Page 6 - IRANRptFeb19

Toughest ever sanctions
US: No impact expected
and Greece. Oil, Iran’s big export earner, is for now entirely out of the equation.
“It won’t change things dramatically, but it’s an important political message to Iran to show that we are determined to save the JCPOA [Iran nuclear deal] and also the United States to show we defend our interests despite their extraterritorial sanctions,” one European diplomat was quoted as saying by Reuters.
The news agency also cited Rob Malley, a former Middle East director at the US National Security Council under President Barack Obama and now at the International Crisis Group think tank, as saying that although the payment channel’s economic impact would be modest there was hope the political symbolism could help persuade Tehran to stick to the nuclear deal. Hardliners in Iran have always fiercely opposed the decision of Iran’s centrist, pragmatic president, Hassan Rouhani, to sign up to the multilateral accord in late 2015. They resisted the move saying that the US could not be trusted to not back out of the required commitments.
The sanctions regime imposed on Tehran by US President Donald Trump since last year is the toughest ever with which Washington has gone after the Islamic Republic. Trump wants to strangle Iran’s economy to the point that the Iranians come begging for a deal which would see big concessions on their activities in the Middle East as well as on their nuclear and ballistic missile development programmes.
He announced his sanctions policy in May last year when he pulled the US out of the nuclear deal that shielded Iran from crippling sanctions in return for compliance with measures designed to ensure Tehran does not move towards the development of a nuclear weapon.
Trump maintains that the accord is not demanding enough on Iran but the other signatories—Iran itself, the UK, France, Germany, Russia and China—were at pains to point out that Iran was honouring a deal that had been struck after years of painstaking negotiations (something that, to Trump's ire, even his own intelligence chiefs this week implied was the case). Sticking with the principled line of international diplomacy that there were no grounds for abandoning the nuclear deal, the remaining signatories have stayed in the agreement, while pushing back, where they can, against the sanctions assault.
Nevertheless, great numbers of foreign traders and investors, fearing they would be hit with secondary sanctions by the US, have pulled out of post-nuclear accord deals made with the Iranians, and, according to the IMF, Iran’s economy has sunk back into recession . Trading with Iran is now precarious as so many available payment channels have financial system links to the US, making any party connected to such trade vulnerable to Trump administration penalties.
European banks generally back off from any suggestion that they involve themselves in business linked to Iran.
Responding to the announcement of Instex, the US Embassy in Berlin said: "As the President has made clear, entities that continue to engage in sanctionable activity involving Iran risk severe consequences that could include losing access to the US financial system and the ability to do business
6 IRAN Country Report February 2019 www.intellinews.com