Trade Sanctioning a Nation of Traders

by Amir Taheri

The word bazaar understood around the world, irrespective of language, describes so much more than a place to come and buy something. It brings thoughts of haggling, bargain finding, tough negotiation, and avoiding being conned. Persians are known for their famous bazaars (where this word originates). The one in Tehran is the largest in the world stretching out for miles. Any visitor to Iran will note that Iran's shopping experience is an interesting one. Large department stores are almost not existent and only now starting to pick up in popularity and growth. Iran is dominated by mostly "mom and pop shops" - small family businesses that specialize in a certain product. As in the ancient bazaar where an entire row of stalls specialize in selling one type of thing, so are modern shops on most Iranian streets today organized. You will find one entire street selling consumer electronics, jewelry, or furniture. A large percentage of Iran's population are in this way; self-employed.

If there was a prize given out for a country that hast the most sanctions placed on it, Iran would get it hands down. Almost everything is somehow sanctioned, barred, or classified as a dual use item and banned to be sold to Iran. At times a company or entity is sanctioned multiple times. Where there is not currently a sanction, countries use the bully and shame method to push companies from doing business with Iran. Lately, the US is going after foreign shipping firms that ship to Iran's ports. There has been fear that many essential food items like wheat, corn, and sugar could be effected. Planes and plane parts are banned to Iran if it contains an American firms involvement, which translates to almost all plane manufactures (including Russian since they recently use American engine parts). Even items like medical MRI and CT scanners are banned under the "dual civilian military use" definition.

If these multi-layer sanctions were to be effective than Iran would have to look very different than it does today. Unlike countries like, Cuba, North Korea, Zimbabwe, Syria, Iraq, and Sudan, Iran today has a very active economy that trades with many countries. As pressure from Europe and America has increased, business from Iran has migrated to China, Turkey, and Latin American countries. Iran's trade with China as of late has past $30 billion and is set to mark $50 in a few years. Iran's trade with Turkey is also on the rise anticipated to pass $10 billion this year. Walk into any shop in Iran and you will be amazed by the selection of products and items from around the world, even in your local grocery the times the size of a walk in closet. In one tally recently, I found soft drinks from as far as South Korea, China, and Argentina. European and American chocolate bars are brought from Dubai and other Arabic countries (as the Arabic text states). Even ready to make meals from Europe are sold but with Turkish text. Actually, I found not one product that I needed NOT offered in Iran, whether it was American, European or Asian.

Search in any shop in Iran's bazaar and you will find with high probability one item that is not for sale. Wether it is the first carpet woven by the shop, or that antique item that has been past down by each of the previous owners of the shop, the shop owner will always guide you to another "better" item in his offerings. As your eyes wander back to that jewel of a piece, he will quickly push you in another direction where a new set of hand made silk carpets are laid out. You think to yourself, "was that first eye catcher really that nice?" You wonder, is that item just there to tempt me to want it more? As you convince yourself otherwise and head out of the bazaar with your new silk carpet, you have that nagging feeling growing inside, "was I just conned"?

As one European diplomat once said about the nuclear negotiations with Iran, and its difficulty he stated that the talks with the Iranians are always tough. He went on further by saying, "while we are playing checkers, the Iranians are playing chess". So have the sanctions against Iran been effective? It depends on a prior question being answered; effective for whom? While you are thinking on this question, take a flight on Mahan's recently purchased sparkling Airbus planes, continue to think on the question while you play on your new Ipad 2 bought in any of Iran's many electronic shops, and relax and zip up your Abercrombie sweater before landing in Tehran's airport.

Editor’s Note: Amir Taheri is one of the authors of Uskowi on Iran. His weekly columns appear here on Fridays.