Iran condemns 'doomed' sanctions

The US seems determined to create a new cold war. Iran is being forced into the arms of Russia and China. Blocking financial dealings with the US and allies will force the development of stronger financial dealings with China and Russia and certainly Iran will no longer deal with the dollar in its oil sales. Other countries will balk at the control that the US is attempting to exert through its global influence on financial institutions..
This is from the Guardian.
Iran condemns 'doomed' sanctions


Ewen MacAskill in Washington, Fred Attewill and agencies
Friday October 26, 2007
Guardian Unlimited


Iran has issued a defiant response to the harshest sanctions imposed on it by the United States since the 1979 Islamist revolution, saying the measures are "doomed to failure".
The head of the revolutionary guard, branded a "proliferator of weapons of mass destruction", said the sanctions would only drive the corps to defend the "ideals of the revolution more than ever before".

The US under-secretary of state, Nicholas Burns, conceded that past sanctions, in place since 1984, had done little to constrict the growth of Iran's trade with other countries, in particular China and Russia.




"They [China] are now the number one trade partner with Iran. It's very difficult for countries to say we're striking out on our own when they've got their own policies on the military side, aiding and abetting the Iranian government in strengthening its own military," he told the BBC.
Mr Burns said the US still hoped Russia and China would approve a third UN security council resolution imposing new sanctions next month.

Israel, a strong supporter of the US action, said today its foreign minister, Tzipi Livni, would travel to Beijing this weekend to lobby for harsher UN sanctions on Iran.

However, China warned today that "sanctions should not be lightly imposed in international relations".

"Dialogue and negotiations are the best approach to resolving the Iranian nuclear issue," the foreign ministry said.

"To impose new sanctions on Iran at a time when international society and the Iranian authorities are working hard to find a solution to the Iranian nuclear issue can only complicate the issue."

The response of the Russian president, Vladimir Putin, was more scathing. He said sanctions made a negotiated settlement harder.

"Why worsen the situation by threatening sanctions and bring it to a dead end?" he said. "It's not the best way to resolve the situation, by running around like a madman with a razor blade in his hand."

The US measures target the 125,000-strong Iranian revolutionary guard (IRG), one of the best-resourced parts of the country's military, with its own tanks and planes. It also owns hotels, oil companies and other businesses.

Many analysts believe it is highly unlikely China or Russia will allow further UN sanctions to be imposed on Iran.

The Bush administration went a step further with the IRG's elite Quds division, responsible for covert actions abroad, labelling it a terrorist organisation, the first time a country's military has been put on America's terrorist list. The US says the Quds division, numbering about 15,000, is involved with Lebanon's Hizbullah and groups elsewhere in the Middle East.

Making the announcement at a press conference, the US secretary of state, Condoleezza Rice, said the punitive moves were intended "to confront the threatening behaviour of the Iranians". The sanctions and other steps would "increase the costs to Iran of its irresponsible behaviour".

The administration also imposed sanctions on three Iranian state-owned banks: the banks Melli and Mellat, for alleged arms proliferation, and Bank Saderat, which was labelled "a terrorist financier".

In addition to the IRG and the banks, eight individuals and several other companies are covered by the sanctions. The measures have long been threatened and Tehran responded by saying they would have no more success than in the past.

Mohammad Ali Hosseini, a spokesman for the foreign ministry, said: "The hostile American policies towards the respectable people of Iran and the country's legal institutions are contrary to international law, without value and, as in the past, doomed to failure."

He called the Bush administration's accusation that Iran was arming Shia militants in Iraq "ridiculous".

The revolutionary guard, which has huge business interests in businesses including cars, oil and newspapers, is thought to control up to a third of the Iranian economy.

But some analysts believe the unilateral measures will have little effect in isolating Iran - and still less in changing its policy. Selig Harrison, of the Centre for International Policy, told BBC Radio 4's Today programme: "I don't think these will be very effective. Arab traders in Dubai thumb their noses up when people say you shouldn't trade with Iran. A lot of Iran's foreign trade hasn't been affected."

There have also been claims that the Iranian president, Mahmoud Ahmadinejad, will be strengthened by the sanctions.

"Hardliners in Tehran were looking forward to the sanctions. It helps them hide their incompetence behind the embargo," said the political commentator Saeed Laylaz. However, other observers say the measures could weaken Mr Ahmadinejad, leaving him open to charges that his stance is pushing the US into punishing the country and damaging its already fragile economy.

The sanctions package, combined with the sending of a second US carrier group to the Gulf earlier this year, is aimed primarily at containing Iran, which has been expanding its influence in the region since the 2003 invasion of Iraq. It is also intended to force Tehran to stop its alleged attempts to develop a nuclear bomb and end its alleged supply of weapons to Iraqi militia groups.

Ms Rice, who has had to withstand pressure from within the Bush administration for military action, insisted she remained committed to the diplomatic route. But she said: "Unfortunately the Iranian government continues to spurn our offer of open negotiations, instead threatening peace and security by pursuing nuclear technologies that can lead to a nuclear weapon, building dangerous ballistic missiles, supporting Shia militants in Iraq and terrorists in Iraq, Afghanistan, Lebanon and the Palestinian territories, and denying the existence of a fellow member of the United Nations, threatening to wipe Israel off the map."

The US president, George Bush, has said repeatedly that a military strike is an option.

As part of a multibillion-dollar request for more military spending earlier this week, the Pentagon asked for $88m (£43m) to develop the Massive Ordnance Penetrator, a huge bunker-busting bomb, for its Stealth bombers. The Bush administration said the bomb was needed "in response to an urgent operational need for theatre commanders".

Democratic members of Congress questioned whether the weapon was intended for use against Iran, where nuclear facilities are largely hidden underground.

Jim Moran, a Democratic member of the House of Representatives defence spending committee, said: "My assumption is that it is Iran, because you wouldn't use them in Iraq, and I don't know where you would use them in Afghanistan. It doesn't have any weapons facilities underground that we know of."

The immediate impact of the sanctions announcement will be felt in the boardrooms of banks and companies in Britain and elsewhere in Europe. Any business continuing to trade with Iran risks US reprisals.

The sanctions make it illegal for any US citizen to knowingly provide material support or resources to the Quds division. As the US has had few links with Iran since 1979, this is mainly academic. The impact will be felt by non-American companies that have business interests in the US and Iran.

The US treasury secretary, Henry Paulson, who accompanied Ms Rice at the press conference, said: "It is increasingly likely that if you are doing business with Iran, you are doing business [with the Iranian revolutionary guard corps]. It's simply not worth the risk."

European governments, including Britain, are discussing whether to also designate the Quds division a terrorist organisation, though the legal definition and the process of designating groups as terrorist is different to that in the US.