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Elephants in the Room
The Coronavirus Is Absolutely No Excuse to Lift Sanctions on Iran
Exploiting Iran's coronavirus crisis to demand an end to sanctions is fundamentally dishonest—and panders to a brutal regime.
Iran’s clerical dictatorship cares more about its own survival than it cares about the welfare of the Iranian people. But you wouldn’t know it from the chorus of Americans and Europeans exploiting the coronavirus crisis in Iran to push the Trump administration to lift sanctions against Iran. This is fundamentally dishonest—the sanctions do not restrict medical supplies and other forms of humanitarian aid—and plays into the hands of a brutal regime.
Iran’s human rights record is one of the worst in the world. Last fall, the regime killed 1,500 people who peacefully protested the dictatorship’s mishandling of the economy. Soon after, it blew a passenger airliner out of the sky, killing everyone on board. A few weeks ago, Iranian-backed militias killed two U.S. and one British soldier in Iraq.
Last week, we learned that Robert Levinson, a former FBI agent held by Iran, died in captivity. His captors refused to provide information on his whereabouts to his long-suffering family for 13 years. More Americans and other foreigners, arbitrarily detained and falsely accused of being spies, remain hostage in Iranian jails today.
Are we to believe the same Iranian leaders committing these human rights crimes when they say they need wholesale relief from U.S. sanctions to combat the coronavirus? To an unwitting American audience, such Iranian propaganda can be quite persuasive, particularly when the request for sanctions relief is endorsed by the United Nations secretary general, the Chinese foreign minister, European politicians, and even former officials from Barack Obama’s administration.
[Mapping the Coronavirus Outbreak: Get daily updates on the pandemic and learn how it’s affecting countries around the world.]
Let’s separate fact from fiction.
U.S. sanctions on Iran have always provided an exception for humanitarian aid. A recent analysis of pharmaceutical trade between Europe and Iran shows little change between 2011 and 2019 despite periods of imposition, suspension, and return of sanctions.
If Iran is experiencing challenges in convincing banks to process transactions with its trade partners, perhaps it’s because Tehran is determined to use its financial sector for money laundering and terrorism finance—concerns that led the Financial Action Task Force, a 39-country anti-money laundering organization, to recommend last month that the global financial community take stringent measures to defend itself against Iran’s illicit practices.
Tehran’s record of diverting humanitarian goods to fund its terrorist operations is also well documented. The State Department last week reported that in July 2019, “one billion euros intended for medical supplies ‘disappeared’ and another $170 million dollars allocated for medical goods were instead spent on tobacco.” In 2018, the Treasury Department revealed that an Iranian medical and pharmaceutical company was being used to facilitate illicit payments to Russia in a scheme to help Syria finance purchases of oil. In the years leading up to the 2015 nuclear deal with Iran, Turkey’s Halkbank infamously helped facilitate billions of dollars of illicit transactions on behalf of Tehran using fake invoices for fictitious humanitarian goods.
While Iran’s leaders disregard the welfare of their people, the United States is committed to enabling the flow of humanitarian goods. Even as it exerts maximum pressure on Iran, Washington has permitted several Iranian banks to remain on the SWIFT financial messaging system to facilitate humanitarian trade. The U.S. Treasury and the Swiss government established a humanitarian banking channel backed by rigorous oversight to prevent the regime from diverting money and goods away from the Iranian people. Tens of billions of dollars of Iranian oil revenue sitting in foreign escrow accounts are available to fund the import of humanitarian goods. Indeed, that’s how Iran imported $15 billion in essential goods and medicine in the past year, according to the governor of the Central Bank of Iran.
Iran’s supreme leader, Ayatollah Ali Khamenei, controls more than $200 billion in off-the-books assets in holding companies and foundations and another $91 billion in Iran’s sovereign wealth fund, of which $20 billion is in cash or cash equivalents. He could easily use $40 billion from this corporate empire to support Iran’s $400 billion economy. Instead, he uses this money, much of which was illegally confiscated from Iranians, to fund his revolutionary agenda of domestic repression and regional destruction.
The pattern of abuse applies to Iran’s sovereign wealth fund, too. The supreme leader has approved diverting billions of dollars from this fund over the last two years to finance terrorism, human rights abuses, and expanded nuclear activities. Yet when it comes to fighting a pandemic to save lives, there’s allegedly no money to be found.
Khamenei’s nuclear program continues without delay even during the pandemic. Iran’s centrifuges keep spinning, producing more enriched uranium for potential use in a future nuclear weapon. The regime is also denying nuclear inspectors access to certain suspicious sites related to the Iranian nuclear program.
Sanctions relief would only make these challenges worse. So would a $5 billion International Monetary Fund bailout requested by Iran. Money is fungible. The regime hasn’t stopped supporting terrorism or killing Americans. Concerns regarding money laundering, corruption, and diversion of humanitarian goods remain unresolved. With clerics encouraging Iranians to engage in risky public activities despite public health guidance to maintain social distancing, putting money into the hands of this government will neither solve the pandemic in Iran nor improve global security.
The regime has repeatedly rejected offers from the United States to provide direct assistance and has instead blamed America (and Israel) for creating the virus. Iranian President Hassan Rouhani, meanwhile, admitted the regime was waging a global public relations campaign to use the pandemic as a pretext for wholesale sanctions relief while his own health officials say there are no shortages.
The regime in Iran is a terrorism addict asking the world for money to fight a pandemic. To make sure funds are used for the Iranian people, not the supreme leader’s malign activities, world leaders should ask for a supply list, buy the goods, monitor their distribution, and insist on the implementation of public health measures to save the Iranian people.
Sanctions relief for the regime should be a non-starter. The Iranian people are suffering at the hands of their own leaders on top of a pandemic. They know all too well that their own government is the problem, not U.S. sanctions.
Mark Dubowitz is the chief executive officer of the Foundation for Defense of Democracies. Twitter: @mdubowitz