When arguing in favor of the 2015 agreement with the Islamic Republic, Barack Obama and members of his administration insisted that European nations would not cooperate indefinitely with the U.S.-led sanctions regime. If a deal was not concluded promptly, they warned, Tehran would obtain economic relief elsewhere, without having to restrict its nuclear activities. The events of the past year prove otherwise, writes Tzvi Kahn:
[T]he Trump administration has reinstated the sanctions that President Obama lifted and then gone farther, most notably by ending the waivers that allowed some Iranian oil exports and by putting new sanctions on the industrial-metals sector. The impact on Iran has been substantial. On May 11, [Iran’s President Hassan] Rouhani likened current conditions to the country’s economic plight during the Iran-Iraq War (1980-1988), the most traumatic period of the Islamic Republic’s 40-year history. . . .
The latest economic indicators underscore Iran’s distress. In April, the twelve-month point-to-point inflation rate hit 51.4 percent, according to the state-run Iranian Statistical Center. As of Tuesday, the rial traded at 143,000 per U.S. dollar. . . . By contrast, when President Trump withdrew from the deal on May 8, 2018, the rial was trading at 64,500 per U.S. dollar. The International Monetary Fund forecast in early April that Iran’s GDP will contract by 6 percent in 2019. . . .
U.S. sanctions have [in fact] led most European companies to exit the country. Meanwhile, efforts by European governments to establish an alternative payment system that would bypass the sanctions have foundered. This reality remains inconsistent with warnings from senior Obama administration officials. . . .
[W]hile most foreign governments oppose the reinstated sanctions, international corporations have proved unwilling to risk losing access to America’s $20-trillion economy in order to conduct business with Iran’s $400-billion economy. Firms also do not wish to jeopardize their access to the U.S. dollar, which remains indispensable as a medium of trade. . . . The Trump administration should keep up the pressure by fulfilling its recent pledge to impose even more sanctions.