Israel praised the EU on Monday for deciding to ratchet up sanctions on the
Islamic Republic, saying this sent a strong message to Tehran that Europe was
“not letting Iran off the hook” until it ceased its nuclear march.
“This
is definitely an important step that sends the right and strong message to the
Tehran regime,” Foreign Ministry spokesman Yigal Palmor said.
Foreign
Minister Avigdor Liberman said on Sunday that the failure of the EU to send a
strong message at this time would be similar to the West’s failure to stop
Hitler in the 1930s.
The EU’s 27 foreign ministers agreed at their
monthly meeting in Luxembourg to clamp further sanctions against Iran’s banking,
shipping and industrial sectors, hoping this would draw Tehran into serious
negotiations on its nuclear program.
Three rounds of negotiations since
April between Iran and the US, Russia, China, Germany, France and Britain – a
group known as the P5+1 – led nowhere.
EU foreign policy chief Catherine
Ashton said she hoped that turning up the heat on the Islamic Republic would
persuade it to make concessions and that negotiations could resume “very
soon.”
“I absolutely do think there is room for negotiations,” said
Ashton, who represents the P5+1 in the talks. “I hope we will be able to
make progress very soon.”
German Foreign Minister Guido Westerwelle was
more pessimistic than Ashton about the prospect that additional economic pain
might drive Tehran – whose Islamic Revolution has long thrived on defiance of
the West – to make concessions.
“Iran is still playing for time,” he told
reporters. “We don’t see a sufficient readiness for substantial talks about the
nuclear program.”
The new sanctions mark one of the toughest moves
against Iran by Europe to date and a significant change of policy for the
27-member bloc, which until now focused on targeting specific people and
companies with economic restrictions.
The EU has lagged behind the US in
imposing blanket industry bans, and says this is because it is concerned about
punishing ordinary Iranian citizens while inflicting pain on the
government.
The EU sanctions are deemed by some as more significant than
Washington’s because the bloc does much more business with Iran than the
US.
The foreign ministers, who already clamped an embargo on Iranian oil
this summer, also decided to freeze the assets of 34 Iranian entities to hinder
the government’s ability to raise funds for its nuclear program.
As a
part of the new package, the EU also prohibited transactions between European
and Iranian banks except for those “explicitly authorized in advance by national
authorities under strict conditions,” to ensure that the bloc’s financial
institutions do not process funds that contribute to the Iranian nuclear
program, according to an EU statement. Restrictions were also tightened on
Iran’s central bank.
The new restrictions also include a ban on exports
to Iran of materials that could be used in the its nuclear and ballistic
programs, in particular graphite, aluminum and steel as well as industrial
software. In addition, the EU prohibited the import of natural gas from Iran and
broadened the existing export ban on key equipment for the Iranian oil, gas and
petrochemical industries.
Furthermore, the package imposed new
restrictions in the shipping industry, prohibiting the use of vessels that
belong to EU citizens and companies for transporting or storing Iranian oil and
petrochemical products. The ministers banned flagging and classification
services for Iranian oil tankers and cargo vessels, and decided that EU nations
will no longer support trade with Iran through new short-term export credits,
guarantees or insurance.
In a reversal of existing European policy, the
ban will require European traders to apply to their governments for
authorization before they can finance any transactions in permitted goods.
Previously, the EU’s more narrow approach was to allow trade broadly while
prohibiting specific products. Trade will be hampered further by a new ban on
European governments extending short-term trade guarantees.
Diplomatic
officials said the three EU countries involved in the direct negotiations with
Iran – Germany, France and Britain – were the driving force behind the
sanctions. Sweden and Austria were among the EU countries that argued for more
watered down steps.
The Netherlands was another one of the EU states
leading the diplomatic efforts to secure a tough sanctions package. Its
ambassador to Israel, Caspar Veldkamp, told The Jerusalem Post that these steps
“show our determination, as 27 EU member states, to continue to exert full
pressure on Tehran’s regime.”
“It is not acceptable that Iran still does
not meet its international obligations,” he said. “Until the moment that they
do, we will have to continue to increase the pressure. As far as the Netherlands
is concerned, we’re not speculating about other options right now. But they are
not excluded either.”
Mark Dubowitz, the executive director of the
Washington-based Foundation for Defense of Democracies and an Iran sanctions
expert, said, “These EU sanctions fill loopholes in the current sanctions
regime, but they are a long way from the sweeping action required to deal with
the only fundamental question that matters: Will Iran reach an economic cripple
date – when its foreign reserves prove insufficient to head off economic
collapse – before or after it becomes a threshold nuclear power? “Based on our
analysis of Iran’s balance of payments, Iranian foreign reserves could last at
least two years under current conditions. If so, Iranian nuclear physics will
beat Western economic pressure,” Dubowitz continued.
“Europe needs to go
to the next stage and ban all non-humanitarian trade with Iran and blacklist
Iran’s central bank for its support of proliferation and terrorism. Only if the
economic pressure is massively intensified will we know if economic collapse is
enough to break Iran’s supreme leader’s nuclear will.”
The widening
sanctions are already doing significant damage to the Iranian economy. Earlier
this month, riots broke out in Tehran in protest at the collapse of the rial
currency, which has lost some two-thirds of its value against the dollar in the
past 15 months, stoking inflation that is now running at around 25
percent.
Ashton last met Iran’s chief negotiator Saeed Jalili in Istanbul
in September for a session that her spokesman described as “useful and
constructive.”
Bloomberg and Jerusalem Post staff contributed to this
report.