Sanctions step up threat of war

26th August 2018

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 Donald Trump continues to ramp up tensions with Iran

The next step in the undeclared war on Iran has been taken by the United States, with the first wave of sanctions in place, following the unilateral withdrawal of the US from the Joint Comprehensive Plan of Action (JCPOA).  Jane Green reports on the short term impact and possible long term consequences.

The JCPOA, widely known as the Iran nuclear deal, was agreed in 2015 by the United States, Russia and the European Union to halt the domestic uranium enrichment programme in Iran, in exchange for the relaxation of previously imposed sanctions.  The deal was being monitored by the International Atomic Energy Agency (IAEA) and, up until the most recent inspection earlier in 2018, Iran was deemed to be following the terms of the agreement.

US President Donald Trump has never been a fan of the deal and promised to withdraw as part of his election campaign rhetoric.  For Trump, relaxing sanctions on Iran simply allows the regime in Tehran to draw down international resources which it can then use to support its adventurous foreign policy, through what the US deems to be its proxies in the Middle East.

There can be no doubt about the anti-people credentials of the Iranian regime.  For over 40 years the Islamic Republic has been to the forefront in its abuse, arrest and torture of the political opposition, trade unionists, women’s organisations and in suppressing student protests.  The regime in Iran is only matched in its vicious response to internal criticism by the United States’ key allies in the region, Israel and Saudi Arabia.

However, the sanctions imposed last week by the United States, which will be further intensified on 4th November, are not about acting in the interests of the Iranian people and freeing them from an oppressive regime.  The US sanctions are entirely about the power balance in the Middle East, with the US seeking to impose its will and maximise control of the region’s resources.

Ironically, the path being pursued by Trump was initiated under President Obama, as part of the United States’ New Middle East Plan, to reassert influence and bolster resource control in the region.  Obama’s version of the Plan resulted in the JCPOA, a more nuanced approach to containing the perceived threat of Iran to the regional power balance.

For Trump there are no such niceties.  To all intents and purposes, the gloves are off and the New Middle East Plan mark 2 is simply to bring Iran to its knees, whatever the cost to the prospects for peace in the region or to the plight of the people of Iran.

The latest round of US sanctions has resulted in those European companies which had begun to re-engage with Iran, in putting plans on hold.  German car and truck manufacturer, Daimler, has dropped plans to expand its business in Iran.  French companies, Peugeot and Renault, have suspended operations in Iran and have said they will comply with the US sanctions.

French energy giant, Total, has said it will quit the multibillion-dollar South Pars gas project if it cannot secure a waiver from the U.S. sanctions.

Total signed a contract in 2017 to develop Phase II of the South Pars field with an initial investment of $1 billion and has not yet said what it will do with its 30 percent stake should it pull out. It has until 4th November to wind down its Iran operations, barring any surprise exemption.

The widespread withdrawal and suspension of economic activity by European companies is remarkable because the US sanctions have no international force and no United Nations backing.  The US strategy is essentially that of the playground bully.  Companies are free to deal with Iran if they choose but they may find it difficult to do business in markets with the US.  For most companies the choice between sticking with Iranian business or losing access to the US market is no choice at all.  The United States knows this and the international community appears powerless to prevent it.

The latest round of sanctions will cripple even further an already crumbling Iranian economy.  The confrontational position taken by the US is encouraging the hardliners in Iran to feel emboldened.  Former president Ahmadinejad has recently called upon current President Rouhani to resign.  Those who have always opposed the JCPOA are now regarding the word of the US as valueless and are seeking to turn the current turmoil to their advantage.

Further information at www.codir.net

 

 

 

 

 

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