Posts Tagged ‘Syria’

Pentagon assessing potential responses to Iranian behavior

May 21, 2018

The U.S. military will take all necessary steps to confront Iranian behavior in the region and is still assessing whether that could include new actions or doubling down on current ones, the Pentagon said on Monday.

“We are going to take all necessary steps to confront and address Iran’s malign influence in the region,” Pentagon spokesman Colonel Robert Manning told reporters.

Image result for Jim Mattis, photos

U.S. Secretary of Defense James Mattis

“We are assessing if we are going to double down on current actions or implement new actions,” Manning said.

He did not comment on specific actions.

Reuters

Reporting by Idrees Ali and Phil Stewart; Editing by Chizu Nomiyama

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An Arab Plan B for Containing Iran

May 21, 2018

 

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Plan A was the nuclear deal. That’s over. Now key Gulf states want the U.S. to flex more muscle.

Containment

Photographer: Jim Watson/AFP/Getty Images

President Donald Trump’s withdrawal from the Iran nuclear deal didn’t draw much international applause, but three U.S. allies in the Middle East — Israel, Saudi Arabia and the United Arab Emirates — warmly welcomed the move.

Israel had long said that the deal didn’t do enough to prevent Iran from becoming a nuclear power, and Gulf Arab countries believed it gave Iran cover for an intensified campaign of destabilizing the Arab world. And they have plenty of ideas when it comes to drawing up a Plan B for a U.S.-led containment campaign against Iran.

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Houthi rebels launch an Iranian made ballistic missile into Saudi Arabia

Saudi Arabia and the UAE never shared President Barack Obama’s conviction that engagement and sanctions relief could moderate Iran’s revolutionary brashness, regional meddling and support for sectarian extremists.

So they’re pleased by Trump’s rhetorical attacks and reimposed sanctions against the Iranian regime, and they want the U.S. to foreclose any efforts by European countries that remain signatories to the nuclear deal to find a way to let their companies keep doing business with Iranian institutions.

However, Iran’s expansion as a regional power largely took place before the nuclear deal was signed, and the comprehensive international sanctions that existed in the years leading up to the agreement did not deter Tehran’s support for extremist groups in Arab countries like Iraq, Syria, Lebanon, Bahrain and Yemen.

So the Gulf states don’t expect sanctions alone to do the trick. They hope that with Islamic State crushed in Iraq and Syria, Washington will now lead a coordinated regional strategy to cut Iran’s power down to size.

Among other things, they want limited and focused military action to reverse some of the gains Iran has made since the U.S. invasion of Iraq in 2003.

Indeed, they’ve already taken on the Iranian-backed Houthi rebels in Yemen, as well as the local al-Qaeda affiliate. They may also hope to play a role in confronting Iran’s lawless behavior in the waters of the Gulf itself.

They are looking for Washington to take the lead in confronting Iran in Iraq, but there, too, Saudi Arabia has shown it is willing to play a diplomatic, political and financial role.

Perhaps the most strategically vital theater in any such campaign would be Syria, which is far from the Gulf countries. There, they hope that Israel will enforce its own red lines on Iranian conduct and make life difficult for the Hezbollah militants in Syria and possibly even in their home base of Lebanon.

They would urge the U.S. to prevent Iran from taking advantage of the collapse of Islamic State in western Iraq and eastern Syria in order to create a secured military corridor running from Iran to Lebanon and the Mediterranean. Such a strategic upheaval, if secured and consolidated, would ensure that Iran emerges as a regional superpower.

Gulf Arab countries also want to work with the U.S. to persuade Turkey and Russia that their interests in Syria are not served by an empowered and aggressive Iran. Otherwise, Russia could prove a major obstacle to reducing Iran’s influence in Syria and getting Hezbollah to go back to Lebanon.

Finally, while the Gulf countries don’t want an all-out war with Iran, there are signs of Arab and American encouragement of uprisings by Iranian ethnic minorities such as Baluchis, Arabs and Kurds.

The goal isn’t regime change, partly because that’s not considered a serious possibility at the moment. What they want, instead, is a sustained containment campaign to pressure Iran to change its behavior and ambitions and constrain its ability to destabilize neighbors and spread influence.

It’s a big ask, and probably bigger than many Gulf Arab leaders realize. After decades of U.S. leadership in the region, these countries grew used to, and benefited from, a U.S.-enforced regional order. But now, especially after Iraq and Afghanistan, Americans across the political spectrum have an advanced case of Middle East war fatigue. Trump’s “America First” campaign didn’t signal much enthusiasm for the kind of interventionist foreign policy that these Gulf allies are hoping for.

But if the U.S. wants to combat terrorism and confront Iran, as the administration insists it does, Trump’s idea of withdrawing the more than 2,000 U.S. forces in Syria is a nonstarter.

The Gulf countries aren’t asking for a repetition of the 2003 adventure in Iraq, which they didn’t support or encourage. What they want is a multi-front effort to roll back Iran’s influence by defanging its proxies, supporting its enemies and insurgents and choking off its economy. Only Washington, they believe, can do that. The idea is especially to weaken Iran’s Revolutionary Guards and its clients around the region.

Containing Iran will take time, effort and troops and will not be painless. But it needn’t and shouldn’t be a madcap adventure like the campaign that began in 2003 to remake Iraq in an American image. Instead, as Russia has demonstrated in Syria, even in the Middle East it’s possible to secure limited goals with limited means, especially if allies work together. That’s what Saudi Arabia and the UAE are hoping is in the works for a Plan B regarding Iran.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Hussein Ibish at hussein.ibish@gmail.com

To contact the editor responsible for this story:
Jonathan Landman at jlandman4@bloomberg.net

https://www.bloomberg.com/view/articles/2018-05-21/containing-iran-there-s-an-arab-plan-b

Report: Explosions heard at Iranian facility near Damascus

May 21, 2018

Sky News Arabia says blasts target electronic warfare facility used by Tehran south of Syrian capital; no confirmation

Times of Israel
May 21, 2018

An explosion is seen coming from an army base, allegedly used by Iran-backed militias, outside the northern Syria city of Hama on April 29, 2018. (Screen capture; Facebook)

An explosion is seen coming from an army base, allegedly used by Iran-backed militias, outside the northern Syria city of Hama on April 29, 2018. (Screen capture; Facebook)

Explosions reportedly rocked an area thought to house an Iranian facility near Damascus early Monday morning, according to a report in Sky News Arabia.

There was no immediate confirmation of the explosion and it was not clear what may have caused the blasts, which came days after another mysterious explosion at a Syrian base.

Sky News said locals reported hearing explosions in the area of Najjah, a neighborhood south of Damascus which houses a military academy.

According to the report, the blasts are thought to have occurred at an Iranian electronic warfare facility there.

There was no immediate word from Syria, which was said to be on the verge of pushing the last pockets of Islamic State resistance out of southern Damascus on Monday.

Israel has increasingly taken aim at Iranian facilities in southern Syria over recent months as it attempts to keep Tehran from gaining a military foothold on its doorstep.

The sorties, which Israel rarely admit to openly, have led to increased tensions in the border region and earlier this month sparked a barrage of 20 missiles at northern Israel, drawing a massive Israeli reprisal attack.

The explosions were reported after mysterious blasts tore through weapons and fuel depots on Friday at a military airport in Syria’s Hama province, according to the Syrian Observatory for Human Rights, killing at least 28 people.

Syrian state media reported the blasts at the time but did not provide any details, while the Observatory had said they were likely due to a technical malfunction.

However, the Sky News Arabia outlet reported that the explosions were caused by an attack on an advanced Iranian air defense system, despite it coming in the middle of the day, when Israel rarely carries out airstrikes.

After maintaining an official policy of refusing to comment on such strikes, the Israeli military last week revealed that it had been conducting air raids against Iranian targets in Syria as part of a mission dubbed “Operation Chess.”

The purpose of “Operation Chess” was to prevent Iran from carrying out reprisals for an Israeli airstrike against the Iranian-controlled T-4 air base in central Syria on April 9, which killed at least seven members of the Islamic Revolutionary Guard Corps, including a senior officer responsible for its drone program.

Iran had also used the T-4 base to launch an attack drone carrying explosives into Israel in February, according to the Israel Defense Forces; the drone was shot down.

The IRGC’s al-Quds Force in southern Syria launched 20 rockets at northern Israel last week. Four of the rockets were intercepted by Israeli air defenses, the army said, and the rest fell short of the border.

In response, the Israeli Air Force conducted strikes against over 50 Iranian military targets in Syria and destroyed several Syrian air defense systems that had fired on Israeli jets, the army said.

Israeli officials have repeatedly stated that the Jewish state will not accept Iranian entrenchment in Syria and is prepared to take military action in order to prevent it.

Last week, the Israeli army reportedly told senior ministers that it believes the current round of hostilities was over, but tensions in the north will persist, and that border incidents are still possible.

https://www.timesofisrael.com/report-explosions-heard-at-iranian-facility-near-damascus/

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Washington seeks global ‘coalition’ against Iran regime

May 18, 2018

Washington wants to build a global “coalition” against the Tehran regime and its “destabilizing activities,” the State Department said on Thursday, after pulling out from the Iran nuclear accord to the anger of US allies.

The plan is to be detailed on Monday by the top United States diplomat, Secretary of State Mike Pompeo, in his first major foreign policy address since taking office in April.

“The US will be working hard to put together a coalition,” State Department spokeswoman Heather Nauert told reporters.

AFP

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The aim is to “bring together a lot of countries from around the world with the specific goal of looking at the Iranian regime through a more realistic lens” which would include “all of its destabilizing activities that aren’t just a threat to the region but are a threat to the broader world,” she said.

Nauert added that the coalition will not be “anti-Iran” because the US stands “firmly behind” the country’s people, in contrast to the regime and its “bad actions.”

She evoked a comparison with the US-led international coalition against the Islamic State group in Syria and Iraq.

Begun in 2014, that coalition now counts as members 75 countries or institutions and intervened militarily against the jihadists, although only a minority of coalition members have conducted most of that military action, which has left the extremists nearly defeated on that battlefield.

Nauert did not say whether the proposed coalition against Iran’s regime would have a military component.

She said the State Department received on Monday about 200 foreign diplomats to explain to them President Donald Trump’s decision to withdraw from the nuclear accord, and the next steps.

In a breakthrough that ended a 12-year standoff over Western fears that Iran was developing a nuclear bomb, the administration of former president Barack Obama and other major powers reached the accord with Iran in 2015.

It lifted punishing international sanctions in return for Iran’s agreement to freeze its nuclear effort.

Withdrawing from the deal last week, Trump called for a new agreement with deeper restrictions on Iran’s nuclear program as well as curbs on its ballistic missiles and its backing for militant groups across the Middle East.

Along with Iran the other signatories of the 2015 deal — France, Britain, Germany, China and Russia — strongly criticized the US withdrawal.

On Thursday the European Union said it will begin moves to block the effect of reimposed US sanctions on Iran as efforts to preserve the nuclear deal deepened a transatlantic rift.

Asked about the potential willingness of European nations to join the proposed new coalition, Nauert said many US allies “fully understand” and are “not turning a blind eye” to Iran’s actions.

France freezes company assets over Syria chemical weapons

May 18, 2018

France on Friday froze the assets for six months of companies based in Syria, Lebanon and China after they were linked to an alleged chemical weapons programme in Syria.

© AFP/File | An image grab taken from a video released by the Syrian civil defence in Douma shows volunteers helping children at a hospital following an alleged chemical attack on the rebel-held town on April 8, 2018

The businesses include Sigmatec and the Al Mahrous Group, both based in Damascus, Technolab in Lebanon, and a trading company in Guangzhou in China, according to a list published in the government’s official gazette.

Two Syrian nationals will also face asset freezes, as well as a person born in Lebanon in 1977 whose nationality was not specified.

The asset freezes were signed by French Finance minister Bruno Le Maire.

In January, France sanctioned 25 people and companies based in Syria, but also French, Lebanese and Chinese, over suspicions of fuelling the development of chemical weapons in the war-ravaged country.

The companies targeted included importers and distributors of metals, electronics, logistics and shipping.

Some thirty countries meet in Paris on Friday to put in place mechanisms to better identify and punish those responsible for using nerve agents such as Sarin and chlorine in attacks.

After hundreds of people were killed in chemical attacks near Damascus in August 2013, a landmark deal with Russia was struck to rid Syria of its chemical weapons stash, staving off US air strikes.

Despite the deal, a suspected chlorine and sarin attack in the Syrian town of Douma on April 7 triggered a wave of punitive missile strikes against alleged chemical weapons facilities in Syria by the United States, Britain and France.

The Organisation for the Prohibition of Chemical Weapons is due to soon release a fact-finding report into the suspected Douma attack.

Gaza violence puts Palestinian cause back on global agenda

May 16, 2018

Weeks of mass protests and deadly violence on the Gaza-Israel border have put the Palestinian cause back on the global agenda, but questions remain over whether the impact will last.

© AFP / by Joe Dyke | Palestinian mourners carry the body of 51-year-old Nasser Ghorab at his funeral in a refugee camp in the central Gaza Strip on May 16, 2018, a day after he was killed along during protests the border with Israel

AFP

More than 100 Palestinians were killed in seven weeks of protests, culminating in 60 dead on Monday, mainly from Israeli sniper fire, as tens of thousands rallied against the transfer of the US embassy to Jerusalem.

The violence overshadowed the embassy move, as television networks split their screens between US President Donald Trump’s daughter Ivanka speaking at the inauguration and the carnage on the Gaza border.

Israel says its actions are necessary to defend the border and stop mass infiltrations from the Palestinian enclave, which is run by the Islamist movement Hamas.

Following unconfirmed reports of indirect contacts between Hamas and Israel, Tuesday proved far calmer — only a few thousand people gathered on the border, with only minor incidents reported.

Ramadan, the Muslim month of dawn-to-dusk fasting, was also poised to begin on Thursday, likely to keep people away from the protests.

Near the border on Tuesday evening, 26-year-old Mutassim Hajjaj showed off videos of himself seeking to breach the border fence the day before.

He said the protests had overshadowed the embassy move.

“That’s a victory. It’s a victory for us as the Palestinian people as it raised the issue of the right of return,” he said.

Hajjaj was referring to Palestinian demands to return to land they fled or were expelled from in 1948 during the war surrounding Israel?s creation.

– Israel, Hamas feel pressure –

But whether the protests will have a lasting impact is up for debate.

So far, there has been limited diplomatic fallout for Israel, although the dozens of dead have led to condemnation from a range of countries worldwide.

Turkey, Ireland, Belgium and South Africa took diplomatic measures, while others called on the Jewish state to show more restraint against unarmed protesters.

But the United States vetoed a UN Security Council motion calling for an independent probe into the deaths and the President Donald Trump’s administration blamed Hamas.

Mukhaimer Abu Saada, a politics professor at Gaza’s Al-Azhar University, said Hamas will be hoping for an easing of Israel’s blockade of the territory and for Egypt to open its border, largely closed in recent years.

“Under increased international pressure, Israel will have to come up with a solution to the deteriorating humanitarian situation in Gaza,” Abu Saada said.

Trump’s administration and other global powers have failed to come up with a unified position, said Hugh Lovatt of the European Council on Foreign Relations think-tank.

“The international community ultimately proved itself unwilling and unable to curb Israeli action,” he said.

“This further emboldened Israel.”

Mark Heller of the Institute for National Security Studies at the University of Tel Aviv said the Israeli government, seen as the most right-wing in the country’s history, would resist outside pressure.

“The government, in spite of the voices raised for an easing of the blockade, will not do anything because it does not consider Hamas can be a partner” for peace.

– ‘Big disappointment’ –

Three wars between Israel and Hamas since 2008 have devastated Gaza, while damage to Israel was relatively limited.

Hamas has started to adopt a new language, encouraging what it argues are peaceful protests.

Israel says protesters have used firebombs and explosive devices, while Israeli soldiers were fired upon at one point on Monday.

Only one Israeli soldier has been reported wounded since the protests began on March 30.

Officially the protests were due to end on Tuesday but Hamas leaders have said they will continue in some form.

Reham Owda, a political analyst in Gaza, said Hamas would face scrutiny over its strategy of encouraging thousands to the border for the “right to return” protests.

“Maybe we will witness some easing in the blockade, but for people who lost their sons, there will be a big disappointment.?

Some analysts say Hamas is not looking for a fresh war, knowing the impact would be severe on its already suffering people.

“But Hamas cannot afford to wave the white flag,” Heller said. “We must therefore expect sooner or later that new clashes are inevitable.”

Israeli drones have flown over protesters near the border dropping tear gas, largely without any armed reaction.

But on Tuesday evening as one flew over, plainclothed militants in the crowd rushed to grab their Kalashnikov rifles and fired round after round into the air, eventually bringing it down, an AFP journalist witnessed.

“Victory!” a man shouted.

by Joe Dyke

Israeli Defense Chief: Hamas Leaders ‘Bunch of Cannibals Who Use Children as Ammunition’

May 16, 2018

Avigdor Lieberman tours Gaza border two days after 60 Palestinians were killed by Israeli gunfire near fence as tens of thousands demonstrated

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Avigdor Lieberman near the Israel-Gaza border on May 16, 2018.
Avigdor Lieberman near the Israel-Gaza border on May 16, 2018. Eliyahu Hershkovitz

The leaders of Hamas are “a bunch of cannibals who also treat their own children as ammunition,” Defense Minister Avigdor Lieberman as he toured of the Gaza border area on Wednesday, two days after Israeli troops killed 60 Palestinians who were among tens of thousands demonstrating.

“Their goal is to lift the siege on Gaza, but not to build an economy or to speak about coexistence,” Lieberman said. “They need to lift the siege so they can smuggle weapons, continue to build up [their] power,” yet they remain unwilling to recognize Israel, he said.

Lieberman also referred to criticism of troops’ conduct on Monday and Palestinian discussions of turning to the International Criminal Court in The Hague, saying: “I suggest that everyone think about what would have happened if that rabble had succeeded in violating sovereignty and breaking into one of the communities.”

>> Hamas trying to use deadly Gaza clashes to secure humanitarian relief, Israel believes | Analysis >>

He asserted that the military “has acted in accordance with ethical norms that we have not seen anywhere else in the world.”  Lieberman accused critics of hypocrisy and said he has never heard critics of the army’s conduct condemning Syrian President Bashar Assad over the deaths of 600,000 people in Syria. “Every day in the Middle East, more than 100 people are murdered,” he said.

Commenting on the relative quiet on the Gaza border on Tuesday, Lieberman said there should be “no illusions” that Hamas has not given up its intentions to foment disturbances of the peace and “terror processions,” as he called the marches near the border. “But first of all, they have sustained a serious, significant blow,” which Lieberman said caused them to make a retreat.

On reports of unofficial channels of contact with Hamas, Lieberman said most of the emissaries represent only themselves and nothing substantial has come of their activities. “Our proposal remains openly and transparently on the table: rehabilitation [of Gaza] in exchange for demilitarization. It is not acceptable for them to be get quiet and a lifting of the siege only to continue building their power and smuggling weapons.”

Particularly since the Islamist Hamas movement forcibly took control of Gaza from the Palestinian Authority in 2007, Israel has restricted the movement of people and goods in and our of the coast enclave. Egypt, which also shares a short border with Gaza, also restricts  movement over its border.

As Haaretz has reported, between Monday evening and Tuesday morning, Hamas conveyed a series of messages to Israel via Egyptian intelligence official, apparently as well as mediation by the Gulf state of Qatar through which the group indicated that it wishes to rein in the violence following Mondays’ bloodshed.

Meanwhile, Hamas refused on Tuesday to accept two trucks full of medical equipment offered by the Israel Defense Forces. Following the reopening of the Kerem Shalom crossing to vehicles transporting goods, trucks carrying medical equipment and basic necessities arrived, including four from the Palestinian Authority, two from UNICEF, and two from the IDF. Hamas refused to accept the military’s equipment and instructed personnel not to unload it.

The Palestinian Health Ministry on Tuesday urged the world to send aid to Gaza in the form of medical equipment to help the enclave’s overburdened hospitals. Hamas’s refusal to accept the Israeli may stem from security considerations.

Turkey: Investors Lose Faith in Erdogan Economy — increasingly unpredictable policy making drives money away

May 16, 2018
Erdogan’s rule no longer seen as optimal result for markets — Turks head to polls to vote in early elections on June 24
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“Investors have become more downbeat on the economy’s longer-term prospects due to increasingly unpredictable policy making and the lack of reforms.”
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For the first time since he came to power in Turkey 15 years ago, investors aren’t so enthusiastic about the prospect of Recep Tayyip Erdogan winning another election.

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Concerned that the political-stability dividend of Erdogan’s rule no longer pays, they’ve been selling Turkish assets in the run-up to an early vote called for June 24, driving the lira to successive lows and yields on long-term government debt to the highest on record. Assurances that Erdogan is ultimately a pragmatist on economic issues have been replaced by fears that his single-minded focus on growth is running the economy into the ground.

“An Erdogan victory would be the worst possible outcome for the market as it would signal likely policy continuity,” said Paul Greer, who manages a $2 billion emerging-market debt fund at Fidelity International in London. “Albeit, this result would be the least surprising for Turkish markets.”

The popular support that Erdogan has commanded over the past 16 years has been a welcome substitute to revolving-door coalition governments that wreaked havoc on the economy in the 1990s, leaving investors conflicted about an optimal outcome at the polls next month. But money mangers from Aberdeen Asset Management Plc. to RAM Capital say this time is different, and an extension of his reign may not be taken well in markets.

Growth First

That’s largely because Erdogan, who remains the favorite in the race, shows no signs of backing down on populist economic policies to backstop break-neck economic growth. The Turkish economy grew faster than China’s last year, even as analysts cautioned that the pace was neither healthy nor sustainable, and urged measures to address growing economic imbalances.

“Turkey arrived at the level it’s at today due to growth-oriented policies,” the president’s office said in a statement last Wednesday after Erdogan convened an emergency meeting of policy makers to discuss the lira’s plunge. “In the period ahead, our country will also continue on its way with growth-oriented policies.”

New fiscal stimulus measures announced at the end of April are compounding concerns: investors say monetary policy is too loose to anchor the nation’s assets, the economy’s current-account deficit isn’t sustainable, and Erdogan’s distaste for higher interest rates is preventing the central bank from getting a lid on double-digit inflation.

Drifting Away

The anxiety isn’t confined to the economic sphere, either. Turkey has drifted away from its traditional allies in the West. It remains under emergency rule imposed after an attempted coup two years ago, and Erdogan’s increasingly autocratic rule is alienating two of its biggest sources of capital: Germany and the U.S., the latter of which is considering unprecedented sanctions against its NATO ally.

If a victory for Erdogan and his ruling party “means the continuation of the current unsustainable policies, then it is clearly not a good investment case,” said Viktor Szabo, who helps manage $14 billion in emerging-market debt at Aberdeen Asset Management Plc in London. “I’d be looking for a policy change which would accept slower, but more balanced growth, avoiding the boom-bust cycles.”

While Szabo adds that a return to the unpredictable politics of previous eras would probably be worse for investors than Erdogan staying around, he says it’s difficult to imagine his government changing tack, leaving the market “stuck between a rock and hard place.”

Changing Course

For some, the best hope is Erdogan and his government will change course. After securing a victory, the ruling AK Party will have little incentive to court voters with spending windfalls or prop up friendly construction companies with government contracts for mega infrastructure projects, that argument goes.

“Investors appear to be hoping that after the elections, the government will roll back efforts to promote growth at the expense of increasing vulnerabilities,” said ABN Amro economist Nora Neuteboom. “We are not convinced that such a normalisation will actually take place.”

In an interview with Bloomberg TV on Monday, the Turkish president said he intends to tighten his grip on the economy and the monetary policy if he wins the election. “This may make some uncomfortable. But we have to do it. Because it’s those who rule the state who are accountable to the citizens, ” Erdogan said. His remarks sent the lira to its weakest level ever against the dollar.

Turkey’s corporate sector is starting to buckle under a record $336 billion pile of foreign-currency debt while the lira plunges to record lows, making it more expensive to pay back. The nation’s overstretched banks rely on foreign inflows to keep growth ticking, and a development model based on domestic consumption and real estate looks to be out of steam. A global backdrop of dollar strength and higher U.S. interest rates is meanwhile laying bare the costs of years of growth fueled with borrowed money.

Long Term

“Turkey has been struggling economically for the last 3-4 years, maybe even longer,” said Ogeday Topcular, a fund manager at RAM Capital in London. “The political and economic decisions taken by this government have pushed the country towards a worse situation than before.”

So what to investors want to see now?

“Central bank independence, press freedom, a better foreign policy approach and relations with countries, a better Middle East strategy, and improved domestic policy,” Topcular said, adding that the track record suggests achieving any of that is a long shot.

At an election in June 2015, when it became clear that Turkey was headed for a hung parliament, the fear of political deadlock associated with multi-party rule sent markets into a tailspin. Foreign investors pulled $2.6 billion out of the bond market and volatility reined until Erdogan renewed the vote and AK Party won back its majority.

“The market has always seen an AK victory as positive, but that mainly seems to be because it reduces uncertainty, not because it promises better economic prospects,” said William Jackson, a senior emerging markets economist at Capital Economics in London. “Investors have become more downbeat on the economy’s longer-term prospects due to increasingly unpredictable policy making and the lack of reforms.”

https://www.bloomberg.com/news/articles/2018-05-16/voting-with-their-cash-investors-lose-faith-in-erdogan-economy

U.S. Sanctions Iran Central Bank Governor for Alleged Terrorist Support

May 15, 2018

Treasury sanctioned nine Iranians and companies last week

People walk by a mural in Tehran.

Photographer: Ali Mohammadi/Bloomberg

The U.S. Treasury Department imposed sanctions Tuesday on Iran’s central bank governor and another senior official in the bank for allegedly providing support for terrorist activities.

Treasury named Valiollah Seif, Iran’s central bank governor, and Ali Tarzali, the assistant director of the international department at the central bank of Iran, as “specially designated global terrorists” for allegedly assisting Iran’s Islamic Revolutionary Guards Corps-Quds Force to support Hezbollah. The U.S. accused Seif of playing a role in funneling millions of dollars on behalf of the Quds Force to support Hezbollah.

“It is appalling, but not surprising, that Iran’s senior-most banking official would conspire with the IRGC-QF to facilitate funding of terror groups like Hizballah, and it undermines any credibility he could claim in protecting the integrity of the institution as a central bank governor,” Treasury Secretary Steven Mnuchin said in a statement. “The United States will not permit Iran’s increasingly brazen abuse of the international financial system.”

The new sanctions cut off Iran’s access to a “critical banking network,” the Treasury Department said in a statement, adding that it seeks to “stifle Iran’s ability to abuse the U.S. and regional financial system.”

The action against Seif does not sanction the Central Bank of Iran, though the bank is targeted under sanctions President  Donald Trump reinstated when he withdrew from the Iran nuclear deal.

By Nov. 5, sanctions will be re-imposed on those engaging with “certain significant transactions” with Iran’s central bank.

The U.S. sanctioned nine Iranian citizens and companies on Thursday for allegedly operating a currency exchange network that — with the help of Iran’s central bank — transferred millions of U.S. dollars on behalf of the Quds force.

The action comes a week after Trump announced that the U.S. was pulling out of the Iran nuclear deal and reimposing sanctions that were in place before the 2015 agreement.

Seif is also under attack inside Iran. Half of Iran’s lawmakers have written to President Hassan Rouhani demanding the removal of the central bank chief, accusing him of mismanaging the banking industry and currency markets as the rial weakened.

https://www.bloomberg.com/news/articles/2018-05-15/u-s-sanctions-iran-central-bank-s-governor-and-another-official

US hits Iran central bank governor with sanctions

May 15, 2018

The United States slapped sanctions Tuesday on Valiollah Seif, the governor of the Central Bank of Iran, accusing him of helping the country’s Revolutionary Guard Corps transfer millions of dollars to Lebanon’s Hezbollah.

Image result for Valiollah Seif,, photos

ValiollahSeif, the governor of the Central Bank of Iran

In the second move in a week taking aim at the money networks of the Revolutionary Guards, or IRGC, the US Treasury also blacklisted a second central bank official, Iraq’s Al-Bilad Islamic Bank and its top two executives, and a liaison between IRGC and Hezbollah, which Washington has designated an international terrorist group.

The Treasury said Seif covertly moved “hundreds of millions of dollars” to Hezbollah from IRGC via Al-Bilad Islamic Bank.

Image result for Al-Bilad Islamic Bank, Photos
Al-Bilad Islamic Bank

Tuesday’s action seeks to cut off what the US called a “critical” banking network for Iran, and deny those blacklisted access to the global financial system.

“The United States will not permit Iran’s increasingly brazen abuse of the international financial system,” said US Treasury Secretary Steven Mnuchin.

“The global community must remain vigilant against Iran’s deceptive efforts to provide financial support to its terrorist proxies.”

On Thursday, the Treasury announced sanctions against a “large scale” currency exchange network serving the Revolutionary Guards, hitting six individuals and three companies at the center of the network.

At the time, the US singled out the Central Bank of Iran as “complicit” in the operation, foreshadowing Tuesday’s action.

The move against Seif came one week after President Donald Trump withdrew from the Iran nuclear accord and signalled plans to ratchet up pressure on the Iranian economy, and especially on the economic power of the Revolutionary Guards.

AFP

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