U.S. Failing to Assess Whether Iran Sanctions Work, GAO Says

By Tony Capaccio

Jan. 16 (Bloomberg) -- U.S. agencies responsible for carrying out economic sanctions against Iran since 1987 need a system for tracking whether they are effective, a new government report says.

``Except for the Treasury, the agencies do not assess the impact of sanctions in helping achieve U.S. objectives nor collect data demonstrating the direct results of their sanctioning and enforcement actions,'' the Government Accountability Office says in a report to be released today.

The 60-page report recommends that Congress order the National Security Council and departments of State, Commerce, Energy and Homeland Security to measure whether the sanctions are helping curtail Iran's support to terrorist groups and its acquisition of biological, chemical and nuclear weapons.

Representative Christopher Shays of Connecticut, who requested the report, said he will introduce legislation directing the U.S. to regularly track the impact of sanctions.

``If we want to continue to improve the application of sanctions, we must first know how the current batch are working,'' Shays, the top Republican on the House national security subcommittee, said in an e-mailed statement to Bloomberg News.

The GAO report comes as President George W. Bush completes a visit to the Middle East aimed in part at drumming up support for increased pressure on Iran. That goal is challenged by Iran's role as the world's fourth-largest oil producer and exporter, the GAO says in the report.

U.S. Sanctions

The first formal U.S. sanctions against Iran, an executive order in 1987, banned imports of Iranian goods. Congress in 1992, 1996 and 2000 passed laws that called for imposing civil or criminal financial penalties, freezing assets and barring U.S. business with any companies that sell Iran technology that enhances its chemical, biological or nuclear weapons programs.

Iran's overall exports worldwide still increased in 2006 to $70 billion from $8.5 billion in 1987, while Iranian imports worldwide grew to $46 billion from $7 billion over the same time, the GAO says.

The report said Treasury and State Department officials who enforce sanctions acknowledged that, except in limited cases involving financial penalties, they don't assess the impact of their agency's actions against Iran.

The officials cited ``the difficulty of isolating the impact of sanctions from other factors that influence Iran's behavior,'' the report said. ``State officials reported that sanctions are just one component of U.S. efforts to influence Iran's behavior.''

Except for Treasury assessments of financial sanctions, the agencies ``do not possess data on the direct results of sanctions,'' according to the report. Without more data, ``Congress and the administration will continue to lack important information for developing effective strategies to influence Iran's behavior.''

Recommendations

The GAO recommended Congress require the agencies to start collecting specific data to measure the impact of sanctions and report periodically to Congress. The assessment should include State, Commerce and intelligence estimates of sensitive U.S. technology diverted to Iran through third nations, whether companies overseas continue to sell products to Iran after being penalized by the U.S. and whether foreign financial institutions are delaying energy business with Iran, GAO says.

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

Last Updated: January 16, 2008 00:00 EST

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