Israeli Threats of Attack Sparked New Wave of Iran Sanctions, Officials Say

Foreign Ministry official says recent sanctions imposed by EU, U.S., as well as China's reduction of oil purchases from Iran, point to international community's apprehensions about Israeli military strike.

Senior officials in the Foreign Ministry believe that the latest sanctions imposed by the West against Iran result from the threats Israel issued about launching a unilateral attack on the Iranian nuclear facilities.

Yesterday, Swift, the global provider of financial services, announced that it is severing 25 Iranian banks from its systems, starting tomorrow. This dramatic move means that Iran's government will effectively have to transact its international business in cash.

AIPAC - AP - March 2012

A top Foreign Ministry official said that the recent rounds of sanctions imposed by the European Union and the U.S. against Iran, along with the fact that states such as Japan and South Korea have joined efforts to pressure Tehran, and also China's reduction of oil purchases from Iran, bear witness to the international community's apprehensions about an Israeli military strike. "These aren't sanctions against Iran. Instead, they are sanctions imposed by the West to curb Israel's attack plans," a senior foreign ministry official said. "Had Israel not spoken out about its intention to attack, none of this would be happening. The Iranians are frightened. You have to understand what's going on there in stores; citizens grab food off the shelves because they are worried about an impending attack. Inflation is soaring and the currency has lost half its value. All this attests to fear."

Israel's political leadership remains divided regarding how to react to the Iranian nuclear reactor issue. Prime Minister Benjamin Netanyahu and Defense Minister Ehud Barak believe that international sanctions will not successfully end Iran's drive to develop nuclear weapons, and support a unilateral Israeli attack; on the other hand, a considerable number of top officials oppose such an attack under the current circumstances, and believe there is time to see whether sanctions will work.

Members of this group of opponents of a unilateral strike includes four members of the inner cabinet of eight - Moshe Ya'alon, Dan Meridor, Benny Begin and Eli Yishai. Finance Minister Yuval Steinitz, a close associate of Netanyahu, continues to sit on the fence, and Foreign Minister Avigor Lieberman's position on the Iranian issue remains a mystery. Many ministers believe that Lieberman has joined the Netanyahu-Barak camp, but the foreign minister has refrained from public comment and in private discussions has expressed support for the sanctions policy.

Lieberman, who arrived yesterday in China on an official trip during which he will discuss the Iranian nuclear issue along with plans to expand the volume of Israel-China trade, will serve as the swing man who casts the deciding ballot on any vote taken by the eight-man inner cabinet regarding Israel's response to the Iranian threat.

Yet for the time being at least, the inner cabinet is not likely to hold a decisive discussion on the Iranian issue. The last time the inner cabinet discussed the issue was four months ago.

Members of the inner cabinet have indicated that Israel is not about to reach a decision regarding a military strike on Iran. The issue could become more pertinent on July 1, when the oil embargo emplaced by the EU against Iran becomes fully operational, these officials suggest.

One of the eight ministers said that Netanyahu is discussing the Iranian threat primarily with Ehud Barak. Netanyahu also confers with ministers individually on the matter, the inner cabinet member said. "As in the case of the Gilad Shalit prisoner exchange deal, or discussions about the possibility of extending the freeze on settlement construction, Netanyahu and Barak sit with ministers separately and ascertain their position," said the minister.

A top Foreign Ministry official expressed satisfaction yesterday about the "Swift" decision. He defined it as "another mortal blow to the Iranian regime," adding that the move will further restrict the Iranian government's ability to trade with foreign states.

Swift is based in Brussels, and operates a huge global financial services network. It handles more than 80% of the financial transactions and electronic money transfers that occur around the globe. Some 10,000 banks and financial institutions in 210 countries subscribe to Swift's services.

Swift's decision comes in the aftermath of a new European Union decision to prohibit any company listed in one of its countries from carrying out electronic transactions with any of the 25 Iranian banks boycotted under the sanctions policy.

Swift announced that starting Saturday March 17, it will sever all connections with the 25 Iranian banks. This is an unprecedented move, and it means that Iran's government will have to physically relay cash or gold bars to pay for its transactions overseas.

During his recent talks with U.S. President Barack Obama in Washington, Netanyahu brought up the issue of severing the Iranian banks from Swift.

A top Israeli official said yesterday that during his talks in Washington and Ottawa, Netanayhu insisted that we need "Swift sanctions swiftly."

The Prime Minister's Office yesterday released a response to the Swift decision, saying "Prime Minister Netanyahu welcomes Swift's decision to sever the Iranian banks from its system."