Trump Flip Flops On Iran Sanction-Again

(THIS ARTICLE IS COURTESY OF THE TIMES OF ISRAEL)

 

Despite threats, Trump to extend sanctions relief for Iran — sources

US president likely to link decision with new, targeted sanctions on businesses and people connected with regime

Secretary of State Rex Tillerson, left, and Secretary of Defense Jim Mattis, right, listen as President Donald Trump speaks during a cabinet meeting at the White House, January 10, 2018, in Washington. (AP Photo/Evan Vucci)

Secretary of State Rex Tillerson, left, and Secretary of Defense Jim Mattis, right, listen as President Donald Trump speaks during a cabinet meeting at the White House, January 10, 2018, in Washington. (AP Photo/Evan Vucci)

WASHINGTON (AP) — US President Donald Trump is expected this week to extend relief from economic sanctions to Iran as part of the nuclear deal, citing progress in amending US legislation that governs Washington’s participation in the landmark accord, according to US officials and others familiar with the administration’s deliberations.

But Trump is likely to pair his decision to renew the concessions to Tehran with new, targeted sanctions on Iranian businesses and people, the six people briefed on the matter said. The restrictions could hit some firms and individuals whose sanctions were scrapped under the 2015 nuclear agreement, a decision that could test Tehran’s willingness to abide by its side of the bargain.

The individuals — two administration officials, two congressional aides and two outside experts who consult with the government — weren’t authorized to speak publicly on the matter and demanded anonymity. They cautioned that Trump could still reject the recommendation from Secretary of State Rex Tillerson, Defense Secretary James Mattis and national security adviser H.R. McMaster and that no final decision had been made. They said heated discussions were going on within the administration and with key Republican lawmakers.

The State Department and White House didn’t immediately respond to requests for comment.

Trump must decide by Friday to extend the nuclear-related sanctions relief for Iran’s central bank or re-impose the restrictions that President Barack Obama suspended two years ago.

An Iranian man reads a copy of the daily newspaper ‘Omid Javan’ bearing a picture of US President Donald Trump with a headline that reads in Persian ‘Crazy Trump and logical JCPOA (Joint Comprehensive Plan of Action),’ on October 14, 2017, in front of a kiosk in the capital Tehran. (AFP Photo/STR)

The old, central bank sanctions largely cut Iran out of the international financial system, and are considered to be the most powerful of the penalties imposed by the US during the Obama era, along with global penalties for buying Iranian oil. Some Iran hawks want to see both sets of restrictions return, but the six people with knowledge of Trump’s plans say the president isn’t planning to reinstate either at this point.

The individuals said Trump’s top national security aides appear to have successfully made a different case to the president: Waiving anew for 120 days the nuclear-linked sanctions while simultaneously imposing new measures to punish Iran’s ballistic missile testing, alleged terrorism support and human rights violations.

Such a balance could satisfy Trump’s demand to raise pressure on Iran, while not embarking on a frontal assault on the most central trade-offs of the nuclear agreement. While the US and other world powers rolled back economic restrictions on Tehran, the Iranians severely curtailed their enrichment of uranium and other nuclear activity. Trump has complained that many of the Iranian restrictions expire next decade and has vacillated between talk of toughening the deal and pulling the US out entirely.

A senior State Department official told reporters Wednesday that Tillerson and Mattis would be meeting with Trump on the matter before an announcement Friday. Trump, Tillerson and Vice President Mike Pence were scheduled to have lunch Wednesday at the White House after a formal Cabinet meeting.

US Secretary of State Rex Tillerson listens as US President Donald Trump speaks during a cabinet meeting at the White House, Dec. 20, 2017, in Washington. (AP Photo/Evan Vucci)

The decision coincides with the administration’s efforts to secure a face-saving fix from Congress on the requirement for Trump to address Iran’s compliance every three months. In October, Trump decertified the nuclear deal under US law, saying the sanctions relief was disproportionate to Iran’s nuclear concessions, and describing the arrangement as contrary to America’s national security interests.

Tillerson told The Associated Press in an interview last week that he and others were working with Congress on ways to amend the Iran Nuclear Agreement Review Act, or INARA, to resolve concerns Trump has with the deal. That will be coupled with diplomacy with European government on addressing Iran’s missile testing and support for the Hezbollah militant movement, Shiite rebels in Yemen and Syrian President Bashar Assad.

“The president said he is either going to fix it or cancel it,” Tillerson said of the overall deal. “We are in the process of trying to deliver on the promise he made to fix it.”

On the INARA law, it’s unlikely Congress could move fast enough to codify changes by Friday. So Tillerson and others are hoping to convince the president there’s enough momentum to warrant another extension of sanctions relief and not jeopardizing the entire agreement. The goal would be for Congress to make the changes sometime before May, when Trump is next required to address the sanctions.

The new Iranian long-range missile Khoramshahr is displayed during the annual military parade marking the anniversary of the outbreak of its devastating 1980-1988 war with Saddam Hussein’s Iraq, on September 22,2017 in Tehran. (AFP/str)

Trump has repeatedly dismissed the Iran deal, one of Obama’s signature foreign policy achievements, as the worst ever negotiated by the US He has particularly bristled at having to give Iran a “thumbs up” every few months by acknowledging that it is meeting the requirements to invest in foreign banks, sell petroleum overseas, buy US and European aircraft, and so forth.

Iran hawks in Congress and elsewhere worry the changes being discussed don’t strengthen the nuclear deal enough.

One would automatically re-impose, or “snap back,” suspended sanctions if Iran commits certain actions, possibly including things unrelated to its nuclear program. Currently, Congress must act for the sanctions to snap back.

Another proposal would require snapback if Iran refuses a request from the International Atomic Energy Agency, the UN’s atomic watchdog, to inspect a military site not currently being monitored. Iran hawks worry the IAEA, fearing a confrontation with Iran, won’t even ask for such an inspection.

Other debates center on Iran’s missile testing. Hardline Republican senators Tom Cotton, Marco Rubio and Ted Cruz want sanctions back if Iran launches any ballistic missiles capable of targeting territory outside of Iran, such as Israel or Saudi Arabia, and not just an intercontinental missile.

Senate Democrats, generally more supportive of the nuclear deal, are pushing their own suggestions. One would let a simple House and Senate majority stop any effort to snap back sanctions, unless the president vetoes the block. While such a mechanism is unlikely to threaten Trump in the short term, some anti-deal Republicans fear it could be used against them under a future Democratic president.

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Iran already has a lot of problems, Is Banking Crisis Next

(THIS ARTICLE IS COURTESY OF CNBC NEWS)

 

Iran already has a lot of problems, and the next one could be a banking crisis

  • Iran’s stock market is up 3 percent in 2017
  • The country’s top fund that takes foreign investment has soared 12 percent
  • But a banking crisis could derail hope of economic normalcy

1 Hour Ago 

A trader speaks with a stock market official beneath the electronic board at the Tehran Stock Exchange, Sept. 15, 2010.

Caren Firouz | Reuters
A trader speaks with a stock market official beneath the electronic board at the Tehran Stock Exchange, Sept. 15, 2010.

Nothing is easy for Iran’s economy these days, and things could soon get even tougher.

The U.S. House of Representatives is expected to pass a bill Tuesday to put new sanctions on Russia, North Korea — and Iran. A Senate version passed overwhelmingly last month.

Iran is being targeted for its activities in Syria, its ballistic missile program and other “destabilizing activities,” according to the Senate’s version of the legislation. Under the terms of the 2015 Iran Nuclear Deal, Tehran is not immune to new sanctions as punishment for activities outside of the country’s nuclear program.

Men use their smartphones to follow election news as posters of Iran's President Hassan Rouhani are seen in Tehran, Iran May 17, 2017.

TIMA | Reuters
Men use their smartphones to follow election news as posters of Iran’s President Hassan Rouhani are seen in Tehran, Iran May 17, 2017.

Ramin Rabii, CEO of Turquoise Partners, Tehran’s largest investment firm for foreign money, said “there is definitely some worry over new sanctions, especially of their impact on business with Europe and Asia.”

There are bright spots, however, for the Iranian economy: “One of President (Hassan) Rouhani’s greatest achievements,” said Rabii, “has been to lower inflation from 45 percent down to a much more manageable 10 percent.”

The next big economic problem?

But that moderating inflation has caused another problem to surface. Lower inflation combined with soaring interest rates — sometimes as high as 25 percent — have the country’s top banking officials warning of a potential crisis.

During the presidency of Mahmoud Ahmadinejad, many banks were pressured into making risky loans with the short-term goal of propping up parts of the economy. Now, many of the recipients of those loans, often small to mid-sized businesses with narrow profit margins, are having trouble keeping up with the payments.

“We have seen a big increase in European corporations coming to Iran, although inflow of foreign portfolio investment is still slow. It’s better than it was, but it is still slow.”-Ramin Rabii, CEO of Turquoise Partners

That said, any crisis that occurs is likely to be less severe than the 2008 catastrophe that struck the United States because Iran generally has much less debt in its economy. But the threat remains significant.

The prospect of a banking crisis is so serious that in a speech earlier this year, the head of Iran’s central bank, Valiollah Seif, warned financial executives that non-performing loans were a threat to all the gains the Rouhani government is making on the economic front. While he has proposed possible solutions, nothing has been agreed upon.

Turquoise’s fund has no bank holdings — Rabii said he exited the sector three years ago. He said he believes the central bank may need to intervene in the next 18 months to stave off a major threat.

Year-to-date, Turquoise’s signature fund is up 12 percent, easily outpacing Tehran’s main benchmark, which is up 3 percent. Turquoise has holdings in Iranian industrials, refined petroleum and the chemical sector.

“We have seen a big increase in European corporations coming to Iran, although inflow of foreign portfolio investment is still slow,” he said. “It’s better than it was, but it is still slow.”

Tehran Worried after Drone Flies Near Khamenei Office

(THIS ARTICLE IS COURTESY OF ASHARQ AL-AWSAT NEWS)

Tehran Worried after Drone Flies Near Khamenei Office

Tehran

London – Iranian authorities were worried on Friday after a drone flew near the office of the country’s Supreme Leader Ali Khamenei in Tehran.

Iran’s anti-aircraft forces extensively fired at the drone as it approached the Pasteur strategic area, where the office of the supreme leader is located.

The drone later appeared to have been operated by a film crew shooting aerial footage for a documentary.

Tehran’s deputy governor general for security affairs, Mohsen Hamedani said the state television crew was filming Friday prayers and “did not know about the prohibited airspace.”

He added: “The drone did not respect the no-fly zone” in central Tehran.

Pasteur Street in central Tehran is highly secured due to the presence of key government institutions there, such as the office of the Iranian President, the center of Iran’s Revolutionary Guards Intelligence leadership, the center of the Assembly of Experts for the Leadership, and the Supreme National Security Council. The street also includes several military schools and the center of the Armed Forces Logistics.

Iran’s Air Defense Base issued a statement on Friday saying the drone had entered Tehran’s airspace without coordination and permission, Mehr new agency said.

The statement said the drone was shot down by the anti-craft forces in a central district of the capital.

ILNA news agency quoted an unnamed source as saying that the drone was shot down as “it approached the no-fly zone” near the office of the supreme leader.

The source later explained that the drone belonged to a documentary-making team that had permission to film but “unintentionally started moving it towards the no-fly zone,” Reuters reported.

The commander of Tehran air defense forces said in August that the capital’s airspace was under full control and “no aircraft can enter it without permission.”

Meanwhile, experts expected on Friday that the U.S. decision to renew the Iran Sanctions Act (ISA) would engender a new crisis between Washington and Tehran that could negatively reflect on the Nuclear Deal, already criticized by U.S. President-elect Donald Trump.

On Dec. 15, U.S. President Barack Obama allowed U.S. sanctions against Iran to be renewed, but have rejected in a surprise move to actually sign the legislation that brings the sanctions into force.

AFP said on Friday that the White House said renewing ISA was pointless since it remains suspended so long as Tehran sticks to its promises to curb its nuclear program.

“The US Congress never liked the deal and now that Obama is leaving office, they’re trying to find ways of violating the deal without being too obvious about it,” Foad Izadi, a world politics professor at the University of Tehran told AFP.

Iran also fears that keeping the sanctions would affect Tehran’s economic relations with the rest of the world. Tehran therefore believes that the U.S. Treasury should take more measures to comfort banks that are hesitant in dealing with Iran due to the sanctions.

When the banks ask the U.S. Treasury for guidance, the answers are slow and ambiguous, said Izadi.

“They ask for a green light, and they are given a yellow light, which is not enough.”

Shashank Joshi, from the RUSI think tank in London said, “Iran is showing they’re looking into doing something tough, without actually doing it… that they’re willing to tear up the deal if pushed too far.”

Asharq Al-AwsatArab

Asharq Al-Awsat

Asharq Al-Awsat is the world’s premier pan-Arab daily newspaper, printed simultaneously each day on four continents in 14 cities. Launched in London in 1978, Asharq Al-Awsat has established itself as the decisive publication on pan-Arab and international affairs, offering its readers in-depth analysis and exclusive editorials, as well as the most comprehensive coverage of the entire Arab world.

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