According to Jpost the Jewish perspective on Iranian sanctions: The International Crisis Group (ICG) said the regional stability in Iran could be undermined for years to come due to the sanctions afflicted to the country.
It is in a new report released by the International Crisis Group that one can read about the effects that the sanctions on Iran could have in the long term. According to the group, the sanctions made on Iran are so intricately woven that it will become extremely difficult to untangle. That said the effect they will have on the country is to swell the black economy and that could have bad consequences on the regional stability in the following years.
In the description of those “unintended consequences” the report made mention of the fact that not everybody has been directly affected by the sanctions. Those in position to have access to the best resources of the country have many ways to circumvent the sanctions. That includes the elite Revolutionary Guards (IRGC). At the same time smuggling networks are finding their ways to integrate themselves into the economy.
The report said that this is not necessarily harmful to the regime. Rather it has helped create a symbiosis between organizations affiliated to the state such as the IRGC and the smuggling networks found across the country.
This will enable organized crime networks to become more sophisticated over time to the point where they will be able to survive long after the sanctions have been lifted. The fact that Iran is located near two countries with the highest levels of corruption (Iraq, Afghanistan) increases the likeliness that cross-border criminality flourishes and that undermines long term stability.
Apparently, due to the enormous pressure on its economy, Iran has found new ways of going around the sanctions that have been imposed on its oil and banking sector because of its enrichment of uranium in its nuclear plant.
According to the West, Iran’s nuclear program conceals an intent to develop a nuclear weapon, Tehran has always denied that allegation.
The ICG has made recommendations that will help release tension in Iran and those are broadly similar to what most experts in Iran suggest. One recommendation has to do with the progressive lifting of the sanctions in return for Iran to concede on its nuclear program and that should be followed by talks between Tehran and the White House.
But according the the report on Spider Web, this process might be much more difficult than we think. Easing the sanctions on Iran may not necessarily result in any concrete positive action on the side of Iran and that is despite the limited progress made after Iran met with the major world powers concerning the nuclear program.
The ICG said that the extensiveness and complexity of those sanctions takes away the flexibility needed for diplomacy.
For now Iran has found different ways to adapt its economy to the sanctions. It has introduced another tier of exchange rates, a “hawala” system for financial transaction and the use of barter. ICG explained that all this has played a role in the rise of the black economy.
As official commercial networks are replaced by clandestine ones, smuggling is booming and crime rates have been rising. According to reports smuggling networks accounted for 21% of GDP and are becoming an integral part of the economy.
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