Iran Says Trump’s Financial Sanctions On Khamenei End Diplomatic Solution To Crisis

US-Iran Tensions
A Super Hornet launches from the flight deck of USS Abraham Lincoln in the Red Sea (Photo: Reuters)

President Donald Trump has ceded the strategic advantage to Iran by imposing what he claimed were "hard-hitting" financial sanctions against Iran's supreme leader, Ayatollah Ali Khamenei, and his close circle of advisers.

On Monday, Trump signed an executive order denying Khamanei access to all of his financial assets under U.S. jurisdiction.  He said Khamenei and his associates are ultimately responsible for what he said is "the hostile conduct of the (Iranian) regime".

"Sanctions imposed through the executive order ... will deny the supreme leader and the supreme leader's office, and those closely affiliated with him and the office, access to key financial resources and support," said Trump.

Some analysts, however, said the sanctions against Khamenei are useless. They noted most of Khamenei's wealth (estimated at anywhere from $100 to $200 billion) remains within Iran.

Khamenei is believed to have minimal investments abroad, and probably a much smaller amount in American financial institutions that can now deny him access to these funds.

Almost all of Khamenei's wealth is derived from revenues earned by "Setad," or the Headquarters for Executing the Order of the Imam. Originally a charity, Setad under Kahmanei has morphed into an economic powerhouse.

It owns large tracts of real estate throughout Iran and controls 37 companies operating in most sectors of the Iranian economy, including finance, oil, and telecommunications.

The vast wealth accumulated by Setad gives Khamenei the financial resources to operate independently of the Iranian state and the national budget. It also insulates him from Iran's internecine factional infighting.

Iran apparently reacted with delight to the sanctions against Khamenei. Western political analysts said that by closing the door to negotiations with these sanctions, and by showing Iran his unwillingness to use military force against it, Trump has effectively left himself at the mercy of the Iranians.

They noted Trump's twin errors were tantamount to giving Iran a blank check to do as it pleases with little fear of American military reprisals. Whether Iran will push this advantage to the brink of war is another matter altogether, however.

Iran said on Tuesday Trump's new sanctions permanently shut the door to diplomacy between Iran and the United States.

"Imposing useless sanctions on Iran's Supreme Leader (Ayatollah Ali Khamenei and the commander of Iran's diplomacy (Foreign Minister Mohammad Javad Zarif) is the permanent closure of the path of diplomacy," tweeted Foreign Ministry spokesman Abbas Mousavi.

"Trump's desperate administration is destroying the established international mechanisms for maintaining world peace and security."

© 2019 Business Times All rights reserved. Do not reproduce without permission.
Sign Up for Newsletters and Alerts