April 8, 2015: Zaiwalla & Co, the solicitors who overturned both the United Kingdom’s and European Union’s sanctions against Iranian banks, welcomed the  framework agreement which has been reached between the P5+1 countries and Iran relating to Iran’s nuclear programme.

This deal, which was announced on April 2 night, has come about after more than a decade of negotiations. However, substantial progress in these negotiations was made only after the successful legal challenges launched by Bank Mellat, Iran’s largest private bank. Bank Mellat won its actions in the UK Supreme Court and EU courts; the sanctions against the bank were declared unlawful, and the bank is now claiming damages of $4 billion from the UK government.

In these current negotiations, the West has offered to lift the sanctions imposed against Iran in return for Iran agreeing to roll back its nuclear programme, reducing approximately two-thirds of its installed centrifuges. Iran will receive sanctions relief if it verifiably abides by its commitments under the framework agreement. The current US and EU sanctions will be suspended after the IAEA has verified that Iran has taken all of its key nuclear-related steps.

The US sanctions will be retained during the course of the deal and will allow for a re-enforcement of the same in the case of non-performance of obligations by Iran. The West’s concerted campaign of pressure, involving the imposition of a wide range of blanket sanctions on Iran’s financial, oil and gas sectors, suffered a setback when the UK Supreme Court and the European Court of Justice annulled numerous sanctions imposed on various Iranian entities. The judgment of the European Court, therefore, put pressure on the West to be more amenable in negotiations with Iran; it was widely criticised by the US administration.

Bank Mellat’s victory sent a signal that the European Court will decide cases based on the Rule of Law rather than observing political exigencies. This brought confidence to many other Iranian private entities to challenge sanctions imposed on them, and a wave of subsequent successful challenges by these entities followed. Member states of the European Union do recognise that when sanctions are declared unlawful by EU courts, the payment of damages to those suffered by sanctions has to come from the taxpayers’ pockets.

Sarosh Zaiwalla, Senior Partner of Zaiwalla & Co. LLP, who acted for Bank Mellat said: “Iran has an ancient culture of peace and goodwill towards all and this historic agreement will give momentum for start of a new relationship between Iran and the West. The Iranian people and business have suffered due to the sanctions imposed on Iran and the framework agreement will come as a welcome relief to Iranian people.”

Press release

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Kamilia Lahrichi

April 2, 2015: Russia’s Foreign Minister Sergey Lavrov courted Cuba, Nicaragua, Colombia and Guatemala during a four-day visit to South America in March 2015 to boost bilateral trade, as food shortage is hitting his country hard.

Last year, Moscow banned for one year agricultural products from the European Union, the United States, Canada, Norway and Australia, in an economic war. The US is isolating Russia for its policies in Ukraine, where a bloody conflict still rages, and for the annexation of Crimea in March 2014.

Embargoed products include beef, pork, poultry, fish, cheese, milk and dairy products, fruits and vegetables.

This radical policy has led to significant losses for Russia, which heavily depends on food imports to feed its 143.5 million stomachs.

In 2013, Russia imported nearly $23 billion worth of the banned products from the United States and the European Union mainly, according to Trade Map data. Europe is Moscow’s largest trading partner.

Products like French cheese, German sausage, Norwegian salmon or basmati rice have today vanished from Russian supermarkets.

Russia’s economy is going through the worst turbulence in President Vladimir Putin’s leadership due to Western sanctions as well as plummeting oil prices. Inflation runs at 10% and living standards have fallen significantly.

The Russian central bank imposed a steep interest rate hike to halt the ruble’s collapse – it lost more than 45% of its value against the dollar since the beginning of 2014.

Food scarcity in Russia, opportunities in Latin America

Lavrov met presidents Raúl Castro in Cuba, Juan Manual Santos in Colombia, Daniel Ortega in Nicaragua and Otto Pérez Molina in Guatemala, to get agricultural goods denied to the Russian market – behind the diplomatic rhetoric.

It is his second visit to the region since the war in Ukraine broke out.

During this 24-hour visit to Guatemala, the Russian envoy reaffirmed Moscow’s continued support for the Central American nation. He also lambasted the US sanctions against Venezuela and called for ending the American trade embargo on Cuba.

He also said that Russia wants to set up a regional centre to train Central American security officials to fight drug trafficking and terrorism.

In Nicaragua, Lavrov suggested that Russia might be keen to help build a waterway to rival the Panama Canal.

In Colombia, the Russian foreign minister and his counterpart agreed to increase bilateral trade, without saying by how much.

“We want to expand that market [Russian] and to work together [taking advantage of] the different opportunities. We all have a job to do, but also a commitment to improving trade relations,” said the Colombian Foreign Affairs Minister Mary Angela Holguin.

Lavrov expressed Moscow’s willingness to be a pillar in the development of a multipolar world order. He sought to build ties with regional unions like the Southern Common Market (MERCOSUR).

“The selection of countries is based on the USSR’s old links with the region,” said Sergio Berenzstein, a political analyst in Buenos Aires.

Communist Cuba and sovietico-sandinista Nicaragua are the United States’ historical foes and Russian allies. In 2002, Russia and Nicaragua inked a deal to axe the Central American country’s debt with the USSR.

Russia is reaping the benefits of the anti-imperialist and anti-American tendencies of these populist governments – aside from Colombia.

Yet, Nicaragua, Colombia and Guatemala are above all a pragmatic choice as Russian senior officials rarely visit these countries.

“There is a need to negotiate visa-free travel – it it hasn’t been introduced already – and expand bilateral trade,” explained Igor Danchenko, Program Research Manager on Russia and Eurasia at Sidar Global Advisors, a markets research company in Washington D.C.

Food supplies wanted

“Russia’s goal is to turn to new food suppliers as well as promote Russia’s technology and energy in developing countries with shortcomings in these areas,” said Matias Garcia Tuñón, Coordinator at the Russian Argentine Chamber of Commerce and Industry in Buenos Aires.

Boosting trade with Latin American countries would help Moscow get the foreign reserves it needs while the breadbasket region would reap the benefits of a larger consumer market.

For instance, Nicaragua exports meat, seafood, milk, cheese, peanuts and coffee to the Russian market. Moscow is interested in importing vegetables and tropical fruits it cannot grow due to its harsh climate.

Since 2013, both countries began negotiating a free trade agreement as exports to Russia are relatively low. In 2013, Nicaragua exported over $18 million to Russia – it is still a one-third increase compared to the previous year.

Cuba – Russia’s largest sugar cane supplier – exports citrus, concentrated juices, rum, tobacco and drugs in exchange for oil, auto parts and machinery and fertilizers. Russia is Cuba’s 10^th largest trading partner.

The trade balance between the two economies grew by 17% during the first six months of 2012, compared to the same period in 2011, when it reached $224.7 million.

Guatemala remains an under-developed market for Russia although its goods enjoy customs preferences in the federation since 2007. In 2013, the Central American country exported about $29 million worth of products to the Russian market and imported about $72 million.

Guatemala exports sugar, coffee, tobacco and cardamom to Russia and imports fertilizers, steel and zinc.

Finally, Colombia exports coffee and flowers (almost 60% of all exports) to Russia while Moscow supplies fertilizers and technology. Both countries are also in talks for a free trade agreement since 2013.

Moscow’s strategy in Latin America

Clearly, Moscow will not rely on these four markets only as they are too small to feed Russian customers.

Besides, distance is a challenge. “The logistical challenge to send to Russia perishable goods is mainly the time for maritime transport to San Petersburg (Russia’s main port apart from Vladivostok and Novorossijk),” explained Mr. Tuñón.

“If we estimate an average of 30 days for sea transit, in addition to the time to produce the food and sell it in Russia, it is very complicated to commercialise short-life products,” he added.

Air transport would be an interesting – albeit costly – option.

Although Moscow expects to capitalise on long-term relationships with Latin American countries, “Russia’s position in Cuba is destined to weaken because of sheer proximity to the United States and a large Cuban diaspora [there],” said Mr. Danchenko.

In addition, “since Latin America can’t be an alternative source of loans to replace the West and China/Asia, interests are limited,” he added.

Also Read:

Argentina: Russia’s new market

Crimean crisis: World divided on sanctions against Russia

Ukraine conflict: UK wants SWIFT punishment for Russian banks

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Sharan Lal

September 30, 2014: The gruesome beheading of two American journalists and a British aid worker in the months of August 2014 and September 2014 have once again turned all eyes on the Middle-East, particularly Iraq and Syria. This is almost three years after the withdrawal of American troops from Iraq in December 2011, marking the end of the controversial US-Iraq war/second Gulf war.

The murder of James Foley, an American journalist, and of Steven Sotloff, an American-Israeli journalist, were captured on video and uploaded on the internet under the titles ‘A Message to America’ and ‘A Second Message to America’, respectively. Subsequently, the beheading of British aid worker, David Haines, was also uploaded on the internet under the title ‘A Message to the Allies of America’.

All three videos depict a terrorist/militant wearing a black body suit and black ski mask, speaking in a British accent, holding a long knife, and appearing to begin cutting the aforesaid three men, who were all clad in orange jumpsuits. The militants belong to the extremist militant group Islamic State (‘IS’), which previously referred to itself by various other names such as Al-Qaeda in Iraq (‘AQI’), Islamic State of Iraq (‘ISI’), Islamic State of Iraq and Sham/Syria (‘ISIS’), Islamic State of Iraq and the Levant (‘ISIL’) and the Arabic acronym “Da’esh”.

None of the three videos actually show the beheadings and, therefore, the investigation reports have not addressed whether the executioner depicted in the videos actually carried out the killings himself. The FBI has recently claimed that it has now identified the executioner in the videos, but would not reveal his identity.

The first two videos (i.e. the beheading of the American journalists) were directly addressed to the US President in a direct response to the American attacks on IS in Iraq in early August 2014. In the third video, the British captive David Haines says that he holds Prime Minister David Cameron entirely responsible for his execution because Britain voluntarily entered into a coalition with the US in their war against IS. The US and its allies responded to IS’ videos by increasing the intensity of the air attacks in Iraq. This recent turn of events in the Middle-East has raised several pressing questions such as the reason for the US air strikes in Iraq this August (after having ended the Iraq war in 2011), the origin, growth and goals of IS, the strength/funding sources of the group and the economic/national threat that IS poses to the US and the rest of the world.

Why did the US authorise air strikes in Iraq?

In the year 2003, almost two years after the 9/11 attack, the US waged war on Iraq to oust the then-President Saddam Hussein. The Bush administration had then argued that Iraq possessed weapons of mass destruction (‘WMD’) and was responsible for funding/supporting terrorist organisations.

As years went by, no real evidence was found to validate that Saddam and Iraq were in possession of WMD and this made the US’ reasons for going to war questionable and tainted its global image. There was speculation that the unpublicised concern for the US attacking Iraq was Iraq’s oil supplies. Iraq’s oil revenues meant that Saddam would always have the power and resources to spike/manipulate world oil prices or distort the economic dominance of the West because of the influence that oil supplies have on the dollar value. In the year 2011, President Barack Obama announced the end of the Iraq war, thereby fulfilling one of his election promises.

Almost two and half years since the withdrawal of US troops from Iraq, President Obama launched a series of air strikes against IS, the Sunni Muslim militant group, in northern Iraq. The strikes were aimed at halting the advance of IS toward Erbil, the capital of the Kurdistan region in northern Iraq, because it is home to a United States consulate and thousands of American diplomats, military advisors and citizens.

In addition to protecting Americans in Erbil, the US President said he had authorised air strikes to help the tens of thousands of minority Christians and Yazidis who have taken refuge on Mount Sinjar in the Sinjar region of Iraq to protect themselves from IS attacks. Yazidis are a religious minority group closely allied with the Kurds (i.e. the ethnic group mostly occupying the region of Kurdistan in Iraq) and have been ill-treated for centuries, particularly by Saddam’s Sunni Muslim regime and now by IS, on the grounds of being considered ‘devil worshippers’. The United Nations and the US both warned that attacks on the minority Christians and Yazidis were imminent acts of ‘genocide’ (i.e. violent crimes committed against groups with the intent to destroy the existence of that group). This was another reason for President Obama authorising military action on IS forces that have besieged/surrounded Mount Sinjar.

These air strikes took place in early August 2014 and marked the return of the US to a direct combat role in Iraq, which it left in 2011. In response to the air strikes by the US and its allies, IS beheaded the US and British citizens to warn/threaten the world of the bloodshed that would follow in the event the US didn’t stop the attacks on IS and Britain didn’t withdraw its support to the US.

What does IS want?

The IS has garnered numerous headlines across the globe for embracing such an extreme, violent ideology that it makes even Al Qaeda ideologies and practices look moderate. The IS is an extremist Sunni Muslim movement, attracting terrorists from all over the world eager to help build the new ‘caliphate’ (i.e. an Islamic state/region led by a supreme religious/political leader who would be referred to as a ‘caliph’ and is believed to be the successor to Prophet Muhammad). IS claims religious authority over all Muslims across the world and aims to bring most of the Muslim-inhabited regions of the world under its political control beginning with territory in the Levant region, which includes Jordan, Israel, Palestine, Lebanon, Cyprus, Syria and parts of southern Turkey.

Also Read:

How did the IS emerge?

Al-Qaeda agenda: IS is on track

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