Iran: The next steps

The cause is just. Now more people must join it.

June 14, 2010 08:30
3 minute read.
Brazilian Ambassador to the UN Maria Ribeiro Viott

UNSC vote on Iran sanctions. (photo credit: Associated Press)

Last week the UN Security Council approved new economic sanctions on Iran for refusing to curb its nuclear weapons program. As we have argued, these steps, watered down under pressure from Russia and China, are unsatisfactory.

Nevertheless, hope should not be lost. A major effort must be made to ensure that the sanctions agreed upon will be enforced. More importantly, now that there is a consensus on sanctions, the US and the EU must go further and hit harder.

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Though the new resolution might stop short of shutting down Iran’s financial links to the outside world, it does include a clause urging nations to block transactions that “could” help Teheran’s nuclear program.

Interpreted broadly, this is an invitation to take additional steps against Iran.

Germany and Italy – Israel’s two closest European allies – can take the lead. These two countries have the largest levels of trade with the Shi’ite regime, yet both have already taken major steps to reduce economic ties with Iran.

Italian Foreign Minister Franco Frattini announced in March that his country would block new oil and gas projects in Iran and cut credit insurance for exporters. With the encouragement of German Chancellor Angela Merkel, engineering multinational Siemens, which enjoyed sales worth about 500 million euro a year to Iran, announced in January it would no longer take on new orders from the Mullahled state. German insurance giants Allianz and Munich Re followed suit. German carmaker Daimler is looking to sell off its holdings in Iran, and it has already pulled out of the German-Iranian Chamber of Industry and Commerce.

But much more can be done. Last Wednesday, the same day the UN resolution was announced, The Wall Street Journal reported that Germany’s exports to Iran increased by 48 percent in March compared to the same month last year and by 15% in the first quarter.

Imports rose an astounding 94%.

The figures underscored the difficulties of following through on economic sanctions, even in a country like Germany with political leadership that has been consistently outspoken in support of tough measures against Iran.

Merkel has already indicated that she would need across-the-board backing of the EU to convince her own country’s business sector to take the painful steps needed to cut trade ties with Iran. Matthias Küntzel, an expert on German-Iranian relations, has pointed out that smaller German firms are stepping into the positions being vacated by larger companies.

He recommends additional political pressure on these businesses to stop trade with Iran.

But as long as firms have an economic interest in maintaining ties with Iran, the “top-down” approach in which governments put pressure on businesses will have a limited impact.

A new grassroots initiative by Shai Baaton, an Israeli financial market expert, might help add some bite to the sanctions. Baaton proposes enlisting Israeli firms, rabbis, Diaspora community leaders, youth movements, intellectuals and municipalities to form a “Jewish boycott” targeting firms doing business with Iran. The Kibbutz Movement has already joined the initiative and letters have been sent to President Shimon Peres and 52,000 Israeli companies.

The idea is to create an undercurrent of protest against publicly traded companies that have ignored warnings to cut ties with Iran. Investors in financial markets, wary of companies with business in Iran, would sell their stock holdings, resulting in a sharp fall in prices. The initiative would include non-Jews who recognize that Iran poses a threat not just to Israel but to the stability of the Middle East and to the free world. Initially, three companies have been targeted: Air France and German companies Bosch and BMW.

The initiative has been fittingly nicknamed the “Jewish boycott” as it is based on the very Jewish belief in tikkun olam: that the actions of individuals can bring about positive change in the world.

Last week’s UN Security Council resolution has its faults. But we must be optimistic that it will strengthen the resolve of the US and the EU to take additional steps to stop Iran’s nuclear weapon program and give moral backing to initiatives like the “Jewish boycott.”

The cause is just. All that is needed now is for more people to join it.

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