Iran’s Economy defying Likudnik Inspired American Sanctions
Press Reports.
Over the last couple of decades, america’s jewish elite has succeeded in pressuring a succession of american administrations into imposing unilateral sanctions against iran. In recent years the global jewish elite has pressured the united nations’ security council into passing sanctions on iran. However, nobody has carried out any empirical research into whether these sanctions have been effective or not. The first assessment into the efficacy of these likudnik sanctions has just been released by the american government’s accountability office. "A three-year international effort to pressure Iran is faltering, with a new report to Congress questioning the impact of 20 years of U.S. economic sanctions on Tehran and a long-sought U.N. resolution against Iran in trouble. In a report released yesterday, the investigative arm of Congress challenged the impact of U.S. sanctions against Iran dating to 1987. Tehran has circumvented many economic sanctions, it concluded, noting Iran's ability to negotiate $20 billion in contracts with foreign firms since 2003 to develop its energy resources. With the country's oil wealth, Iranian banks also have funded their activities in currencies other than the dollar. "Iran's global trade ties and leading role in energy production make it difficult for the United States to isolate Iran and pressure it to reduce proliferation and support for terrorism," the Government Accountability Office said. "Iran's overall trade with the world has grown since the U.S. imposed sanctions, although this trade has fluctuated."" (Robin Wright ‘GAO Report Challenges Effect of Longtime U.S. Sanctions on Iran’ http://www.washingtonpost.com/wp-dyn/content/article/2008/01/16/AR2008011603711.html January 17, 2008); "A report released Wednesday by the Government Accountability Office, an independent auditing group that answers to the U.S. Congress, says, "The overall impact of sanctions, and the extent to which these sanctions further U.S. objectives, is unclear," and that foreign firms continue to make deals in Iran's state-controlled energy sector." (Borzou Daragahi and Ramin Mostaghim ‘Iran sanctions ripple past those in power’ http://fairuse.100webcustomers.com/itsonlyfair/latimes0042.html January 20, 2008). The gao’s conclusion "Iran's overall trade with the world has grown since the U.S. imposed sanctions .." will not make the likudniks happy.
The Factors suggesting Iran’s Economy is Expanding not Contracting under Sanctions.
There is strong circumstantial evidence that, over the last few years, iran’s economy has been expanding despite us/un sanctions, despite any economic damage caused by these sanctions.
Trade.
Iran’s Trade with Afghanistan.
In the past it was difficult for iran to trade with afghanistan because the taliban was hostile to iran. However, after america’s invasion overthrew the taliban the country has acquired a new government which is much more amenable towards iran. Iran’s trade with afghanistan has grown considerably which must have boosted its economy.
Iran’s Trade with Armenia.
"The Russian gas export monopoly owns all the gas pipelines in Armenia, to which Iran has recently completed a new export pipeline. Gazprom will operate the section of that pipeline in Armenia." (Simon Webb and Amie Ferris-Rotman ‘Russian energy ties with Iran send U.S. a message’ http://wiredispatch.com/news/?id=53864 February 21, 2008).
Iran and Azerbaijan.
"Iranian President Mahmoud Ahmadinejad, keen to counter growing US influence on his doorstep, urged closer ties with neighboring Azerbaijan during his first official visit here Tuesday. "We have very good relations on all levels and in all spheres. However, there is big potential we must use," Ahmadinejad said after meeting his Azerbaijani counterpart, Ilham Aliyev. "There should be no obstacles to the development of our relations." Iran and the US are vying for influence in energy-rich Azerbaijan, wedged between Iran and Russia on the western shore of the Caspian Sea. The two countries signed five bilateral agreements, including deals to build a new bridge on their border, establish new customs posts and set up a direct bus link through Iran connecting the Azerbaijani exclave Nakhchivan with the rest of the country. The two leaders added that they would seek to increase cooperation on energy and power generation. Azerbaijan has close diplomatic and trade relations with Iran. Both countries are predominantly Shiite Muslim and share strong cultural ties. Northern Iran is home to between 16 million and 30 million ethnic Azeris, according to varying estimates, easily outnumbering the 8 million in Azerbaijan itself." (‘Tehran seeks Azerbaijan ties to counter US’ http://www.dailystar.com.lb/article.asp?edition_id=10&categ_id=2&article_id=84691 August 22, 2007).
Iran and Bahrain.
"Ahmadinejad said after meeting Bahrain's King Hamad bin Isa al-Khalifa that his trip aimed at expanding "economic and cultural relations" between the two countries. He signed a memorandum of understanding to export natural gas to Bahrain. "Iran will provide one million cubic feet per day of natural gas, and the details are expected to be finalized within a year before signing a deal on this strategic project," said Bahrain's foreign minister, Sheik Khalid bin Ahmed al-Khalifa." (‘Iran prez plays down possible US strike’ http://news.yahoo.com/s/ap/20071118/ap_on_re_mi_ea/iran_us_2 November 18, 2007).
Iran and China.
"China, which has enjoyed growing trade since the early 1990s, ranked third behind the United Arab Emirates last year, with $4.48bn of exports, up 35.8 per cent on 2005. If the growth continues this year, as predicted, China will become the leading supplier." (Najmeh Bozorgmehr ‘Embargo adds to lure of eastern promise for Iran’ http://www.ft.com/cms/s/0/941a9c00-625b-11dc-bdf6-0000779fd2ac.html September 14, 2007). Much more dramatically. "Beijing doesn't want its economic relationship with Tehran disrupted. Iran is a major supplier of oil to China. China intends to boost its bilateral trade with Iran to over US$100 billion annually in the near future. (There is no reason to doubt China's capacity to do so.) China supplies weapons and industrial products to Iran and participates in major projects, such as the Tehran metro." (M K Bhadrakumar ‘A new Chinese red line over Iran’ http://www.atimes.com/atimes/Middle_East/IL07Ak02.html December 07, 2007).
Iran’s Trade with Iraq.
In the past it was difficult for iran to trade with iraq because saddam was so hostile to iran. However, after america overthrew saddam the new shiite government is much more amenable towards iran. Iran’s trade with iraq has grown considerably. "More than four years after the U.S.-led invasion toppled Saddam, Iran's influence from trade links to political sway has never been greater, a fact bedeviling the United States as President Bush pledges American troops will remain in Iraq in large numbers. These days, Iran's influence still is most apparent across Iraq's mostly Shiite south. But it is also felt in Kurdish northern areas and even in Baghdad, where many new reconstruction projects, such as improving Iraq's electricity grid, are financed by Iranian investment. "Decades of war and U.S. invasion have destroyed almost everything in Iraq. And Iran is well prepared to make good use of this opportunity to flood Iraqi markets with goods and services," said Saeed Leilaz, an economic and political analyst in Iran. The export of goods to Iraq brings both money and influence, he noted. "Iranian products are sold everywhere in Iraq. This never happened before. Iran is playing a clever game," he said. Each month, more than 40,000 Iranians visit southern Iraq's important Shiite spots such as the holy cities of Najaf and Karbala, buying religious souvenirs and pumping money into the economy by staying in hotels. Iran has said it wants to build an airport in Najaf and promises to help renovate important shrines. It also has begun work on a railroad between Iranian port of Khorramshar and Basra, connecting Iran's rail system to Iraq's. Tehran also has signed a $150 million contract to build a 300-megawatt power plant in Baghdad. Another project, a 400-megawatt electricity transmission line from the Iranian frontier city of Abadan to the Iraqi town of Alharasa is expected to go into operation in a few months." (Ali Akbar Dareini ‘Iranian influence increasing in Iraq’ http://news.yahoo.com/s/ap/20070914/ap_on_re_mi_ea/iraq_iran_s_influence September 14, 2007); "Meanwhile, as Iran competes with the United States for influence in Iraq, Tehran is hedging its bets beyond ISCI, building up an impressive portfolio of political, economic, religious and military holdings in its western neighbor. There is a steadily increasing trade, including a black market, across the Iran-Iraq border, and the Iranian government and its state-owned entities have made significant investments in and loans to Iraqi businesses and the rebuilding of Shiite holy cities. There are longstanding clerical ties between Qom, Iran, and Najaf, Iraq, and tens of thousands of religious pilgrims, no doubt including more than a few Iranian intelligence officers, cross the border every month. In March Iranian President Mahmoud Ahmadinejad plans to make the first state visit by an Iranian leader to Baghdad." (Robert Dreyfuss ‘Is Iran Winning the Iraq War?’ http://www.uruknet.de/?p=m41362&hd=&size=1&l=e February 21, 2008).
Iran’s Trade with Malaysia.
"Iran last week signed a six billion dollar deal with Malaysia to develop two offshore gas fields, touting the planned investment as the biggest ever in the country." (Siavosh Ghazi ‘Iran hit by gas cuts after Turkmenistan halts supplies’ http://news.yahoo.com/s/afp/20071231/wl_mideast_afp/iranturkmenistanenergygas December 31, 2007).
Iran’s Trade with Russia.
"Gazprom has been involved in Iran for years and invested about $4 billion in the country between 2000-2007, said Huseynov. It was involved in an earlier phase of development at South Pars with Total and Malaysia's Petronas." (Simon Webb and Amie Ferris-Rotman ‘Russian energy ties with Iran send U.S. a message’ http://wiredispatch.com/news/?id=53864 February 21, 2008); "Iran holds the world's second-largest proven natural gas reserves, behind only Russia. Alexei Miller, chief executive of Russia's state-run gas exporter Gazprom, recently visited Tehran and met with Iran's Oil Minister Gholam-Hossein Nozari. The result is that Gazprom will develop "two or three" blocks of the monstrous South Pars gas field in Iran; and its daughter company, Gazpromneft, will also be part of a huge oil project in Iran. Gazprom has been in South Pars since 1997, alongside TotalFinaElf of France and Malaysia's Petronas. Gazprom has already invested at least US$4 billion in Iran since 2000. The Russian company will also help Iran to develop its pipeline system, which will finally link the north (where Tehran is located) to the oil and gas fields in the south and southwest. This means Iran won't need to import gas from unreliable neighbor Turkmenistan, prone to cut off supplies over endless arguments about unpaid bills. This means that Iran, already exchanging energy with Azerbaijan, Armenia and Turkmenistan, will also connect to Russia's national power grid. Fattah said Iran and Russia would cooperate in the construction of two power plants in Tajikistan. The results are obvious: the merging of Russian and Iranian electricity networks will cover virtually all the demand in Central Asia and the Caucasus. Most of the new investment will be Russian." (Pepe Escobar ‘Russia gas pact energizes Iran http://www.atimes.com/atimes/Middle_East/JB27Ak01.html February 27, 2008).
Iran’s Trade with Syria.
"From car manufacturing plants and a proposed $2bn industrial zone for Iranian businesses, to plans to overhaul urban transportation systems, Iranian companies are charging into Syria, looking to cash in on a recent privatisation push by Damascus. Weighed down by a behemoth public sector, an influx of nearly two million Iraqi refugees and falling oil production, Syria's leaders are trying to liberalise their economy in hopes of avoiding a financial meltdown. In another time, the privatisation effort might have presented an opportunity for the US and Europe to use their enormous commercial muscle to drive a wedge between Syria and Iran, Washington's foremost antagonists in the region. But the US imposed sanctions in 2004 as punishment for Syrian support of militant Palestinian and Lebanese organisations. These banned American exports to Syria and gave President George Bush the added option of outlawing American investment in the country, effectively scaring off American and other Western companies. The Syrian government estimates that Iranian investment in 2006 alone surged to more than $400m, making Tehran the third-largest foreign investor here, behind Saudi Arabia and Turkey. Though exact figures are unavailable, by some estimates Iran has invested a total of $3bn in Syria, most of that in the past few years." (Hugh Naylor ‘Sanctions put Iranians on the road to Damascus’ http://scotlandonsunday.scotsman.com/business.cfm?id=1600142007 October 07, 2007).
Iran’s Trade with Turkey.
Despite the bush regime’s efforts to impose unilateral, global sanctions on iran, turkey has continued to make huge investments in iran. "Turkey, Iran and Turkmenistan will set up a company to build a natural gas-fired power plant in Turkmenistan, a senior Turkish energy ministry official said on Tuesday. Turkey has rapidly expanded its cooperation on energy projects with Iran in recent months. This includes Turkish plans to invest $3.5 billion in the Islamic Republic's South Pars gas fields and to use Iran as a transit country for Turkmen natural gas. The US has said it opposes the plan and does not support any investment in Iran." (‘Turkey, Iran to build power plant in Turkmenistan’ http://www.arabianbusiness.com/498109-turkey-iran-to-built-power-plant-in-turkmenistan August 21, 2007); "Furthermore, Burns pointed out that an energy deal signed between Iran and Turkey in July was not helpful. The preliminary deal foresees the construction of two separate pipelines to ship natural gas from the fields in Iran and neighboring Turkmenistan via Turkish territory. Turkey plans to invest 3.5 billion dollars in Iran for gas production. The first pipeline would originate from Iran’s South Pars gas field and second from Turkmenistan, Iran’s Central Asian neighbor. Analysts say Turkey can use part of this gas for its own consumption. The rest can be transferred further into Europe along the upcoming Nabucco pipeline." (‘Turkey defends energy ties with Iran despite U.S. opposition’ http://www.tehrantimes.com/index_View.asp?code=153655 September 25, 2007).
Trade between the two countries is booming. "The AKP government's leanings toward the Islamic world include Iran and a robust effort is on to build bilateral cooperation. Trade touching an all-time high level of US$7 billion may soon reach double digits. Ankara envisages a big role for Iran in its ambition to become the region's "energy hub". Disregarding US pressure, Ankara has pressed ahead with an agreement for the transit of Iranian gas to Europe." (M K Bhadrakumar ‘Saudi monarch woos Turkey's Islamists’ http://www.atimes.com/atimes/Middle_East/IK13Ak03.html November 13, 2007); "Similarly, Turkey plans to expand trade with Iran, notwithstanding U.S. disapproval. According to the Turkish press, trade has grown from $2.3 billion to $6.7 billion between 2003 and 2006, and the two countries have signed a preferential trade pact on a series of goods. Iran (along with Russia) supplies Turkey its gas needs, which have been growing in pace with the economy." (Ann Berg ‘Turkey: From Bloody Birth to Power Broker’ http://www.antiwar.com/orig/berga.php?articleid=11937 November 21, 2007).
Turkey has agreed to allow iranian gas to be exported to syria through its territory. Exports will begin once the arab gas pipeline between syria and turkey has been constructed. "The Syrian Gas Co. (SGC) and the Iranian National Company for Gas Export (INCGE) on Tuesday signed an initial principles agreement to purchase Iranian gas. The agreement included the basic principles for preparing a deal on natural gas purchase from Iran. It will come into effect by the end of 2009 when Aleppo-Kiles pipeline is completed and connected with the Turkish gas network. Shirazi (Hosein Noqrehkar-Shirazi, deputy Iranian Minister of Oil) referred to the depth of Syrian-Iranian cooperation relations, expressing his country's readiness to further develop and boost this cooperation." (‘Syria to Buy Iranian Gas Via Turkey’ http://www.downstreamtoday.com/(X(1)S(lbipkv55gr4biwmywmckhyec))/News/Articles/200801/Syria_to_Buy_Iranian_Gas_Via_Turkey_8021.aspx?AspxAutoDetectCookieSupport=1 January 09, 2008). Syria will this be getting gas from egypt and iran.
The bush regime has recently increased its pressure on turkey to limit its trade with, and investments in, iran. "First, Washington will expect that Turkey go slowly on expanding and deepening its cooperative ties with Iran, a trend that the Bush administration had been viewing with disquiet in the recent past. Turkey can be expected to respond with pragmatism and calibrate its ties with Iran in accordance with the US sensitivity." (M K Bhadrakumar ‘The door to Iraq's oil opens’ http://www.atimes.com/atimes/Middle_East/JB16Ak05.html February 16, 2008).
Iran’s Trade with the UAE.
"UAE-Iran trade rose to $12bn (€8.1bn, £5.8bn) last year, with Dubai's re-export hub the single most important entry point for goods coming into Iran." (Najmeh Bozorgmehr and Simeon Kerr ‘UAE detains ship as grip on Iran tightens’ http://www.ft.com/cms/s/0/f1b6eb8a-9ee6-11dc-b4e4-0000779fd2ac.html November 30 2007); "Iran and the United Arab Emirates (UAE) have begun top-level talks to boost economic relations, despite efforts by the United States to disrupt trade ties and an unresolved territorial dispute over the three strategic islands of Abu Mousa, the Lesser and the Greater Tunb in the Strait of Hormuz. The UAE is already Iran's top trade partner with bilateral trade reaching US$14 billion, according to official sources." (Kimia Sanati ‘US efforts to scuttle Iran-UAE ties fail’ http://www.atimes.com/atimes/Middle_East/JB27Ak02.html February 27, 2008).
Iran’s Trade with Venezuela.
"The presidents of Venezuela and Iran boasted Monday that they will defeat U.S. imperialism together, saying the fall of the dollar is a prelude to the end of Washington's global dominance. In Tehran, the two presidents signed four memorandums of understanding Monday to create a joint bank, a fund, an oil industry technical training program and an industrial agreement, Iranian state television said. It said Chavez then left after an official farewell ceremony. On Chavez's previous visit in July, the two leaders broke ground for construction of a jointly owned petrochemical complex in Iran, with 51 percent of it in Iranian ownership and 49 percent to be owned by Venezuela. The two nations also began construction of a second petrochemical complex in Venezuela, at a total combined cost of $1.4 billion. Since 2001, the two countries have signed more than 180 trade agreements, worth more than $20 billion in potential investment, according to official reports." (Nasser Karimi ‘Chavez, Ahmadinejad to work against US’ http://news.yahoo.com/s/ap/20071119/ap_on_re_mi_ea/iran_venezuela ).
Currency Dealings.
Iran Switches away from the Dollar.
After bush’s ‘axis of evil’ speech in 2003, the bush regime started imposing unilateral sanctions on iran. It must have been obvious to iran that bush would eventually ban the country from using the dollar. This acted as a spur for iran to start using alternative currencies. The bush mafia may have believed that stopping iran from using the dollar would be a financial punishment but, paradoxically, it has been financially beneficially to iran because of the fall in the value of the dollar. If iran had continued using the dollar it would have suffered considerable financial losses from the devaluation of the dollar, like those oil producing countries which hold onto the dollar, whereas by using alternative currencies it has protected the value of its oil revenues. "Iranian President Mahmoud Ahmadinejad has suggested an end to the trading of oil in US dollars, calling the currency "a worthless piece of paper". The call came at the end of a rare Opec summit, and was opposed by US ally Saudi Arabia. Speaking after the end of the summit, Mr Ahmadinejad said all leaders at the meeting were unhappy with recent falls in the value of the dollar. The dollar has weakened considerably against the euro and other currencies in the past 12 months. Its decline has affected the revenues of Opec members because most of them price and sell their oil exports in the US currency. Mr Ahmadinejad said that all Opec countries had showed interest in converting their cash reserves into other currencies. "They [the US] get our oil and give us a worthless piece of paper," he told reporters." (‘Iran leader dismisses US currency’ http://news.bbc.co.uk/2/hi/americas/7101050.stm November 18, 2007).
Iran stopped using the dollar altogether in december 2007. "On December 8, Chinese and French news services reported that Iran had stopped billing its oil exports in dollars. Iran's oil minister, Gholam Hossein Nozari, declared: "The dollar is an unreliable currency in regards to its devaluation and the loss oil exporters have endured from this trend."" (Paul Craig Roberts ‘Shrinking the US Dollar from the Inside-Out’ http://www.counterpunch.org/roberts12132007.html December 13, 2007); "But as for Iran, OPEC's second-largest exporter, it no longer trades a single barrel of oil in dollars. That is no small amount of non-dollars. The country's oil revenue will reach US$63 billion by the end of the current Iranian year on March 20, according to Nozari. Iran converted all its oil export payments to other currencies in December 2007. It now sells oil to Japan in yen, the Far East country, the world's second biggest economy, is the top importer of Iranian oil and Iran is Japan’s third-largest supplier." (Pepe Escobar ‘Slouching towards Petroeurostan’ http://www.atimes.com/atimes/Global_Economy/JB21Dj07.html February 21, 2008).
It has also been suggested that ahmadinejad’s efforts to persuade other opec states to give up the dollar seems to be bearing fruit. "Iran has proposed to OPEC that the US dollar no longer be used by any oil exporting countries. As the oil emirates and the Saudis have already decided to reduce their holdings of US dollars, the US might actually find itself having to pay for its energy imports in euros or yen." (Paul Craig Roberts ‘Shrinking the US Dollar from the Inside-Out’ http://www.counterpunch.org/roberts12132007.html December 13, 2007); "Worryingly for the dollar, other oil producers are preparing to follow Iran's lead. Qatari Prime Minister Sheikh Hamad bin Jassim al-Thani has already announced that the tiny oil-rich emirate would abandon the dollar for the Qatari riyal before summer. There’s a strong possibility the United Arab Emirates may also switch to its own currency." (Pepe Escobar ‘Slouching towards Petroeurostan’ http://www.atimes.com/atimes/Global_Economy/JB21Dj07.html February 21, 2008).
The bush mafia’s efforts to stop iran from using the dollar is turning out to be a blessing in disguise for iran because of the constantly depreciating dollar. Iran is having to rely upon other more solid currencies rather than the dollar and is thus not losing out so much as it would have been.
Domestic Policies.
Iran to start selling off its Industries.
Iran is in the process of privatizing some of its big nationally owned industries and the government stands to make almost as much money as the thatcher government did during the 1980s. "In the short term, Iran will sell a quarter of the National Copper Industry Company, one of the largest Iranian businesses, through the Malaysian stock exchange within the next two months, a stake that Mr Kord Zangeneh said would raise much more than its current $1.5bn (€1bn, £770m) book value." (Anna Fifield ‘Iran banks seek to sidestep US curbs’ http://fairuse.100webcustomers.com/itsonlyfair/ft002.html February 10, 2008).
Conclusions.
Iran switches from trade with America and Europe to trade with China and Russia.
America’s unilateral sanctions on iran, and the west’s support for these sanctions, is not causing a reduction in iran’s overall trade with the world because it is simply increasing its trade with other countries especially russia and china. Although sanctions might have a temporary disruptive effect on iranian businesses when they switch from trading with american/western companies to trading with chinese/russian companies, there doesn’t seem to be any permanent reduction in trade, and thus no long term damage, to the iranian economy. "Iran has steadily shifted its trade from West to East and, with the benefit of record high oil prices, was likely to withstand new US sanctions imposed last week, reports said yesterday. Analysts told The Washington Post that China was expected to overtake Germany as Iran's biggest trading partner this year." (‘Iran shielded from sanctions’ http://www.theaustralian.news.com.au/story/0,25197,22668761-2703,00.html October 30, 2007).
Just how much trouble can Iran’s Economy be in when it is flush with Oil Money?
Given the huge rise in the global price of oil over the last six years, it has to be asked just how bad a state can iran’s economy be in when the government is flush with oil revenue? "The Iranian Oil Minister says the country's oil revenues will reach $63 billion by the end of the Iranian year which ends March 20. Gholam-Hossein Nozari said Iran's oil sales have reached $55 billion in the first 11 months of the year ... Nozari announced last week that Iran's crude oil production had reached 4.184 million barrels per day, the highest level since the Islamic Revolution." (‘Iran oil revenues to reach $63B’ http://www.presstv.ir/detail.aspx?id=42941§ionid=351020103 February 13, 2008).
Every time bush denounces iran, the price of oil goes up, and iran earns even greater profits from its fossil fuels. Bush finds himself in the difficult position of having to whip up global support for continually widening sanctions against iran but, the more he does this, the more jittery the oil markets become, the higher the price of fossil fuels, the greater iran’s oil revenues, and the less effective sanctions become.
Sanctions policy won’t be effective because of Iran’s Good Neighbours.
Iran’s trade with its neighbours iraq, afghanistan, syria, and turkey, is booming. "The need to keep tightening the sanctions noose arises from the ineffective nature of the sanctions regime. To counter the stated U.S. attempt to isolate it, but more importantly to assure its own security, Iran has pursued a very active strategy vis-à-vis its neighbors, with many which it has long and porous borders. The northern border in particular, shared with former Soviet states of Armenia, Azerbaijan and Turkmenistan, not to mention the vast Caspian Sea, is particularly open. Pakistan and Afghanistan borders to the west, both with new land routes into Central Asia and China, are also uncontrolled by the West. Dubai and other Persian Gulf free ports, as well as newly developed facilities on the Sea of Oman guarantee that needed goods will flow into the country if severe trade sanctions are enacted. Dubai is also the place to get around the financial restrictions imposed on Iran. Even the present chaos in Iraq guarantees free flow of goods across Iran’s border (Iraq is reportedly now the second destination for Iran’s non-oil exports). Those who are pushing for more sanctions know this. They know that so long as neighbors such as the UAE and Turkey are unwilling to give up their lucrative business with Iran, the sanctions regime will not harm Iran enough to abandon its stance. They also know that given Iran’s long borders, the sanctions in place will be adjusted to in a short period of time. So for Iran to feel any kind of political heat the sanctions noose has to be tightened periodically." (Farideh Farhi ‘New Unilateral Sanctions against Iran: What Do They Mean?’ http://icga.blogspot.com/2007/10/new-unilateral-sanctions-against-iran.html October 26, 2007).
Western Propaganda about the state of Iran’s Economy.
Zionist occupied governments in the west and the zionist dominated western media continually try to prop up the efficacy of american/un sanctions against iran by suggesting that sanctions are causing considerable damage to iran’s economy. "Ordinary Iranians are less worried with conforming to Islamic norms and more concerned about the parlous state of the economy. At a time of economic crisis and a tightening international embargo against Iran, the Islamic Republic may have to dispense with marshaling young people toward an Islamic ideal if it is to survive." (Iason Athanasiadis ‘Iran's winds of change’ http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/02/14/irans_winds_of_change/ February 14, 2008); "The decision by the Guardian Council was the second major rebuke in less than a month for the hardline president, whose popularity has plummeted recently in the face of Iran's ailing economy. Ahmadinejad was elected in 2005 on a populist agenda promising to bring oil revenues to every family, eradicate poverty and tackle unemployment. Now he is facing increasingly fierce criticism for his failure to meet those promises." (Ali Akbar Dareini ‘Powerful council opposes Iran president’ http://wiredispatch.com/news/?id=48448 February 16, 2008).
But commentators find themselves in a quandary. On the one hand, in order to be politically kosher for the zionist dominated western media, they have to talk about the dire state of the iranian economy. On the other hand, they have to acknowledge the country’s soaring oil revenues without seeming to contradict their description of the dire state of the iranian economy. Even jim lobe seems to have drowned in this particular quandary. "The Director of National Intelligence, retired Admiral J Michael McConnell .. presented the intelligence community's "annual threat assessment" before the Senate Intelligence Committee in Washington on Tuesday. He believed "Supreme Leader Ali Khamenei and Iran's various conservative factions, despite growing infighting in the run-up to this year's parliamentary elections, "are expected to maintain control over a politically stable, if economically troubled Iranian state". Record high oil export earnings have placed Iran "on its soundest financial footing since the revolution"." (Jim Lobe ‘Pakistan taken to task over al-Qaeda’ http://www.atimes.com/atimes/South_Asia/JB07Df02.html February 07, 2008). If iran has been enjoying "Record high oil export earnings" then surely it can’t be that much of an "economically troubled Iranian state"?
Britain’s ambassador to the un tried to pretend that sanctions are hurting iran but provided no evidence to back up his allegation. "Two rounds of U.N. sanctions against Iran for refusing to halt sensitive nuclear activities have had an economic and political impact on the Islamic Republic, Britain's U.N. ambassador said Wednesday. "The economic effect has been to contribute to a further downturn in Iran's trade, particularly with Europe, and the readiness of international companies to invest," British ambassador to the United Nations, John Sawers, told reporters. While there are no figures for the precise impact of the sanctions, Iranian unemployment is high at around 10 percent and inflation has hit 19 percent, hurting mostly the poor voters Ahmadinejad courted in the 2005 presidential race." (Louis Charbonneau ‘UN sanctions have hit Iran's economy, Britain’ http://wiredispatch.com/news/?id=25883 January 30, 2008).
A couple of journalists have tried highlight the terrible stress ordinary iranians must be under because of the rapidly rising price of imported french perfumes. "But on the streets and in the shops of Tehran, the capital, sanctions have had a visible effect, diminishing the ability of merchants and consumers to buy goods from Europe, forcing them to opt for cheaper Asian imports. (sic, what a terrible price the iranians are being forced to pay! Especially when western consumers seem to be doing the same!). Prices of most goods, including French perfumes and German printing plates, have increased 50% in the last four months, merchants say, a result of the extra cost of doing business through Dubai, in the United Arab Emirates, instead of directly with foreign manufacturers and distributors. Many of those firms are wary of doing business with Iran lest they come under the scrutiny of the U.S. Treasury Department, which has begun aggressively targeting companies with ties to both the United States and Iran. "Now, doing business with anywhere other than China or Russia is too much of a pain," said Ali-Reza Morshed Razam, owner of an eyeglasses shop on Palestine Street, in downtown Tehran." (Borzou Daragahi and Ramin Mostaghim ‘Iran sanctions ripple past those in power’ http://fairuse.100webcustomers.com/itsonlyfair/latimes0042.html January 20, 2008). Isn’t it possible iranian merchants are making a bomb selling freedom perfumes?
Does iran’s expansion of trade suggest its economy is reeling in the same way the american economy is reeling?
The Factors suggesting it is America and the West which is suffering from the imposition of Sanctions on Iran.
It is possible that american/un sanctions against iran are hurting the west more than they are hurting iran.
Iran no longer propping up the value of the Dollar.
The bush mafia believed that banning iran from using the dollar would hurt iran whereas, as has been noted above, it has been financially beneficial to iran. However, it has been financially detrimental to america since iran is no longer helping to prop up the value of the dollar. The economic benefits that once accrued to america through iran’s use of the dollar are now going to other countries when iran uses their currencies.
America and Europe losing out on Trade with Iran.
American and western european companies are cutting back on their trade with iran and losing out on hundreds of billions of dollars’ worth of business. The germans have sacrificed a substantial amount of their trade with iran. "The adoption of tougher sanctions against Iran over its nuclear program could cost the German budget 2 billion euros, according to Finance Ministry estimates cited in Der Spiegel magazine on Saturday." (Noah Barkin ‘Tough Iran sanctions to hit Germany hard: report’ http://news.yahoo.com/s/nm/20071124/wl_nm/germany_iran_sanctions_dc November 24, 2007); "The German government halved the volume of new export credit guarantees for trade with Iran last year, the Economy Ministry said on Monday, in a sign Berlin is increasing pressure on Tehran over its nuclear programme. The value of new export guarantees approved by the government in 2007 fell to 503.4 million euros ($732.7 million), from 1.16 billion in 2006, a ministry official said." (Germany slashes credit guarantees for Iran exports’ http://wiredispatch.com/news/?id=41647 February 11, 2008).
American and European Companies being replaced by Russian and Chinese Companies in Iran.
As western countries reduce their trade with iran, eastern countries take their place. By the time the west is forced to abandon its sanctions on iran, the iranian economy will be so well integrated with the russian and chinese economies it would take a huge wrench for it to revert back to trading with the west. "Sinopec, China's largest oil refiner, has just finalized a multi-billion dollar deal to develop the giant Yadavaran oil field, and this is in addition to the "deal of the century" contract for natural gas from Iran's immense North Pars field. Chinese contractors are also busy constructing oil terminals for Iran in the Caspian Sea, extending the Tehran metro, building airports, among other projects. And this while China arms sales to Iran have included such hot items as ballistic-missile technology and air-defense radars." (Kaveh L Afrasiabi ‘A China base in Iran?’ http://www.atimes.com/atimes/Middle_East/JA29Ak03.html January 29, 2008); "Trade with Italy has fallen 20 per cent in six months. In 2006, Germany’s exports to Iran dropped 7 per cent and Japan’s fell 13 per cent. But business with China is booming. Last year Beijing signed a $100bn deal to import Iranian natural gas and Chinese companies will be 50 per cent stakeholders in the Yadavaran oil field. China has also become the second biggest market for Iran’s non-oil exports, taking $1.72bn in 2006-7, after the UAE with $2.5bn. Iran’s overall non-oil exports rose 47.2 percent to $16.3bn. "The situation over sanctions is a huge opportunity for China, former Soviet republics and regional countries," says one Asian diplomat in Tehran." (Gareth Smyth ‘Sanctions fail to fuel dissent on Iran’s streets’ http://www.ft.com/cms/s/481229ae-3948-11dc-ab48-0000779fd2ac.html July 24, 2007). The consequence is that, "Regarding the latter, China has already surpassed Germany as Iran's number one trade partner." (Kaveh L Afrasiabi ‘A China base in Iran?’ http://www.atimes.com/atimes/Middle_East/JA29Ak03.html January 29, 2008).
The Jews-only state’s efforts to sanction Iran have ended up sacrificing American/Western economies whilst providing an economic and political Bonanza for Russia and China.
The jews-only state in palestine and its allies around the world who have pressured american/european/un sanctions are in effect sacrificing western economies for the sake of promoting jewish supremacism in the middle east. Zionist inspired us/un sanctions are forcing the re-orientation of the iranian economy from the west to the east, from its preferred trade with europe and america to trade with russia and china. The reorientation of iran’s economy is going to boost the economic power of china and russia in comparison to the economic power of the west. It will allow china and russia to establish a critical geopolitical role in iran. Without the likudniks stirring up hatred between america and iran they could have developed highly profitable economic links which could have led to a vital strategic alliance. But this is exactly what the jews-only state does not want. The jews do not want iranians to get nuclear weapons but they are even more sacred of america developing a strategic alliance with iran such as the one it had under the shah. The likudniks warmongering over iran’s non-existent development of nuclear weapons is simply a political device to stir up hatred between america and iran.
The jews are sacrificing their allies, america and the rest of the western world, to the considerable benefit of russia and china. It must be humiliating for america and europe to accidentally shoot themselves in the foot by promoting sanctions against iran. But for them to deliberately shoot themselves in the foot because warmongering, paranoid, likudnik extremists have told them this would be good for their health, is a far greater humiliation. They really need to seek ahmadinejad’s advice on establishing independence from the jews-only state.
Over the last couple of decades, america’s jewish elite has succeeded in pressuring a succession of american administrations into imposing unilateral sanctions against iran. In recent years the global jewish elite has pressured the united nations’ security council into passing sanctions on iran. However, nobody has carried out any empirical research into whether these sanctions have been effective or not. The first assessment into the efficacy of these likudnik sanctions has just been released by the american government’s accountability office. "A three-year international effort to pressure Iran is faltering, with a new report to Congress questioning the impact of 20 years of U.S. economic sanctions on Tehran and a long-sought U.N. resolution against Iran in trouble. In a report released yesterday, the investigative arm of Congress challenged the impact of U.S. sanctions against Iran dating to 1987. Tehran has circumvented many economic sanctions, it concluded, noting Iran's ability to negotiate $20 billion in contracts with foreign firms since 2003 to develop its energy resources. With the country's oil wealth, Iranian banks also have funded their activities in currencies other than the dollar. "Iran's global trade ties and leading role in energy production make it difficult for the United States to isolate Iran and pressure it to reduce proliferation and support for terrorism," the Government Accountability Office said. "Iran's overall trade with the world has grown since the U.S. imposed sanctions, although this trade has fluctuated."" (Robin Wright ‘GAO Report Challenges Effect of Longtime U.S. Sanctions on Iran’ http://www.washingtonpost.com/wp-dyn/content/article/2008/01/16/AR2008011603711.html January 17, 2008); "A report released Wednesday by the Government Accountability Office, an independent auditing group that answers to the U.S. Congress, says, "The overall impact of sanctions, and the extent to which these sanctions further U.S. objectives, is unclear," and that foreign firms continue to make deals in Iran's state-controlled energy sector." (Borzou Daragahi and Ramin Mostaghim ‘Iran sanctions ripple past those in power’ http://fairuse.100webcustomers.com/itsonlyfair/latimes0042.html January 20, 2008). The gao’s conclusion "Iran's overall trade with the world has grown since the U.S. imposed sanctions .." will not make the likudniks happy.
The Factors suggesting Iran’s Economy is Expanding not Contracting under Sanctions.
There is strong circumstantial evidence that, over the last few years, iran’s economy has been expanding despite us/un sanctions, despite any economic damage caused by these sanctions.
Trade.
Iran’s Trade with Afghanistan.
In the past it was difficult for iran to trade with afghanistan because the taliban was hostile to iran. However, after america’s invasion overthrew the taliban the country has acquired a new government which is much more amenable towards iran. Iran’s trade with afghanistan has grown considerably which must have boosted its economy.
Iran’s Trade with Armenia.
"The Russian gas export monopoly owns all the gas pipelines in Armenia, to which Iran has recently completed a new export pipeline. Gazprom will operate the section of that pipeline in Armenia." (Simon Webb and Amie Ferris-Rotman ‘Russian energy ties with Iran send U.S. a message’ http://wiredispatch.com/news/?id=53864 February 21, 2008).
Iran and Azerbaijan.
"Iranian President Mahmoud Ahmadinejad, keen to counter growing US influence on his doorstep, urged closer ties with neighboring Azerbaijan during his first official visit here Tuesday. "We have very good relations on all levels and in all spheres. However, there is big potential we must use," Ahmadinejad said after meeting his Azerbaijani counterpart, Ilham Aliyev. "There should be no obstacles to the development of our relations." Iran and the US are vying for influence in energy-rich Azerbaijan, wedged between Iran and Russia on the western shore of the Caspian Sea. The two countries signed five bilateral agreements, including deals to build a new bridge on their border, establish new customs posts and set up a direct bus link through Iran connecting the Azerbaijani exclave Nakhchivan with the rest of the country. The two leaders added that they would seek to increase cooperation on energy and power generation. Azerbaijan has close diplomatic and trade relations with Iran. Both countries are predominantly Shiite Muslim and share strong cultural ties. Northern Iran is home to between 16 million and 30 million ethnic Azeris, according to varying estimates, easily outnumbering the 8 million in Azerbaijan itself." (‘Tehran seeks Azerbaijan ties to counter US’ http://www.dailystar.com.lb/article.asp?edition_id=10&categ_id=2&article_id=84691 August 22, 2007).
Iran and Bahrain.
"Ahmadinejad said after meeting Bahrain's King Hamad bin Isa al-Khalifa that his trip aimed at expanding "economic and cultural relations" between the two countries. He signed a memorandum of understanding to export natural gas to Bahrain. "Iran will provide one million cubic feet per day of natural gas, and the details are expected to be finalized within a year before signing a deal on this strategic project," said Bahrain's foreign minister, Sheik Khalid bin Ahmed al-Khalifa." (‘Iran prez plays down possible US strike’ http://news.yahoo.com/s/ap/20071118/ap_on_re_mi_ea/iran_us_2 November 18, 2007).
Iran and China.
"China, which has enjoyed growing trade since the early 1990s, ranked third behind the United Arab Emirates last year, with $4.48bn of exports, up 35.8 per cent on 2005. If the growth continues this year, as predicted, China will become the leading supplier." (Najmeh Bozorgmehr ‘Embargo adds to lure of eastern promise for Iran’ http://www.ft.com/cms/s/0/941a9c00-625b-11dc-bdf6-0000779fd2ac.html September 14, 2007). Much more dramatically. "Beijing doesn't want its economic relationship with Tehran disrupted. Iran is a major supplier of oil to China. China intends to boost its bilateral trade with Iran to over US$100 billion annually in the near future. (There is no reason to doubt China's capacity to do so.) China supplies weapons and industrial products to Iran and participates in major projects, such as the Tehran metro." (M K Bhadrakumar ‘A new Chinese red line over Iran’ http://www.atimes.com/atimes/Middle_East/IL07Ak02.html December 07, 2007).
Iran’s Trade with Iraq.
In the past it was difficult for iran to trade with iraq because saddam was so hostile to iran. However, after america overthrew saddam the new shiite government is much more amenable towards iran. Iran’s trade with iraq has grown considerably. "More than four years after the U.S.-led invasion toppled Saddam, Iran's influence from trade links to political sway has never been greater, a fact bedeviling the United States as President Bush pledges American troops will remain in Iraq in large numbers. These days, Iran's influence still is most apparent across Iraq's mostly Shiite south. But it is also felt in Kurdish northern areas and even in Baghdad, where many new reconstruction projects, such as improving Iraq's electricity grid, are financed by Iranian investment. "Decades of war and U.S. invasion have destroyed almost everything in Iraq. And Iran is well prepared to make good use of this opportunity to flood Iraqi markets with goods and services," said Saeed Leilaz, an economic and political analyst in Iran. The export of goods to Iraq brings both money and influence, he noted. "Iranian products are sold everywhere in Iraq. This never happened before. Iran is playing a clever game," he said. Each month, more than 40,000 Iranians visit southern Iraq's important Shiite spots such as the holy cities of Najaf and Karbala, buying religious souvenirs and pumping money into the economy by staying in hotels. Iran has said it wants to build an airport in Najaf and promises to help renovate important shrines. It also has begun work on a railroad between Iranian port of Khorramshar and Basra, connecting Iran's rail system to Iraq's. Tehran also has signed a $150 million contract to build a 300-megawatt power plant in Baghdad. Another project, a 400-megawatt electricity transmission line from the Iranian frontier city of Abadan to the Iraqi town of Alharasa is expected to go into operation in a few months." (Ali Akbar Dareini ‘Iranian influence increasing in Iraq’ http://news.yahoo.com/s/ap/20070914/ap_on_re_mi_ea/iraq_iran_s_influence September 14, 2007); "Meanwhile, as Iran competes with the United States for influence in Iraq, Tehran is hedging its bets beyond ISCI, building up an impressive portfolio of political, economic, religious and military holdings in its western neighbor. There is a steadily increasing trade, including a black market, across the Iran-Iraq border, and the Iranian government and its state-owned entities have made significant investments in and loans to Iraqi businesses and the rebuilding of Shiite holy cities. There are longstanding clerical ties between Qom, Iran, and Najaf, Iraq, and tens of thousands of religious pilgrims, no doubt including more than a few Iranian intelligence officers, cross the border every month. In March Iranian President Mahmoud Ahmadinejad plans to make the first state visit by an Iranian leader to Baghdad." (Robert Dreyfuss ‘Is Iran Winning the Iraq War?’ http://www.uruknet.de/?p=m41362&hd=&size=1&l=e February 21, 2008).
Iran’s Trade with Malaysia.
"Iran last week signed a six billion dollar deal with Malaysia to develop two offshore gas fields, touting the planned investment as the biggest ever in the country." (Siavosh Ghazi ‘Iran hit by gas cuts after Turkmenistan halts supplies’ http://news.yahoo.com/s/afp/20071231/wl_mideast_afp/iranturkmenistanenergygas December 31, 2007).
Iran’s Trade with Russia.
"Gazprom has been involved in Iran for years and invested about $4 billion in the country between 2000-2007, said Huseynov. It was involved in an earlier phase of development at South Pars with Total and Malaysia's Petronas." (Simon Webb and Amie Ferris-Rotman ‘Russian energy ties with Iran send U.S. a message’ http://wiredispatch.com/news/?id=53864 February 21, 2008); "Iran holds the world's second-largest proven natural gas reserves, behind only Russia. Alexei Miller, chief executive of Russia's state-run gas exporter Gazprom, recently visited Tehran and met with Iran's Oil Minister Gholam-Hossein Nozari. The result is that Gazprom will develop "two or three" blocks of the monstrous South Pars gas field in Iran; and its daughter company, Gazpromneft, will also be part of a huge oil project in Iran. Gazprom has been in South Pars since 1997, alongside TotalFinaElf of France and Malaysia's Petronas. Gazprom has already invested at least US$4 billion in Iran since 2000. The Russian company will also help Iran to develop its pipeline system, which will finally link the north (where Tehran is located) to the oil and gas fields in the south and southwest. This means Iran won't need to import gas from unreliable neighbor Turkmenistan, prone to cut off supplies over endless arguments about unpaid bills. This means that Iran, already exchanging energy with Azerbaijan, Armenia and Turkmenistan, will also connect to Russia's national power grid. Fattah said Iran and Russia would cooperate in the construction of two power plants in Tajikistan. The results are obvious: the merging of Russian and Iranian electricity networks will cover virtually all the demand in Central Asia and the Caucasus. Most of the new investment will be Russian." (Pepe Escobar ‘Russia gas pact energizes Iran http://www.atimes.com/atimes/Middle_East/JB27Ak01.html February 27, 2008).
Iran’s Trade with Syria.
"From car manufacturing plants and a proposed $2bn industrial zone for Iranian businesses, to plans to overhaul urban transportation systems, Iranian companies are charging into Syria, looking to cash in on a recent privatisation push by Damascus. Weighed down by a behemoth public sector, an influx of nearly two million Iraqi refugees and falling oil production, Syria's leaders are trying to liberalise their economy in hopes of avoiding a financial meltdown. In another time, the privatisation effort might have presented an opportunity for the US and Europe to use their enormous commercial muscle to drive a wedge between Syria and Iran, Washington's foremost antagonists in the region. But the US imposed sanctions in 2004 as punishment for Syrian support of militant Palestinian and Lebanese organisations. These banned American exports to Syria and gave President George Bush the added option of outlawing American investment in the country, effectively scaring off American and other Western companies. The Syrian government estimates that Iranian investment in 2006 alone surged to more than $400m, making Tehran the third-largest foreign investor here, behind Saudi Arabia and Turkey. Though exact figures are unavailable, by some estimates Iran has invested a total of $3bn in Syria, most of that in the past few years." (Hugh Naylor ‘Sanctions put Iranians on the road to Damascus’ http://scotlandonsunday.scotsman.com/business.cfm?id=1600142007 October 07, 2007).
Iran’s Trade with Turkey.
Despite the bush regime’s efforts to impose unilateral, global sanctions on iran, turkey has continued to make huge investments in iran. "Turkey, Iran and Turkmenistan will set up a company to build a natural gas-fired power plant in Turkmenistan, a senior Turkish energy ministry official said on Tuesday. Turkey has rapidly expanded its cooperation on energy projects with Iran in recent months. This includes Turkish plans to invest $3.5 billion in the Islamic Republic's South Pars gas fields and to use Iran as a transit country for Turkmen natural gas. The US has said it opposes the plan and does not support any investment in Iran." (‘Turkey, Iran to build power plant in Turkmenistan’ http://www.arabianbusiness.com/498109-turkey-iran-to-built-power-plant-in-turkmenistan August 21, 2007); "Furthermore, Burns pointed out that an energy deal signed between Iran and Turkey in July was not helpful. The preliminary deal foresees the construction of two separate pipelines to ship natural gas from the fields in Iran and neighboring Turkmenistan via Turkish territory. Turkey plans to invest 3.5 billion dollars in Iran for gas production. The first pipeline would originate from Iran’s South Pars gas field and second from Turkmenistan, Iran’s Central Asian neighbor. Analysts say Turkey can use part of this gas for its own consumption. The rest can be transferred further into Europe along the upcoming Nabucco pipeline." (‘Turkey defends energy ties with Iran despite U.S. opposition’ http://www.tehrantimes.com/index_View.asp?code=153655 September 25, 2007).
Trade between the two countries is booming. "The AKP government's leanings toward the Islamic world include Iran and a robust effort is on to build bilateral cooperation. Trade touching an all-time high level of US$7 billion may soon reach double digits. Ankara envisages a big role for Iran in its ambition to become the region's "energy hub". Disregarding US pressure, Ankara has pressed ahead with an agreement for the transit of Iranian gas to Europe." (M K Bhadrakumar ‘Saudi monarch woos Turkey's Islamists’ http://www.atimes.com/atimes/Middle_East/IK13Ak03.html November 13, 2007); "Similarly, Turkey plans to expand trade with Iran, notwithstanding U.S. disapproval. According to the Turkish press, trade has grown from $2.3 billion to $6.7 billion between 2003 and 2006, and the two countries have signed a preferential trade pact on a series of goods. Iran (along with Russia) supplies Turkey its gas needs, which have been growing in pace with the economy." (Ann Berg ‘Turkey: From Bloody Birth to Power Broker’ http://www.antiwar.com/orig/berga.php?articleid=11937 November 21, 2007).
Turkey has agreed to allow iranian gas to be exported to syria through its territory. Exports will begin once the arab gas pipeline between syria and turkey has been constructed. "The Syrian Gas Co. (SGC) and the Iranian National Company for Gas Export (INCGE) on Tuesday signed an initial principles agreement to purchase Iranian gas. The agreement included the basic principles for preparing a deal on natural gas purchase from Iran. It will come into effect by the end of 2009 when Aleppo-Kiles pipeline is completed and connected with the Turkish gas network. Shirazi (Hosein Noqrehkar-Shirazi, deputy Iranian Minister of Oil) referred to the depth of Syrian-Iranian cooperation relations, expressing his country's readiness to further develop and boost this cooperation." (‘Syria to Buy Iranian Gas Via Turkey’ http://www.downstreamtoday.com/(X(1)S(lbipkv55gr4biwmywmckhyec))/News/Articles/200801/Syria_to_Buy_Iranian_Gas_Via_Turkey_8021.aspx?AspxAutoDetectCookieSupport=1 January 09, 2008). Syria will this be getting gas from egypt and iran.
The bush regime has recently increased its pressure on turkey to limit its trade with, and investments in, iran. "First, Washington will expect that Turkey go slowly on expanding and deepening its cooperative ties with Iran, a trend that the Bush administration had been viewing with disquiet in the recent past. Turkey can be expected to respond with pragmatism and calibrate its ties with Iran in accordance with the US sensitivity." (M K Bhadrakumar ‘The door to Iraq's oil opens’ http://www.atimes.com/atimes/Middle_East/JB16Ak05.html February 16, 2008).
Iran’s Trade with the UAE.
"UAE-Iran trade rose to $12bn (€8.1bn, £5.8bn) last year, with Dubai's re-export hub the single most important entry point for goods coming into Iran." (Najmeh Bozorgmehr and Simeon Kerr ‘UAE detains ship as grip on Iran tightens’ http://www.ft.com/cms/s/0/f1b6eb8a-9ee6-11dc-b4e4-0000779fd2ac.html November 30 2007); "Iran and the United Arab Emirates (UAE) have begun top-level talks to boost economic relations, despite efforts by the United States to disrupt trade ties and an unresolved territorial dispute over the three strategic islands of Abu Mousa, the Lesser and the Greater Tunb in the Strait of Hormuz. The UAE is already Iran's top trade partner with bilateral trade reaching US$14 billion, according to official sources." (Kimia Sanati ‘US efforts to scuttle Iran-UAE ties fail’ http://www.atimes.com/atimes/Middle_East/JB27Ak02.html February 27, 2008).
Iran’s Trade with Venezuela.
"The presidents of Venezuela and Iran boasted Monday that they will defeat U.S. imperialism together, saying the fall of the dollar is a prelude to the end of Washington's global dominance. In Tehran, the two presidents signed four memorandums of understanding Monday to create a joint bank, a fund, an oil industry technical training program and an industrial agreement, Iranian state television said. It said Chavez then left after an official farewell ceremony. On Chavez's previous visit in July, the two leaders broke ground for construction of a jointly owned petrochemical complex in Iran, with 51 percent of it in Iranian ownership and 49 percent to be owned by Venezuela. The two nations also began construction of a second petrochemical complex in Venezuela, at a total combined cost of $1.4 billion. Since 2001, the two countries have signed more than 180 trade agreements, worth more than $20 billion in potential investment, according to official reports." (Nasser Karimi ‘Chavez, Ahmadinejad to work against US’ http://news.yahoo.com/s/ap/20071119/ap_on_re_mi_ea/iran_venezuela ).
Currency Dealings.
Iran Switches away from the Dollar.
After bush’s ‘axis of evil’ speech in 2003, the bush regime started imposing unilateral sanctions on iran. It must have been obvious to iran that bush would eventually ban the country from using the dollar. This acted as a spur for iran to start using alternative currencies. The bush mafia may have believed that stopping iran from using the dollar would be a financial punishment but, paradoxically, it has been financially beneficially to iran because of the fall in the value of the dollar. If iran had continued using the dollar it would have suffered considerable financial losses from the devaluation of the dollar, like those oil producing countries which hold onto the dollar, whereas by using alternative currencies it has protected the value of its oil revenues. "Iranian President Mahmoud Ahmadinejad has suggested an end to the trading of oil in US dollars, calling the currency "a worthless piece of paper". The call came at the end of a rare Opec summit, and was opposed by US ally Saudi Arabia. Speaking after the end of the summit, Mr Ahmadinejad said all leaders at the meeting were unhappy with recent falls in the value of the dollar. The dollar has weakened considerably against the euro and other currencies in the past 12 months. Its decline has affected the revenues of Opec members because most of them price and sell their oil exports in the US currency. Mr Ahmadinejad said that all Opec countries had showed interest in converting their cash reserves into other currencies. "They [the US] get our oil and give us a worthless piece of paper," he told reporters." (‘Iran leader dismisses US currency’ http://news.bbc.co.uk/2/hi/americas/7101050.stm November 18, 2007).
Iran stopped using the dollar altogether in december 2007. "On December 8, Chinese and French news services reported that Iran had stopped billing its oil exports in dollars. Iran's oil minister, Gholam Hossein Nozari, declared: "The dollar is an unreliable currency in regards to its devaluation and the loss oil exporters have endured from this trend."" (Paul Craig Roberts ‘Shrinking the US Dollar from the Inside-Out’ http://www.counterpunch.org/roberts12132007.html December 13, 2007); "But as for Iran, OPEC's second-largest exporter, it no longer trades a single barrel of oil in dollars. That is no small amount of non-dollars. The country's oil revenue will reach US$63 billion by the end of the current Iranian year on March 20, according to Nozari. Iran converted all its oil export payments to other currencies in December 2007. It now sells oil to Japan in yen, the Far East country, the world's second biggest economy, is the top importer of Iranian oil and Iran is Japan’s third-largest supplier." (Pepe Escobar ‘Slouching towards Petroeurostan’ http://www.atimes.com/atimes/Global_Economy/JB21Dj07.html February 21, 2008).
It has also been suggested that ahmadinejad’s efforts to persuade other opec states to give up the dollar seems to be bearing fruit. "Iran has proposed to OPEC that the US dollar no longer be used by any oil exporting countries. As the oil emirates and the Saudis have already decided to reduce their holdings of US dollars, the US might actually find itself having to pay for its energy imports in euros or yen." (Paul Craig Roberts ‘Shrinking the US Dollar from the Inside-Out’ http://www.counterpunch.org/roberts12132007.html December 13, 2007); "Worryingly for the dollar, other oil producers are preparing to follow Iran's lead. Qatari Prime Minister Sheikh Hamad bin Jassim al-Thani has already announced that the tiny oil-rich emirate would abandon the dollar for the Qatari riyal before summer. There’s a strong possibility the United Arab Emirates may also switch to its own currency." (Pepe Escobar ‘Slouching towards Petroeurostan’ http://www.atimes.com/atimes/Global_Economy/JB21Dj07.html February 21, 2008).
The bush mafia’s efforts to stop iran from using the dollar is turning out to be a blessing in disguise for iran because of the constantly depreciating dollar. Iran is having to rely upon other more solid currencies rather than the dollar and is thus not losing out so much as it would have been.
Domestic Policies.
Iran to start selling off its Industries.
Iran is in the process of privatizing some of its big nationally owned industries and the government stands to make almost as much money as the thatcher government did during the 1980s. "In the short term, Iran will sell a quarter of the National Copper Industry Company, one of the largest Iranian businesses, through the Malaysian stock exchange within the next two months, a stake that Mr Kord Zangeneh said would raise much more than its current $1.5bn (€1bn, £770m) book value." (Anna Fifield ‘Iran banks seek to sidestep US curbs’ http://fairuse.100webcustomers.com/itsonlyfair/ft002.html February 10, 2008).
Conclusions.
Iran switches from trade with America and Europe to trade with China and Russia.
America’s unilateral sanctions on iran, and the west’s support for these sanctions, is not causing a reduction in iran’s overall trade with the world because it is simply increasing its trade with other countries especially russia and china. Although sanctions might have a temporary disruptive effect on iranian businesses when they switch from trading with american/western companies to trading with chinese/russian companies, there doesn’t seem to be any permanent reduction in trade, and thus no long term damage, to the iranian economy. "Iran has steadily shifted its trade from West to East and, with the benefit of record high oil prices, was likely to withstand new US sanctions imposed last week, reports said yesterday. Analysts told The Washington Post that China was expected to overtake Germany as Iran's biggest trading partner this year." (‘Iran shielded from sanctions’ http://www.theaustralian.news.com.au/story/0,25197,22668761-2703,00.html October 30, 2007).
Just how much trouble can Iran’s Economy be in when it is flush with Oil Money?
Given the huge rise in the global price of oil over the last six years, it has to be asked just how bad a state can iran’s economy be in when the government is flush with oil revenue? "The Iranian Oil Minister says the country's oil revenues will reach $63 billion by the end of the Iranian year which ends March 20. Gholam-Hossein Nozari said Iran's oil sales have reached $55 billion in the first 11 months of the year ... Nozari announced last week that Iran's crude oil production had reached 4.184 million barrels per day, the highest level since the Islamic Revolution." (‘Iran oil revenues to reach $63B’ http://www.presstv.ir/detail.aspx?id=42941§ionid=351020103 February 13, 2008).
Every time bush denounces iran, the price of oil goes up, and iran earns even greater profits from its fossil fuels. Bush finds himself in the difficult position of having to whip up global support for continually widening sanctions against iran but, the more he does this, the more jittery the oil markets become, the higher the price of fossil fuels, the greater iran’s oil revenues, and the less effective sanctions become.
Sanctions policy won’t be effective because of Iran’s Good Neighbours.
Iran’s trade with its neighbours iraq, afghanistan, syria, and turkey, is booming. "The need to keep tightening the sanctions noose arises from the ineffective nature of the sanctions regime. To counter the stated U.S. attempt to isolate it, but more importantly to assure its own security, Iran has pursued a very active strategy vis-à-vis its neighbors, with many which it has long and porous borders. The northern border in particular, shared with former Soviet states of Armenia, Azerbaijan and Turkmenistan, not to mention the vast Caspian Sea, is particularly open. Pakistan and Afghanistan borders to the west, both with new land routes into Central Asia and China, are also uncontrolled by the West. Dubai and other Persian Gulf free ports, as well as newly developed facilities on the Sea of Oman guarantee that needed goods will flow into the country if severe trade sanctions are enacted. Dubai is also the place to get around the financial restrictions imposed on Iran. Even the present chaos in Iraq guarantees free flow of goods across Iran’s border (Iraq is reportedly now the second destination for Iran’s non-oil exports). Those who are pushing for more sanctions know this. They know that so long as neighbors such as the UAE and Turkey are unwilling to give up their lucrative business with Iran, the sanctions regime will not harm Iran enough to abandon its stance. They also know that given Iran’s long borders, the sanctions in place will be adjusted to in a short period of time. So for Iran to feel any kind of political heat the sanctions noose has to be tightened periodically." (Farideh Farhi ‘New Unilateral Sanctions against Iran: What Do They Mean?’ http://icga.blogspot.com/2007/10/new-unilateral-sanctions-against-iran.html October 26, 2007).
Western Propaganda about the state of Iran’s Economy.
Zionist occupied governments in the west and the zionist dominated western media continually try to prop up the efficacy of american/un sanctions against iran by suggesting that sanctions are causing considerable damage to iran’s economy. "Ordinary Iranians are less worried with conforming to Islamic norms and more concerned about the parlous state of the economy. At a time of economic crisis and a tightening international embargo against Iran, the Islamic Republic may have to dispense with marshaling young people toward an Islamic ideal if it is to survive." (Iason Athanasiadis ‘Iran's winds of change’ http://www.boston.com/bostonglobe/editorial_opinion/oped/articles/2008/02/14/irans_winds_of_change/ February 14, 2008); "The decision by the Guardian Council was the second major rebuke in less than a month for the hardline president, whose popularity has plummeted recently in the face of Iran's ailing economy. Ahmadinejad was elected in 2005 on a populist agenda promising to bring oil revenues to every family, eradicate poverty and tackle unemployment. Now he is facing increasingly fierce criticism for his failure to meet those promises." (Ali Akbar Dareini ‘Powerful council opposes Iran president’ http://wiredispatch.com/news/?id=48448 February 16, 2008).
But commentators find themselves in a quandary. On the one hand, in order to be politically kosher for the zionist dominated western media, they have to talk about the dire state of the iranian economy. On the other hand, they have to acknowledge the country’s soaring oil revenues without seeming to contradict their description of the dire state of the iranian economy. Even jim lobe seems to have drowned in this particular quandary. "The Director of National Intelligence, retired Admiral J Michael McConnell .. presented the intelligence community's "annual threat assessment" before the Senate Intelligence Committee in Washington on Tuesday. He believed "Supreme Leader Ali Khamenei and Iran's various conservative factions, despite growing infighting in the run-up to this year's parliamentary elections, "are expected to maintain control over a politically stable, if economically troubled Iranian state". Record high oil export earnings have placed Iran "on its soundest financial footing since the revolution"." (Jim Lobe ‘Pakistan taken to task over al-Qaeda’ http://www.atimes.com/atimes/South_Asia/JB07Df02.html February 07, 2008). If iran has been enjoying "Record high oil export earnings" then surely it can’t be that much of an "economically troubled Iranian state"?
Britain’s ambassador to the un tried to pretend that sanctions are hurting iran but provided no evidence to back up his allegation. "Two rounds of U.N. sanctions against Iran for refusing to halt sensitive nuclear activities have had an economic and political impact on the Islamic Republic, Britain's U.N. ambassador said Wednesday. "The economic effect has been to contribute to a further downturn in Iran's trade, particularly with Europe, and the readiness of international companies to invest," British ambassador to the United Nations, John Sawers, told reporters. While there are no figures for the precise impact of the sanctions, Iranian unemployment is high at around 10 percent and inflation has hit 19 percent, hurting mostly the poor voters Ahmadinejad courted in the 2005 presidential race." (Louis Charbonneau ‘UN sanctions have hit Iran's economy, Britain’ http://wiredispatch.com/news/?id=25883 January 30, 2008).
A couple of journalists have tried highlight the terrible stress ordinary iranians must be under because of the rapidly rising price of imported french perfumes. "But on the streets and in the shops of Tehran, the capital, sanctions have had a visible effect, diminishing the ability of merchants and consumers to buy goods from Europe, forcing them to opt for cheaper Asian imports. (sic, what a terrible price the iranians are being forced to pay! Especially when western consumers seem to be doing the same!). Prices of most goods, including French perfumes and German printing plates, have increased 50% in the last four months, merchants say, a result of the extra cost of doing business through Dubai, in the United Arab Emirates, instead of directly with foreign manufacturers and distributors. Many of those firms are wary of doing business with Iran lest they come under the scrutiny of the U.S. Treasury Department, which has begun aggressively targeting companies with ties to both the United States and Iran. "Now, doing business with anywhere other than China or Russia is too much of a pain," said Ali-Reza Morshed Razam, owner of an eyeglasses shop on Palestine Street, in downtown Tehran." (Borzou Daragahi and Ramin Mostaghim ‘Iran sanctions ripple past those in power’ http://fairuse.100webcustomers.com/itsonlyfair/latimes0042.html January 20, 2008). Isn’t it possible iranian merchants are making a bomb selling freedom perfumes?
Does iran’s expansion of trade suggest its economy is reeling in the same way the american economy is reeling?
The Factors suggesting it is America and the West which is suffering from the imposition of Sanctions on Iran.
It is possible that american/un sanctions against iran are hurting the west more than they are hurting iran.
Iran no longer propping up the value of the Dollar.
The bush mafia believed that banning iran from using the dollar would hurt iran whereas, as has been noted above, it has been financially beneficial to iran. However, it has been financially detrimental to america since iran is no longer helping to prop up the value of the dollar. The economic benefits that once accrued to america through iran’s use of the dollar are now going to other countries when iran uses their currencies.
America and Europe losing out on Trade with Iran.
American and western european companies are cutting back on their trade with iran and losing out on hundreds of billions of dollars’ worth of business. The germans have sacrificed a substantial amount of their trade with iran. "The adoption of tougher sanctions against Iran over its nuclear program could cost the German budget 2 billion euros, according to Finance Ministry estimates cited in Der Spiegel magazine on Saturday." (Noah Barkin ‘Tough Iran sanctions to hit Germany hard: report’ http://news.yahoo.com/s/nm/20071124/wl_nm/germany_iran_sanctions_dc November 24, 2007); "The German government halved the volume of new export credit guarantees for trade with Iran last year, the Economy Ministry said on Monday, in a sign Berlin is increasing pressure on Tehran over its nuclear programme. The value of new export guarantees approved by the government in 2007 fell to 503.4 million euros ($732.7 million), from 1.16 billion in 2006, a ministry official said." (Germany slashes credit guarantees for Iran exports’ http://wiredispatch.com/news/?id=41647 February 11, 2008).
American and European Companies being replaced by Russian and Chinese Companies in Iran.
As western countries reduce their trade with iran, eastern countries take their place. By the time the west is forced to abandon its sanctions on iran, the iranian economy will be so well integrated with the russian and chinese economies it would take a huge wrench for it to revert back to trading with the west. "Sinopec, China's largest oil refiner, has just finalized a multi-billion dollar deal to develop the giant Yadavaran oil field, and this is in addition to the "deal of the century" contract for natural gas from Iran's immense North Pars field. Chinese contractors are also busy constructing oil terminals for Iran in the Caspian Sea, extending the Tehran metro, building airports, among other projects. And this while China arms sales to Iran have included such hot items as ballistic-missile technology and air-defense radars." (Kaveh L Afrasiabi ‘A China base in Iran?’ http://www.atimes.com/atimes/Middle_East/JA29Ak03.html January 29, 2008); "Trade with Italy has fallen 20 per cent in six months. In 2006, Germany’s exports to Iran dropped 7 per cent and Japan’s fell 13 per cent. But business with China is booming. Last year Beijing signed a $100bn deal to import Iranian natural gas and Chinese companies will be 50 per cent stakeholders in the Yadavaran oil field. China has also become the second biggest market for Iran’s non-oil exports, taking $1.72bn in 2006-7, after the UAE with $2.5bn. Iran’s overall non-oil exports rose 47.2 percent to $16.3bn. "The situation over sanctions is a huge opportunity for China, former Soviet republics and regional countries," says one Asian diplomat in Tehran." (Gareth Smyth ‘Sanctions fail to fuel dissent on Iran’s streets’ http://www.ft.com/cms/s/481229ae-3948-11dc-ab48-0000779fd2ac.html July 24, 2007). The consequence is that, "Regarding the latter, China has already surpassed Germany as Iran's number one trade partner." (Kaveh L Afrasiabi ‘A China base in Iran?’ http://www.atimes.com/atimes/Middle_East/JA29Ak03.html January 29, 2008).
The Jews-only state’s efforts to sanction Iran have ended up sacrificing American/Western economies whilst providing an economic and political Bonanza for Russia and China.
The jews-only state in palestine and its allies around the world who have pressured american/european/un sanctions are in effect sacrificing western economies for the sake of promoting jewish supremacism in the middle east. Zionist inspired us/un sanctions are forcing the re-orientation of the iranian economy from the west to the east, from its preferred trade with europe and america to trade with russia and china. The reorientation of iran’s economy is going to boost the economic power of china and russia in comparison to the economic power of the west. It will allow china and russia to establish a critical geopolitical role in iran. Without the likudniks stirring up hatred between america and iran they could have developed highly profitable economic links which could have led to a vital strategic alliance. But this is exactly what the jews-only state does not want. The jews do not want iranians to get nuclear weapons but they are even more sacred of america developing a strategic alliance with iran such as the one it had under the shah. The likudniks warmongering over iran’s non-existent development of nuclear weapons is simply a political device to stir up hatred between america and iran.
The jews are sacrificing their allies, america and the rest of the western world, to the considerable benefit of russia and china. It must be humiliating for america and europe to accidentally shoot themselves in the foot by promoting sanctions against iran. But for them to deliberately shoot themselves in the foot because warmongering, paranoid, likudnik extremists have told them this would be good for their health, is a far greater humiliation. They really need to seek ahmadinejad’s advice on establishing independence from the jews-only state.
Labels: America's unilateral sanctions against Iran, Sanctions against Iran, United Nations Security Council Resolutions against Iran. The Bush Mafia.
posted by The Mundi Club at 7:40 PM
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