US sanctions and Iran’s battle against the COVID-19

Iran is hit hard by COVID-19. According to the World Health Organization, the number of infected people in Iran (as of 28th March) is 35,408 and the death toll rising up to 2,517. But, in addition to contending with an unknown and terrifyingly infectious disease, Iranian authorities are struggling to marshal the necessary medical resources in the face of draconian US and European sanctions. Experts are divided on how Iran became the hardest hit country among the Arab nations, some say that it is due to the Iran-China trade although there are several countries in that region who have got good trade relations with China like Pakistan and in Pakistan the number of the infected people is 1,495 (according to WHO as of 28 th March’20) which is much lower than Iran. But some doctors and experts are saying that Iran is doing more tests than countries like Pakistan or India, the Iranian government said that they have tested more than 15million people although it is not clear whether those “tests” were Covid-19 tests or whether those tests comprised thermal tests and covid-19 tests.

Iran currently has one of the worst outbreaks of COVID-19 following the US, Europe and China since the first reported case on 19 th February. Speculation is that the situation there is far worse than official accounts indicate. And this critical situation is further worsened by the sanctions. Although US sanctions do not cover medical aid but it targets the International Banking system leaving Iran unable to pay for all of its expenses. Tehran says that because of the US sanctions, central banks keep Iran from using its foreign exchange reserves. The US sanctions particularly imposed on the energy, shipping and financial sector caused foreign investment to dry up and hit oil exports. BBC said as a result of the sanctions, Iran’s gross domestic product (GDP) contracted an estimated 4.8% in the 2018 and is forecast to shrink another 9.5% in 2019. The IMF is forecasting zero growth in 2020. Iran’s crude oil production had fallen to 2.1 million bpd on average, according to OPEC’s data. Unemployment in Iran is skyrocketing and in addition to all of this Iran’s currency has hit record low recently.

So, until there is relief Iran cannot pay for the necessary medical facilities. The sanctions also target cargo and transportation systems, so test kits and other medical equipment cannot even reach Iran. Several companies that supply the medical equipment required to fight coronavirus have stopped shipping to Iran because their banks refuse to handle the transactions, reports New York Times. Addressing this particular issue, the foreign minister of Iran Javad Zarif wrote an open letter to UN Secretary-General Antonio Guterres, making a public plea for sanctions relief on medical supplies. At the end of February, the Trump administration had agreed to a sanctions waiver to transfer humanitarian aid via a Swiss channel. But on March 11th, the Iranian Foreign Ministry spokesman claimed the US did not allow Iran to use that channel. The sanctions are devastating in several other ways for example, it targets any trade that has the Iranian govt. involved i.e. it prohibits any trade which has the public infrastructures involved.

This affects the health sector in Iran which is still largely controlled by the public sector. In the face of an epidemic it is but natural that common people can get necessary facilities only through public sector and state intervention. It must be understood that in countries like Iran, the

public sector is still the driving force of the economy and in the verge of stringent sanctions it is impossible for Iran’s economy to cope up with the current situation. The current economic condition and Covid-19 outbreak in Iran has forced the country to make a request for a 5-million-dollar loan from the IMF Covid-19 aid fund. Iranian Foreign Minister Javad Zarif confirmed on 12th march that his country had applied for the emergency aid for the first time in six decades. “IMF/IMF Board should adhere to the Fund’s mandate, stand on the right side of history & act responsibly,” he tweeted. The United State sits in the decision-making board of the IMF so there is a fair chance of that request getting vetoed even if the organisation agrees. But even if the IMF decision-making body responds positively to Iran’s application, there would be other technical obstacles before any money can flow.

There is also another side to the story. Blaming the US for the worsening situation in Iran, renowned journalist Mehdi Hassan also criticised the current Iranian government for being “grotesquely incompetent” and “deeply dishonest”. Mehdi Hassan quoted Dr. Kamiar and Arash Alaei, both of them said that in the initial stage of the outbreak the Iranian government did not take adequate measures to contain the disease and even said that the threat of coronavirus is an exaggeration by Iran’s enemies. The Iranian regime also overlooked the threat of covid-19 when the first case was reported back in January because they wanted to continue with the scheduled legislative elections on February 21st and downplayed the severity of the virus. Graeme Wood, who estimates the number of potential cases in Iran could be in the millions, writes in The Atlantic that “Iran’s government told its people that the United States had hyped COVID-19 to suppress turnout, and Tehran vowed to punish anyone spreading rumours about a serious epidemic.” So along with the US sanctions the problem is additionally compounded by a general lack of public trust in the regime, which initially did not take adequate containment measures, and later on reversed its position on the outbreak. It eventually led the people to panic buying and obviously the released official data on the outbreak has lost its credibility in the eyes of the common mass.

But in addition to all of this, there is little doubt that the sanctions are mainly responsible for the worsening of the situation. Although the consistent response from the US Treasury Secretary Steve Mnuchin is that the sanctions do not prevent humanitarian aid does not reflect reality. Human Rights Watch pointed out in October 2019, months before the novel coronavirus outbreak in Iran, “while the US government has built exemptions for humanitarian imports into its sanctions regime … in practice these exemptions have failed to offset the strong reluctance of US and European companies and banks to risk incurring sanctions and legal action by exporting or financing exempted humanitarian goods.” And hence the sanctions are continuously denying Iranians to access essential medicines and to impair their right to health. In late February, the Trump administration made a minor adjustment to the sanctions regime and allowed some humanitarian aid to arrive in Iran in coordination with the Swiss government. Confirming the claims made by the Iranian foreign ministry spokesperson the UN ambassador of Iran Majid Ravanchi said, “Even the so-called Swiss Channel, designed to facilitate humanitarian trade with Iran and announced with much fanfare, is not functioning well because of the cumbersome nature of transactions in transferring Iran’s reserves — blocked outside Iran — to the designated Swiss bank. Furthermore, as strict U.S. interference in Iranian trade further drains our foreign currency reserves, this channel may actually become redundant in a few months. As such, it appears that the U.S. administration is more interested in paying lip-service to the notion of humanitarian needs, and is engaged more in propaganda, than in actually facilitating the humanitarian business with Iran.”

There is little doubt that these sanctions are ‘draconian’ in nature. The Chinese and Russian governments demanded the U.S. suspend sanctions on Iran as a result of the pandemic. The Chinese foreign ministry called on the U.S. to “immediately lift unilateral” sanctions on Iran, which it described as undermining the “delivery of humanitarian aid by the UN and other organizations.” The Russian government called the sanctions “illegal” and “anti-human” and accused Washington of “purposefully” cutting off millions of Iranian citizens “from the possibility of purchasing necessary medical supplies.” Britain is also privately pressing America to withdraw its sanction (according to a Guardian Newsletter dated 18th March’20). European Union has backed both Iran and Venezuela (which is also going through a similar situation as Iran due to the ‘draconian’ US sanctions) for their demand of 5 million-dollars each from the IMF. The EU foreign affairs Chief Joseph Borrell said on 2 rd March that the EU will give 20 million Euro to Iran as humanitarian aid and such support does not contradict the laws of the sanctions.

The United States is still continuing with its ‘draconian’ sanctions on Iran and Venezuela. Ironically on 17th March’20 the Secretary of State Mike Pompeo urged Iran to release the US citizens being held in the country as a “Humanitarian Gesture.” From the perspective of foreign policy, Rob Malley, who worked closely with the Obama administration during the 2015 Nuclear Deal between Iran and the US argues that the Coronavirus epidemic could be used as a “maximum pressure strategy” on Iran by the Trump administration but voices to withdraw sanctions are also coming from within the United States. Democratic senator and presidential candidate Bernie Sanders said,”Iran is facing a catastrophic toll from the coronavirus pandemic. U.S. sanctions should not be contributing to this humanitarian disaster”, he tweeted on 18th March’20, “As a caring nation, we must lift any sanctions hurting Iran’s ability to address this crisis, including financial sanctions.” The New York Times concluded their report on Iran by giving a “nutshell argument” of the situation and that argument is “Iranians will remember the choice the United States makes today.”

Uttoran Bhattacharyya

Intern, AGA

(The views, thoughts, and opinions expressed in the text belong solely to the author  and does not  in anyway reflect the position of the organization)