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Trump warns trading partners over business with Iran, escalating row with Europe

US President Donald Trump Trump warned that businesses and individuals that continue to work with Iran risk "severe" consequences
MANDEL NGAN (AFP)

Hours after the first wave of crippling US sanctions against Iran came into force at midnight on Tuesday, President Donald Trump issued a fiery message to international trading partners warning that continued economic cooperation with Iran would result in no further business with the United States.

"Anyone doing business with Iran will NOT be doing business with the United States," Trump tweeted. "The Iran sanctions have officially been cast. These are the most biting sanctions ever imposed, and in November, they ratchet up to yet another level."

"I am asking for WORLD PEACE, nothing less!" he added.

Shortly after, German multinational automotive corporation Daimler announced it was halting activities over US sanctions.

In May, President Donald Trump effectively withdrew from the 2015 nuclear agreement negotiated between Iran and world powers by announcing the phased re-imposition of sanctions lifted under the terms of the "horrible Iran deal", as it was labeled in the initial statement by the White House Monday.

His withdrawal has infuriated European partners who were determined to keep it alive and now find their businesses operating in Iran faced with the threat of US legal penalties.

The White House confirmed that at midnight on August 7, sanctions would be reimposed on trading with US dollars by the Iranian government, trade in gold and other precious metals, and trade in graphite, aluminum, steel, coal, and software used in industrial processes.

Transactions related to the Iranian rial, Iran's issuance of sovereign debt and the country's large automotive sector will also be sanctioned.

Iran's currency has been in steady decline since the start of the year as the country anxiously anticipates the re-imposition of full US sanctions, trading at record lows and losing nearly two-thirds of its value against the dollar.

Nevertheless, Trump left an opening to reengage in talks with Iran but not without calling out the regime for what he argues was left unaddressed under the original deal.

"As we continue applying maximum economic pressure on the Iranian regime, I remain open to reaching a more comprehensive deal that addresses the full range of the regime’s malign activities," Trump said towards the end of the statement.

ATTA KENARE (AFP)

Early on Tuesday morning, Iran dismissed the US offer to renegotiate despite President Hassan Rouhani suggesting after the announcement on Monday that negotiations would be possible if sanctions were first lifted.

"Negotiations with sanctions doesn't make sense. They are imposing sanctions on Iranian children, patients and the nation," the president said expressing concern that essential supplies such as medicines would be affected by the sanctions.

Rouhani said Iran had "always welcomed negotiations", though he used incisive language calling into question Washington's "trustworthiness".

"If you're an enemy and you stab the other person with a knife and then you say you want negotiations, then the first thing you have to do is remove the knife....How do they show they are trustworthy? By returning to the JCPOA," he said, using the technical name for the 2015 nuclear deal.

While the Trump administration has stated that it is not advocating a regime change in Iran, it has seemed to point to the regime as responsible for the "long-suffering Iranian people", who according to the statement are "the real victims of the regime’s policies."

"We look forward to the day when the people of Iran, and all people across the region, can prosper together in safety and peace," the statement concluded in a direct overture to the Iranian citizenry.

Olivier Matthys (POOL/AFP/File)

European Response

The White House statement also issue warning to "those who fail to wind down activities with Iran risk severe consequences," in contravention to the European parties to the nuclear deal, who are pushing to keep Iran on board with its obligations.

In a joint statement in response to the US re-imposition of sanctions, the UK, French, German and EU foreign ministers led by Representative Federica Mogherini, said they "deeply regretted the decision," arguing that Iran has complied with the agreement "as confirmed by the International Atomic Energy Agency (IAEA) in 11 consecutive reports."

The European partners said they expected Iran to continue to comply with its obligations under the 2015 Iran deal signed in agreement by the UN's permanent members (China, France, Russia, United Kingdom, United States), Germany, and the European Union.

"We are determined to protect European economic operators engaged in legitimate business with Iran," the statement said, explaining that special measures would become effective August 7th in order to "protect EU companies doing legitimate business with Iran from the impact of US extra-territorial sanctions."

“Preserving the nuclear deal with Iran is a matter of respecting international agreements and a matter of international security,” the European statement added.

Screenshot/YouTube

Israel Reaction

For Israel, the Trump decision is a major victory after a long-fought campaign by its leaders to convince the world of the Iranian threat.

"I congratulate President Trump and the US administration for making the important decision to impose sanctions on Iran. This is an important moment for Israel, the US, the region and the entire world," Prime Minister Benjamin Netanyahu wrote in a tweet Monday.

"The time has come to stop talking and to take action, and that is exactly what the US has done and what Europe should do," he added in a subsequent tweet.

In an elaborate televised presentation back in May, Netanyahu stood in front of a bookcase laden with binders he said held copies of top-secret documents and CDs retrieved by Israel in a stunning intelligence operation proving the existence of an alleged secret Iranian nuclear weapons program.

On Monday, Minister of Defense Avigdor Liberman suggested Trump's "courageous" decision was a historic one that "altered course on Iran," he wrote in a tweet earlier Monday.

"Misguided agreements and appeasement have been replaced by a resolute campaign to stop the murderous regime of the ayatollahs, that spreads terror, violence and hatred throughout the entire Middle East," he added.

The Intelligence Minister Israel Katz did not hide his hope that the sanctions would bring down Iran's current regime, despite American denials of such intentions.

“The first option is good, the second is excellent,” he tweeted referring to the two possible effects of the sanctions as either the termination of Iran's nuclear program or the collapse of the regime. “I welcome the US president’s tough and justified policies,” he added.

"It would be better of the Iranian regime would disappear entirely from the world," Public Security Minister Gilad Erdan said in an interview with Israel Radio, "but it would also be a blessing to see Obama's bad nuclear agreement replaced with a better one," he added.

He also said there was a "good chance" Iran will renegotiate the deal.

Earlier Monday, Iranian Foreign Minister Mohammad Javad Zarif said Monday that the leaders of the United States, Saudi Arabia and Israel were isolated in their hostility to Iran.

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