SANCTIONS ON IRAN THROUGH THE HISTORICAL BACKGROUND, REASONS AND EFFECTS

Esma Doğan

INTRODUCTION

Despite Iran is a regional power which has affected international politics historically and has rich resources, young population, and extensive territory. Also, Iran had strong relations with great powers like the US until the Iranian revolution in 1979 and the relations have proceeded negatively through sanctions on Iran by the US, UN, and EU.  The deterioration of relations is seen mostly with the US. As a result of these sanctions on the regional power, other regional countries and international politics have been affected deeply. In this article, sanctions on Iran are explained historically and reasons of these sanctions are mentioned as well as considering the nuclear program as the main reason. Lastly, effects of sanctions on the Iranian governments’ policies, public ideas, the economy of the country and one of the important regional power, Turkey, is analyzed within the context of relations of countries and organizations which have implemented sanctions.

HISTORICAL BACKGROUND

Most of the sanctions which are implemented on Iran are based on the US with the emergence of the new regime in Iran. The US Government Accountability Office (GAO) report in 2007 shows that the US sanctions on Iran include three categories as implementing a comprehensive trade and investment ban on Iran, sanctioning foreign parties that are related to proliferation or terrorism activities with Iran and imposing financial sanctions, including freezing the assets of Iran and banning its access to the US’ financial system.

The conflict between the US and Iran started after the Iranian Islamic Revolution. According to Aghazadeh(2013), the directional change in the Iranian government and having a religious tendency in the political decision process was new concepts for the US and the changes in the Iranian’s policy did not fit the US’ policies in the region.[1] The first sanctions of the US started with the Iranian hostage crisis which Iranian radical students took 52 American officers who work in the US Embassy in Tehran as hostages for 444 days. This increased the tension between these two countries and the Carter administration ended the diplomatic relations withIran.Also, the Iranian government’s assets in the US which are approximately 12 billion$ and interest properties were frozen by the US government.

In 1980, trade embargo which includes transactions as the prohibition of making any payment or transfer of any property on Iran started. The sanctions included restrictions on sales of the US dual-use items, banning on direct the US financial assistance and arms sales to Iran, withholding of US aid to organizations that assist Iran.

The trade embargo was tightened under Ronald Reagan’s presidency through Iran’s support of terrorism. According to the Iranian government, the increase on sanctions as because of the US concerns about Iranian’s economic and military development and the US’ interests in the Middle East. In 1995, additional economic sanctions by the Clinton administration started towards Iran’s continuing support for international terrorism. However, the US needed to more influential steps with its allies as European countries but these countries had more trade relations with Iran and it would affect them in a negative way. Thus, they did not want to be part of the sanctions on Iran within the beliefs that sanctions would be effective.

After the 11 September attacks, the US policies have become stricter. In 2001, the president, George W. Bush administration and the Senate approved for the extension of sanctions and Bush called Iran as an “axes of evil” in his speech. With the effects of attacks, at the beginning of the 2000s, Iran’s nuclear energy programs became more visible and IAEA reports in 2003 did not mention that Iran has or tries to have nuclear weapons but there were some concerns for the international community because Iran did not declare its nuclear program to IAEA clearly and some facilities of nuclear energy did not check by the IAEA.

In 2004, the Paris Agreement was signed by France, Germany, the UK, and Iran to sustain confidence. Iran voluntarily suspended all uranium enrichment temporarily. According to Aghazadeh(2013), despite all Iranian governments’ efforts to cooperate with the IAEA, the result was not successful. The reason lays in the fact that the West distrusted Iran regarding its nuclear program due to concerns over Iran’s likelihood of pursuing nuclear military goals.[2]With the nuclear weapon program threat, the pressure on Iran increased and added to the US sanctions, the UN and the EU started to implement sanctions on Iran. In 2006, the United Nations Security Council adopted the Resolution 1696 because of Iran’s refusal to allow full access of the IAEA.According to resolution, if Iran wants to be verified by the IAEA, it should suspend all activities and Iran refused the suspension of uranium enrichment. Thus, sanctions were detailed on the Resolution 1737 in 2007 which includes prevention the provision to Iran of any technical assistance or training, financial assistance, investment, brokering, the transfer of financial resources and services related to the supply, sale transfer, manufacture or use of the prohibited items, materials, equipment goods and technology (which could be relevant to Iran’s enrichment program or heavy water-related activities). Also, this resolution includes arms embargo which blocks supplying, selling or transferring directly or indirectly from its territory or by its nationals or using its flag vessels or aircrafts any arms or related material.[3] Sanctions continued with the resolution in 2010 with further sanctions about enrichment plants of Iran.

In 2010, the US Congress passed the Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010 against Iran’s secret uranium plant in Qam and prevent Iran from continuing its “ illicit nuclear efforts”, nuclear program activities and make pressure on the Iranian government about respect human rights and religious freedom in Iran.[4]

Despite trade relations between Iran and the EU is high until 2011, Iranian nuclear program caused a change in relations and the EU started to implement sanctions on Iran including the export-import ban on arms, goods, and technologies that could be related to nuclear enrichment or dual-usee products. Thus, sanctions on oil trade, export-import, and international banking are aimed to isolate Iran from the international society by cutting from the international finance system.

After 2013, a different kind of political environment occurred between Iran and the US. Joint Comprehensive Plan of Action was signed to form cooperation between Iran and the West through easing sanctions against Iran and decrease the uranium enrichment. Despite this deal seems a new start of relations between Iran and international society, its continuance could not be provided. In 2018, the US withdrew from the nuclear deal and started to implement sanctions which aim to damage Iran’s economy through blocking energy production and trade on the country again. On the contrary, Iran decided to restart the nuclear actions which were stopped to sustain the agreement as a result of the US’ withdrawal from the agreement. The conflict between the US and Iran continues after all these implications and the polarization despite the EU’s effort to solve the crisis.

REASONS OF THE SANCTIONS

The continuing conflict between the US and Iran started after the Iranian Islamic Revolution. According to Jahangir Amuzegar, the concept of the Islamic Republic of Islamic government is new for the US, also it does not fit the US’ policies and interests in the Middle East. He explains reasons of this conflict between these two countries as Iran’s aim to expose the Islamic revolution in the Middle East and the Persian Gulf region, Iran’s supports terrorism as Hamas and Hizbullah, aspiring to be a hegemonic power, human rights abuses and distrusts of the West to Iran’s nuclear program.[5]

Reasons for sanctions show differences in terms. The US grounded the first sanctions after 1979 with the hostage crisis in Iran. In the 1980s and 1990s, Iran was accused of supporting terrorism because of the connection with Hizbullah and Hamas and the US signed the Iran- Libya Sanctions Act(ILSA) in 1996. After the 9/11 attacks, the policies towards Iran changed and became more aggressive. President Bush called Iraq, Iran and North Korea as the axes of evil in 2002.

In the 2000s, sanctions have been based on Iran’s nuclear program as a perception of threat. The US accepted Iran’s nuclear program and uranium enrichment as a possibility to have nuclear weapons. Also, hiding the enrichment program from the IAEA caused insecurity for the international community. As a result of the enrichment program, Iran went beyond the norms of the Non-Proliferation Treaty which Iran is a party to it since 1970. The US gained support from the international community about using sanctions with these reasons. The UN, the EU started to implement sanctions on Iran to block its nuclear weapon program.

These reasons have been used to sharp sanctions and form policies on Iran and the Middle East. According to Borszik(2016), the importance of sanction objectives such as nonproliferation, counterterrorism and democratization have defined the sanction objective of regime change as encompassing ‘not only the explicit targeting of a particular foreign leader but also structural changes that imply new leadership, most notably the embrace of democracy.[6] Therefore, the structure of Iran after the Iranian revolution caused problems with the US.Interests and policies of both countries in the region have clashed and the polarization and insisting about following their policies instead of negotiation has increased the tension which reverberates to the international community. While the US is insisting on sanctions to damage Iran’s economy and discipline, Iran is insisting on improving the nuclear program.

IRANIAN NUCLEAR PROGRAM

Nuclear program of Iran dated back to 1950s, Shah Reza Pehlevi, with support of the Western countries including the US to mostly have trade relations with Iran about nuclear equipment.

Non-Proliferation Treaty (NPT) which has three main pillars as non-proliferation, disarmament and peaceful uses of nuclear energy was signed by Iran in 1968. With the treaty, Iran’s nuclear program could be checked by the International Atomic Energy Agency (IAEA). The process of the nuclear program was accelerated with the increase of the number of Iranian scientists after the establishment of the Atomic Energy Organization of Iran. However, the report of the IAEA in 2003 concluded that “Iran has failed to meet obligations under its Safeguards Agreement for the reporting of nuclear material, the subsequent processing and use of that material and the declaration of facilities where the material was stored and processed.”[7] The secession from the treaty and withholding the process of the nuclear program from the IAEA caused distrust and concerns of the international community against Iran. These concerns resulted in the UN and the EU sanctions on Iran about uranium enrichment and the nuclear program of Iran because of the possibility of producing nuclear weapons.

According to Katzman and Kerr, Iran has three gas centrifuge enrichment facilities which can produce both low-enriched uranium(LEU) that can be used in nuclear power reactors and weapons-grade highly enriched uranium(HEU) and contains about 90% uranium-235.[8] Iran can produce nuclear weapons by using low-enriched uranium.

In 2015, the Joint Comprehensive Plan of action was signed by Iran and the West under the leadership of Hassan Rouhani who gained power in 2013 and is moderate and liberal. After all these years from the Iranian revolution, these two countries contacted directly. Also, negotiations between Iran and the P5+1 countries (China, France, the US, the UK, Russia, and Germany) started about a possible nuclear deal. This process continued until 2015 and ended with the agreement.According to this deal, Iran would allow IAEA to have controlled entrance and access to Iran’s military bases. Also, Iran would decrease in two-thirds of the number of centrifuges which are used for the uranium enrichment. According to a November 14, 2013 report from IAEA, Iran had generally stopped expanding its enrichment and heavy water reactor programs.[9] In return, sanctions on Iran would remove gradually. According to Kanapiyanova(2017), Iran could gain its position in the international trade and show its power in the region through cooperation on economy and energy with the removal of sanctions.[10] After the withdrawal of the US from the treaty in 2018, new sanctions started against Iran and the country decided to exceed the limit of uranium enrichment in 2019.[11]

According to Mehrish(2012), the reasons of insisting on the nuclear program despite the pressure from the US and international community are using the program as the deterrence factor against other countries which challenge the country and the perception of threats from the US against Iranian regime type.[12]

EFFECTS OF SANCTIONS ON IRAN

The process of using sanctions on Iran by the US, the UN and the EU has some effects on the country’s economy, social structure and political decision process.

Economic Effects

According to Pape(1997), there are two crucial factors which affect the success rate of sanctions as economic structures of countries that use sanctions and face these sanctions and second factor is the longevity of the sanctions.[13]Firstly, the structure of Iran’s economy mostly depends on oil trade and according to Berber(2013), the main reason of the failure of establishing the balanced economic order in the country is remaining constant the former economic system which depends on state policies after the Iranian Islamic Revolution.[14] Also, the US has a developed economic structure which can diversify its trade relations and can damage the Iranian economy. Secondly, sanctions on Iran have continued since the Iranian regime change with different types of economic sanctions from different structures as the US, the UN, and the EU. Thus, Iran economy has damaged because of economic sanctions. They result in many areas as oil, gas, petrol producing and selling decreased, banking, finance, and insurance sectors are damaged, industrial production decreased, unemployment grew, currency and GDP decline, the inflation rate increased and the prices of consumer goods rose. Tehran responded to these economic sanctions in different ways as adopting measures at the international level such as shifting its economic relations from European countries to Asian countries. Moreover, China and Russia are seen as countries which sustain the balance against the US sanctions on Iran by using increasing trade relations with these countries. Also, the adaptation to sanctions has increased. According to Torbat(2005), the efficiency of sanctions has diminished due to the fact that elasticity is higher in the long run and Iran has been able to adjust to the sanctions and find alternative sources for the US-made products.[15]

Political effects

Political effects of sanctions cause a debate between academicians. Some academicians believe that sanctions affect Iran politically. According to Borszik(2016), the efficiency of sanctions brought Iran to the table in 2015 to sign the treaty.[16] On the other hand, some academicians believe that sanctions could not exactly fulfill the desire of pressure on Iran. According to Uzun(2013), despite economic sanctions which Iran faced from only the US until last decades cause economic problems in Iran, they could be able to sustain neither the isolation of Iran from the international area nor economic damage in order to form political pressure.[17]Until the sanctions against Iran’s nuclear program, Iran continued its trade relations with great economies as European countries except for the US.

Despite the signing Joint Comprehensive Plan of Action Treaty with Iran after sanctions from the UN and the EU can be seen as a political success, the current situation of the treaty, withdrawal of the US from the treaty and Iran’s decision in order to continue enrichment uranium, shows that the continuity of political gains by using sanctions has not sustained yet. Thus, it is hard to say that sanctions are not able to sustain Iran’s restatement from the nuclear program by the political pressure and political isolation of Iran. Moreover, Instead of aiming public pressure on the government about the damage on the economy by sanctions which are based on Iran’s nuclear program, facing and standing against the international pressure make Iran leaders more popular and Iranian people perceive the US and Western powers as attackers against Iranian regime type.[18] Thus, Iranian people with national feelings support their government about the nuclear program and against the sanctions. The reason for economic failure in Iran is seen by the public as a problem within the country. According to Uzun(2013), the reason for economic problems is the government’s incorrect economy policies and nuclear program of Iran is seen as not just a government policy but as the state policy.[19]

EFFECTS OF IRAN SANCTIONS ON TURKEY

As a result of that Iran is a regional power which has trade relations within the Middle East; sanctions against Iran have effects on other regional powers as Turkey. Historically, Turkey and Iran are competing countries which try to be more powerful than others and have a balance in the region. According to Özdağ(2018), although Iran’s possibility of having nuclear programs can cause the balance disorder, the trade relations between Iran and Turkey have continued because Iran needs to protect its trade relations in order to overcome effects of sanctions and the relations fit the JDP government’s policies in the region as the policy of zero problems with neighbors.[20]

On the other hand, as a result of that one of the aims of sanctions on Iran is the isolation of the country; the US has applied pressure on Turkey through trade relations. Turkey decreased its petrol trade slowly within the exemption from sanctions and sustained the trade relations over gold. The US prepared a new resolution against the trade relations over gold in 2013 and targeted Iran’s banking to isolate Iran from the international finance. These negatively reflected on the Turkish economy. Limitation of trade relations with Iran damages the economy and the pressure of the US causes the decline of the currency. Also, Reza Zarrab crisis can be seen as an example of the pressure of the US on Turkey about Iran trade relations.

CONCLUSION

Sanctions on Iran which started after the Iranian Islamic Revolution are used as tools to change the Iranian governments’ policies about regime type, social structure and after the 2000s mostly nuclear program. It is seen that these sanctions damage Iran economically because of Iran’s dependency on the oil trade. However, Iran diversifies its political and trade relations to protect itself. Moreover, new challenger countries of the US as Russia and China seem to support Iran to balance the US. Thus, isolation of Iran from the international society could not be sustained by the sanctions. Also, people of Iran perceive sanctions attacks of Western countries instead of criticizing the government and it is used by the Iranian leaders as rally round the flag effect. The possibility of Iran’s producing nuclear weapons causes tension and concerns in the international society and these concerns reflected in the UN sanctions. However, the only concern is not just about the Iranian nuclear program. Besides, the US’ popular discourse and policies on Iran trigger the polarization between these two countries and make people think about a possible war.  Lastly, Turkey is one of the countries which is affected because of the sanctions economically and politically. While, the limitation of trade relations causes economic problems, insisting on continuing on oil trade with Iran causes tension increase between Turkey and the US.

BIBLIOGRAPHY

Aghazadeh, M. (2013). A Historical Overview Of Sanctions On Iran And Iran’s Nuclear Program, AkademikAraştırmalarDergisi, 56, 137-160

Berber, S. (2013). İran’ınEkonomiPolitikası, YaptırımlarınEtkisiveİkilemleri, Bilge Stratejisi, 5(9), 61-84

Borszik, O. (2016). International sanctions against Iran and Tehran’s responses: political effects on the targeted regime, Contemporary Politics, 22(1), 20–39, http://dx.doi.org/10.1080/13569775.2015.1112951

International Atomic Energy Agency (IAEA), Implementation of the NPT safeguards aggrement in the Islamic Republic of Iran (IAEA reports, 6 June 2003):3

Kanapiyanova, Z. (2017). İran’ın “OrtakKapsamlıEylemPlanı” SonrasıEnerjiPolitikalarıÜzerineÇıkarımlar, EgeAkademikBakış, 17(4), 553 -564, Doi: 10.21121/eab.2017431303

Kibaroglu, M., Caglar B. (2008). Implications Of A Nuclear Iran For Turkey, Middle East Policy, 15(4), 59-80

Mehrish, B. N. (2012). Iran’s Nuclearization and Its Implications for Global and Regional Security, IUP Journal of International Relations, 6(2), 67-79.

OrhonÖzdağ, H. H. ( 2018). 2000’lerde ABD Yaptırımlarının İran-TürkiyeEkonomikİşbirliğineEtkileri: Neo-GramsciyenBirÇözümleme, Marmara University Journal of Political Science, 6(2), 231-261, Doi: 10.14782/ipsus.460140

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https://www.bbc.com/turkce/haberler-dunya-48985571

[1]MahdiehAghazadeh. (2013). “A HistoricalOverview of Sanctions on Iran andIran’sNuclear Program,” Akademik Araştırmalar Dergisi 56: 137-160

[2]MahdiehAghazadeh. (2013). “A HistoricalOverview of Sanctions on Iran andIran’sNuclear Program,” Akademik Araştırmalar Dergisi 56: 137-160

[3]United Nations Security Conceal, ResolutionNumber 1747: Adoptedbythe Security Council at its 5647th meeting(Security Council S/RES/1747:2007): 02.

[4]The Comprehensive Iran Sanctions, AccountabilityandDivestmentAct (CISADA), (July 01,2010): 04.

[5]JahangirAmuzegar.(1997) “Iran’sEconomyandthe U.S. Sanction,” Middle East Journal 51, No. 2: 186-187

[6]O. Borszik.(2016) “ International Sanctionsagainst Iran Tehran’sresponses: politicaleffects on thetargetedregime,” ContemporaryPolitics 22, No. 1, 20-39

[7]International AtomicEnergyAgency (IAEA), Implementation of the NPT safeguardsaggrement in theIslamicRepublic of Iran (IAEA reports, 6 June 2003):3

[8]KennethKatzman, Paul K. Kerr. “Iran NuclearAgreement,” CongressionalResearch Service. (May 2016). 1-40

[9]KennethKatzman, Paul K. Kerr. “Iran NuclearAgreement,” CongressionalResearch Service. (May 2016). 1-40

[10]ZhuldyzKanapiyanova, “İran’ın Ortak Kapsamlı Eylem Planı Sonrası Enerji Politikaları Üzerine Çıkarımlar,” Ege Akademik Bakış, Vol.17.No.4. (Ekim 2017), 553-564

[11]BBC, https://www.bbc.com/turkce/haberler-dunya-48662044, 2019

[12]B. N. Mehrish, “Iran’sNuclearizationandItsImplicationsfor Global andREgional Security,” Vol.6.No.2, 67-79

[13]Robert A. Pape, “WhyEconomicSanctions Do Not Work,” International Security, Vol.22.No.2. (Autumn,1997),91.

[14]Seçkin Berber,”İran’ın Ekonomi Politikası, Yaptırımların Etkisi ve İkilemleri,” Bilge Strateji, Vol.5.No.9 (Autumn 2013) 61-84

[15]Akbar Torbat. “Impacts of the US Tradeand Financial Sanctions on Iran,” California StateUniversity,

[16]O. Borszik.(2016) “ International Sanctionsagainst Iran Tehran’sresponses: politicaleffects on thetargetedregime,” ContemporaryPolitics 22, No. 1, 20-39

[17]Özüm S. Uzun. İran’a Ekonomik Yaptırımlar: Kırılganlaşan Nükleer Program mı Hükümet mi?” OrtadoğuAnaliz. Vol.5.No.54.(Haziran 2013) 62-70

[18]BBC, https://www.bbc.com/turkce/haberler-dunya-48985571, 2019

[19]Özüm S. Uzun. İran’a Ekonomik Yaptırımlar: Kırılganlaşan Nükleer Program mı Hükümet mi?” OrtadoğuAnaliz. Vol.5.No.54.(Haziran 2013) 62-70

[20]H. Hande Orhon Özdağ. 2000’lerde ABD Yaptırımlarının İran-Türkiye Ekonomik İşbirliğine Etkileri: Neo-Gramsciyen Bir Çözümleme. Marmara Üniversitesi Siyasal Bilimler Dergisi. Vol.6.No.2 (Eylül 2018) 231-261