Will Asia Nix Iran Sanctions?
Image Credit: White House

Will Asia Nix Iran Sanctions?


Last week, two senior US officials visited South Korea and Japan to rally support for applying additional sanctions against Iran for Tehran’s continuing defiance of UN Security Council resolutions over its nuclear programme.

In Seoul and Tokyo, Robert Einhorn, the US State Department's special adviser for non-proliferation and arms control, and Deputy Assistant Secretary of the Treasury for Terrorist Financing and Financial Crimes Daniel Glaser lobbied their hosts to strengthen their enforcement of existing multinational sanctions and to adopt additional measures that exceed the limited Security Council measures.

This likely won’t be the last time such a joint team is in Asia—although European allies appear to be on board with the additional measures, the United States is concerned that some Asian states might be tempted to free ride on the unilateral economic sanctions they’ve adopted in recent months.

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The US Government Accountability Office has already identified Malaysia, Singapore and the United Arab Emirates as the main third-party countries through which US military and dual-use goods (civilian goods with potential military applications) reach Iran. More importantly, however, Japan, South Korea and China in particular have substantial economic dealings with Iran—all are major producers of industrial machinery and machine-making tools that Iran needs to develop its energy industry.

The problem is that some of these goods also have military uses, including in the production of nuclear weapons and ballistic missiles. The US hopes that by decreasing such ties, further pressure will be placed on Tehran to make concessions on the nuclear issue. Yet, Chinese and other Asian business managers are eager to exploit Iran’s isolation from international markets for their own economic benefit.

Before leaving Washington, Einhorn told a hearing of the US House Oversight and Government Reform Committee that he saw the sanctions recently enacted by the EU as setting ‘some very high standards for sanctions,’ and that he ‘wanted to see if Japan and South Korea could come up to that mark.’

But Asian governments have a quite different set of calculations than European nations. After all, unlike NATO countries, whose governments can identify a plausible military threat from an Iran that possessed nuclear warheads and long-range ballistic missiles, Asian countries consider an attack from Iran a remote contingency and are more concerned with the nuclear rogue in their back garden, namely North Korea.

This leaves Asian governments with an awkward calculation to make—how much can they afford to antagonize US policymakers and endanger their economic interests in the United States if Washington sanctions their firms for engaging in commerce with Iran. Connected to this is the fear that ties with Iran will endanger Asian firms’ reputations, prove unprofitable without access to Western technology and financing and entangle their foreign operations in the extensive network of secondary sanctions that the Bush and now Obama administrations have been building to entrap entities with ties to Iran’s illicit nuclear activities.

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