Ayatollah’s assets protected him from sanctions squeeze

November 12, 2013

Khamenei’s corporation eased sanctions strain, Iran blames nuclear impasse on Western leaders, and China’s meager Philippines aid could further harm ties with Southeast Asia. Today is Tuesday, November 12, and this is the World Wrap, brought to you by @dwbronner.

Iran’s supreme leader Ayatollah Ali Khamenei attends a meeting with high-ranking officials in Tehran, August 31, 2011. REUTERS/www.khamenei.ir/Handout

Spotlight: Iran → Sanctions sidestep. A six-month Reuters investigation found that Setad, Iranian Supreme Leader Ali Ayatollah Khamenei’s land-grab firm, has provided the leader with the economic backing needed to remain in control. Setad has also been key in allowing Iran to maintain independence despite tough Western sanctions, and has managed to avoid restrictions:

In July 2010, the European Union issued a 12-page list of Iranian individuals and entities it was sanctioning. Among them: Mohammad Mokhber, president of Setad, which the EU described as “an investment fund linked to Ali Khamenei, the supreme leader.” Mokhber and the others were cited for alleged links to Iran’s nuclear or missile programs, but the EU gave no further details. The action didn’t target Setad itself. The broader sanctions effort grew tougher. That same month, Washington enacted its strictest measures so far, the Comprehensive Iran Sanctions, Accountability and Divestment Act, which targeted Iran’s oil and gas sector. The Act, and a series of EU and U.S. sanctions over the following two years, increased pressure on Iran, in particular its energy exports and its banks. Growth slowed to 3 percent in 2011, and the economy shrank 1.9 percent in 2012. Oil exports have fallen by around 60 percent in the past two years as European and most Asian buyers reduced imports because of U.S. and EU sanctions. Iran now earns around $100 million from oil sales a day, down from $250 million two years ago. Setad itself, however, managed to evade the tightening noose. In October 2012, without any explanation, the EU removed Mokhber from its sanctions list.

In June of last year, the U.S. sanctioned Setad and several companies it oversees. Though an official from the U.S. Treasury department told a Senate committee that Khamenei controls Setad, the Ayatollah was not specifically targeted because the U.S. did not want to be seen as motivated by regime change. Explore Setad’s corporate holdings in an interactive chart, and click through for parts one and two of the special report on the Ayatollah’s assets. Stay tuned for part three tomorrow.

Spotlight: Iran → Geneva flop. Iranian foreign minister Mohammad Javad Zarif blamed Western leaders for the impasse during last week’s nuclear negotiations in Geneva, contradicting Secretary of State John Kerry’s statement that Iran held up proceedings. On Monday, Kerry said that major powers had drafted a proposal over the weekend: “There was unity, but Iran couldn’t take it at particular moment.”

U.S. Secretary of State John Kerry leaves after a news conference following nuclear talks in Geneva, November 10, 2013. REUTERS/Denis Balibouse

On Twitter, Zarif responded: “Mr. Secretary, was it Iran that gutted over half of U.S. draft Thursday night?” Russia agreed that it was not Iran’s fault that representatives from France, the U.S., the U.K., Germany, China, and Russia could not agree over the future of Iran’s disputed nuclear program with representatives from that country. Hopes were high for the Geneva meeting, which followed a warming of ties between Tehran and Washington.

Beijing backlash. China’s relatively meager offering of aid to the super typhoon Haiyan-devastated Philippines could harm any chance of goodwill between Beijing and Southeast Asia, long engaged in a dispute over claims to the South China Sea.

Residents cover their noses as they walk past devastated houses after super typhoon Haiyan hit Tacloban city, central Philippines, November 11, 2013. REUTERS/Romeo Ranoco. See more images here

China has promised $100,000 in aid to the Philippines – a paltry commitment compared to Japan’s $10 million and relief team, or Australia’s $9.6 million donation. Manila and Beijing have sparred over access to the energy-rich region. Click here for up-to-date information on the aftermath of the storm that left an estimated 10,000 people dead, and here to learn how to help Haiyan’s survivors.

Nota Bene:  The Japanese government is completing plans to borrow another $30 billion towards cleaning up Fukushima.


“Let’s get it on” – Toronto Mayor Rob Ford prepares to face motion urging him to take a leave. (The Star)

Fructose fallacy –  Mexican Coke is more American than you may think. (Bloomberg Businessweek)

Dope drive – The leader of Liberia’s presidential motorcade is arrested for smuggling 654 pounds of marijuana in an official vehicle. (BBC)

Bridesmaid brigade – Sri Lankan couple breaks record for most bridesmaids in a wedding party. (Huffington Post)

Rice regrets – Thailand admits its rice subsidy program may have been a mistake. (Quartz)

From the File:

  • Western-backed Syrian opposition names cabinet for rebel areas.
  • Pro-Mursi students, police, residents clash at Egyptian university.
  • China vows ‘decisive’ role for markets, results by 2020.
  • Islamic Jihad grows in Gaza’s shadow.
  • Europeans and Americans oppose spying on allies, according to poll.
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