Region | Iran
Demonstrations cost nation dearly
Millions of dollars in private wealth has begun flooding out of Iran in the wake of mass demonstrations that have paralysed commercial life. Fears of a new round of crippling sanctions are also thought to have fuelled the exodus of money.
- By Damien McElroy, The Telegraph Group Limited, London 2009
- Published: 23:45 June 26, 2009
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Millions of dollars in private wealth has begun flooding out of Iran in the wake of mass demonstrations that have paralysed commercial life. Fears of a new round of crippling sanctions are also thought to have fuelled the exodus of money.
Western intelligence agencies have reported that prominent private businesses and wealthy families have moved tens of millions of dollars out of Iranian banks into overseas accounts.
The Italian foreign intelligence service is said to have detected multiple transactions, each of up to $10million (Dh36 million), by Iran's big four banks on behalf of Iranian families seeking a safe haven.
Iran has already been hit by rounds of financial sanctions from the UN, and these have limited its access to international finance and trade. In Britain, a spokesman for the Treasury hinted that further action could be taken, particularly in relation to Mojbata Khamenei, son of Supreme Leader Ali Khamenei who runs his father's office.
"We do not have this person on the sanctions list and while we do put people on the list on human rights grounds we do it very much in conjunction with the EU and the UN," the spokesman said.
"We can be very aggressive in pushing within those bodies, though I'm not saying we're doing so in this case."
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Meanwhile, one of Iran's leading foreign investors, the Austrian oil and gas firm OMV, said it would not invest any more money in a large offshore gas project and gave warning that it would pull out if Iran demanded more cash.
Helmut Langanger, OMV's Iran representative, said the political environment would have to improve before it put any more money into the South Pars offshore gas field. "They are proceeding with the project on their own," he said.
In the US, Mark Kirk, a Republican congressman, said there was growing support for a bill he is sponsoring that would strip American support from foreign companies supplying refined petroleum to Iran.
Iran is a large oil producer but decades of financial isolation means it must import petrol and other end products from abroad. Reliance, the Indian company, provides one third of Iran's daily needs while also enjoying a massive trade loan from the US.
Another bill that would exclude companies involved in the trade from doing business in the US was put on hold earlier this year as a gesture from President Barack Obama to improve relations.
The fallout from the pro-democracy demonstrations is expected to embroil Iran and the Gulf in a new cycle of instability.
Sami Alfaraj, a Gulf expert, warned Iran was unpredictable and that meant the stability of the oil-rich region was in the balance. "Iran could launch foreign attacks," he said. "It could disrupt the shipping lanes of the Gulf, drive up the cost of doing business ... all these options would have an economic impact."
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