x Abu Dhabi, UAEFriday 21 July 2017

Will Iran face new sanctions?

As the UN Security Council considers measures aimed at curbing the expansion of Iran's nuclear programme, among western powers there is growing pressure to impose tougher sanctions on Tehran, the most frequently mentioned being to restrict Iran's petrol imports. A last-minute offer of talks from Saeed Jalili, Iran's top nuclear negotiator complicated the deliberations of the permanent members and Germany.

As the UN Security Council considers measures aimed at curbing the expansion of Iran's nuclear programme, among western powers there is growing pressure to impose tougher sanctions on Tehran, the most frequently mentioned being to restrict Iran's petrol imports. A last-minute offer of talks from Saeed Jalili, Iran's top nuclear negotiator, complicated the deliberations of the permanent members and Germany. The New York Times said: "As foreign powers weigh further efforts to rein in Iran's nuclear programme, the German chancellor, Angela Merkel, is sounding markedly more determined about imposing tougher sanctions on the government in Tehran. "The shift - a potentially fraught move given the strength of Germany's business dealings with Iran and the interest in preserving them during a recession - came about, diplomats and analysts say, after the Iranian authorities cracked down on protesters who charge that Mahmoud Ahmadinejad stole the presidential election in Iran in June. Mrs Merkel, who grew up in Communist East Germany, was the first foreign leader to demand a new vote and to condemn the violence, speaking out well ahead of others, including President Barack Obama. "Iran - with its nuclear programme and its domestic political turmoil - looms large on the global diplomatic agenda as leaders gear up for the United Nations General Assembly later this month. On Wednesday, senior diplomats from the United States, Europe, Russia and China met in Frankfurt to weigh the next step in years of fruitless efforts to curb what Iran insists is a civilian nuclear effort." The Times reported: "Western diplomats struggled yesterday to secure an agreement on imposing tougher sanctions on Iran in an attempt to end its nuclear programme. "The meeting of the five United Nations permanent Security Council members and Germany was complicated by a last-minute offer of talks from Saeed Jalili, the top nuclear negotiator in Iran. "Because no details of the offer were available, the delegates assumed that Mr Jalili planned to use his proposal to slow the progress of moves to impose sanctions. Russia and China used the prospect of a peace offering from Tehran, however vague, as an argument against punitive measures. "One of the diplomats said: 'The point is to duck, dive, tease and confuse until they are more or less resistant to the kind of sanctions that we have been considering.' "One plan, currently before the US Congress, is to ban exports of refined petroleum products and tighten control over Iran's activities in the financial and insurance markets. A ban on petrol would hit Iran since it imports about 40 per cent of its needs. Petrol shortages have, in the past, led to domestic protests." Time magazine said: "While the Obama administration may think that a gasoline embargo, even a partial one, would pressure the Iranian regime to suspend its nuclear activities, Tehran may be hoping for just that sanction to help it with one of its longtime goals: reducing gasoline consumption. Indeed, the Iranian government, which has been subsidising pump prices for years and keeping them well below the international market price (at a huge burden to the national budget), would love the US to take the political hit for helping to end the subsidies. "Former President Mohammad Khatami stated that his greatest economic failure during his tenure was not reducing the massive subsidies the Iranian government spends to keep gas prices low. Every year, his government had to draw millions of dollars from Iran's special "rainy day" oil revenue reserve fund in order to pay out the subsidies. By 2003, the leaders today associated with the ongoing Green Movement opposition - Khatami, Mehdi Karroubi and Ali Akbar Hashemi Rafsanjani - all supported rationing gasoline in order to reduce domestic consumption and government expenditure."

"The technology entrepreneurs of the Arab world have long played the supporting role to the region's higher-profile property developers, traders and merchants," The National reported. "But when Yahoo announced last week that it would acquire the Jordanian web portal Maktoob, for a sum believed to be more than US$75 million (Dh275.4m), this small but important community enjoyed a moment in the spotlight. One well-known Arab technology entrepreneur says he received several phone calls from US venture capital firms in the hours after the Yahoo announcement." Forbes noted: "Yahoo is not buying a market leader with this deal. When it comes to traffic rankings, Maktoob is actually less popular in the Arab world than its new owner - only in Saudi Arabia is Maktoob ranked higher, according to Maktoob's website. But what counts is the local content, delivered in the Arabic language: Yahoo says Middle East markets are in the 'early stages' of internet adoption, with only 1 per cent of all online content in Arabic, despite the fact that there are 320 million Arabic speakers worldwide. In other words, the growth potential is promising." The blog 360east said: "Maktoob was founded in 1997, was bought and sold by various investors over the years. The rumours about an acquisition have been swirling for years. The Arab internet is very late to the party indeed, but it is quite thrilling, nonetheless, that it was a Jordanian-founded company that now stands as the first example of an Arab internet portal able to attract the interest of a global internet brand." Fadi Ghandour wrote: "It is the ultimate success story in a region long used to failure. For our younger generations, it is a wonderful example of how a dream can turn into a brilliant achievement through a combination of boundless creativity and down-to-earth business sense. "For our leaders, it is hopefully a painful reminder of the distance between their priorities and the ambitions of an increasingly wired younger generation (16.5 million of whom are unique visitors of Maktoob's) eager to move away from a state-driven, oil-dominated future. "For our wealthy Arab investors, it is a wakeup call that true value lies in our youth rather than in real estate, and that talent is closer to home than they could have ever imagined. "For the Arab world, it is proof that money may count for something but, in the final analysis, an education, smarts and determination count for much more, because the two entrepreneurial gentlemen who made Maktoob started out in Jordan - their home and, it just so happens, one of our area's more resource-poor countries - and, even when their company reached way beyond it, never left." BusinessWeek noted: "While rivals Google and Microsoft have waded cautiously into the emerging Middle East, Yahoo will be the first major Internet company from the West to run a full online content business in the region. How the company navigates the cultural and legal norms of the Arab world will be watched closely by competitors back home. So will its approach to Internet censorship. "The relatively tiny market for online ads in Arab countries has companies stepping carefully into the market. Microsoft partners with an Egyptian ISP for its MSN Arabia site, and Google offers an Arabic-language version of its search engine. But neither has entered the Middle East with as much conviction as Yahoo. 'Many of the emerging markets are very similar. You have nascent penetration of online users and ad dollars,' says Keith Nilsson, Yahoo's senior vice-president for emerging markets. 'The Middle East is unique because you have a contiguous language which a very large population speaks - one of the reasons we were interested in this acquisition.' "The market for online advertising and transactions in the Middle East may be tiny by Silicon Valley standards, but experts say the potential is huge."

pwoodward@thenational.ae