GAO Questions Effectiveness of Iran Sanctions

McClatchy Newspapers:

Two decades' worth of U.S. economic sanctions against Iran appear to have had little impact, Congress' investigative arm said Wednesday, calling into question a key pillar of President Bush's strategy to curb Iran's nuclear ambitions and support for terrorism.

A report by the Government Accountability Office says that high oil prices and growing international trade have insulated Iran's leaders from the effect of sanctions. Iranian corporations and banks have switched to currencies other than the dollar and used other "workarounds" to bypass the sanctions, it says.

Iran's government has signed contracts with foreign firms worth roughly $20 billion since 2003 to develop its oil and gas deposits, the report says.

"Iran's global trade ties and leading role in energy production make it difficult for the United States to isolate Iran and pressure it to reduce proliferation and support for terrorism," it says.

Overall, it says, the effect of sanctions is unclear.