How Iran is avoiding international sanctions

By Olivier Guitta

While the European Union just announced new sanctions against Iran, including the freezing of the assets of Bank Melli, Iran had already anticipated this move.

In fact, I just wrote an article for the Middle East Times on Iran's ability to go around the international sanctions.
You can read the whole article here.

Here is an excerpt:
Embarking upon what was described as his European farewell tour, U.S. President George W. Bush made a point last week of focusing on the Iranian issue with his European allies. Britain's Prime Minister Gordon Brown announced that he was ready to add more sanctions to pressure Iran to give up its nuclear program. At the same time, the Iranian media revealed that in the past few months, Iran, anticipating this move, had withdrawn close to $75 billion of deposits from European banks. This is just an example of why the international sanctions have been somewhat weak. Indeed, Iran has quickly adapted and found a way around the sanctions.
Iran's main conduit in avoiding sanctions has been Dubai in the United Arab Emirates. There are historical reasons for this: since the beginning of the 20th century, Dubai and Iran have enjoyed close trade relations. Also, Dubai welcomed several waves of Iranian immigrants.

Not a week goes by without an Iranian minister or official visiting Dubai.

The 350,000 Iranians of Dubai compose the third largest community after the Indians and the Pakistanis. The large fortunes belong to families of Iranian origin. There are 8,200 Iranian companies today in Dubai compared to 6,500 in 2005.

Dubai has become Iran's back-up base and Iranian companies that do business abroad prefer to be based in the emirate. More than 200 flights each week link Dubai to the main Iranian cities. The port ships merchandise of all kinds to Iran, from cars to electric machinery and food.

The official trade figure between the two countries is $6 billion annually, but the smuggling amounts to an estimated additional $1.2 billion a year. Out of that $1.2 billion figure about $250 million stems from U.S. goods, supposedly banned from entering Iran.

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