Iranian sanctions biting the Emirates
The sanctions and freeze outs that were enforced on Iranian assets and oil trading by the United States and the United Nations are hardly only affecting the Iranian economy. Surrounding economies including Dubai are facing the aftermath of the fire. Dubai officials are asking the government for guidance about trading with Iran as exports to one of Dubai’s biggest markets has now shrunk.
Export of goods from Dubai to Iran were falling "day by day," said Hamad Buamim, the director general of the Dubai Chamber of Commerce and Industry. "Iran is a major market for Dubai businesses. A quarter of total volumes of exports and re-exports go to Iran," he said. "But with the further measures taken during 2011 and early this year, this share is shrinking down day by day."
Dubai has stood as a gateway to Iran for several goods ranging from cars to grain. The flow of these goods is now being strangled by UN, U.S and the EU in light of these sanctions and restrictions. Reuters reported this month that the UAE Central Bank had told lenders to stop financing trade with Iran.The chamber is still encouraging its members to trade with Iran as long as they do not breach international sanctions but due to the wide variety of restrictions imposed means that there is less than a solid business flexibility and understanding.
The problem with the sanctions is that they are not very clear. Initially they related to the nuclear sector, but recently the sanctions have widened to the whole of the financial services.