Sanctions have Iran economy on brink of collapse

Con Coughlon:

Iran's banks are on the brink of collapse and its manufacturing industries facing severe shortages as sanctions bite, according to assessments by Western officials.

Despite recent public statements by President Mahmoud Ahmadinejad that sanctions by America and the UN "are not working", a confidential report submitted to the Iranian parliament said that continued economic isolation was having dire consequences.

The sanctions are designed to increase pressure on Teheran to reach a compromise with the UN over its nuclear enrichment programme.

The country's banking industry is suffering from a boycott by European, Japanese and American banks, Western diplomats said.

The biggest banks will not conduct any transactions with any Iranian clients, meaning that businesses are finding it increasingly difficult to find hard currency.

"There is no doubt that the Iranian regime is now paying the price in economic terms of its defiance of the international community," said a British official working closely with the UN on Iran.

"The sanctions are having a deeply negative effect on the Iranian economy and there is the prospect of more to come."

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Many of Iran's major manufacturing industries are facing severe difficulties as a crippling shortage of equipment and materials from overseas suppliers has resulted in a dramatic fall in production.

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I think they may be waiting for the 12th Imam to bail them out. They certainly are not engaged in any non faith based ways to resolve the matter. They keep upping the anti and poling onward through their nuclear fog. It is probable that these banking problems will have a cascading effect on the Iranian economy that will build to a crescendo before a collapse.

Meanwhile, the Washington Posts says new Iran sanctions are in the works with a focus still on the banks and the Qods force.