Economic sanctions not forcing Iran to change

Published March 18th, 2013 - 10:12 GMT
Economic sanctions against Iran aren't working, officials have said.
Economic sanctions against Iran aren't working, officials have said.

Tough economic sanctions against Iran has taken a serious toll against its economy, but has not yet produced the kind of public unrest that could force Iranian leaders to change their nuclear policies, U.S. and European officials have acknowledged.

Western diplomats and analysts said that nine months after Iran was hit with the toughest restrictions in its history, the nation's economy appears to have become slow, with no jobs and hard currency, but does not appear to be in no immediate danger of collapse.

According to the Washington Post, at the same time, the hardships have not triggered significant domestic protests or produced a single concession by Iran on its nuclear programme.

Analysts said that although weakened, Iran has resisted Western pressure through a combination of clever tactics, political repression and old-fashioned stubbornness.

The mixed results from the sanctions complicate the West's bargaining position ahead of the next round of nuclear talks with Iran, in early April.

According to the report, at the last round, in February, the United States and five other world powers offered significant new concessions to Iran in exchange for curtailment of its uranium-enrichment programme, but Iran has neither accepted the proposal nor offered concessions of its own.

Iran's continuing resistance will also make it tougher for President Barack Obama to reassure Israeli and Arab allies when he arrives in the region mid-week.

The Iranian regime is showing no sign of giving in. On Thursday, a powerful cleric taunted the U.S. administration, vowing that economic pressure could never force Iran to abandon its nuclear programme.

Although Iran has been under U.S. sanctions since the 1979 takeover of the U.S. Embassy in Tehran, the restrictions imposed last summer were the most significant attempt to hit its oil sector and central bank.

The impact has been hardest on the middle and working classes, which have seen savings evaporate and purchasing power dry up.

According to the report, Iran has also found legal ways to soften the bite of sanctions, using currency reserves of euros in foreign banks and arranging complex financial deals that evade the U.S. banking system.

Iran has used the imported goods - such as cars and air conditioners - to counteract high inflation in the country, a congressional staffer who tracks sanctions on Iran and who spoke on the condition of anonymity to discuss sensitive intelligence on Tehran's economic policies, said.

The imports help Iran conserve cash, which it uses to pay salaries and subsidize consumer prices to keep popular unrest at bay, the staffer added. 

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