USA, EU lift sanctions on Iran!
-Dr. Abdul Ruff
It seems the world, after a pretty long time, is now passing though a sort of happy moment as diplomacy allows chances for peace.
Diplomacy has worked in US-Iran talks revealing its natural power over threats and blackmail tactics. Persuasive diplomacy of both USA and Iran has shaken off the notion that only wars can solve all bilateral and multilateral issues. And it worked rather too well with regard to the issue of western anger over Iran’s nuclear standoff and West dealing with sanctions. Iran, as a result, is back to limelight as a fully fledged nation reviving its previous economic activities.
Today, the January 17, the USA and European nations lifted oil and financial sanctions on Iran and released roughly $100 billion of its assets after international inspectors concluded that the country had followed through on promises to dismantle large sections of its nuclear program. Most UN sanctions also automatically ended.
With the start of the implementation day, the day that the accord goes fully into operation, the structures are finally in place for Tehran to re-engage with the world after decades of isolation.
Iran has opted for non confrontational approach in solving the nuclear issue. The International Atomic Energy Agency (IAEA), has issued a report detailing how Iran had shipped 98 percent of its fuel to Russia, dismantled more than 12,000 centrifuges so they could not enrich uranium, and poured cement into the core of a reactor designed to produce plutonium.
This came at the end of a day of high drama that played out in a diplomatic dance the across West and the Middle East, just hours after Tehran and Washington swapped long-held prisoners. Five Americans, including a Washington Post reporter, Jason Rezaian, were being flown out of the country on a Swiss aircraft right after the nuclear accord was implemented. The detention of one of the released Americans, Matthew Trevithick, had been engaged in language studies in Tehran. “Iran has undertaken significant steps that many people and doubted would ever come to pass,” Secretary of State John Kerry said at the headquarters of IAEA.
In Tehran and Washington, political battles are still being fought over the merits and dangers of moving toward normal interchanges between two countries that have been avowed adversaries for more than three decades. Kerry suggested that the nuclear deal had broken the cycle of hostility, enabling the secret negotiations that led up to the hostage swap. It was far from a sure thing: Just weeks ago, Iran was demanding the release of nearly 20 Iranians convicted or indicted in the United States; a White House official said that number had been whittled down to seven, but even that still rankled some.
Kerry was clearly energized by the release of the Americans, an issue he took up on the edges of almost every nuclear negotiation, and pursued in a separate, secret set of talks that many involved in the nuclear issue were only vaguely aware were happening.
The release of the “unjustly detained” Americans, as Kerry put it, came at some cost: Seven Iranians – either convicted or charged with breaking US embargoes – were released in the prisoner swap, and 14 others were removed from international wanted lists.
Many of the US presidential candidates, including Sen, Marco Rubio of Florida and Donald Trump, denounced the swap as a sign of weakness, and they have long promised to review or withdraw from the nuclear agreement. They particularly object to the release of about $100 billion in frozen assets – mostly from past oil sales – that Iran will now own as its right, and the end of US and European restrictions on trade that had been imposed as part of the US-led effort to stop the program. The sanctions forced Iran to the table for peace. The United States and Israel also developed one of the world’s most sophisticated cyber weapons to destroy the centrifuges that Iran has been dismantling. But even in a week that started with the release of 10 sailors who drifted into Iranian waters and ended with a prisoner swap that seemed drawn from the pages of the Cold War.
Logic of Sanctions
Sanctions are considered to be economic terrorism perpetrated on countries that seek nuclear facility as their legitimate right at par with nuclear states. . Since Iran’s nuclear programme became public in 2002, the International Atomic Energy Agency (IAEA) has been unable to confirm Tehran’s assertions that its nuclear activities are exclusively for peaceful purposes and that it has not sought to develop nuclear weapons.
Not only USA and Europe but also countries like China, Australia, South Korea, Japan, Canada, Israel and India also imposed sanctions of varying degrees. Norway, Switzerland, and others also put in place a strong, inter-locking matrix of sanctions measures relating to Iran’s nuclear, missile, energy, shipping, transportation, and financial sectors. In October 2012, the EU adopted a further set of restrictive measures against Iran
Western governments insist that Iran’s uranium enrichment program is intended for developing the capability to produce nuclear weapons. Iran counters that its nuclear program is for civilian purposes, including generating electricity and medical purposes.
The UNSC (Security Council) passed a number of resolutions imposing sanctions on Iran, following the report by the International Atomic Energy Agency Board of Governors regarding Iran’s non-compliance with its safeguards agreement and the Board’s finding that Iran’s nuclear activities raised questions within the competency of the Security Council. Sanctions were first imposed when Iran rejected the Security Council’s demand that Iran suspend all enrichment-related and reprocessing activities. Sanctions will be lifted when Iran meets those demands and fulfills the requirements of the IAEA Board of Governors. To-date, Iran sanctions are the toughest the world community has imposed on any country
Following the Iranian Revolution of 1979, the United States imposed sanctions against Iran and expanded them in 1995 to include firms dealing with the Iranian government. In 2006, the UN Security Council passed Resolution 1696 and imposed sanctions after Iran refused to suspend its uranium enrichment program. US sanctions initially targeted investments in oil, gas and petrochemicals, exports of refined petroleum products, and business dealings with the Iranian Revolutionary Guard Corps. This encompasses banking and insurance transactions (including with the Central Bank of Iran), shipping, web-hosting services for commercial endeavors, and domain name registration services. Over the years, sanctions have taken a serious toll on Iran’s economy and people. Since 1979, the United States has led international efforts to use sanctions to influence Iran’s policies.
The sanctions bring difficulties to Iran’s $483 billion, oil-dominated economy, and dramatically reduced Iran’s oil sale. Sanctions have reduced Iran’s access to products needed for the oil and energy sectors, have prompted many oil companies to withdraw from Iran, and have also caused a decline in oil production due to reduced access to technologies needed to improve their efficiency. The effects of U.S. sanctions include expensive basic goods for Iranian citizens, and an aging and increasingly unsafe civil aircraft fleet. The international arms embargo against Iran is slowly reducing Iran’s military capabilities, largely due to its dependence on Russian and Chinese military assistance. The EU sanctions, in particular, were tough, even brutal. Many international companies have also been reluctant to do business with Iran for fear of losing access to larger Western markets. As well as restricting export markets, the sanctions have reduced Iran’s oil income by increasing the costs of repatriating revenues in complicated ways that sidestep the sanctions; Iranian analysts estimate the budget deficit for the 2011/2012 fiscal year, which in Iran ends in late March, at $30bn to $50bn.
In the face of increased economic pressure from the United States and Europe and a marked decrease of oil exports, Iran is seeking to build a resistance economy as well as ongoing gold imports from Turkey. China which supported US sanctions in order to protect tits trade, has now become Iran’s largest remaining trading partner
On 2 April 2015, the P5+1 and Iran, meeting in Lausanne, Switzerland, reached a provisional agreement on a framework that, once finalized and implemented, would lift most of the sanctions in exchange for limits on Iran’s nuclear programs extending for at least ten years.
Critics will continue to attack the deal for giving away too much to Tehran. But the fact that Iran’s nuclear ambitions will be effectively frozen for the next 10 to 15 years is considered a real advantage for USA as it was achieved by tough-minded diplomacy and not war. Recent encounters with Iran – including its ballistic missile tests and its propping up of President Bashar Assad of Syria, demonstrate how complicated the western relationship with Iran will continue to be. President Barack Obama said that he will keep up the pressure and he is considering new sanctions against Iran for the ballistic missile tests in violation of UN Security Council resolutions. A copy of the proposed sanction leaked three weeks ago, and the Obama administration pulled it back – perhaps to avoid torpedoing the prisoner swap and the completion of the nuclear deal.
Meanwhile, the United States and Iran were struggling late Saturday to define the details of what kind of “advanced centrifuges” Iran will be able to develop nearly a decade from now – the kind of definitional difference that can undermine an accord. But Iran has something it desperately needs: Billions in cash, at a time oil shipments have been cut by more than half because of the sanctions, and below $30-a-barrel prices mean huge cuts in national revenue. Just how much cash is a matter of dispute. A senior U.S. official said Saturday that Iran will be able to access about $50 billion of a reported $100 billion in holdings abroad, although others have used higher estimates. The official said Iran will likely need to keep much of those assets abroad to facilitate international trade.
Under the new rules put in place, the United States will no longer sanction foreign individuals or firms for buying oil and gas from Iran. The US trade embargo remains in place, but the government will permit certain limited business activities with Iran, such as selling or purchasing Iranian food and carpets and US commercial aircraft and parts.
The president and Kerry, with about an year left in office, are hoping to foster new discussions that will bear fruit in other areas, including ending the war in Syria and moving, slowly, to the eventual restoration of diplomatic relations.
Iran seeks peace and Iran’s Supreme Leader, Ayatollah Ali Khamenei permitted these talks to go ahead.
IAEA chief Yukiya Amano will travel to Tehran to meet Rouhani and the head of the Atomic Energy Organisation of Iran.
In Washington, President Barack Obama pardoned three Iranian-Americans charged with violating sanctions against Iran, a lawyer for one of the men said, while prosecutors moved to drop charges against four Iranians outside the United States. Iran agreed to free five Americans including Rezaian and Abedini, an Iranian-American Christian pastor sentenced to eight years in prison in 2013 on charges of undermining Iran’s national security.
Four Iranian-American citizens freed by Iran in a prisoner swap with the USA have left Tehran and are in Bern in Switzerland. Iranian state television reported Jason Rezaian, the Washington Post’s Tehran correspondent, Saeed Abedini, a Christian pastor, former US Marine Amir Hekmati, and Nosratollah Khosravi, departed on a special Swiss plane. Iran announced their release on Saturday, just hours before Tehran’s historic nuclear deal with world powers was implemented, in exchange for Washington pardoning seven Iranians accused of sanctions-busting. State television said the seven Iranians — Nader Modanlou, Baharam Mechanic, Khosrow Afghahi, Arash Ghahreman, Tooraj Faridi, Nima Golestaneh, and Ali Saboonchi — “will be freed”. A fifth American was also released in a separate process. Iran’s ambassador to the UN, Gholam Ali Khoshroo, said that Switzerland played a “positive role” in the prisoner swap. Reports suggest several Iranian-Americans held in US prisons after being charged or convicted for sanctions violations have also been released.
The prisoner deal was the culmination of months of diplomatic contacts, secret talks and legal maneuvering which came close to falling apart because of a threat by Washington in December to impose fresh sanctions on Iran for recent ballistic missile tests. Speaking to parliament, Iranian President Hassan Rouhani hailed the nuclear deal with world powers and the resulting lifting on Saturday of USA, European and United Nations sanctions as a “golden page” in Iran’s history.
President Rouhani, a pragmatist elected in 2013 on promises to end Iran’s years of sanctions and isolation, said he looked forward to an economic future less dependent on oil exports. These are nevertheless likely to jump now that the United States, European Union and UN have scrapped the crippling sanctions in return for Tehran complying with the deal to curb its nuclear ambitions. The UN nuclear watchdog announced late Saturday that Iran had complied with its side of the July 2015 accord, allowing the lifting of sanctions.
Rouhani said the nuclear negotiations, succeeded by the guidance of the Supreme Leader and support of people, were truly a golden page in Iran’s history. “The nuclear deal is an opportunity that we should use to develop the country, improve the welfare of the nation, and create stability and security in the region,” Rouhani said.
Rouhani took a swipe at its critics. “Everybody is happy except the Zionists, the warmongers who are fuelling sectarian war among the Islamic nation, and the hardliners in the US congress,” he said. Rouhani noted bitter opposition to the lifting of economic curbs from arch foe Israel, some members of the US Congress and what he called “warmongers” in the region – an apparent reference to some of Iran’s Gulf Arab adversaries.
Presenting the draft budget for the next Iranian fiscal year, which begins in March, Rouhani told parliament the deal was a “turning point” for the economy of Iran, a major oil producer which has been virtually shut out of international markets for the past five years.
America’s thaw with Iran is viewed with deep suspicion by US Republicans as well as allies of Washington in the Middle East, including Israel and Saudi Arabia.
Britain welcomed the deal’s implementation, as did France which said it would keep a close eye out to ensure that the deal is strictly respected. Japan plans to lift most of its sanctions against Iran, including a halt to fresh investments in Iranian oil and gas projects, “within a few days”, a Foreign Ministry official said. The European Commission said it would undertake a first “technical assessment mission” in February to explore energy ties with Iran.
The EU executive is particularly keen to develop Iranian energy supplies as an alternative to Russia, whose powerful role as supplier of around a third of the EU’s oil and gas has divided the bloc.
Israel’s options for peace
Nuclear Israel’s opposition to the nuclear deal and US-Iran rapprochement was evident in a statement from the office of PM Benjamin Netanyahu: “Even after the signing of the nuclear agreement, Iran has not abandoned its aspirations to acquire nuclear weapons, and continues to act to destabilize the Middle East and spread terrorism throughout the world while violating its international commitments”.
Definitely Israel is unhappiest nation earth for the US-Iran deal and its implementation, ending the sanctions on Iran over nuclear issue. Iran’s adherence with the agreement as well its readiness to swap prisoners with USA have shocked Tel-Aviv the crudest manner as Israel had never expected such positive development in West Asia.
Israel’s main worry is its policy of perpetual expansionism in Palestine and if USA supports the Palestine’s just cause for sovereignty it will have to allow a free Palestine to come into existence in Mideast. This will deny Israeli military to continue genocides of Palestinians by raising the bogey of “security”.
As the International Atomic Energy Agency ruled Iran had abided by last July’s deal with world powers curbing its nuclear program, spelling a windfall in sanctions relief, many eyebrows were lifted in Israel and Washington. Israel bristled at the lifting of international sanctions on Iran and vowed to flag up any violations of its arch-foe’s nuclear restrictions while drawing on US defense aid to prepare for a possible military face-off in the future. A parallel Iranian-US prisoner exchange, devised in secrecy, drove home the adversaries’ desire to reengage diplomatically.
The developments put paid to years of intensive Israeli lobbying for more comprehensive curbs on Tehran – a campaign that strained relations between Israel (Netanyahu) and USA (President Barack Obama). Netanyahu repeated he found the US nuclear deal with Iran unacceptable found as this is an “historic mistake”. He called on world powers to impose “harsh, aggressive sanctions” for any nuclear violations by Iran.
Netanyahu sounded unrepentant – even as one Israeli official grudgingly commended the Iranian statecraft and a dangerously failed Israeli strategy. “Were it not for our efforts to spearhead the sanctions and foil Iran’s nuclear program, Iran would have already had nuclear weapons long ago,” Netanyahu told his cabinet. Ram Ben-Barak, director-general of Israel’s Intelligence Ministry, predicted Iran would invest in economic recovery in the coming years while remaining able to restart its nuclear drive “overnight”.
The Americans are satisfied with the deal because, diplomacy succeeded. But Israel says it is absolutely clear to everyone that this hiatus is “utterly temporary” as the Gulf countries claim to be are very, very worried. Israel argues that the prospect of a nuclear-armed Iran has been eclipsed for the time being.
As usual Israel seeks to request an economic package in US defence aid as much as $5 billion annually in order to fend off the “regional threats”. The current package worth an average of $3 billion expires next year. Netanyahu said those negotiations were in the final stages.
US officials have said President Obama is unlikely to fully meet the Netanyahu government’s new request for increased aid, though they affirmed Washington’s commitment to Israel’s “security” to weaken Palestine as US policy. Israel is in talk with all US presidential candidates in this regard whosoever assumes power so that White house would have to listen to Israeli leaders.
Impact of ending sanction
The lifting of sanctions on Iran is likely to thaw ties further with the United States as Tehran emerges from years of international isolation. Together, the lifting of sanctions and the prisoner deal help to ease the hostility between Tehran and Washington that has shaped the Middle East since Iran’s 1979 Islamic Revolution. Tens of billions of dollars’ worth of Iranian assets will now be unfrozen and global companies that have been barred from doing business there will be able to exploit a market hungry for everything from automobiles to airplane parts.
Prospect of the Iran pumping an additional 500,000 barrels a day following the closure of sanctions on Iran sends stock markets in Middle East, particularly Dubai and Saudi Arabia. All seven stock markets in the Gulf States tumbled as panic gripped traders. Stock markets across the Middle East saw more than £27bn wiped off their value as the lifting of economic sanctions against Iran threatened to unleash a fresh wave of oil onto global markets that are already drowning in excess supply.
The end of sanctions means more money and prestige for Shi’ite Iran as it becomes deeply embroiled in the sectarian conflicts of the Middle East, notably in the Syrian civil war where its allies are facing Sunni Muslim rebels. It is also a crowning achievement for Rouhani, a pragmatic cleric elected in 2013 in a landslide on a promise to reduce Iran’s international isolation. Iran denies its nuclear programme was aimed at obtaining an atomic bomb. Washington maintained separate, less comprehensive sanctions on Iran over its missile program.
USA maybe willing for restart of economic ties with Iran and work for peace and stability in the region but whether or not it be able to withstand the pressure tactics of Israel and its paid agents in Washington remains to be seen.
That exactly is the trillion dollar question.