US sanctions plan for Iran would imperil food and drug imports

A U.S. proposal to almost totally sever Iran from the global financial system could hinder its ability to secure supplies of food and drugs just as it struggles to contain a resurgence of the worst coronavirus outbreak in the Middle East.

The Trump administration is considering targeting more than a dozen banks and labeling Iran’s entire financial sector off limits, three people familiar with the matter said on Monday. That would mark a sharp escalation in Washington’s efforts to force Iran into new negotiations over its nuclear program and activities in the region, two years after the U.S. left a landmark 2015 deal and reimposed sweeping sanctions, including on vital oil exports.

“I really don’t know what to say. Access to money will definitely get even harder for us,” said Seyed Abdolreza Hejazi Farahmand, chief executive officer of Tehran-based Behestan Plasma PJS Co., which produces plasma-derived products for hemophiliacs.

Under the plan, the administration would blacklist roughly 14 banks in Iran that have so far escaped some U.S. restrictions, under authorities designed to punish entities associated with terrorism, ballistic-missile development and human-rights abuses. The proposal is still under review and hasn’t been sent to President Donald Trump.

Included in the list of banks are Saman Bank and Middle East Bank, the two remaining lenders still able to conduct humanitarian trade and import food and pharmaceuticals into Iran. Officials at the banks, and the Central Bank of Iran, weren’t immediately available for comment.

Drug importers and medical supply companies in Iran are now weighing the possibility that the proposed new penalties would all but paralyze their work. That could leave companies increasingly dependent on a small network of informal money changers overseas who can execute financial transfers but who might also find themselves in Trump’s crosshairs under the new sanctions.