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The sanctions by Western nations came in response to a report by the UN atomic watchdog IAEA about Iran`s nuclear programme and after their proposal to impose new sanctions in the United Nations was blocked due to opposition from Russia and China. US President Barack Obama signed an executive order on Monday that specifically targets Iran`s petrochemical industry, and expands sanctions on Iran`s oil and gas business; besides slapping sanctions on several individuals and entities in Iran.
Invoking Patriot Act, the US identified the entire Iranian banking sector, including the Central Bank of Iran, as a threat to governments or financial institutions that do business with Iranian banks. "The message is clear: If Iran`s intransigence continues, it will face increasing pressure and isolation," Clinton told reporters joined by Treasury Secretary Timothy Geithner.
These steps were accompanied by complementary measures by Britain and Canada, she said, adding that US expects additional sanctions by other international partners in the days ahead. "Together, these measures represent a significant ratcheting up of pressure on Iran, its sources of income and its illegal activities," Clinton said.
Geithner said Iran`s national shipping line, which was earlier targetted in sanctions too has been shut off from many major ports, and the country`s oil sector too is in decline. In the new sanctions, for the first time entire Iranian banking sector has been identified as a threat. Noting that there is little indication that Iran is serious about negotiations on its nuclear programme, Clinton said until Iran`s leaders live up to their international obligations, they will face increasing consequences.
"Let me be clear: Today`s actions do not exhaust our opportunities to sanction Iran. We continue actively to consider a range of increasingly aggressive measures. We have worked closely with Congress and have put to effective use the legislative tools they have provided. We are committed to continuing our collaboration to develop additional sanctions that will have the effect we all want: putting strong pressure on Iran," she stressed.
While Britain said it was "ceasing all contact" between its financial system and that of Iran, Canada said it was stopping "virtually all transactions" with the country. European Union too said is was considering imposing fresh sanctions on 200 Iranian firms and individuals. The executive order signed by Obama, allows US to sanction provision of goods, services and technology to petrochemical sector. To accompany this new measure, the US will launch a worldwide diplomatic campaign to encourage other countries to shift any purchases of Iranian petrochemical products to other suppliers. While the US law already sanctions large-scale investments in upstream exploration and development of oil and gas, the executive order will also be sanctionable to provide goods, services and technology for those activities as well. "This will make it more difficult for Iran to work around the sanctions and will further impede efforts to maintain and modernise its oil and gas sector," Clinton said.
"Under an existing executive order, we are designating a number of individuals and entities for their roles in assisting Iran`s prohibited nuclear programmes, including its enrichment and heavy water programmes. Their assets, subject to US jurisdiction, will be frozen, and American individuals and entities will be prohibited from engaging in any transactions with them," she said. Geithner asserted that these sanctions have dramatically reduced Iran`s access to the international financial system.
"Iranian banks are losing the ability to do business around the world, which in turn has reduced the ability of the government to finance activities opposed by the international community," he said.
