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TOP STORIES
The Obama administration followed up a planeload of
$400 million in cash sent to Iran in January with two more such
shipments in the next 19 days, totaling another $1.3 billion,
according to congressional officials briefed by the U.S. State,
Treasury and Justice departments. The cash payments-made in
Swiss francs, euros and other currencies-settled a decades-old
dispute over a failed arms deal dating back to 1979. U.S. officials
have acknowledged the payment of the first $400 million coincided
with Iran's release of American prisoners and was used as leverage to
ensure they were flown out of Tehran's Mehrabad on the morning of
Jan. 17... The Obama administration previously had refused to
disclose the mechanics of the $1.7 billion settlement, despite repeated
calls from U.S. lawmakers. The State Department announced the
settlement on Jan. 17 but didn't brief Congress that the entire
amount had been paid in cash. U.S. lawmakers have voiced concern
that Iran's military units, particularly the elite Islamic Revolutionary
Guard Corps, would use the cash to finance military allies in the
Middle East, including the Assad regime in Syria, Houthi militias in
Yemen, and the Lebanese militia, Hezbollah.
A U.S. Navy coastal patrol ship changed course after a
fast-attack craft from Iran's Islamic Revolutionary Guard Corps came
within 100 yards (91 meters) of it in the central Gulf on Sunday,
U.S. Defense Department officials said on Tuesday. It was at
least the fourth such incident in less than a month. U.S. officials
are concerned that these actions by Iran could lead to
mistakes... there have been 31 similar interactions with Iranian
ships this year, almost double the amount from the same period last
year. "We don't see this type of unsafe and unprofessional
activity from any other nation," the defense official added.
With Iran's oil production closing in on pre-sanctions
levels, the world's biggest crude suppliers may face a lower hurdle
to an agreement on freezing output to revive prices. The Persian
Gulf nation is pumping 3.8 million barrels a day, approaching its
daily target of 4 million barrels, Mohsen Ghamsari, director for
international affairs at the National Iranian Oil Co., said Wednesday
at a conference in Singapore. He said earlier in the week that Iran
could reach its target in two to three months.
CONGRESSIONAL ACTION
Senate Republicans are taking aim at the Obama
administration's settlement of an arms dispute with Iran, which GOP
lawmakers believe was a ransom, amid lingering backlash over the
agreement. Sen. Marco Rubio (R-Fla.) is introducing legislation
Tuesday to force Iran to return the money and pay American victims of
Iran-backed terrorism. The Treasury Department would be blocked from
making payments to Iran out of its Judgement Fund until Tehran
complies with the bill... The Florida Republican's legislation
is backed by GOP Sens. John Cornyn (Texas), Mark Kirk (Ill.), Kelly
Ayotte (N.H.), John Barrasso (Wyo.) and Shelley Moore Capito (W.Va.).
Rubio, Kirk and Ayotte are in the midst of heated reelection battles.
Rep. Mike Pompeo (R-Kan.) is introducing the bill in the House
that is expected to consider Iran legislation this month.
House Foreign Affairs Committee Chairman Ed Royce
introduced a bill Tuesday that "makes clear" President
Obama violated U.S. policy by paying $400 million in cash in exchange
for four U.S. citizens held in Iran. The legislation would also "ban
cash payments to Iran - period," and would require
"transparency on future settlements" to ensure they are not
used to pay ransom.
BUSINESS RISK
[The Supreme] Leader's adviser has told reporters
joining Financial Action Task Force (FATF) would restrict activities
of some of Revolutionary bodies... [and] that it was not expedient
for the country to join the Task Force and any decision to join it should
be postponed.
A senior Iranian lawmaker warned that an agreement between the
Islamic Republic and the Financial Action Task Force (FATF), the
policy-making body of the international financial system, threatens
the country's national security. Speaking to the Tasnim News Agency,
Mohammad Javad Jamali, a member of the presiding board of the
parliament's National Security and Foreign Policy Commission,
expressed concerns that the deal between Iran and the FATF could
endanger the country's national interests. He said the Westerners are
seeking to further interfere in the internal affairs of the Islamic
Republic through the agreement. They are trying to secretly monitor
Iran's banking system and financial exchanges with other countries, he
added. "... If the deal is implemented, the security of the
Islamic establishment will be threatened," the MP said.
SANCTIONS RELIEF
German company SOLARWATT GmbH, one of the pioneers of
the solar industry, has plans to start projects in Iran by
constructing a 30 megawatt solar power plant... Abolfazl Mousavi
Fazel, representative of SOLARWATT, said the company is applying for
permission to build the plant as part of the German government's
plans for the promotion of solar industry in Iran.
The Taiwan-based payment company Castles,
specializing in payment tools, has started a semi knocked-down
production line in Iran's Arvand Free Trade Zone, in cooperation with
Bank Pasargad's subsidiary, FANAP. FANAP is launching the POS
terminal production line in Khorramshahr Free trade Zone, Khuzestan
Province. Jason Chiang, sales manager of Castles in the Middles East,
said the high demand in Iranian market has prompted the company to
expand its presence in the country. "The Iranian market offers
many opportunities, especially now that sanctions are lifted and
foreigners have more opportunities to take part in the market,"
he said. "Our Iranian partner, FANAP, is producing the POS
terminal and we provide them with technical and technological
assistance."
Italtel - a leading telecommunications company in
Network Functions Virtualization, managed services and all-IP
communication - today revealed its intentions in Iran, announcing it
will concentrate on building up ultra-fast Internet wideband
infrastructures so that essential services such as health and
education can be improved. Iran is one of the fastest growing
economies of the Middle East following the removal of the economic
sanctions at the beginning of 2016. As a result, many international
operators and technology vendors, including Italtel, are looking to
take advantage of the growth and development opportunities. Speaking
at the Iran Connect 2016 conference - which is taking place today and
tomorrow at Tehran's Espinas Palace Hotel - Italtel's CEO Stefano
Pileri said industries including health, transport and education
would be the sectors which would reap the most benefit for operators
and Iran citizens.
FOREIGN AFFAIRS
Head of French National Assembly Claude Bartolone
yesterday reiterated the French desire to maintain relations with the
Iranian Shura Council... Heading a parliamentary delegation,
Bartolone said the nuclear deal reached last year contributed to the
development of mutual relations. He also expressed his hope that Iran
implement the terms of the deal... Bartolone's visit to Tehran
is expected to last until Friday and he is scheduled to meet Iran's
President Hassan Rouhani, Foreign Minister Mohamed Javad Zarif and
the chairman of the Expediency Discernment Council of Iran.
SAUDI-IRAN TENSIONS
Saudi Arabia's top cleric is revving up the kingdom's
rhetoric against Iran, saying in comments published on Tuesday that
Tehran's leaders are "not Muslims," in response to
rancorous remarks from Iran's supreme leader. The remarks by
Grand Mufti Abdulaziz Al Sheikh came a day after Iran's Ayatollah Ali
Khamenei accused Saudi authorities of killing Muslims injured during
last year's crush of crowds at the hajj pilgrimage.
Head of the Strategic Research Center of Iran's
Expediency Council Ali Akbar Velayati slammed Riyadh for its
negligence to ensure the safety of Hajj pilgrims last year, saying
that the deadly crush of people in Mina will pave the way for the
collapse of the Al Saud ruling family. "The Al Saud regime has
made some moves over the past years, which are very rare in the
history of Islam," Velayati, who is also an international
adviser to Leader of the Islamic Revolution Ayatollah Seyed Ali
Khamenei, said...
Iran's president on Wednesday called on the Muslim
world to "punish" Saudi Arabia following last year's hajj
crush and stampede that killed over 2,400 people - sharp criticism as
multitudes poured into the kingdom for this year's pilgrimage.
DOMESTIC POLITICS
With only eight months left of his current term,
President Hassan Rouhani and his potential rivals are gearing up for
Iran's May 2017 presidential election. Rouhani, who came to power in
2013 promising to resolve the nuclear issue, has fulfilled this key
pledge with a comprehensive agreement with world powers. But is the
nuclear deal enough to guarantee his victory in the upcoming
elections? The most likely answer is "no," considering the
challenges he faces in domestic politics, cultural issues and, most
importantly, the economy... phrases such as "Rouhani hasn't been
able to do anything either" or "the nuclear deal has had no
effect on people's livelihoods" are quite common among the
Iranian public these days.
OPINION & ANALYSIS
Last week we published a study on a set of exemptions
to the limits of the Iran deal, or Joint Comprehensive Plan of Action
(JCPOA), which were made by the JCPOA Joint Commission prior to
Implementation Day. The report caused a whirlwind of media and
expert attention. Not surprisingly, the way many viewed these
revelations was driven in large part by whether or not they supported
the deal. Given the nature of the report, the pro-deal faction
was the most vocal against our findings and claimed the report
exaggerated the findings and implications of the information.
The anti-deal faction used the information as further support for
their belief that the deal is flawed. However, though both
sides in some cases disagreed with the framing, neither was able to
refute our central claim that the exemptions were made and that Iran
would not have been in compliance with the JCPOA on Implementation
Day had the Joint Commission not reached decisions granting these
exemptions.
Jay Solomon, one of America's top national security
journalists, has covered Asia, Europe, and the Middle East. Over the
last few years, he has focused especially on Iran, its larger
regional project, and U.S.-Iran relations, including the deal over
the regime's nuclear program, also known as the Joint Comprehensive
Plan of Action. Solomon's stories about Iran continue to lead the
news. His report last month showing how the Obama White House shipped
$400 million to Iran on wooden pallets at the same time the clerical
regime released U.S. hostages strongly suggested the administration
paid ransom. His just-published first book "The Iran Wars: Spy
Games, Bank Battles, and the Secret Deals that Reshaped the Middle
East" is the fall season's top book on national security and has
already hit a number of bestseller lists. Recently, I sat down with
Solomon here in Washington, D.C. to talk about his book, Iran, the
Obama administration, and the direction of American foreign policy.
Iran "has fully implemented its required
commitments." That was the representation Obama secretary of
state John Kerry made to the American people in announcing on January
16 - "Implementation Day" of President Obama's Iran nuclear
deal (aka, the Joint Comprehensive Plan of Action, or JCPOA) - that
international economic sanctions were consequently being lifted
against Iran. Secretary Kerry added that "Iran has undertaken
significant steps that many, and I do mean many, people doubted would
ever come to pass." Still, Kerry promised, the Obama
administration would continue watching the mullahs like a hawk, thus
"assuring continued full compliance" with the regime's
JCPOA commitments. The same day, President Obama signed an executive
order lifting a number of U.S. economic sanctions against Iran. We
now know he also set in motion a furtive $400 million cash transfer
to the regime as a ransom (which the administration calls
"leverage") for the release of four American hostages - the
first installment of a carefully structured $1.7 billion side payment
to Iran (ostensibly in settlement of a failed 1970s arms deal),
details about which the administration continues to withhold from
Congress and the public. All of this was based on this purported
"full implementation" of Iran's "required
commitments" under the JCPOA touted by Obama and Kerry. And all
of it was a deliberate, audacious, elaborately plotted lie.
Washington, conventional wisdom has long held that Iran's presence
south of the U.S. border constitutes little more than an axis of
annoyance. In this telling, Iran's activities in Central and South
America-from numerous commercial and trade deals with various nations
to the establishment of cultural centers throughout the region-are
disorganized, opportunistic, and ultimately of little consequence.
That narrative has proved remarkably persistent, and-in part as a
result-Washington has historically paid scant attention to Iran's
presence in the hemisphere. But there is ample evidence to the
contrary in the form of Iran's strategic cooperation with the
region's anti-American regimes, and in well-documented instances of
Iranian-sponsored subversion organized there and aimed at U.S.
interests and allies. Now, with the Islamic Republic increasingly
unfettered from sanctions as a result of last year's nuclear deal
with the West, there are unmistakable signs that it is widening its
presence in the Americas in earnest.
For over 37 years, ever since the Islamic revolution
in Iran which toppled the Shah and caused a major regional shift and
realignment in the Gulf region, the Arabian and Iranian sides of the
Gulf have been locked in bitter rivalry, distrust and lately, a cold
war atmosphere that has fomented sectarian tensions and proxy wars
that stretch from Yemen to Syria. Over the past few years, I have
penned numerous articles in Gulf News, in addition to delivering many
lectures on the troubled GCC-Iran relations. I have described this
relationship between the two sides as a cold war that keeps getting
worse each passing year - with no inkling of a detente on the
horizon. Moreover, I have repeatedly warned of the repercussions of
the continued flagrant interference of Iran and its meddling in the
affairs of GCC states - which has metastasised to other Arab
countries. This is weakening other Arab states, scuppering the
chances of peace, as well as fomenting sectarian tensions and
exacerbating the arc of the region's crises. While the GCC and the
United States supported the nuclear deal with Iran, provided it ended
its nuclear arms ambitions and stopped it interfering in the affairs
of GCC states, we have discovered that we have been wrong-footed by
the US and are confused by Washington's reticence over Iran's
systematic and alarming behaviour. Now we view the nuclear deal with
scepticism.
Recent diplomatic efforts on the part of Tehran reveal
it to be pursuing a two-pronged strategy towards attracting
investment and reintegrating with the global economy: (1) seeking
foreign capital to rebuild the country's domestic infrastructure,
while (2) using Iranian capital to finance the construction of oil
refineries throughout the world. With Iran's infrastructure
investment needs estimated at $1 trillion over the next ten years,
Tehran will be heavily reliant on project finance arrangements in
order to rebuild its infrastructure. Under these arrangements,
investors put up large sums of money in exchange for a return based
on long-term cash flows-often for up to thirty years. Iran's heavy
reliance on project financing arrangements will have consequences
that far outlive the initial terms of the Iranian nuclear agreement,
while creating a potentially unique set of incentives for the various
parties in the event Iran defaults on its commitments or resorts to
old patterns at the expiration of the Joint Comprehensive Plan of
Action (JCPOA). As such, Tehran's strategic thinking is clearly
calculated well beyond the terms of the JCPOA. In its strategy to
reintegrate with the world economy, Iran is playing the long game.
The latest report issued by the Institute for Science
and International Security (ISIS) reveals confidential exemptions
that Iran was granted by the Joint Commission in order to meet its
requirements for implementing the Iran deal last January. The report has
sparked a debate over whether there were in fact exemptions, and what
they entailed. But the more serious issue raised by this report-and
emphasized by its authors-regards the question of secrecy and
confidentiality surrounding elements of the Joint Comprehensive Plan
of Action and its implementation. From this perspective, the ISIS
report is only the latest in a string of episodes over the past year
in which issues involving secrecy (or lack of disclosure) have been
exposed. Sometimes the issues have related directly to JCPOA
provisions, and sometimes to the U.S. administration's portrayal of
events or policies related to the deal... there is no
justification for secrecy regarding the JCPOA, Iran's arrangements
with the IAEA or discussions regarding implementation of the deal in
the Joint Commission. When dealing with a known violator,
confidentiality has no place... U.S.-Iran dynamics will be a key
factor in the implementation of the deal, and in determining whether
Iran is able to manipulate its way to nuclear weapons. U.S.
passivity-not to mention acting as Iran's defender-risks weakening
America's ability to keep Iran in line. The United States must wake
up to the reality that the struggle with Iran continues, at least as
far as Iran is concerned. Not responding to Iranian challenges risks
losing the game.
This Sunday, Iran's Foreign Minister Mohammad Javad
Zarif embarked on a six-nation tour in seemingly far away Latin
America "to expand political and economic relations between the
two sides." But, is it so far away given Iran's stated
aspirations which seem to be increasingly backed by words and deeds?
Just as the foreign minister was arriving in Havana, back home the
regime was announcing the establishment of the Shiite Liberation Army
under the command of Major General Qasem Soleimani of the Quds Force.
Though it's likely the force will be deployed largely in the Arab
territories, the announcement took pains to note that Iran was
prepared to deploy its forces to distant lands,
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