It will take six to nine months to lift the sanctions on Iran once the country meets the conditions in the agreement on nuclear energy made with world powers, a US Treasury Department official said on Wednesday.
"When the Joint Comprehensive Plan of Action (JCPOA) goes into effect, there will be no immediate relief from UN, EU, or US sanctions," said Adam J. Szubin, Acting Under Secretary of Treasury for Terrorism and Financial Intelligence US Senate Committee on Banking, Housing, And Urban Affairs.
"Only if Iran fulfills the necessary nuclear conditions [of the nuclear deal] ... will the US lift sanctions. We expect that to take at least six to nine months," he explained in an official statement. The International Atomic Energy Agency (IAEA) must verify compliance, and then phased sanctions relief will come into effect, the statement said.
The JCPOA effectively closes off Iran’s pathways to a nuclear weapon, the official said.
On July 14, the world powers P5+1 group -- the US, the UK, France, Russia, China and Germany -- reached a final nuclear agreement with Iran, which agreed to curb its nuclear research program and to open its nuclear and military facilities for IAEA inspections.
However, he pointed out that the US embargo will continue to prohibit US persons from investing in Iran, from importing or exporting to Iran most goods and services, and from dealing with most Iranian individuals and companies.
The official said that Iranian banks will not be able to enter into relationships with US financial institutions, and Iran will be denied access to importing US technology and goods from anywhere in the world.
"In short, Iran will continue to be denied access to the world’s principal financial and commercial market," he said.
Szubin said that if Iran violates its commitments after sanctions are suspended, the US, UN, and the EU have the ability to snapback the sanctions immediately.
"For US sanctions, this can be achieved rapidly, in a matter of days," he said. "Multilateral sanctions by the UN also can be reimposed quickly, and the US has the ability to reimpose those sanctions unilaterally, even over the objections of other P5 members."
Szubin said that sanctions had reduced Iran’s oil exports by 60 percent. Szubin estimated that Iran has lost some $160 billion in oil revenues since 2012.
He noted that the Iranian currency has declined by more than 50 percent in value during sanctions, a factor which cost Iran an additional $70 billion in oil revenue.
The official expects, even with sanctions relief, it will take Iran until at least 2022 to get back to where it would have been without the sanctions.