Could America’s hardline policies towards Iran be a dilemma for Arab countries?

US Secretary of State Mike Pompeo has announced new economic sanctions and a more hardline American policy towards Iran. How are Middle Eastern nations likely to react?

Iran protests

On Monday, US Secretary of State Mike Pompeo gave a speech in which he said that the US will “crush” Iran by the means of economic sanctions and military pressure. The Trump administration’s new policy on Iran comes just weeks after the US withdrew from the Iran nuclear deal. Pompeo said that the US is now intent on restraining Iran’s influence in the Middle East and ensuring that Tehran is never able to develop nuclear weapons. But many political analysts and pundits in Washington say the new policy amounts to one of regime change.

Some Arab countries will likely welcome this new tougher US policy. Saudi Arabia, Iran’s arch-rival in the region, has openly called the Iranian regime a member of the “axis of evil” in the past. Saudi Arabia, along with Qatar, Bahrain, Kuwait and Oman, is a member of the Gulf Cooperation Council (GCC), which may also back Washington’s policy to isolate Iran. Earlier this month, GCC Secretary General Abdullatif al-Zayani said that Iran should have to meet certain requirements such as “the completion of the nuclear file in terms of inspection, not providing terrorists with ballistic missiles, respecting UN Security Council resolutions and non-interference in neighboring countries.”

Dr. Mohamad Ezz al-Arab, a political expert at the Al-Ahram Center for Strategic Studies in Cairo added that elites in Gulf nations such as Saudi Arabia, the United Arab Emirates and Bahrain view Iranian influence to be “very dangerous” for their security due to Iran’s support for militias such as Hezbollah in Lebanon and Syria or the Houthis in Yemen. Speaking to DW, he also noted that the US role in the region is to bolster Israel’s security and support governments of countries such as Saudi Arabia that align with US interests.

Saudi Arabian Foreign Minister Adel al-Jubeir and US Secretary of State Mike Pompeo (Reuters/F. Al Nasser)Saudi Arabian Foreign Minister Adel al-Jubeir meets with US Secretary of State Mike Pompeo

The US as new regional police?

But Iranian political analyst and former diplomat Said Hadi Afaqhi told DW that countries which support the new US policy on Iran could face negative repercussions. “The American desire to change the balance of the region runs contrary to the interests of Russia and Arab countries,” he said. Greater US intervention in the case of Iran could mean that the US is becoming more of watchdog in the Middle East. If Arab countries refuse to act in a way that the US wants and step out of line with American policy, they too could face economic sanctions or isolation from the American administration. He warned that Arab countries should refrain from “applauding” Trumps hardline policy towards the Islamic Republic.

Saudi Arabian vs. Iranian competing influence in the Middle East Saudi Arabia and Iran are in a power struggle and use proxies to push their interests in the Middle East.


Afaqhi also argued that Iran does not intervene in the conflicts of Arab countries without the permission of the governments in those countries. “It is not for America to determine what Iran should or should not do. Iran has entered Syria and Iraq at the invitation of the government officials there,” he said. He also said that Iran’s dispute with Saudi Arabia and other Gulf States is a matter for those countries to decide – not the US. “In regards to the nuclear agreement, Iran was able to reach an understanding with the US, EU and other great powers, so why is Iran seen as not being able to deal with its neighbors?” he argued.

What future for Iran?

One Middle Eastern country that is sure to take Iran’s side in the face of this new hardline policy from the US is Syria, as the Iranian government financially backs the Assad regime in Damascus. And Holly Dagres, an Iran analyst and curator of The Iranist newsletter, says past experience shows that Iran’s influence in the region is unlikely to dwindle, despite the renewed sanctions and American pressure. “We have have to remember that when the Syrian uprising started and Iran intervened on the behalf of Bashar Assad’s government, the country was under the worst sanctions in its history, which were implemented by the Obama administration, ” she told DW.

Watch video03:53

US foreign policy planner: Iran must behave ‘like a normal nation’

If anything, Dagres believes that the Iranians will continue to expand their influence in the region. “After decades of international isolation, Iran has managed to circumvent sanctions in numerous ways, whether by working the middleman, the black market, or trading with countries that the American sanctions enforcement agency OFAC cannot reach. If Iran wants something to be done, it will find a way,” Dagres concluded.

Every evening at 1830 UTC, DW’s editors send out a selection of the day’s hard news and quality feature journalism. You can sign up to receive it directly here.


Pompeo unveils US Iran plan: Economic strife, break with EU

The secretary of state has outlined a hard-line Iran strategy that is likely to deepen the chasm between the EU and US. Analysts and former US officials say the plan is incoherent and dangerous.

Mike Pompeo US Außenminister (picture-alliance/AP Photo/J. S. Applewhite)

The Trump administration threatened Iran with “unprecedented financial pressure” on Monday, issuing a laundry list of harsh requirements demanding Tehran change its foreign and domestic policies.

In a speech touted to outline the administration’s strategy toward Iran, Secretary of State Mike Pompeo promised “the strongest sanctions in history” should Tehran not buckle to US demands.

Pompeo’s speech comes nearly two weeks after President Donald Trump pulled out of the Iran nuclear deal and reimposed sanctions lifted under the Joint Comprehensive Plan of Action (JCPOA), the 2015 accord that Iran signed with Russia, China, the United States, Britain, France and Germany.

Read more: What is the Iran nuclear deal?

“The sting of sanctions will only grow more painful if the regime does not change course from the unacceptable and unproductive path it has chosen for itself and the people of Iran,” Pompeo said at the conservative Heritage Foundation think tank in Washington, DC.

Pompeo said the United States would not try to renegotiate the JCPOA. Instead, any new deal would require Iran to meet 12 demands, including halting its ballistic missile program and ending interventions in Syria and Yemen, as well as wide-ranging concessions on its civilian nuclear program. Pompeo added that the United States and its partners in the Middle East would “crush” Iranian operatives and regional allies such as the Lebanese Shiite group Hezbollah.

Iran shoots back

Several hours later, Iran President  Hassan Rouhani decried Pompeo’s threats, saying Washington had no right to make decisions for his country.

“All world countries want independence in their decisions, and the Americans may advance their agenda in some places through pressure, but logic does not accept them making decisions for the world,” Rouhani was quoted by state broadcaster Press TV as saying. “Who are you to decide for Iran and the world?”

Iran’s top diplomat, Javad Zarif, described Pompeo’s plan as “regression to old habits.” In a Twitter post, he chided the Trump administration  for being “imprisoned by
delusions, failed policies and dictated to by corrupt special interest.”

Javad Zarif


US diplomacy sham is merely a regression to old habits: imprisoned by delusions & failed policies—dictated by corrupt Special Interest—it repeats the same wrong choices and will thus reap the same ill rewards. Iran, meanwhile, is working with partners for post-US JCPOA solutions.

Not a strategy

Analysts and former US officials said the Trump administration revealed that it had little desire for a diplomatic solution, but looked rather to be pursuing a policy of economic pressure designed to topple the Iranian regime.

“This isn’t a strategy. It is an unprioritized and internally incoherent wish list,” said Jarrett Blanc, who was coordinator for implementation of the agreement at the State Department under the Obama administration. “It is a fantasy of regime change without the resources or leverage. It is, obviously, also an insult to our European allies.”

Read more: Iran’s military power

Washington’s hard-line policy of economic warfare is likely to further strain relations with allies already angry at Trump for withdrawing from the nuclear deal despite their lobbying and Iran’s compliance.

EU leaders are now scrambling to ensure that Iran receives the economic benefits it was promised in order to remain in the deal. Among other things, they are considering implementing a blocking statutethat would protect EU firms that do business with Iran and another measure to have EU governments make direct money transfers to Iran’s central bank.

Pompeo made it clear that the United States expects the support of regional and global allies, including the European Union. Though he said he believed that the EU would follow the United States because they shared “values,” he also doubled down on threats to target European entities doing business with Iran.

However, EU Foreign Policy Chief  Federica Mogherini accused Pompeo failing to show how pulling out of the nuclear accord would make the region safer or “how it puts us in a better position to influence Iran’s conduct in areas outside the scope of the JCPOA.”

Mogherini went on to stress that the EU would remain committed to the deal as long as Iran abided by its nuclear-related commitments, “as it is doing so far.”

Read more:  European allies struggle to curb impact of US sanctions 

Watch video01:50

EU unites against Trump over US sanctions on Iran

‘Fissure,’ ‘trans-Atlantic rift’

Ali Vaez, the director of the Iran Project at the International Crisis Group, said the Trump administration had made it clear that EU leaders had wasted their time trying to convince the president to remain a party to the deal, and that there was now a “fissure in the middle of the Atlantic.”

“Its message to Europe is now clear: ‘Join me in changing not Iran’s behavior, but its regime,'” Vaez said. “Pompeo’s speech further proved that there is no middle ground to be explored with the Trump administration. Europe should take its fate in its own hands.”

The US strategy appears to be to apply economic pressure that will create domestic political instability in Iran that will challenge the regime directly. However, unilateral US sanctions are unlikely to be as effective as the international measures that had brought Iran to the table to negotiate the JCPOA.

Those international sanctions were punishing, but they were only effective because of their international scope. For China, Russia and the European Union, going back to those sanctions is a nonstarter so long as Iran complies with the nuclear accord.


Watch video00:27

German chancellor expresses EU support for Iran nuclear deal at meeting with Putin.

Read more: No clear benefit from Trump’s reimposing sanctions on Iran

“The idea of reapplying sanctions, which will hammer the Iranian people under the guise of helping them, is not only deeply incoherent, it also directly undermines the chosen policy approach of America’s European allies,” said Esfandyar Batmanghelidj, the founder of the Europe-Iran Forum, a business network.

“Europe is continuing to bet on dialogue and engagement, including economic engagement, and is getting results, so far keeping the Iranians in the agreement after Trump violated and abrogated the deal,” he said. “The trans-Atlantic rift is only getting deeper.”

Meanwhile, analysts said the US’s violation of the JCPOA had only reinforced perceptions in Iran that the United States cannot be trusted. The Trump administration’s calls for Iranians to rise up against the country’s leaders and veiled threats of regime change will also harden the Iranian leadership’s resolve.

“Even if the US could inflict maximum pressure on Tehran, such onerous measures are unlikely to persuade an Iranian leadership seemingly convinced that the only thing more dangerous than this threat would be to surrender to it,” Vaez said. “The Trump administration might believe that it has devised a new Iran strategy, but, in the eyes of the Iranian leadership, this is par for the course.”

Every evening at 1830 UTC, DW’s editors send out a selection of news features. You can sign up to receive it directly here.

Watch video04:13

What is it like doing business in Iran?


Egypt’s Sisi Clamped Down on Political Opposition—Next Up Is the Economy

The military has amassed a growing business empire under the former general-turned-president, leading to renewed popular resentment

Egyptian President Abdel Fattah Al Sisi speaks during the inauguration of an agricultural project at a military base. AGENCE FRANCE-PRESSE/GETTY IMAGES

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  • CAIRO—Three years ago, President Abdel Fattah Al Sisi’s government announced that a gleaming new capital city would rise in Egypt’s eastern desert by 2022, featuring tree-lined boulevards, new homes for five million people and the tallest building in Africa.

    The project is now well behind schedule, according to its military-controlled developer. The only finished structure is a military-owned hotel in a cream-colored compound. Project spokesman Khaled El Husseiny said just one of three phases is under construction. “We did not plan for anything other than the first phase, I have to be honest,” he said.

    President Sisi won re-election in March with 97% of the vote, facing only a token challenger after every credible opposition candidate was jailed or removed from the race. Within the Arab world, Mr. Sisi’s continued rule is an example of the resurgent regimes that increasingly claim victory over the forces unleashed by the 2011 Arab Spring.

    The site of a planned new administrative capital in Egypt’s eastern desert.
    The site of a planned new administrative capital in Egypt’s eastern desert. PHOTO: AHMED GOMAA/XINHUA/ZUMA PRESS

    Egypt is also an example of how those same forces are bubbling just under the surface. In many ways, Mr. Sisi’s strategy mirrors that of former President Hosni Mubarak, whose nearly three-decade rule here was ended by popular uprising. Like Mr. Mubarak, Mr. Sisi has relied on a vast security state and an economic approach that privileges the military. Many in the business sector complain that Mr. Sisi has gone even farther in sidelining private enterprise, to the detriment of the economy.

    “They trust the military first. And the private sector, they accept them,” said Naguib Sawiris, a billionaire who says some of his own Egyptian business plans have been thwarted by state intervention. “The security can block any project. They have their own companies now. It’s not a good situation.”

    Arab Winter

    Egypt is doing better than many of its peers in overall economic growth since the Arab Spring, but ordinary Egyptians remain plagued by a soaring cost of living and high unemployment.

    GDP growth






























































    Source: World Bank

    Egypt’s economy is growing at a modest clip of about 5.4%, according to the central bank. But for the vast majority of Egyptians, living standards have been slipping amid high youth unemployment and rising food prices, fueling some of the same grievances that preceded the revolution—and raising the prospect of a repeat.

    Inflation and economic malaise have triggered demonstrations across the wider Middle East in recent months. In Iran in December and January, economic frustration sparked more than a week of protests that left at least 20 people dead. In Tunisia, budget cuts triggered raucous demonstrations and clashes with security forces in 10 cities and towns coinciding with the anniversary of the ouster of long time strongman Zine Al Abedine Ben Ali. In Jordan, sit-ins and other protests took place in January in reaction to the rising price of bread. Spontaneous protests erupted in Egypt earlier this month after the government announced a surprise increase in the price of subway tickets.

    Riot police recently guarded a metro station at Tahrir square in the center of Cairo, a focal point of protests during the Arab Spring.
    Riot police recently guarded a metro station at Tahrir square in the center of Cairo, a focal point of protests during the Arab Spring. PHOTO: AMR ABDALLAH DALSH/REUTERS

    In the Gulf, wealthy monarchies count Egypt’s government as a firewall against a repeat of the popular upheaval.

    “I prayed to God that Egypt would not collapse,” said Saudi Arabia’s Crown Prince Mohammed bin Salman during a visit to Cairo in March.

    A former commander of the armed forces, Mr. Sisi surged to power after he led the overthrow in 2013 of the elected Islamist President Mohammed Morsi. Following the coup, security forces cracked down on Mr. Morsi’s supporters and other political opponents, killing at least a thousand people and jailing tens of thousands of others, according to rights groups.

    Mr. Sisi promised Egyptians stability and prosperity, claiming credit for steering Egypt away from the turmoil and war that engulfed other Arab countries such as Syria, Libya, and Yemen.

    For a time, Mr Sisi enjoyed cult status. His inspired supporters stamped his likeness on everything from chocolates to women’s underwear.

    But the sheen has worn off his presidency. Stability has proved elusive as the government struggles to halt attacks by militant groups, including the Islamic State which has killed hundreds of soldiers and civilians in recent years.

    Discontent has even surfaced within the same military establishment that brought Mr. Sisi to power. Since December, the government has detained and sidelined a series of opponents who stepped forward to challenge the president in the election, including three current and former military officers.

    Although Mr. Sisi has helped expand the military’s economic profile, would-be opposition candidates from military backgrounds assailed the president’s record on security, the economy, and a lack of political freedoms.

    Mr. Sisi’s office didn’t respond to a request for comment. Egypt’s armed forces spokesman declined to comment.

    Analysts say Mr. Sisi sees himself as a part of a world-wide cohort of strongman rulers. Prior to Egypt’s vote, he made a point of congratulating Russia’s President Vladimir Putin on his victory in a scripted election. He also lauded China’s President Xi Jinping, who just became China’s de facto leader for life.

    A Cairo market, where signs of inflation abound.
    A Cairo market, where signs of inflation abound. PHOTO: KHALED DESOUKI/AGENCE FRANCE-PRESSE/GETTY IMAGES

    Egypt’s military has played a major role in the economy for decades. Business ventures helped the armed forces offset budget cuts imposed by Mr. Mubarak in the years following the 1978 peace treaty with Israel. By the end of Mr. Mubarak’s 30 years in power, the military owned supermarkets and hotels and also made pasta as well as weapons, taking advantage of its tax-exempt status and access to cheap labor in the form of conscripted soldiers.

    But under Mr. Sisi, the military has achieved new heights of economic power. The exact percentage of the economy controlled by the armed forces is impossible to calculate, as military-linked enterprises don’t disclose their profits and the details of the military’s budget aren’t made public. Any accounting by government watchdogs is now even harder, since Egypt’s former chief corruption auditor is on military trial after he joined an opposition presidential campaign and threatened to release incriminating evidence about the military leadership.

    In an interview with state TV in March, Mr. Sisi said the military makes up only 2% to 3% of the economy. “If it was 50% I would have been proud,” he said. “The armed forces are part of the government.”

    Experts believe the true size of the military’s economic role is much higher than the official figure, based on observations of army-led enterprises.

    “He doesn’t trust the private sector. He doesn’t trust businessmen,” said Andrew Miller, a former official responsible for Egypt at the U.S. National Security Council.

    When Mr. Sisi came to power, he turned to the military to help fix the stumbling economy. He assigned the Armed Forces Engineering Authority to organize an expansion of the Suez Canal, one of his signature megaprojects.

    With Mr. Sisi’s blessing, the military soon encroached on civilian enterprises too. The government discarded a civilian-authored plan to parcel out land along the canal to build an industrial zone and port area. He instead awarded a pair of contracts, including one to a partnership between the military and a private developer, according to Ahmed Darwish, the former chairman of the Suez Canal Economic Zone. To date, the planned zone hasn’t materialized, although the government says it is pressing ahead with the project.

    Mr. Darwish was later replaced at his post by Admiral Mohab Mamish, a military leader who also heads the Suez Canal Authority. Several other business-oriented civilian officials have departed Mr. Sisi’s government over the years, including two economists who served in previous cabinets, leaving the military even more dominant.

    The military also exerts influence through a diffuse network of current and former officers who sit on corporate boards and own stakes in private businesses. Those holdings help the military class gain control and profit even from enterprises it doesn’t directly own.

    “They just have a finger in every pie,” said Shana Marshall, an expert on Egyptian political economy at George Washington University.

    Military and security officials have orchestrated a takeover of at least three major privately owned television channels in the past two years. A former military spokesman took charge of the satellite channel Al Asema in January 2017. A security company headed by a former military intelligence official took over Al Hayat TV in mid-2017.

    The takeover rolled back the influence of some of Egypt’s most powerful civilian businessmen. Mr. Sawiris, the former owner of popular network OnTV, said the government asked him to fire at least three news anchors. When he refused, the network OnTV was taken over by a pro-government steel magnate, before his shares were sold to a company owned by Egypt’s intelligence service in 2017.

    Egyption billionaire Naguib Sawiris says some of his business plans have been thwarted by state intervention
    Egyption billionaire Naguib Sawiris says some of his business plans have been thwarted by state interventionPHOTO: SIMA DIAB/BLOOMBERG NEWS

    Mr. Sawiris said the security forces also have thwarted private-sector business plans. He said his attempt to acquire the investment firm CI Capital was blocked by the security services in 2016. CI Capital didn’t respond to a request for comment.

    Objections by Egyptian security services scuttled an attempt last year by Archer Daniels Midland Co. to acquire Egypt’s National Company for Maize Products, according to Mr. Sawaris. A person familiar with the matter confirmed that Egyptian regulators blocked the planned acquisition.

    The maize company, which couldn’t be reached for comment, later merged with another Egyptian company instead.

    During Mr. Sisi’s years in power, the government has ushered in regulatory changes that make it easier for the armed forces to do business. His government expanded their ability to strike real estate deals and authorized the military to form a pharmaceutical company.

    When a currency crisis resulted in shortages of staples like sugar in 2016, the army began selling subsidized parcels of food out of the backs of trucks. It also supplied baby formula at a discount through pharmacies, touting the move as a victory over the private sector. “The Armed Forces has landed a blow against the greedy monopoly of traders and companies working in the milk industry,” the military spokesman said in a written statement in September 2016.

    The most visible element of the military’s expanding economic empire is a vast array of government construction projects, including roads and apartment buildings, such as a national initiative to build a million housing units across the country. New regulations have allowed military-linked contractors to establish a virtual monopoly over public building contracts, experts say.

    The so-called “New Administrative Capital” is the most ambitious of those projects. Announced in 2015, the government hoped it would attract five million residents, alleviating overcrowding in greater Cairo, currently home to an estimated 20 million people. Millions live in slums and other informal housing with unreliable access to government services.

    The planned new city has offered the military ample opportunity to flex its economic muscle. When a Chinese state company backed out of a $3 billion deal to build government buildings at the site in 2017, the Armed Forces Engineering Authority offered to complete construction at half the price through subcontracts, according to Mr Husseiny.

    In March, the Egyptian government announced the start of construction of a commercial district in the new capital, an area that includes plans for a 1,263-foot skyscraper. The building would be Africa’s tallest if completed. To complete this section of the new capital, the military-backed company overseeing the new capital contracted with China State Construction Engineering Corp.

    On the dusty road to the construction site is a billboard for the Talaat Moustafa Group, which is one of the largest known investors in the project.  The firm of Hisham Talaat Moustafa, a former senior member of Mr. Mubarak’s party, has poured nearly $2 billion in the new capital.

    Mr. Moustafa emerged from an extraordinary bout of legal trouble to contribute to the project.

    Banners lauding President Sisi are common at election time.
    Banners lauding President Sisi are common at election time. PHOTO: AMR ABDALLAH DALSH/REUTERS

    A Cairo criminal court convicted Mr. Moustafa of hiring the former police officer who stabbed to death a Lebanese pop star Suzanne Tamim in a Dubai hotel in 2008. The trial made Mr. Moustafa into a symbol of what many saw as a culture of excess and cronyism in the twilight years of Mr. Mubarak’s presidency. Mr. Moustafa’s office didn’t respond to requests for comment.

    In June 2017, Mr. Sisi pardoned Mr. Moustafa, freeing him from prison and allowing him to resume his position as CEO of his company, TMG Holding. The firm later reported that its revenue more than doubled following Mr. Mousafa’s release and its involvement in the military-led new capital project.


    Iran Uses Nuclear Pact as Bargaining Chip With EU Over U.S. Sanctions

    Tehran’s suggestion could drive wedge between Washington and Brussels

    EU Energy Commissioner Miguel Arias Canete was in Tehran with a plan to prevent Iran’s economic isolation and secure its commitment the nuclear accord.
    EU Energy Commissioner Miguel Arias Canete was in Tehran with a plan to prevent Iran’s economic isolation and secure its commitment the nuclear accord. PHOTO: ATTA KENARE/AGENCE FRANCE-PRESSE/GETTY IMAGES

    TEHRAN—Iran vowed to uphold the pact curbing its nuclear activities if the European Union can offset renewed U.S. sanctions, senior officials here said, advocating an approach that would widen a deepening schism between Washington and Brussels.

    The EU has redoubled its efforts to salvage the 2015 deal in the wake of President Donald Trump’s recent withdrawal of the U.S. The bloc dispatched Energy Commissioner Miguel Arias Canete to Tehran over the weekend with a plan to prevent Iran’s economic isolation and secure its commitment the nuclear accord.

    The EU’s plan faces daunting obstacles. The bloc would have to continue oil and gas purchases to keep Iran’s economy afloat, but do so by making payments outside of the U.S.-dominated global financial system and shielding European firms from U.S. sanctions.

    “We hope that what they have presented to us, it will be materialized,” Iran’s nuclear chief, Vice President Ali Akbar Salehi, said in an interview with Western journalists. He urged the EU to lead the fight against Washington to preserve the deal, saying Iran would honor its commitments if EU efforts broadly offset U.S. sanctions. “The ball is in their court,” he said of the EU.

    Mr. Canete said the agreement’s “economic dividends” for Iran’s halting nuclear-weapons activities are at stake. Mr. Salehi, in a thinly-veiled warning to world powers concerned that Iran wants to build nuclear weapons, said the deal’s demise would give Tehran a “free hand in doing whatever we want.”

    The EU’s efforts to safeguard the accord despite the U.S. add to growing clashes between Brussels and Washington. Secretary of State Mike Pompeo this week plans to outline Washington’s road map for starting negotiations on a new agreement with Iran.

    Mr. Canete said at a press briefing with Mr. Salehi that the EU “deeply regrets” U.S. withdrawal from the Iran agreement and the EU “is determined to preserve the deal.”

    In addition to clashing over the Iran accord, Brussels is threatening a trade war with the U.S. if Mr. Trump doesn’t exempt it from his steel and aluminum tariffs.

    Yet Europe’s ability to sidestep U.S. sanctions are limited and untested.

    The risk of an exodus by major European companies from Iran cast a pall over EU-Tehran discussions, after French energy giant Total SA said that without a U.S. waiver it may need to exit a $1 billion Iranian natural-gas deal.

    “Europe failed in its first test,” Tehran Times Editor in Chief Mohammad Grader wrote Saturday. “They have practically been subject to Washington’s decisions.”

    The EU is now updating a never-used 1996 law, enacted against U.S. sanctions against Cuba, Iran and Libya, known as the blocking statute. The measure seeks to ban European companies from complying with extraterritorial U.S. sanctions, allows firms to collect damages arising from American restrictions and shields them from adverse foreign-court rulings. But most experts say it isn’t legally watertight.

    A revised blocking statute may help small- and midsize European companies that have few U.S. investments or business links to conduct business in Iran despite Washington’s measures, EU and Iranian officials said. Similarly, the EU plans to let the European Investment Bank, its financing arm, finance activities in Iran by opening credit lines to EU small businesses.

    Yet those steps provide scant relief for Europe multinationals active in the U.S., including energy firms Total, Wintershall AG and Royal Dutch Shell PLC, and shipping giant Maersk Tankers AS.

    “The bite of the U.S. sanctions is bigger,” an EU diplomat said.

    The EU is also deploying confidence-building measures, such as energy cooperation and financial assistance, and potentially letting EU governments facilitating oil payments to Iran via their central banks with one-off transfers. Details of such transactions are yet to be agreed and risk U.S. ire.

    “We expect (Europe) to help us” get paid for oil exports, said Iranian Oil Minister Began Zanganeh said in an interview.

    Mr. Trump’s decision renews challenges for Iran to meet its energy goals, including ramping up production to 4.2 million barrels a day from 3.8 million currently and attracting $200 billion in investments, Mr. Zanganeh said.

    Mr. Zanganeh said Chinese and Russian energy firms’ interest in Iran’s larger oil and gas fields, coupled with smaller European firms that can invest up to $1 billion without getting tripped by U.S. sanctions, would largely alleviate the impact of sanctions. Iran last week unveiled a 10-year oil-production deal with London-based Pergas International Consortium PLC, snubbing renewed U.S. pressure.

    “This extraterritorial sanction from the U.S. against Iran will have an effect” by slowing investment, Mr. Zanganeh said. “But it will not stop us.”

    EU annual trade and investment with Iran nearly tripled as of last year to €21 billion ($25 billion) compared with 2015, with European icons including French car maker Renault SAand plane-builder Airbus SA joining energy firms to strike deals.

    Brussels is already lobbying Washington for waivers to protect major European firms’ business interests in Iran, an EU official said. The push signals the EU’s reliance on trans-Atlantic relations to soften some of Mr. Trump’s blows against Iran and its partners, even as Europe tries to go it alone.

    “For sure there are clear difficulties with the sanctions,” Mr. Canete said. Still, the EU “will engage with the United States… a key partner of the European Union and an ally.”

    Write to Emre Peker at


    Ten dead in Texas high school shooting

    The suspect has been identified as a 17-year-old male student from the school. US President Donald Trump has expressed “sadness and heartbreak” over the incident.

    A police officer walks near school buses as law enforcement officers respond to a shooting on a Texas high school campus.

    A gunman opened fire at Santa Fe High School in Texas on Friday, killing 10 people, including students.

    The incident is the latest in a series of shootings at US schools and universities. In February, a gunman killed 17 students and staff members at a Florida high school, intensifying a national debate over gun control and gun rights.

    What we know so far

    • Texas Governor Greg Abbott confirmed the casualties, saying 10 people were dead and 10 more wounded in the shooting at the school in Santa Fe, around 30 miles (48 kilometers) southeast of Houston.
    • Abbott said the suspect and two other people have been taken into custody.
    • The suspect has been identified as 17-year-old Dimitrios Pagourtzis. He has been charged with murder.
    • The boy is suspected of using his father’s shotgun and pistol.
    • The governor said explosive devices including a Molotov cocktail had been found in the suspect’s home and a vehicle as well as around the school and nearby.
    • Abbott said the assailant used a shotgun and .38-revolver he obtained from his father, who legally owned both the weapons.
    • The governor said the suspect originally intended to commit suicide but gave himself up as he didn’t have the courage to take his own life.
    • Pagourtzis had recently posted a picture of him wearing a “Born to Kill” t-shirt on his Facebook page.
    • Shots broke out at about 8 a.m. local time (1300 GMT) shortly after the start of school.

    Trump expresses ‘heartbreak’

    US President Donald Trump expressed “sadness and heartbreak” over the incident.

    Trump described the incident as “absolutely horrific” and said, “This has been going on too long in our country.”

    “My administration is determined to do everything in our power to protect our students, secure our schools, and to keep weapons out of the hands of those who pose a threat to themselves, and to others,” he added.

    Vice President Mike Pence said he and the president were monitoring the situation.

    Vice President Mike Pence


    To the students, families, teachers of Santa Fe High School, all of those affected and the entire community: We are with you, you are in our prayers, and you’re in the prayers of the American people.

    Governor Abbott called Friday’s shooting “one of the most heinous attacks that we’ve ever seen in the history of Texas schools.”

    Mass shootings: The United States, where the right to bear arms is enshrined in the constitution, has struggled with gun violence for decades. The country has seen more than 100 mass shootings, with nearly 130 killed this year, according to the Gun Violence Archive, a database that tracks gun violence incidents. It classifies mass shootings as events in which four or more people were shot at around the same time and place.

    ap/msh (Reuters, AP, AFP)


    Trump administration orders more sanctions on Iran after quitting the nuclear deal

    An anti-U.S. protest in Tehran, Iran.
    An anti-U.S. protest in Tehran, Iran. (AFP / Getty Images)

    The Trump administration is ratcheting up sanctions on Iran following the president’s withdrawal from the 2015 international accord that curbed Tehran’s ability to develop nuclear weapons.

    The Treasury Department on Thursday blacklisted two individuals and five companies in the Middle East, Africa and Europe that it said were financing the Iran-backed Hezbollah militant group based in Lebanon.

    The sanctions mean any assets that the persons or companies might have in the United States or in U.S. institutions will be frozen, and Americans cannot do business with the targets.

    Treasury Secretary Steven T. Mnuchin identified one of the individuals as Mohammad Ibrahim Bazzi, whom he described as a financier who uses drug trafficking deals and money laundering to help fund Hezbollah.

    “This action highlights the duplicity and disgraceful conduct of Hezbollah and its Iranian backers,” Mnuchin said. “This administration will expose and disrupt Hezbollah and Iranian terror networks at every turn.”

    This was the administration’s third punitive action this week against Iran or entities associated with the country, including the blacklisting on Tuesday of Valiollah Seif, governor of the Central Bank of Iran.

    In that case, non-Americans around the world as well as Americans were barred from doing business with him through a mechanism known as secondary sanctions.

    The sanctions come in the wake of Trump’s announcement on May 9 that he was pulling the United States out of the nuclear deal with Iran. Trump said the accord was not sufficiently tough on Tehran and said he would reimpose a raft of economic penalties aimed at tightening pressure on Tehran.

    The move estranged the Trump administration from England, France and Germany, which also signed the nuclear deal and still support it.


    Israel bombs targets in Gaza

    Israeli warplanes launched an overnight raid on a Hamas facility in Gaza in what the army said was a “retaliatory attack.” Health officals in Gaza said one person was injured in the strikes.

    Israeli warplane

    Israel launched an overnight air raid on a Hamas facility in Gaza Thursday after gunfire from the territory targeted its soldiers and damaged a building in the town of Sderot.

    The exchange of fire stems from weeks of protests over the transfer of the US Embassy to Jerusalem, which peaked on Monday when some 60 Palestinians were killed by Israeli forces.

    What happened:

    • Israeli military said warplanes attacked a Hamas weapons factory in the Gaza Strip.
    • The strikes came in retaliation to machine gunfire that damaged several houses in Sderot, the army added.
    • The Palestinian health ministry said one person was injured.

    Watch video02:15

    Israeli forces kill 58 Palestinians at Gaza border fence

    The aftershocks of the US Embassy move to Jerusalem on Monday and the accompanying violence and deaths from protests are shaking up the region. Palestinian President Mahmoud Abbas sees the embassy move as a betrayal from his former negotiating partners Israel and the US. For years, the Palestinians continued to cooperate with Israeli troops in the West Bank and in turn, the US promised not to move its embassy to Jerusalem and to keep the Palestinian Liberation Organization (PLO) office open in Washington DC.

    Months of protest: Since late March, there have been weekly border protests in Gaza, resulting in the deaths of more than 100 Palestinians. The violence in the region culminated this week in clashes coinciding with the 70th anniversary of the founding of the state of Israel and the transfer of the US embassy to Jerusalem.  Salah al-Bardaweel, a Hamas official in Gaza said that all but 12 of the protesters killed this week were members of Hamas.

    The Palestinian stance: For decades since the 1967 war, the Palestinian strategy has been to seek independence through negotiations. Despite continued Israeli construction of settlements, the Palestinians remained hopeful that negotiations would culminate in an independent state.

    What is the Gaza Strip? Almost two million people live in the tiny, self-governing Palestinian territory. It is just 41 km (25.4 miles) long and anywhere from 6-12km wide. In May of 1994, as part of the Oslo Accords, Israel transferred power to the Palestinian Authority. The Islamist faction Hamas has governed since 2007. The World Bank says Gaza suffers from one of the “highest unemployment rates on earth.”

    av/rt (Reuters, AFP)

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