Australia and US Senate seek tougher sanctions on Iran

Australia and US Senate seek tougher sanctions on Iran

As we noted in a post last week, the EU lat weeked imposed new tougher sanctions on Iran, and today Australia followed suit.

Foreign Minister Kevin Rudd announced from Lithuania that Australian intends to impose additional sanctions in response to Iran’s continuing non-compliance with United Nations Security Council (UNSC) resolutions on its nuclear program. An Australian government media release stated:

“The announcement of new measures follows the attacks on the British Embassy in Tehran on 29 November, as well as the recent International Atomic Energy Agency (IAEA) report reinforcing concerns about Iran’s nuclear activities.

Foreign Minister Kevin Rudd said the additional sanctions, targeting additional entities and individuals for their involvement in Iran’s ballistic missile and nuclear programs, underline Australia’s mounting concern about Iran’s program. ‘The measures will also further restrict business with Iran’s petroleum and financial sectors.’

‘Iran must take steps required by the UNSC and the IAEA, and engage constructively with the international community on its nuclear program,’ Mr Rudd said.

The Australian sanctions are consistent with measures recently taken by the United States, the European Union and a number of other countries.

‘Australia is committed to a negotiated solution of the Iran nuclear issue.’

The new measures follow sanctions imposed last year restricting Australian business dealings with Iran’s oil and gas sector. Those sanctions included a trade ban on all arms and related material and all dual-use items for the development of nuclear, missile, chemical and biological weapons.

It is unclear at this stage whether Australia will follow the French call for to enact sanctions against the Iranian Central Bank and suspend all purchases of Iranian oil – measures that many say are required if sanctions are to be effective.

Meanwhile the US Senate has voted unanimously to pass the most stringent economic sanctions against Iran to date. However, the move was opposed to by the Obama administration.

The vote was on the amendment by Senators Robert Menendez (D-N.J.) and Mark Kirk (R-Ill.) and it passed 100 to 0. The measures would:

  1. Prohibit the opening or maintaining in the United States of a correspondent account or a payable-through account on foreign financial institutions engaged in non-petroleum-related transactions with the Central Bank of Iran after 60 days;
  2. Impose sanctions on foreign financial institutions, including central banks, engaged in petroleum-related transactions with the Central Bank of Iran after 180 days with 180-day special exemptions tied to the availability of non-Iranian oil on the market and a country’s significant reduction in purchases of Iranian oil;
  3. Provide a humanitarian exception for food, medicine and medical devices; and
  4. Provide the President with an unclassified (with classified annex, if necessary) national security waiver authority every 120 days.

At a Senate Foreign Relations Committee hearing, Senator Menendez fiercely criticised the Obama administration for opposing the bill to sanction Iran, he said:

“At your request, we engaged in an effort to come to a bipartisan agreement that I think is fair and balanced. And now you come here and vitiate that very agreement. So that says to me in the future that when you come to me and ask me to engage in a good-faith effort, you should have said, we want no amendment, not that you don’t care for that amendment. Now, having said that, let me just say, everything that you say in your testimony undermines the credibility of your opposition to this amendment.

The clock is ticking. Published reports say we have about a year. Whenever you’re going to start our sanctions regime robustly, six months before the clock has been achieved? Before they get a nuclear weapon?

. . . So I find it pretty outrageous that when the clock is ticking, and when you ask us to engage in a more reasoned effort, and we produce such an effort in a bipartisan basis, that in fact you come here and say what you say. Which really undermines, certainly as it relates to this member, the relationship with me in the future, because you’re not going to tell me that please engage with us in an effort to find a more refined solution, and then when we do that, say you don’t care for it. It would have been more honest to say, we don’t want any amendment whatsoever.”

Washington Post blogger Jennifer Rubin agrees with Menendez’s and argued that it appears that the Obama administration has given up on trying to stop Iran from obtaining nuclear weapons:

“The administration says it wants to avoid a military option in responding to Iran’s quest for a nuclear weapons capability. It says acquiring a nuclear weapon would be ‘unacceptable.’ But in fact, Menendez makes the case that the administration does not want any effective policy. His argument certainly supports the view that the administration has thrown in the towel on preventing a nuclear-armed revolutionary Islamic state.”

In addition, Rubin writes that this is not a partisan issue as shown by the 100 to 0 vote:

“Republicans and Democrats are in perfect agreement. As a senior Senate advisor put it, ‘The Obama Administration runs the risk of losing control of Iran policy. The 100-0 vote on Menendez-Kirk was effectively an overwhelming vote of no confidence in the White House’s efforts thus far to stop Iran’s nuclear drive. Sarkozy’s initiative last week, calling for an international effort to sanction the Iranian Central Bank and stop Iranian oil sales, and now the Senate action show that — as the Washington Post editorial rightly put it — the President is no longer leading from behind on Iran. He’s just behind.'”

Before such a bill can become law, it must be approved by the House and President Obama. Obama is reportedly cautious about harsher sanctions, fearing they could disrupt the oil markets and alienate potential allies. US officials have also warned that depriving global markets of Iranian exports could send oil prices higher, giving Teheran a funding boost.

The US has already forbidden its own banks from dealing directly with the Iranian central bank. Under the new sanctions, foreign banks that do business with Iran’s central bank would be cut off from the US financial system. However, the sanctions are designed to come into effect after a six-month grace period – in order to give oil markets time to factor them in.