggests to some the regime's
growing concern about unrest in the north-west. For years, Tehran has
boasted about the high level of security in its border regions,
including the north-west, which has a large population from the
Kurdish minority. But in recent months, state media has reported that
the north-west has been hit by a string of clashes between regime
forces and Kurdish separatists and Isis militants... Others also
question the guards' motives for making public the clashes, and
whether they are using Isis as a pretext to further curb dissident
ethnic and Sunni minorities.
Mansour Faridfar did well on the black market until
the law caught up and left him jobless, forcing him to join the
thousands of "shakhsi" unofficial taxi drivers clogging
Tehran's streets... Such fly-by-night careers are common in Iran
thanks to decades of economic mismanagement and international
isolation. The jobless rate currently stands at 11 percent. Tehran's
mayor Mohammad Bagher Ghalibaf this week bemoaned the growing number
of shakhsi caused, he said, by the "bad economic
situation". "I've personally witnessed them dare to go to
taxi ranks and take work away from (official) taxi drivers," he
told a transport conference.
Iran's state TV is reporting a cultural official has
resigned after protests by religious authorities over a concert in
the holy city of Qom. The Sunday report says Abbas Daneshi, head of
the department of culture in Qom, resigned due to discontent among
religious authorities over the event last month. Qom, about 130
kilometers (80 miles) south of Tehran is a center for Shiite Muslim
education; among Shiites, it is considered one of the holiest cities
inside Iran. The move is a blow to President Hassan Rouhani who has
vowed a more open cultural policy. In recent months, religious
authorities have criticized the government for allowing concerts in
religious cities that host shrines of revered Shiite saints.
FOREIGN AFFAIRS
A Nigerian state where clashes between the military
and Shiite Muslims led to over 300 deaths last year has banned the
Islamic Movement of Nigeria (IMN), saying it was a security threat.
Two days of violence began on December 12, when supporters of the
pro-Iranian cleric and IMN head, Ibrahim Zakzaky, refused to allow
the chief of army staff's convoy to pass through the northern city of
Zaria in Kaduna state... in a press release issued late Friday,
Kaduna state governor Nasir El-Rufai said IMN was a threat to
Nigeria. "The Kaduna state government has issued an order
declaring the Islamic Movement in Nigeria (IMN) an unlawful
society," a statement said.
OPINION & ANALYSIS
As finance ministers and global economic heavyweights
gather in Washington for the annual meetings of the International
Monetary Fund (IMF) and the World Bank, Iran's future in the
international financial system will certainly be a topic of intense
discussion. This year's conclave will be the first since the
implementation of the nuclear deal between the P5+1 and Iran in
January 2016. IMF staff recently concluded a visit to Tehran,
and reported that "economic conditions are improving
substantially in 2016/2017." They added that real GDP is
projected to rise by at least 4.5%; oil production has risen to
pre-sanction levels; and inflation is being tackled by the
application of "ambitious reforms." But policymakers
and business leaders should not get swept up in the hype surrounding
the alleged new Iranian gold rush in the aftermath of the lifting of
sanctions. Iran's economy remains mired in corruption, hobbled
by political infighting; and wanting in transparency, with many key
sectors controlled by the Islamic Revolutionary Guard Corps (IRGC)-a
terror organization sanctioned by the U.S. and international
community. Thus, significant structural impediments to rejoining the
international community loom large... In the end, betting on Iran at
this juncture could turn into a disastrous gamble, for the mullahs have
still not decided whether the Islamic Republic is a revolutionary
religious cause or an ordinary nation-state, as Henry Kissinger once
suggested.
Since their inception, the Shia irregulars have made
their name on the battlefields of Iraq, but they have always been
central to Tehran's ambitions elsewhere. By not helping to retake
Mosul, the militias are free to drive one of its most coveted
projects - securing an arc of influence across Iraq and Syria that
would end at the Mediterranean Sea... The strip of land to the west
of Mosul in which the militias will operate is essential to that
goal. After 12 years of conflict in Iraq and an even more savage
conflict in Syria, Iran is now closer than ever to securing a land
corridor that will anchor it in the region - and potentially
transform the Islamic Republic's presence on Arab lands. "They
have been working extremely hard on this," said a European
official who has monitored Iran's role in both wars for the past five
years. "This is a matter of pride for them on one hand and
pragmatism on the other. They will be able to move people and
supplies between the Mediterranean and Tehran whenever they want, and
they will do so along safe routes that are secured by their people,
or their proxies." Interviews during the past four months with
regional officials, influential Iraqis and residents of northern
Syria have established that the land corridor has slowly taken shape
since 2014... The plan has been coordinated by senior government and
security officials in Tehran, Baghdad and Damascus, all of whom defer
to the head of the spearhead of Iran's foreign policy, the Quds force
of the Revolutionary Guards, headed by Major General Qassem
Suleimani, who has run Iran's wars in Syria and Iraq.
Last week, the Wall Street Journal reported that the
Obama administration secretly agreed to lift United Nations sanctions
on two of Iran's missile financing institutions as part of a package
of controversial accommodations with Iran in January. Critics of the
move have focused on an alleged "quid pro quo" in which the
delisting of Bank Sepah and Sepah International was part of a
"ransom" paid for the release of Americans being held in
Iran. But the decision to clear the banks also diminishes the ability
of the United States and other governments to enforce U.N. sanctions
on Iran's ballistic missile program, which remain in place until
2023. Specifically, the United States has weakened its ability to
target the Iranian banks that finance missile development-one of the
most powerful means of countering Iran's missile progress. Bank Sepah
and its London-based affiliate Sepah International were two of only a
handful of banks that had been sanctioned by the United Nations, thus
cutting them off from the international financial system. They were
targeted for their support of the Aerospace Industries Organization
(AIO) and two AIO subsidiaries also sanctioned by the United Nations,
the Shahid Hemmat Industrial Group (SHIG) and the Shahid Bagheri
Industrial Group (SBIG). Together, these entities oversee Iran's
solid and liquid fueled missile development. Yet the United States
agreed to lift U.N. sanctions on Bank Sepah and Sepah International
as well as to remove them from the U.S. blacklist. This move
came despite the United States calling Bank Sepah AIO's "bank of
choice" as well as "the financial linchpin of Iran's
missile procurement network [that] has actively assisted Iran's
pursuit of missiles capable of carrying weapons of mass destruction."
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