Global Security Newswire

The Obama administration yesterday leveled financial penalties at 21 companies affiliated with the Iranian government in an effort to turn up the heat on Tehran over its nuclear program and other disputed activities, Agence France-Presse reported (see GSN, Aug. 3).

Following the passage in June of a fourth U.N. Security Council sanctions resolution against Iran, the United States and a number of other nations have adopted unilateral measures aimed at curbing Iranian nuclear activities that could support weapons development. Tehran has insisted its atomic ambitions are strictly peaceful.

Among the entities targeted in the latest Treasury Department measure were two investment companies in Germany, two banks in Belarus and a number of engineering and mining operations in Germany, Italy, Luxembourg, Japan and Iran. Those entities are no longer allowed to conduct business with U.S. companies and individuals.

"As its isolation from the international financial and commercial systems increases, the government of Iran will continue efforts to evade sanctions," Treasury Undersecretary Stuart Levey said.

Tehran was "using government-owned entities around the world that are not easily identifiable as Iranian to facilitate transactions in support of their illicit activities," Levey said (Agence France-Presse I/Google News, Aug. 3).

The State Department said the latest U.N. and independent penalties were making an impact in Iran, Radio Free Europe/Radio Liberty reported.

"We believe it is having an effect on the ground, in Iran. It is getting increasingly difficult to do business in Iran. The cost of doing business for Iran is going up. And we are encouraged by what we're seeing," spokesman P.J. Crowley said.

"Obviously there's more that needs to be done. That's why (State Department special adviser on nonproliferation and arms control Robert) Einhorn has been in South Korea, is in Tokyo today and will be making additional stops in the current weeks" (Radio Free Europe/Radio Liberty, Aug. 3).

Einhorn today pressed Japanese officials to send "strong, clear signals to Iran" with punitive measures in addition to those the adopted this week by the island nation in keeping with June's Security Council resolution, Reuters reported.

"Now we look to Japan as a leader of the global nonproliferation regime and a close ally of the United States to play a strong role in this effort," the official told reporters in Tokyo.

"Japan imports a lot of oil from Iran but steps we are asking Japan to take would not interfere in any way with Japan's energy security and its imports of oil from Iran," he said. "I would advise you as we advised the government of Japan to look at measures already adopted by the European Union (see GSN, July 26). These are strong measures but the Japanese adoption of strong measures would not adversely affect the economy of Japan."

Deputy Assistant Treasury Secretary Daniel Glaser referred to new EU rules that govern dealings with Iranian financial institutions and curb business with other sectors of Tehran's economy.

"There are tremendous risks out there dealing with Iranian banks," he said. "I am quite confident that Japan will take measures to protect the Japanese system from the Iranian financial abuse" (Yoko Nishikawa, Reuters, Aug. 4).

Einhorn's discussion of Iran penalties with a South Korean official yesterday felt somewhat lopsided, the official, told the Korea Times.

"They gave me a very detailed explanation about the sanctions on Iran, about their legitimacy and about how they are going to be implemented," said Kim Ik-ju, the director of the South Korean Finance Ministry's International Finance Bureau. "So I replied 'thank you'" (Cho Jin-seo, Korea Times, Aug. 3).

Einhorn referred directly during their visit to Washington's sanctions against Iran's Bank Mellat, an institution deeply involved in trade with South Korea, the Korea Herald reported. Representatives of the bank are slated to lobby against punitive measures during a visit to Seoul later in August, the newspaper reported.

South Korea, which carried out roughly $10 billion in transactions with Iran last year, must decide how to proceed in implementing sanctions by October, when the United States is expected to finish putting new unilateral penalties in place, government sources said.

“Our efforts are aimed at maintaining a cooperative relationship with the U.S., while at the same time sustaining our good economic ties with Iran,” South Korean Foreign Ministry spokesman Kim Young-sun said (Kim Ji-hyun, Korea Herald, Aug. 4).

Meanwhile, the White House yesterday turned down Iranian President Mahmoud Ahmadinejad's proposal to join U.S. President Barack Obama for a direct discussion of "global" matters, AFP reported.

"We have always said that we'd be willing to sit down and discuss Iran's illicit nuclear program, if Iran is serious about doing that," White House spokesman Robert Gibbs said. "To date, that seriousness has not been there."

Ahmadinejad on Monday accused Obama of ignoring "historic opportunities" for rapprochement with Tehran (Lachlan Carmichael, Agence France-Presse II/Yahoo!News, Aug. 3).

"You (U.S.) can make resolutions and sanctions against us as much as you want until you get fed up," the Iranian president said today in a speech aired by official media.

"As far as the Iranian nation is concerned, we do not care at all and will never beg [for] your goods," Deutsche Presse-Agentur quoted him as saying.

Ahmadinejad denounced the Obama administration's "carrot-and-stick" strategy of pursuing penalties against Tehran while also offering incentives for nuclear cooperation. "If you take one stick, the Iranian nation will take thousands of sticks and hit them on your heads," he said.

Any nation that supports economic penalties against Iran will be cut off from trade with the Middle Eastern nation and "be wiped out from Iranian markets," he added (Deutsche Presse-Agentur I/Monsters and Critics, Aug. 4).

Ahmadinejad called on the United States to join negotiations on a potential exchange of Iranian uranium, AFP reported.

One plan -- negotiated in May by Iran, Brazil and Turkey -- calls for Iran to store 1,200 kilograms of its low-enriched uranium in Turkey for one year; other countries would be expected within that period to provide nuclear material refined for use at a Tehran medical research reactor in exchange for the Iranian material.

The arrangement appeared similar to another proposal, formulated in October by the International Atomic Energy Agency, that was intended to defer the Middle Eastern state's enrichment activities long enough to more fully address U.S. and European concerns about its potential nuclear bomb-making capability. Tehran ultimately rejected the IAEA proposal worked out with France, Russia and the United States. Those nations, known as the "Vienna group," subsequently expressed concerns about the later agreement.

"He (Obama) missed the opportunity last year for a fuel swap; today this opportunity is on the table again," Ahmadinejad said during a visit to the Hamedan, where a crude bomb or firecracker was detonated near his motorcade. "We are ready for talks based on respect, justice and Iran's proposals after mid-Ramadan (late August) and we advise him (Obama) not to miss this opportunity" (Agence France-Presse III/Spacewar.com, Aug. 4).

Ahmadinejad's chief of staff today suggested talks with the European Union over Iranian nuclear activities would be unproductive.

"We have realized that holding nuclear talks with the EU is futile as the Europeans have nothing to say (in world politics)," Esfandiar Rahim Mashaei said (Deutsche Presse-Agentur II/Monsters and Critics, Aug. 4).

Elsewhere, Iranian state media today said Tehran had acquired two Russian-built S-300 air defense interceptors from Belarus and two more of the missiles from an unnamed entity, the Associated Press reported.

"Iran possesses four S-300PT missiles," Iran's Fars News Agency asserted.

Some experts have expressed concern that Iran could use S-300 defenses to help guard its nuclear facilities against potential airstrikes. Russia agreed in 2007 to provide the system to Iran, but Moscow suggested June's Security Council resolution could prohibit the delivery (Ali Akbar Dareini, Associated Press/Google News, Aug. 4).