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New U.S. Sanctions Designed to Further Cripple Several Iranian Industries

Jason Berger — January 7, 2013 – 3:08 pm | Barack Obama | Iran Comments (0) Add a comment

The Washington Post published an analysis of the latest Iran sanctions that President Barack Obama signed last week. The Post emphasized that the tough sanctions are designed to further cripple several of Iran’s already-damaged industries:

New U.S. sanctions have broadened the front in the West’s escalating economic conflict with Iran, targeting large swaths of the country’s industrial infrastructure even as Iranian leaders are indicating a willingness to resume negotiations on the country’s nuclear program.

With Iran’s economy already reeling from previous sanctions, the new measures passed by Congress and signed by President Obama last week are intended to deliver powerful blows against key industries ranging from shipping and ports-management to the government-controlled news media, congressional officials and economic experts say.

While some previous U.S. sanctions targeted individuals and firms linked to Iran’s nuclear industry, the new policies are closer to a true trade embargo, designed to systematically attack and undercut Iran’s major financial pillars and threaten the country with economic collapse, the officials say.

‘This is effectively blacklisting whole sectors of the Iranian economy,’ said Mark Dubowitz, executive director of the Foundation for the Defense of Democracy, a think tank. ‘The goal is to create a chilling effect on all nonhumanitarian commercial trade with Iran.’

By broadening the focus to entire industries, the new effort is intended to make it harder for Iran to evade sanctions through front operations, a time-honored practice in the Islamic republic, said Dubowitz, author of several studies on sanctions policy….

Iranian officials in recent weeks have been unusually candid in acknowledging the extraordinary toll of Western sanctions on the country’s economy. The country’s currency has shed more than 40 percent of its value since August, while exports of petroleum - Iran’s chief source of hard currency - have fallen by half….

The new law imposes sanctions against international companies that do business with Iranian firms in the targeted industrial sectors, and also seeks to block Iran from obtaining aluminum, steel, coal and other materials critical for construction and vehicle manufacturing. It seeks to block Iran from engaging in barter trade with other countries for its oil, and imposes sanctions on some state-run media organizations….

Sanctions continue to have a deep impact on Iran’s economy, but not to the point of creating widespread poverty or inspiring protests as some have predicted.

Iran’s rial dropped sharply in value against the dollar in October, losing more than half its value in less than a month. Since then, the country’s financial difficulties have increased and there has been a slow slide toward lower consumer spending and higher unemployment.

The automobile industry has seen a 40% decrease in production since last year. Medical imports have taken a particularly big hit and the cost of many essential treatments have more than doubled.

Food, however, is generally available, if more expensive, as price controls remain in place for the most basic goods such as bread and cooking oil.

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