WASHINGTON: The Biden administration has extended by four months a sanctions waiver that will allow Iraq to continue to purchase electricity from Iran and gives Iran limited access to the proceeds to buy humanitarian goods.
Secretary of State Antony Blinken signed the 120-day waiver extension and it was transmitted to Congress on Tuesday, US officials said. The move is likely to draw criticism from Iran hawks on Capitol Hill and elsewhere who believe the extension will reward Iran at a time when it is coming under increasing pressure to end its support for proxy groups, including Hamas, that are destabilizing the Middle East.
There is roughly $10 billion in Iraqi payments for Iranian electricity currently being held in escrow accounts in Iraq, and the waiver will allow Baghdad to maintain its energy imports without fear of US penalties for violating sanctions on Iran.
It will also keep in place a provision — included in the last 120-day waiver — under which portions of the electricity proceeds can be transferred to accounts in Oman and then converted to euros or other widely traded currencies for Iran to buy non-sanctioned products.
The officials, who spoke on condition of anonymity to discuss the decision-making process, said Blinken signed the waiver mainly because the administration doesn’t want to cut Iraq off from a critical source of energy.
But, they said the administration is confident Iran will not be able to use any of the money for nefarious purposes. They said a rigorous vetting process is in place to ensure that the cash can only be used for food, medicine, medical equipment and agricultural goods.
Blinken visited Baghdad on Nov. 5 and met with Iraqi Prime Minister Mohammed Shia Al-Sudani during the course of a Middle East trip focused on the Israel-Hamas war and efforts to prevent it from spreading into a broader regional conflict.
The officials added that only a small amount of the money held in Iraq had been transferred to Oman during the past 120 days and that none of the money now held in Omani banks had yet been spent.
The waiver is similar to one signed by Blinken earlier this year, which freed up some $6 billion that South Korea had paid to Iran for oil imports in exchange for the release of Americans held prisoner by Tehran. Under that waiver, the money held by South Korea was transferred to banks in Qatar and is also restricted for the purchase of humanitarian supplies.
However, Iran hawks point out that the waivers can allow Iran to free up domestic revenue it would have otherwise spent on humanitarian goods to fund proxies like Hamas, Lebanon’s Hezbollah and the Houthis in Yemen.
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US extends sanctions waiver allowing Iraq to buy electricity from Iran
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US extends sanctions waiver allowing Iraq to buy electricity from Iran
- There is roughly $10 billion in Iraqi payments for Iranian electricity currently being held in escrow accounts in Iraq
US moves to counter China in Bangladesh, plans to pitch defense alternatives
DHAKA: The United States is concerned about China’s expanding presence in South Asia and is planning to offer Bangladesh’s next government US and allied defense systems as alternatives to Chinese hardware, Washington’s ambassador to Dhaka told Reuters. Bangladesh votes in a general election on Thursday after a Gen Z-led uprising toppled India-allied premier Sheikh Hasina in August 2024. She has since taken refuge in New Delhi, allowing China to deepen its influence in Bangladesh as India’s presence wanes. China recently signed a defense agreement with Bangladesh to build a drone factory near the India border, worrying foreign diplomats. Bangladesh is also in talks with Pakistan to buy JF-17 Thunder fighter jets, a multi-role combat aircraft jointly developed with China.
“The United States is concerned about growing Chinese influence in South Asia and is committed to working closely with the Bangladeshi government to clearly communicate the risks of certain types of engagement with China,” US Ambassador Brent T. Christensen said in an interview on Tuesday.
“The US offers a range of options to help Bangladesh meet its military capability needs, including US systems and those from allied partners, to provide alternatives to Chinese systems,” he said without offering further details.
The Chinese foreign ministry did not immediately respond to a request for comment.
Christensen also said that President Donald Trump’s administration would “like to see a good relationship between Bangladesh and India to support stability in the region.” New Delhi-Dhaka relations have nosedived since Hasina fled, badly affecting visa services and cricket ties between the two neighbors.
COMMERCIAL DIPLOMACY IS PRIORITY
Christensen said many US businesses were looking at potentially investing in Bangladesh but would want the next government to show early and clear signs that it is “open for business.”
“Commercial diplomacy is one of our top priorities, and we look forward to working with the new government to build on progress made with the interim government, particularly in strengthening commercial, economic, and security ties,” he said.
Energy producer Chevron has been in Bangladesh for decades but not many other US companies are visible in the densely populated country of 175 million people, as high taxes and difficulties repatriating profits have created some hurdles.
There are no Starbucks or McDonald’s outlets in Bangladesh.
The envoy said Washington would work with “whichever government is elected by the Bangladeshi people.” The race is between two coalitions led by former allies, the Bangladesh Nationalist Party (BNP) and the Islamist Jamaat-e-Islami, with opinion polls suggesting the BNP holds an advantage.
AID FOR ROHINGYA REFUGEES
Regarding the 1.2 million Rohingya refugees sheltered in Bangladesh, the ambassador said the United States remained the largest contributor to humanitarian operations.
“The US remains the largest contributor to the Rohingya refugee response and continues robust health programming in Bangladesh,” he said, noting a recent $2 billion worldwide funding framework signed with the United Nations to improve the effectiveness of such assistance, including in Bangladesh.
He urged other international donors to take on a greater share of the burden.
“The US cannot sustain the bulk of the effort alone. International partners need to increase their support for the Rohingya response,” he said. In recent years, the UN refugee agency has been struggling to raise sufficient funds to support the Rohingya community, leading to cuts in their rations and the closure of some schools for them.
“The United States is concerned about growing Chinese influence in South Asia and is committed to working closely with the Bangladeshi government to clearly communicate the risks of certain types of engagement with China,” US Ambassador Brent T. Christensen said in an interview on Tuesday.
“The US offers a range of options to help Bangladesh meet its military capability needs, including US systems and those from allied partners, to provide alternatives to Chinese systems,” he said without offering further details.
The Chinese foreign ministry did not immediately respond to a request for comment.
Christensen also said that President Donald Trump’s administration would “like to see a good relationship between Bangladesh and India to support stability in the region.” New Delhi-Dhaka relations have nosedived since Hasina fled, badly affecting visa services and cricket ties between the two neighbors.
COMMERCIAL DIPLOMACY IS PRIORITY
Christensen said many US businesses were looking at potentially investing in Bangladesh but would want the next government to show early and clear signs that it is “open for business.”
“Commercial diplomacy is one of our top priorities, and we look forward to working with the new government to build on progress made with the interim government, particularly in strengthening commercial, economic, and security ties,” he said.
Energy producer Chevron has been in Bangladesh for decades but not many other US companies are visible in the densely populated country of 175 million people, as high taxes and difficulties repatriating profits have created some hurdles.
There are no Starbucks or McDonald’s outlets in Bangladesh.
The envoy said Washington would work with “whichever government is elected by the Bangladeshi people.” The race is between two coalitions led by former allies, the Bangladesh Nationalist Party (BNP) and the Islamist Jamaat-e-Islami, with opinion polls suggesting the BNP holds an advantage.
AID FOR ROHINGYA REFUGEES
Regarding the 1.2 million Rohingya refugees sheltered in Bangladesh, the ambassador said the United States remained the largest contributor to humanitarian operations.
“The US remains the largest contributor to the Rohingya refugee response and continues robust health programming in Bangladesh,” he said, noting a recent $2 billion worldwide funding framework signed with the United Nations to improve the effectiveness of such assistance, including in Bangladesh.
He urged other international donors to take on a greater share of the burden.
“The US cannot sustain the bulk of the effort alone. International partners need to increase their support for the Rohingya response,” he said. In recent years, the UN refugee agency has been struggling to raise sufficient funds to support the Rohingya community, leading to cuts in their rations and the closure of some schools for them.
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