Friday, October 2, 2009

Analysis: Iran to escape nuclear sanctions until 2010

No new sanctions were ever likely to be imposed on Iran at the meeting in Geneva, no matter what Iran said. None now will be imposed until next year at the earliest.



An Iranian long-range Shahab-3 missile is fired in desert terrain at an unspecified location in Iran on September 28, 2009 Photo: AFP/GETTY


But while even Russia seems to think that some punishment is inevitable if Iran does not change course, the purpose of sanctions becomes less clear as time passes.

Even if both the Russians and the Chinese agree to tough measures, analysts do not believe they would stop Tehran completing a nuclear device should it wish to do so.

North Korea, an economically far more isolated regime, has managed to test plutonium-based weapons and claims to be on the way to developing a uranium-based one too.

"Sanctions won't really work for two to three years, and that's all they need to become a nuclear power," said Mustafa Alani, a regional specialist at the Gulf Research Centre in Dubai.

Far more likely are sanctions which Russia and China approve but water down from American demands enough to avoid doing real damage to Iran, and especially its oil industry.

Iran is China's third largest source of oil, and has done energy deals worth an estimated $100 billion with Beijing in the last five years.

Sun Bigan, a former Chinese ambassador to Iran, even argues in a current strategy that it is in China's interest to prevent the Iranian leadership becoming pro-American.

That could lead to China's oil supplies being drastically curtailed as America, even under President Barack Obama, strove to maintain its "global goals and dominance", he wrote.

Currently, UN sanctions ban imports of equipment that can assist uranium enrichment, military equipment exports and "dual use" imports that can be used for either civilian or military purposes. Some individual regime figures are also targeted.

New proposals include restrictions on investments in the Iranian energy industry – almost impossible for China to support, given the high-profile presence of its state-owned oil companies – a ban on insuring Iranian oil tankers, and a ban on imports of refined oil products such as petrol.

Individual American congressmen are preparing bills to extend the United States' own sanctions against companies that trade with Iran, penalising energy firms that sell the country refined oil products and the financial firms that fund the trade.

But again, Chinese firms and those elsewhere in a rising Asia could be the ones that profit. "America is leading the West, but everyone else does not give a damn," said Ahmad Abdullah, a Hong Kong-based energy analyst. "China is now making a lot of headway in Iran and so is India."

The long term goal of sanctions is to disillusion Iran's people with its leaders, and middle class opposition to President Mahmoud Ahmadinejad's re-election may well have been influenced by the strains on its economy.

But Iranian opposition leaders support the government over the nuclear programme and sanctions. "Iran has nationalised the nuclear issue," Mr Alani said. "They have made it a popular issue, saying America and Israel are trying to deny their right to nuclear technology."

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