The Humanitarian Impact of Sanctions on Iran

John Bolton

With the Trump Administration and chief warrior Michael Pompeo imposing even more intense sanctions on Iran's leadership, thanks largely to the American's assassination of Qassem Soleimani:

…one has to question what four decades of economic restrictions on Iran have actually accomplished.  As you will see in this posting, the sanctions have accomplished one thing; jeopardizing the lives of ordinary Iranians who need to access Iran's health care system.

Let's open this posting by looking at a list of sanctions against Iran.  Here is a list of Executive Orders regarding sanctions on Iran from the Department of State website:

Note that the first sanctions were imposed during the Clinton Administration back in 1995.

Here is a list of press releases since May 2018 when Washington withdrew from the JCPOA from the Department of State regarding sanctions on Iran:

As you can see, the Department of State has spent a great deal of energy over the past 18 months on its sanctioning of Iran.

While Donald Trump and his cronies have repeatedly assured the Iranian people that they "stand with them", a recent report by Human Rights Watch (HRW) suggests exactly the opposite.  In the report entitled "Maximum Pressure", the authors examine the impact of the current sanctions, particularly those on Iranian banks, on Iranians' right to health and access to essential medicines needed for many conditions.  While the sanctions have allegedly been designed to exempt humanitarian imports into Iran, the sanctions against Iran's banking sector has deterred international banks from participating in transactions with Iran, including those that involve humanitarian aid, for fear of reprisal (through the imposition of secondary sanctions) from the United States.  In fact, it appears that the pain that United States sanctions are causing ordinary Iranian citizens is deliberate as you can see in this interview with CBS from February 2019 where he both says that the sanctions are showing signs of success because the Iranian people are suffering and that the United States is not targeting ordinary Iranians as quoted here:

"Things are much worse for the Iranian people (thanks to the sanctions) and we are convinced that it will lead the Iranian people to rise up and change the behaviour of the regime".

As background, between November 2018 and October 2019, Human Rights Watch interviews a variety of Iranian medical professionals, importers of medicines, employees of Iranian and international pharmaceutical companies, lawyers, trade specialists familiar with humanitarian trade in Iran and NGO workers. 

Let's look at HRW's findings.  Iran produces 97 percent of all pharmaceuticals consumed domestically, however, the three percent of imported medicines constitute 30 percent of the value of Iran's medical market; the majority of these drugs are for treating rare diseases and multiple forms of cancer for which there are no alternatives.  HRW found that at least 240 of the 433 imported drugs are on the World Health Organization's list of essential medicines.   An additional complication is also present in Iran; one-third of Iran's domestically produced medicines depend on imported materials for their manufacture.

Not only are pharmaceuticals a problem for Iran in the current sanctions environment.  Iran relies heavily on imported medical equipment with 70 percent of the country's medical equipment being imported including items ranging from hospital beds to Magnetic Response Imaging (MRI) equipment.  When the equipment can be imported, there is an additional problem; the plunging value of Iran's currency, the rial, makes purchasing foreign-made medical equipment extremely expensive.  This has resulted in Iran's government designating a subsidized exchange rate of 42,000 rials to the United States dollar (compared to the free market rate of 180,000 rials to the USD in early 2019) which enables importers to purchase more than 5,000 items of medicine and 22,000 items of essential medical equipment at the subsidized rate.  This excludes thousands of items; for example. of the 2,000 imported dental products and equipment used in Iran, only 392 items qualify for the subsidized exchange rate.

In order to meet the strict sanctions guidelines as set out by Washington, the medical and banking sector (particularly in the Eurozone) is invoking "over compliance" to avoid punishment by the United States for breaching its sanctions laws.  Here is just one part of the sanctions law that foreign nations are expected to obey:

"The Comprehensive Iran Sanctions, Accountability, and Divestment Act (CISADA) was a key piece of legislation intended to limit Iran’s access to the international financial system and to reduce the ability of Iran’s import-export community (referred to in Iran as the “bazaar merchants” or “bazaaris”) from obtaining “letters of credit” (trade financing) to buy or sell goods. The Department of the Treasury determines what is a “significant” financial transaction.

CISADA’s key provision—Section 104—requires the Secretary of the Treasury to forbid U.S. banks from opening new “correspondent accounts” or “payable-through accounts” (or force the cancellation of existing such accounts) for:37

1.) any foreign bank that transactions business with an entity that is sanctioned by Executive Order 13224 or 13382 (terrorism and proliferation activities, respectively). No humanitarian exception is provided for. These orders are discussed above. A full list of such entities is at the end of this report, and entities “delisted” are in italics.

2.) any foreign bank determined to have facilitated Iran’s efforts to acquire WMD or delivery systems or provide support to groups named as Foreign Terrorist Organizations (FTOs) by the United States.

3.)any foreign bank that facilitates “the activities of” an entity designated under by U.N. Security Council resolutions that sanction Iran.

4.) any foreign bank that transacts business with the IRGC or any of its affiliates designated under any U.S. Iran-related executive order."

Fear of American reprisal has led several pharmaceutical and medical equipment companies (including France's Roquette, Sweden's Gentige and Germany's JRS Pharma) to preemptively terminate their contracts with Iran.

Obviously, this has had an impact on Iranians requiring medical care.  While there is no widespread shortage of medications (yet), doctors report that patients with rare diseases are finding it increasingly difficult to access the medications needed for their treatment.   Not only is access more difficult but affordability of medications is becoming a significant problem.  According to the Statistical Center of Iran, the cost of health care for families rose by 18.8 percent over the past year.  In addition, the quality of imported raw materials used to manufacture pharmaceuticals in Iran are often lower than what Iran would normally be able to access, resulting in serious side effects that would not normally occur.

To give us a brief glimpse into the scope of the problem caused by Washington's sanctions, let's look at this quote from the HRW report:

1.) Cancer: 

"In November 2018, researchers affiliated with MAHAK Pediatric Cancer Treatment & Research Center, an NGO that treats children with cancer, published a list of drugs needed to treat leukemia.[85] Documents reviewed by Human Rights Watch showed that in May 2019, the NGO lacked pegaspargase, mercaptopurine, and vinblastine, three chemotherapy medications, all of which are on the WHO list of essential medicines.

On July 30, Arasb Ahamdian, the head of MAHAK’s hospital told Euro News Persian service: “When it comes to cancer, the significant portion of medicine that children under our care use  fall under the 5 percent imported category that are very expensive and difficult to find.”.  Several foreign media outlets have reported about patients, particularly children with cancer, suffering from lack of access to vital medications.

2.) Epilepsy:

"On January 5, 2019, the official Islamic Republic of Iran News Network quoted Nesbi Tehrani, executive director of Iran’s Epilepsy Society, as saying that epilepsy patients face a shortage of medication as a result of sanctions.  “Some epilepsy patients are resistant to treatment and have to consume new foreign-made medicine that does not have a domestic alternative, but sanctions have caused a shortage in their medication,” he said. According to a study conducted by Iranian researchers on 242 epilepsy patients in Iran, 72 percent of patients who used imported anti-epilepsy drugs reported significant difficulty in accessing their medication during the period between August 2018 and February 2019. In comparison, 30 percent of patients who used domestically produced medicine reported significant difficulty in accessing their essential medication during the same period."

I believe that is enough to digest for this posting.  With the ever-tightening sanctions noose around Iran, the humanitarian/medical crisis facing ordinary Iranians is likely to get far worse  over the coming months as stockpiled supplies of pharmaceuticals and medical equipment are consumed.  It will be interesting to see if future studies like this show that Iranians are dying because of the lack of medical trade with Iran.

Despite the imposition of more and more sanctions on Iran, it is still very unclear as to whether these sanctions will actually achieve what Washington wants.  In many cases, Iran included, the imposition of sanctions by the United States serves one function; it creates additional hatred for all things American and drives the citizens of the targeted nation into a nationalist mindset where they far prefer their own reality to the great unknown future that may result if their leadership changes.  Just ask the people of Iraq and Afghanistan how they feel about the imposition of the American version of freedom that has been imposed on them.

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