White House decides to choke off Iran's metal exports revenues
The United States is determined to choke off external funding to Iran to prevent it from financing missile development, fomenting regional conflicts and funding terrorist networks, White House trade adviser Peter Navarro in the article for the Financial Times.
Much of Iran’s money comes from metal exports, including $4.2 billion from the sale of steel, which is a 53% increase from 2017, Navarro noted. The country is on schedule to become a net exporter of aluminium by the end of the year.
"That is why US President Donald Trump signed a tough new executive order last week, extending existing sanctions to include Iranian aluminium, copper, iron and steel. Without such sanctions, Iran’s steel export revenues will increase significantly," the article reads.
Most, if not all, of Iran’s export revenues from the metals trade flow right into government coffers. The country’s top three steel producers are all state-owned and account for more than 50 per cent of production. An emerging aluminium industry is entirely state-owned, growing rapidly and was projected to be a net exporter this year.
Iran’s top steel export markets currently include Indonesia, Thailand, Iraq, Turkey, Oman, the United Arab Emirates, Taiwan and Egypt. "The new sanctions should turn the flow of Iranian metals to these markets into a trickle as America’s partners and allies respond to the higher risks of sourcing materials from Iran and seek out more reliable, alternative sources of supply that do not fund terror with the proceeds," Navarro wrote.
According to him, the proposed sanctions should curtail any attempts by Iran to "trans-ship" steel and other metals into the U.S. through third-party countries — a scheme that undermines the pre-existing steel and aluminium tariffs the president has imposed for national security reasons.
These new sanctions will also send a clear signal that China may pay a heavy price if it continues to support rogue regimes, including Iran. Navarro recalled that historically, China has provided Iranian steel producers with much of the investment, equipment and strategic advice necessary to expand its industry.