08 February 2012

Are Sanctions Working Against Iran?

You never hear about the on-the-ground effects of sanctions against a country. But here's a look at the effect they're having on the average Iranian. Yes, they take a long time to work. But maybe they are actually working?

Malaysia has halted palm oil exports to Iran because of payments problems and Asian oil buyers have cut crude purchases as Western sanctions tighten a financial noose around Iran.
Traders in China said they would cut iron ore purchases from Iran, which are worth over $2 billion a year, because of sanctions that have forced payment defaults on Indian rice imports and prompted Ukrainian and European sellers to stop booking shipments of Ukrainian grain to the Middle East country.
The problems are the most visible evidence to date that Western sanctions are squeezing Iran's trade.
Iran's crude oil buyers, including China and Japan, are cutting purchases, reducing the OPEC producer's earnings from its major source of the foreign exchange it needs to pay for critical imports, such as food staples.
The problems have come to light after U.S. sanctions this year targeted Iran's central bank and the European Union decided to ban Iran crude imports in an effort to force Tehran to abandon a suspected nuclear weapons program.
Iran's rial has plunged as the West increased sanctions, raising the price of imports for the economy and making it difficult to find Dubai-based middlemen who can process payments to keep the country's trade flowing.
Bread and rice dominate the diet of most Iranians, many of whom can no longer afford to buy meat, now selling for about $30 a kilogram in Tehran.

By: Brant

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