October 25-2013
by Warren L. Nelson
The Obama Administration is making a list of the sanctions it could ease first—but it isn’t planning to ease any until the Islamic Republic makes some concrete reductions in its nuclear program.
The New York Times reported Friday that the Administration was making its list and checking it twice. The administration plan, the Times said, was to avoid lifting any particular sanctions initially—because they might be hard to reimpose if Iran backtracked—but instead to free up some of the funds that belong to Iran but have been frozen by the sanctions.
This is a reference to the funds such countries as China and Korea pay for Iranian oil but which are blocked in banks in those countries and can only be used by Iran to buy goods from those countries.
It is believed that $50 billion to $75 billion is now blocked in those accounts, with another $1.5 billion being added every month. Freeing up that money would almost double Iran’s monthly receipts from oil sales.
That is a major concession. Officials said they were looking at those funds because opening and closing that valve is relatively easy while removing a brick from the wall of sanctions might weaken the entire system.
The US, however, has imposed many small sanctions that could easily be removed and replaced if needed. That the United States is not discussing those sanctions indicates that Washington realizes they are simply too small and insignificant to be put on the table, as they have been in past talks with Iran. The fact that Washington is now talking about big money indicates it is taking the current negotiating sessions seriously.
In Iran, many news outlets erroneously reported that the United States was planning to free the Iranian assets frozen in the United States after the hostage taking in 1979. Iran has complained about these assets for decades, asserting that they come to $11 billion. Actually, most of those assets were unfrozen in 1981 as part of the agreement releasing the US hostages. The residue, much of which is real estate owned by Iran such as the embassy in Washington, is only worth between $100 million and $200 million.
What Washington is talking about is freeing up a far larger sum.
Some rightwing news outlets in the United States jumped at the The New York Times report and said Obama was planning to lift sanctions before Iran did anything.
But US officials have bent over backwards to say any relief for Iran would come only after it takes some action on its nuclear program. No one, however, is giving any hint what minimum action by Iran would be required for the US to ease up minimally on sanctions.
That is due, in part, because Washington doesn’t know the answer to that question. It is one of the things that will be involved in the negotiations.
There is still a great deal of confusion in news accounts of the talks as to what happened, although Wendy Sherman, the US under secretary of state who leads the US delegation in the talks, made very clear that the October sessions involved broad, preliminary discussions and no decisions except to meet again.
After the two days of talks, Sherman summed them up saying, “Iran addressed what they saw as the objective, what should be in a final step, and what they might do as a first step. This is a framework that the P5+1 has used for some time. Although there remain many differences in each area and in what sanctions relief might be appropriate, specific and candid discussions took place.”
She said, “We’re not in the proposal/counter-proposal stage. We’re in the understanding-each-other’s-needs [stage]—what each is willing to do, what are the issues that have to be addressed, and how we can then put together a way forward.”
Sherman also made clear that she really didn’t pay any attention to what was being said in public in Iran about “red lines” that the Islamic Republic would not cross in making concessions.
“Iran has put things out in public about what they believe they need. But this is a negotiation, and in negotiations, parties put out what they feel they must have. And you begin and you see where you go. And we will see where we go.”
Sherman also said that Washington knows full well that what matters most to Iran is getting rid of sanctions. She took two sanctions specialists with her to Geneva. She noted that Iran brought none of its sanctions specialists and that Foreign Minister Mohammad-Javad Zarif said they needed to bring them the next time.
Many in Congress are calling for additional sanctions to keep the pressure on Iran. But the State Department has been urging Congress to wait, saying the existing sanctions were painful enough to bring Iran to the table and piling on more sanctions while talks are ongoing and positive might just give hard-liners the ammunition they need to scuttle Rohani’s initiative.
Despite all the talk of more sanctions, no Senate committee meetings on sanctions have been scheduled and committee staffers told The New York Times no action was expected until senators saw how the November negotiating session progresses.
