The Great Debate UK
By Kristen Silverberg and Dr August Hanning. The opinions expressed are their own.
The case of Standard Chartered Bank has demonstrated that there are still gaps in the international sanctions regime concerning Iran. In the financial sector, the existing regime can be improved. However, the European sanctions targeting the Iranian oil and gas sector also have significant weaknesses. It is necessary to identify these weaknesses and to close them as quickly as possible.
In January and in July the European Union implemented an important new sanctions regime prohibiting the importation of oil from Iran. These sanctions are significant, and provide a real opportunity to increase pressure on Iran to make meaningful concessions on its nuclear program. However, past experience with Iran has demonstrated that government’s skill at evading international sanctions. To make these sanctions meaningful, the international community needs to continue to work to close off any avenue that would allow Iran to support its nuclear program through oil revenues.
To counter the European oil ban, Iran is already setting up private companies through which it aims to sell its oil. This move, although anticipated, confronts the EU with a new challenge to secure enforcement of the oil sanction. If Iranian oil is routed through several layers of private oil traders, it will generate complex paper work making it very hard if not impossible for European customers to trace the oil back to Iran.
By Kathleen Brooks. The opinions expressed are her own.
Standard Chartered is the latest UK-based bank that seems to be getting it in the neck from our friends across the water. Firstly, there was Barclays and the Libor scandal, then there was HSBC which was fined for allowing drug-trafficked money from Mexico to go through its system and now there is Standard Chartered which is charged with “wilfully misleading” the New York Department of Financial Services and clearing $250 billion of Iranian transactions through its U.S. operation.
Two can be a coincidence, but three in as many months? Since the news on Standard Chartered broke there has been a torrent of investors, politicians and even some in the media who have queried whether this is just an attempt by Washington to discredit London and re-establish New York as the world’s financial centre.
from The Great Debate:
So what's so difficult in getting Iran to drop its nuclear program? All it needs is a great American leader who uses sanctions to break the Iranian economy so badly that popular discontent sweeps away the leadership. It is replaced without a shot being fired.