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OpEdNews Op Eds    H3'ed 8/8/10

the times they are a-changin'

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Message Niloufar Parsi
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western power is in decline. the east has decoupled from the west. so has the south. non-western countries are consistently growing faster than the west, and they trade more with each other than with the west. sanctions against iran are doomed to fail.

call it 'Project for the New Asian Century'

western power is in decline. for the past couple of decades the rate of economic growth among non-western countries has been far faster than that of the west. this differential in rates of growth has been getting wider in time over the past 50 years or so. in other words, if the developing world was on average growing at a rate that was 1-2% higher than that of rich countries about 4 decades ago, over the past decade the difference has grown to around 3-4%. even more importantly, the impact of the 'global' financial crisis over the past three years or so has been far more negative on the west than the rest. while many western economies and russia have had negative rates of growth, the developing world has continued to grow without a significant glitch.


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this phenomenon is referred to as the 'decoupling effect' among economists, and it is rather significant. when the financial crisis started to unravel, there were many western economists and politicians who insisted that the crisis would hit the east as hard as the west (aka the 'domino effect'). around three years later we see that they were simply wrong. the world economy is no longer hinged on the west (assuming that it ever really was). the east has decoupled from the west. so has the south.

there are other equally important factors at play too.

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first, changes in trade patterns have been even more pronounced than the economic growth issue. trade among developing countries has grown at a far faster rate than many expected. most developing countries today do more trade with other developing countries than they do with the north. this is a major driver of decoupling.

second, while production has become more globalised, the attachment of globalised producers to specific countries has waned. in other words, corporations can ignore or bypass national policies quite easily - including western national policies. money talks. corporations obey.

this has important implications for the sanctions-mongers against iran. there are far too many who are ready to jump for joy as soon as some new set of sanctions is announced against iran. but the signs of dissent are there if we choose to look carefully. here is a selection that is cut and pasted from various sources:

"the Indian government is blatantly and publicly discussing ideas on how to circumvent the sanctions and maintain a close trade relationship with Iran. India's energy competition with China is a large part of what is driving India's decision-making on this issue, but there are several other geopolitical interests India is considering in demonstrating its intent to openly flout U.S. and EU sanctions on Iran. Details of a report on this subject from the Indian Ministry of External Affairs were leaked to The Times of India recently. The report, called "International Sanctions on Iran and Way Forward for India-Iran Relations," suggests several "creative mechanisms" that would allow Indian firms to continue trade with Iran without getting caught in the sanctions dragnet. India's bilateral trade with Iran in 2009 was about $14 billion, and the long-time allies have ambitions to double that amount within the next five years. Iran and India have long been allies with mutual interests in the region. One such common interest is the containment of the Taliban in Afghanistan -- a project that Iran, India and the Russians have worked together on in the past in bolstering the Northern Alliance against the Taliban.

Turkey sees no reason to curb trade in petroleum products with Iran, Turkish Energy Minister Taner Yildiz said on Aug. 6, Bloomberg reported. Turkey believes that commercial companies can carry out this business, Yildiz said in Trabzon, adding that it is a functioning commercial relationship.

Beijing has been increasing gasoline exports to Iran since late 2009. The two countries are a perfect match since Iran needs to fill the gap left by sanctions and China has enormous refining capacity. Moreover, every time a multinational energy company pulls out of Iran, Beijing's state-owned players seem to take over, as happened to the Japanese firm Inpex in 2006 when it complied with a previous round of sanctions. China is not prepared to jeopardize its relationship with Iran or its energy security in the name of bolstering U.S. foreign policy aims, especially since doing so would only propel the United States' apparent intention to delimit China's rising influence, especially in Southeast Asia. China pushed back at U.S. pressure on its business and oil trade with Iran in comments published on Wednesday, while Iran's oil minister was in Beijing seeking to shore up ties with the big customer.

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Iranian Presidential Chief of Staff Esfandiar Rahim Mashaei said on Aug. 4 that the country has decided nuclear negotiations with Europe are useless, ISNA reported. He said Europe is broadening its range of sanctions on Iran, however, they do not understand the logic behind them. While speaking at a closing session of an Iranian expatriates conference in Tehran, he added that Europe has "lost its value."

Iran's president told the leaders of Afghanistan and Tajikistan on Thursday that the three neighbors could provide a counterweight to NATO in Asia once foreign troops quit the region. Mahmoud Ahmadinejad hosted the leaders of the two other Persian-speaking countries at a time when Iran is seeking to increase its influence in the region and NATO troops are struggling in Afghanistan.

The road to rock bottom for relations between Brazil and the United States, a dispute that now threatens business ties between the two Western Hemisphere economic giants, began in Brasilia in March. Secretary of State Hillary Clinton was trying to convince Brazilian President Luiz Inacio Lula da Silva to drop or postpone his controversial efforts to negotiate a nuclear deal with Iran, and support a new round of sanctions instead. Lula refused. Then, he dropped a diplomatic bombshell, telling Clinton he was worried Iran would become another Iraq -- that is, that the United States was on a path to war, according to sources familiar with the exchange."

sanctions against iran are doomed to fail. they are not really about the nuclear issue. they are about containment. and they cost both sides. can america really afford it?

 

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An average Iranian with a keen interest in international affairs. Niloufar is a graduate in Development Studies in the UK, and works as an international consultant in the field of international development (non-profit).
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