Iran Digest Week of January 19 - 26

Iran Digest

Week of January 19 - 26

AIC’s Iran digest project covers the latest developments and news stories published in Iranian and international media outlets. This weekly digest is compiled by Research Fellow Shiva Darian. Please note that the news and views expressed in the articles below do not necessarily reflect those of AIC.  

U.S - Iran Relations

Iran’s Fast Boats Stop Harassing U.S. Navy, Baffling Military

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The Iranian military has halted the routine harassment by its armed “fast boats” of U.S. naval vessels in the Persian Gulf, the U.S. military said, a turnabout that officials welcomed but were at a loss to explain.
The boats for at least two years would dart toward the U.S. vessels as they passed through the Persian Gulf, risking miscalculation, but haven't done so for five months, U.S. military officials said.  (Wall Street Journal)

Nuclear Accord

US uncertainty over nuclear deal complicates Iran's economy

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As the Joint Comprehensive Plan of Action (JCPOA) enters its third year of implementation, an atmosphere of uncertainty has slowed the pace of post-sanctions trade and investment.
In Tehran, government figures have sought to lay blame for Iran’s faltering economic recovery on a concerted American campaign to undermine the agreement and dissuade investment.
In a September interview on the sidelines of the United Nations General Assembly, Iranian Foreign Minister Mohammad Javad Zarif pointed to the atmosphere of uncertainty as a part of US President Donald Trump’s strategy to undermine the deal. He said, “I think he has made a policy of being unpredictable, and now he's turning that into being unreliable as well. He has violated the letter, spirit, everything of the deal.”  (Al-Monitor)

House leader Ryan says U.S. wants Europe to join Iran sanctions push

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The United States is in talks with the European Union about tightening sanctions on Iran over its missile program and foreign policy, House of Representatives Speaker Paul Ryan told a conference in the United Arab Emirates on Thursday.
Speaking in the capital Abu Dhabi, Ryan said the Islamic Republic was seeking to expand its influence in the region at the expense of staunch U.S. allies like the UAE and Saudi Arabia and needed to be constrained by sanctions.
The United States and other major powers lifted broad sanctions on Iran after a landmark deal over its nuclear program in 2015, but Washington has since slapped Tehran with new sanctions over its long-range missile program.  (Reuters)

France’s Le Drian plans March trip to Iran after Trump ultimatum on nuclear deal

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France’s foreign minister said on Sunday he would visit Iran on March 5 to discuss its ballistic missile program and the nuclear deal agreed with world powers in 2015, as tensions between the two countries rise.
In an interview with daily Le Figaro to be published on Monday, Jean-Yves Le Drian said he would discuss the landmark nuclear deal after U.S. President Donald Trump’s January 12 ultimatum to Britain, France and Germany to “fix” the deal or he would withdraw.  “A country that goes back on its word devalues its word,” Le Drian said.  (Reuters)


Iran Halts Private Lender Permits After Crisis Fueled Protests

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Iran’s central bank has ceased issuing permits and licenses for new private banks or commercial lenders, after the collapse of several major institutions froze the savings of hundreds of thousands of depositors and helped fuel anti-government protests.
Leading commercial banks and so-called credit institutions or funds -- whose high interest rates allowed them to expand rapidly over the past 15 years -- have shut or received government bailouts, and the crisis first sparked protests in the middle of last year. The lenders were again a focus of anger as demonstrations swept through Iranian cities from late December in the biggest challenge to Iran’s clerical system in nearly a decade.
“I’ve instructed the central bank not to issue any permits to any new private banks,” President Hassan Rouhani said late on Monday in his first major live television appearance since the protests that erupted on Dec. 28.  (Bloomberg)

S. Korea suspends Iran steel deal under Saudi Arabia influence

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South Korea has stopped an investment deal in Iran's steel industry due to Saudi Arabia's influence, Financial Tribune daily reported on Tuesday.
South Korea's POSCO Engineering & Construction signed a 1.6 billion U.S. dollar agreement with the Iranian steelmaker, Pars Kohan Diar Parsian Steel (PKP), in May 2016. Under the deal POSCO was to build a steel mill incorporating the company's proprietary technology in Iran's Chabahar Free Trade-Industrial Zone.
Iran-Saudi relations were increasingly fraught with political tension, bringing POSCO E&C's new board members to not be so keen on investing in Iran, according to a POSCO announcement cited by the daily.  (Xinhuanet)


Smog Choking Iran's Oil Belt Tests Leaders Hit by Protests

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Iranian authorities are scrambling to stem a growing crisis over air pollution in the province that produces a major share of the country’s oil, showing a sensitivity to people’s demands not always visible before anti-government protests raged earlier this month.
A yellow smog has enveloped the southwestern Khuzestan region ever since a severe dust storm struck on Friday, shutting schools and offices and prompting criticism of the administration across local media. So far, 1,530 people have been hospitalized with breathing problems, according to state-run television.  (Bloomberg)

China says it agrees to joint tanker collision probe with Panama, Iran, Hong Kong

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The maritime authorities of China, Panama, Iran and Hong Kong on Thursday signed an agreement to jointly investigate a collision in the East China Sea that caused the worst oil ship disaster in decades, according to China's Ministry of Transport.
Investigation work will be organised by a joint team composed of representatives of all four signatories to the agreement, a brief statement from the ministry said.
The Panama-registered Sanchi tanker (IMO:9356608), run by Iran's top oil shipping operator, collided on Jan. 6 with the CF Crystal (IMO:9497050) about 160 nautical miles off the coast of China near Shanghai and the mouth of the Yangtze River Delta.  (Channel News Asia)

Regional Politics

Israel claims 82,000 fighters are under Iranian control in Syria

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Israel's ambassador to the United Nations, Danny Danon, told a UN Security Council meeting that he was revealing classified information about Iran to convey what he claimed are Iran's plans to dominate Syria, destroy Israel and "terrorize the entire free world."
"Iran is turning the entire country of Syria into the largest military base in the world. In fact, Iran is trying to destabilize all aspects of Syria," Danon said.  Danon also criticized the international agreement that eased sanctions on Tehran in return for curbs on its nuclear program, and implied that European nations now doing business with Iran are enabling its aggression. (CNN)


How Corruption and Cronyism in Banking Fueled Iran’s Protests

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By: Thomas Erdbrink, David D. Kirkpatrick and Nilo Tabrizy

At 25 percent, the interest rate paid on a savings account at the Caspian Finance and Credit Institution in Tehran was a better return than Mehrdad Asgari could earn investing in his own business renting out construction equipment. So in December 2016, he jumped at the chance, depositing $42,000 in a savings account.
Before long though, Caspian stopped allowing withdrawals. After three months, it stopped paying interest. Finally, in May, it shut its doors for good — becoming one of the largest in a long series of failures of Iranian financial institutions in recent years. The closings have destroyed the savings of thousands of people, imperiled the banking system and helped fuel the antigovernment protests that roiled the country late last year.

(Read More)