TEHRAN (Iran News) EU leaders had long debated providing cash-strapped Kiev a so-called ‘reparations loan’ backed by Russian Central Bank assets immobilized in the West, most of which are held in Europe. However, bloc members failed to reach agreement for the plan on Friday, instead opting to raise common debt to fund Ukraine to the tune of €90 billion over the next two years – which is expected to cost EU taxpayers €3 billion a year starting in 2028.

“The EU’s failure to pull off the reparations loan after endless talks will be taken in Washington as extra evidence that the bloc is an impotent force whose discordant views can safely be ignored,” the Economist wrote.

US President Donald Trump has expressed similar views in the past, telling Politico last week that they are “weak” and a “decaying” group of nations unable to control migration.

According to Politico, the Trump administration recently went over Brussels’ head to “backchannel” with some member nations, leading to Italy, Bulgaria, Malta, and the Czech Republic standing against the EU asset grab scheme at Friday’s summit.

Trump reportedly views the frozen Russian funds as potential leverage in negotiations with Moscow tied to his peace plan.

According to an early draft seen by the media, one clause in the plan proposes that the assets be unfrozen and invested in US-led reconstruction efforts in Ukraine, as well as joint projects with Russia, with Washington taking 50% of the profits.

Moscow has repeatedly warned that it would regard any attempt to seize its funds as outright “robbery.”

Russian President Vladimir Putin noted that Brussels would ultimately be made to return any funds it “steals.”

“No matter what they steal, sooner or later they will have to give it back,” he said in his year-end conference on Friday, warning of legal retribution and reputational damage for Western financial institutions.

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The reliable British magazine “The Economist” was founded in 1843 by British businessman James Wilson.

IRAN NEWS POLITICAL DESK

The circulation of this magazine whose readers are mostly educated people, managers and policy-makers has today reached around 1.5 million copies. The stand of this publication since the first day has always been to support the classical school in the liberal economy, and regarding Iran, it pursues important and moderate views.

Recently and after the White House announced imposition of its new sanctions on 18 banks of the Islamic Republic of Iran, this magazine published an interesting article. The economic information desk of The Economist in its article and report on the U.S.s news sanctions on 18 Iranian banks wrote, “We do not expect the new U.S. sanctions and restrictions against Iran to have significant growing impact on Iran’s trade and economy. Accordingly, we do not change our forecast of minus 0.2 percent economic growth for Iran in 2020. This exactly means that the White House, as the old saying goes, did not look before its leap”.

The Economist says President Donald Trump by imposing the new sanctions has tried to peg his power in the foreign policy scene. The report also reads, “Donald Trump by imposing these sanctions have tried to display his power in the foreign policy scene on the eve of the U.S. presidential elections. He and anti-Iranian hawkish men present in his government are all infuriated that their efforts in September to trigger the snapback and extension of the U.N. arms embargo against Iran failed and other signatories of the JCPOA and UNSC members defied this request of the U.S.”

Both inside Iran and overseas almost all experts who write on Iran or express their opinions believe, “The massive sanctions and the outbreak of the Coronavirus are two main factors which have caused Iran’s minus 0.2 percent economic growth in the current year. The reason, that the new U.S. sanctions on the Islamic Republic of Iran’s banks have been faced, on one point, with open defiance of other countries and, on the other hand, they have faced with harsh criticisms due to negative effects on the humanitarian exchanges, is that these sanctions have not been any deterrent factor and the White House and Trump have turned into the laughingstock for the international financial bodies, and even Trump is getting to the point that he loads his gun with the blank, with this notion that he can frighten Iran by triggering it.

The world witnesses this truth that Iran’s Foreign Minister Mohammad Javad Zarif has recently pointed to the U.S. inhuman efforts for blocking the limited access of Iran to the medicines and food, and his stand has faced with considerable sympathies in the international level regardless of how the Coronavirus pandemic has had its effects on the lives of people, and health and medical condition in Iran.

The Economist continues, “Besides these points, the abundant anti-Iran sanctions have made traders and foreign banks be reluctant in doing even licensed businesses with Iran and the country’s no-oil trade for export to those countries has declined in the past two years. So, the recent imposed sanctions against Iran’s banking system will be ineffective or have the least effect.”

The British publication further says, “18 Iranian banks are the new targets of the news U.S. sanctions and they are only authorized to have financial exchanges for food and other humanitarian items. Depriving Iran’s government of having access to the financial resources for developing nuclear and missile program, proliferating terrorism and support of terrorist networks are the claimed goals for imposing these sanctions. But in fact, small part of Iran’s international trade is done through official financial avenues. Let’s skip this point. Iran’s financial system was deprived of using international financial exchange system, known as SWIFT, based on the dollar. In this February. Iran has returned to the blacklist of the Financial Action Task Force (FATF); and it has warned of any financial exchange with Iran. But it has been ineffective because not only has the country not been isolated but also it has planned new ways for its survival in the economy.”

The Economist by elaborating these points concludes, “The new U.S. sanctions against 18 Iranian banks have no special effect or so-called crippling effect on Iran’s economy and trade, and in fact Mr. Trump, by imposing these sanctions on the eve of his presidential campaign, has tried to flaunt his undefeated capability in his foreign policy scene.”

 By: Hamid Reza Naghashian

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