Sunday, April 09, 2006

EU Paper Outlines Tough Action on Tehran

Daniel Dombey, The Financial Times:
Companies doing business in Iran face the prospect of a crackdown on export credits unless Tehran’s co-operation with the United Nations over its nuclear programme is improved, according to a confidential European Union paper. A document drawn up by the staff of Javier Solana, EU foreign policy chief, and sent to the bloc’s 25 national capitals also lists possible measures such as a visa ban on Iran’s nuclear officials and further controls on “dual use” technology that can have civil as well as military purposes.

In addition, it says, the EU could place restrictions on Iranians studying related technologies at European universities, as well as declaring a formal arms embargo on Iran and announcing the definitive end of stalled trade negotiations with Tehran.

The paper, which could be discussed by EU foreign ministers as early as today, looks at possible EU actions in a number of other areas where the bloc has problems with Iran, mooting the possibility of supporting satellite transmissions into Iran to aid human rights groups and “civil society”. READ MORE

A key reason for this policy review is that Iran has taken negative steps in many areas and we have to adapt our tools accordingly,” said an EU diplomat. An end to export credits could be a difficult move to agree – Italy alone has €4.8bn (.8bn, £3.4bn) of credits underwriting Italian companies’ activities in Iran in sectors such as steel and oil.

But the paper – a response to last month’s request from foreign ministers for a list of options concerning Tehran – is a recognition that, as the nuclear dispute continues, the EU may find it necessary to act in parallel or ahead of the UN Security Council, which has struggled to forge a consensus on the issue.

Any moves by the EU would be significant given the difficulty in getting agreement at the UN and the US’s limited scope to tighten sanctions against Tehran.

While the US and EU are increasingly convinced that Iran is seeking nuclear weapons capability, Tehran insists its nuclear programme is peaceful and Moscow and Beijing are keen to avoid a confrontation.

Mohamed ElBaradei, head of the UN’s nuclear watchdog, the International Atomic Energy Agency, is due to visit Tehran this week in the hope of procuring more documentation on Iran’s nuclear programme, ahead of producing a report on Iran’s compliance by the end of the month for the Security Council and the IAEA board.

Some western diplomats warn that, at present, the EU has “no carrot and no stick” to help any negotiations with Tehran succeed.

Western diplomats also say only technical considerations have slowed Iran’s progress in building up uranium enrichment – which can produce weapons grade material – since President Mahmoud Ahmadi-Nejad took office last August.

The US has already called for a “coalition of concerned countries” to consider sanctions on Iran if the dispute continues.