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U.S. Softens Sanction Plan Against Iran

25 March 2010 19:23 (UTC +04:00)

Baku â€“ APA. The U.S. has backed away from pursuing a number of tough measures against Iran in order to win support from Russia and China for a new United Nations Security Council resolution on sanctions, according to people familiar with the matter, APA reports quoting â€œThe Wall Streetâ€ magazine.
Among provisions removed from the original draft resolution the U.S. sent to key allies last month were sanctions aimed at choking off Tehranâ€™s access to international banking services and capital markets, and closing international airspace and waters to Iranâ€™s national air cargo and shipping lines, according to the individuals.
The U.S. and allies are trying to force Iran to rein in a nuclear program that they worry is aimed at developing atomic weapons. Tehran says its nuclear activities are peaceful. The U.K. and Germany, concerned that Russia and China would reject the resolution outright and preferring to turn up pressure on Iran gradually, persuaded U.S. officials to drop or soften several elements, including some of the documentâ€™s harshest provisions, the individuals said.
U.S. officials said they wouldnâ€™t comment on the day-by-day negotiations taking place among the Security Council members. But they acknowledge that there has been a tension between seeking the strongest possible sanctions at the U.N. and still maintaining consensus among the five permanent members of the Security Council and Germany, which are drafting the sanctions.
â€œWe are seeking an appropriate resolution that puts significant pressure on the government,â€ State Department spokesman P.J. Crowley said Wednesday. â€œWe continue to consult with various countries, and itâ€™s our desire to maintain unanimity. It will be a strong united statement that Iran will have to pay attention to.â€
The disclosure of weakened proposals came as U.S. officials sought to persuade Russia and China to back measures against Iran in a conference call on Wednesday among the five permanent members of the Security Council and Germany, the first such meeting including China since mid-January.
Russia and China didnâ€™t endorse a draft resolution, but signaled that they were open to further discussions, people familiar with the matter said. Russian Deputy Foreign Minister Sergei Ryabkov told Interfax news service, â€œWe are continuing the process of comparing the approaches of the parties and considering further options.â€
Russia and China also have been working in tandem to press Iran to accept a United Nations-brokered proposal to send uranium abroad for enrichment, Russian officials said Wednesday. The effort is unusual, coming from the two powers usually least inclined to lean hard on Tehran. â€œThe clouds are gathering, and the position of Iran leaves less and less space for diplomatic maneuver,â€ a senior Russian diplomat told reporters Wednesday.
The current resolution still would target major power centers in Iran, in particular the Islamic Revolutionary Guard Corps, the countryâ€™s elite military force, according to a person familiar with the draft. It would also stiffen a broad range of existing sanctions, including the search and seizure of suspicious cargo bound for Iran through international waters and a ban on states offering financial assistance or credits for trade with Iran. If approved, they would be the most stringent measures Iran has faced.
Yet the original U.S. draft would have gone much further. The cargo sanctions initially named Iran Air and Islamic Republic of Iran Shipping Lines and demand a blanket ban of their airplanes and ships from other countriesâ€™ airspace or territorial waters. The revised version calls for interdiction only of shipments that would evade already-existing sanctions.
The earlier resolution would have made it difficult for Iran to insure imports and exports of oil and other essential commodities, by barring foreign insurers from serving international transport contracts from Iran. The new draft calls only for unspecified â€œadditional stepsâ€ to enforce current sanctions on insurance.
The previous draft would also have barred Iranâ€™s access to international capital markets by prohibiting foreign investment in Iranian bonds. The country hasnâ€™t traditionally relied on debt markets, but earlier this month a state-owned Iranian bank, Bank Mellat, announced an offer to sell bonds valued at â‚¬1 billion ($1.35 billion) to fund development of natural-gas field in South Pars. The new draft makes no mention of Iranian bonds.
The current draft notes â€œwith serious concern the role of the Iranian Revolutionary Guardâ€ in â€œIranâ€™s proliferation sensitive nuclear activities and the development of nuclear weapon delivery systems,â€ according to a person familiar with its contents.
The U.S. Treasury Department has identified billions of dollars in assets controlled by the Revolutionary Guard in financial and commercial sectors, including at least $7 billion in the energy sector and a controlling stake in Iranâ€™s largest telecommunications provider, Telecommunication Company of Iran.
The draft would force an international freeze on the assets of the entire Revolutionary Guard and â€œany individuals or entities acting on their behalf or at their direction,â€ and on â€œentities owned or controlled by them, including through illicit means,â€ according to the person familiar with the draft.
If enforced, the proposed sanctions could force the Revolutionary Guard to divest itself of some holdings to prevent major disruptions in the economy.
The Revolutionary Guardâ€™s affiliation with the countryâ€™s telecom operator, for example, could prompt foreign partners to stop connecting international calls.
Though the sanctions under discussion would target the government, they would inevitably hit many Iranians as well, a senior European official with knowledge of the sanction preparations said. â€œWe donâ€™t want to hurt the Iranian people,â€ he said, but â€œpeople will be affected.â€
China, which relies on Iran as a major supplier of oil, said last week that the standoff with Iran should be resolved through negotiations. U.S. officials have said China remains the linchpin for the Security Council adopting sanctions, and have enlisted key Arab states such as Saudi Arabia and the United Arab Emirates to use their energy dealings with China as leverage to push for cooperation.
â€œI believe in the end the Chinese will be on board,â€ said a senior U.S. official working on drafting the sanctions.
Russia has sent mixed signals in recent weeks on its willingness to impose tougher restrictions on Tehran. Last week, Prime Minister Vladimir Putin said Moscow would assist Iran in starting a civilian nuclear reactor, against U.S. objections.
In a nod to Moscow, the resolution wouldnâ€™t sanction work on many existing energy projects, including that nuclear power plant.
Russia doesnâ€™t want to push Iran to the point of quitting the international Non-Proliferation Treaty and barring nuclear inspectors, analysts say. Industrial lobbies close to the Kremlin also oppose sanctions that would jeopardize their sales of weapons and nuclear energy equipment to Iran.
One of the toughest proposed sanctions in the current draft is a comprehensive international arms embargo against Iran, a longtime goal of the U.S. Despite U.S. pressure to end weapons shipments, a number of countries continue supply Iran with arms, however.
The balance between seeking tough measures and unanimity is affecting the timing of a U.S. push. Negotiations could drag on into the summer.
U.S. officials said they will follow any new U.N. sanctions enacted with a range of new measures implemented either unilaterally or with allied countries in Europe, Asia and the Middle East. The Obama administration has been holding meetings with so-called like-minded nations from outside the Security Council, such as Japan, South Korea, and the U.A.E., which have extensive financial ties to Tehran.
â€œInternational pressure will be backed by steps that are taken nationally,â€ Mr. Crowley said. â€œWe are looking for sanctions that have bite.â€