U.S. Sanctions on Iran Working, Treasury Says

A 12-month U.S. effort to blacklist Iranian companies allegedly involved in funding terrorism and supporting the nation’s nuclear program has proven successful, U.S. Undersecretary of Treasury Stuart Levey told Agence France-Presse in a phone interview yesterday (see GSN, July 26).

“We believe that there is a real potential that these sanctions will have the effect of changing the government of Iran's mind about the defiant policy it is currently pursuing,” said Levey, who head’s the department’s terrorism and financial intelligence office.  He said Treasury officials have been warning private companies and financial institutions of the dangers of doing business with Iran.

As U.S. President George W. Bush has accused Tehran of attempting to build a nuclear weapon, Treasury has blacklisted more than a dozen Iranian companies with ties to Iran’s nuclear, energy and industrial sectors in a stepped-up financial offensive that began about a year ago.  U.S. sanctions have also focused on Iranian financial institutions.  Iranian President Mahmoud Ahmadinejad has insisted that its nuclear program is peaceful and that U.S. sanctions would fail to curb Iran’s nuclear ambitions (Justin Cole, Agence France-Presse/Yahoo!News, July 26).

Meanwhile, the U.S. State Department has filed “numerous” formal complaints with Beijing about burgeoning shipments of sensitive military equipment to Iran by several Chinese companies, the Wall Street Journal reported today.

The shipments are part of a trade surge between Iran and China in which Chinese exports to Iran have grown by 70 percent, to $3.2 billion, in the first half of this year.  The disputed shipments include dual-use goods such as specialty metals that could aid Tehran’s missile and nuclear programs, the Journal reported.  Some of the shipments have been directed to Iran’s main ballistic missile manufacturer.

U.S. officials have argued that two rounds of U.N. sanctions against Iran should bar such trade.  China has not responded to the U.S. assertion, and in the past officials in Beijing have accused the United States of sanctioning Chinese companies based on poor evidence (Neil King, Wall Street Journal, July 27).

Iranian Foreign Minister Manouchehr Mottaki reaffirmed in an interview published yesterday that U.S. and international sanctions would not persuade Tehran to abandon its nuclear program and could lead to “confrontation” with the West.

“In today's world, the instrument of sanctions is no longer effective,” he said (Reuters/Washington Post, July 26).

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