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US, Iran still doing business
08/07/2008 13:49 - (SA)
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| An Iranian shopkeeper shows American-branded items in his store in Tehran. (Hasan Sarbakhshian, AP) |
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Washington - US exports to Iran grew more than tenfold during President George W Bush's years in office even as he accused Iran of nuclear ambitions and helping terrorists.
America sent more cigarettes to Iran under Bush - at least $158m worth - than any other products.
Other surprising shipments to Iran during the Bush administration: brassieres, bull semen, cosmetics, fur clothing, sculptures, perfume, musical instruments. Top states shipping goods to Iran include California, Florida, Georgia, Louisiana, Michigan, Mississippi, New Jersey, North Carolina, Ohio and Wisconsin, according to an analysis by The Associated Press of seven years of US government trade data.
That list includes some solidly conservative Republican states where Bush's assertive foreign policy has been highly popular.
Despite increasingly tough rhetoric toward Iran, which Bush has called part of an "axis of evil", US trade in a range of goods survives on-again, off-again sanctions originally imposed nearly three decades ago. The rules allow sales of agricultural commodities, medicine and a few other categories of goods. The exemptions are designed to help Iranian families even as the United States pressures Iran's leaders.
"Our sanctions are targeted against the regime, not the people," said Adam Szubin, director of the Treasury Department's Office of Foreign Assets Control, which enforces the sanctions. The government tracks exports to Iran using details from shipping records, but in some cases it is unclear whether anyone pays attention.
Sanctions are intended in part to frustrate Iran's efforts to build its military, but the US government's own figures show at least $148 000 worth of unspecified weapons and other military gear were exported from the United States to Iran during Bush's time in office. That includes $106 635 in military rifles and $8 760 in rifle parts and accessories shipped in 2004, the data show.
Also shipped to Iran were at least $13 000 in "aircraft launching gear and/or deck arrestors," equipment needed to launch and recover jets on aircraft carriers, according to US records. Iran's navy is not believed to own or operate any carriers.
'That's something that would obviously concern us greatly'
Those numbers seem small, but military items can sell for pennies on the dollar compared with what the Pentagon paid. Last year, federal agents seized four F-14 fighter jets sold to domestic buyers by an officer at a California naval air station for $2 000 to $4 000 each, with proceeds benefiting a squadron recreation fund. When F-14s were new, they cost roughly $38m each.
Szubin said it was unlikely exports of military gear occurred, but the government was looking into it to be certain after the AP raised questions. He said shipping records are subject to human error, such as citing wrong commodity codes or recording "Iran" as the destination rather than "Iraq." The Treasury Department said on Monday it was still checking to see whether it could offer an explanation.
"That's something that would obviously concern us greatly and concern the whole administration," Szubin said in an interview with the AP. "And so when you presented us with the question in the last day we have called over to our colleagues in other government agencies, and you can be assured they're looking very carefully into it."
This year Bush signed legislation to prohibit the Pentagon from selling leftover F-14 parts. The law was prompted by AP's reports that buyers for Iran, China and other countries exploited Pentagon surplus sales to obtain sensitive military equipment that included parts for F-14 "Tomcats" and other aircraft and missile components. Two men were indicted in Florida last week on charges they shipped US military aircraft parts to Iran including Tomcat and attack-helicopter parts.
Iran received at least $620 000 in aircraft parts and $19 600 worth of aircraft during Bush's terms. Iran relies on spare parts from other countries to keep its commercial and military aircraft flying. In some cases, US sanctions allow shipments of aircraft parts for safety upgrades for Iran's commercial passenger jets.
The US government seems unco-ordinated on efforts to limit trade with Iran.
The Securities and Exchange Commission sought to shine a light on companies active in Iran but stopped after business groups complained. The Treasury Department allowed some companies and individuals suspected of illegal trading with Iran to escape punishment. Yet the Bush administration also has collected millions of dollars in fines from trade-rule violators and pressed Congress without success to pass laws to strengthen enforcement.
That the United States sells anything to Iran is news to some.
"Until you just told me that about Iran I'm not sure I knew we did any business with Iran," said Fred Wetherington, a tobacco grower in Hahira, Georgia, the chairperson of Georgia's tobacco commission. "I thought because of the situation between our two governments, I didn't think we traded with them at all, so I certainly didn't know they were getting any cigarettes."
Politically loaded
The United States sent Iran $546m in goods from 2001 through last year, government figures show. It exported roughly $146m worth last year, compared with $8.3m in 2001, Bush's first year in office. Even adjusted for inflation, that is more than a tenfold increase.
Exports to Iran are a politically loaded but tiny part of US trade. The United States counted more than one trillion dollars in world exports last year. The value of US shipments last year to Canada, America's top trading partner, was more than 1 000 times higher than to Iran.
Top US exports to Iran over Bush's years in office include corn, $68m; chemical wood pulp, soda or sulphate, $64m; soybeans, $43m; medical equipment, $27m; vitamins, $18m; bull semen, $12.6m; and vegetable seeds, $12m, according to the AP's analysis of government trade data compiled by the World Institute for Strategic Economic Research in Massachusetts. The value of cigarettes sold to Iran was more than twice that of the No 2 category on the export list, vaccines, serums and blood products, $73m.
Iran is a top customer of Alta Genetics Inc, a Canadian company with an office in Wisconsin, that sells bull semen, used to produce healthier, more profitable cattle. "The animals we're working with are genetically superior to those in many parts of the world," said Kevin Muxlow, Alta's global marketing manager.
Also getting Bush administration approval for export to Iran were at least $101 000 worth of bras; $175 000 in sculptures; nearly $96 000 worth of cosmetics; $8 900 in perfume; $30 000 in musical instruments and parts; $21 000 in golf carts and-or snowmobiles; $4 000 worth of movie film; and $3 300 in fur clothing.
Few people or companies asking US permission to trade with Iran are turned down by the Treasury Department, the lead agency for licensing exports to sanctioned countries. During Bush's terms, the office has received at least 4 523 licence applications for Iran exports, issued at least 2 821 licences and 213 licence amendments and denied at least 178, Treasury Department data show.
Neither the Treasury data nor trade data compiled by the Census Bureau identify exporters or specify what they shipped. AP requested those details under the Freedom of Information Act in 2005 and still is waiting for the Treasury Department to provide them.
Household names
Though some trade with Iran is legal, some businesses prefer that people not know about it.
Citing corporate financial reports, the Securities and Exchange Commission published a list online last year of companies that said they had done business in Iran or four other countries the State Department considers state sponsors of terror. The SEC withdrew the list after business groups complained but is considering releasing one again.
"There's no question that people are looking for that kind of information," SEC spokesperson John Nester said. "But under the current disclosure regime, it's beyond most people's abilities and time to slog through every corporate report and find companies that make reference to one of those nations."
Business groups oppose publishing such lists. It "could inappropriately label companies with legitimate activities as supporters of terrorism," the European Association of Listed Companies told the commission this year.
An AP photographer strolling through shops in Tehran had no problem finding American brands on the shelves. An AP review of corporate SEC filings found dozens of companies that have done business in Iran in recent years or said their products or services may have made it there through other channels. Some are household names: PepsiCo, Tyson Foods, BP Amoco, Exxon Mobil, GE Healthcare, the Wells Fargo financial services company, Visa, Mastercard.
- AP
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