Iran and the West are now competing over who is getting more stressed: Europe that feared on Wednesday that Iran was about to cut the oil line, or Iran, which has been consistently busy uncovering new technologies.
In one example, the Iranian website Mashreq claimed that the recently launched Navid-class satellite was able to take detailed photographs of the nuclear reactor in Dimona as well as "sensitive sites, air forces bases, and various areas of Tel Aviv."
Iran also displayed its ability to produce its own nuclear fuel on Wednesday, thus claiming to release itself from a dependence on the West, displaying its fuel rod before the IAEA inspectors. Later, Iranian Defense Minister Ahmad Vahidi said that Iran was about to christen a new base geared at launching satellites as heavy as one ton and that the base would be equipped and operational within the year.
On the economic level, while the West is trying to prove the sanctions are working, Iran announced it is upgrading its trade ties with India, Pakistan and Afghanistan. Moreover, Iran says it is about to sign a deal with Iraq and Syria which will include cooperation in the energy sector, and plans to construct one of the largest power plants in the Middle East. The Islamic Republic is also working to renew negotiations with the UN Security Council. According to Turkish sources, the talks are scheduled to begin later this month in Istanbul, hosted by the Turks.
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Iran seems busier with pre-elections political struggles on the domestic front than with the next round of sanctions. In light of the liberal parties' expected boycott of the elections on March 2, Supreme Leader Ayatollah Ali Khamenei announced that "the people will deal the enemy a great blow by showing up en mass at the polling stations." According to Khamenei, the "enemy" is trying to undermine the regime's legitimacy by encouraging a low turnout of voters.
These are extremely important elections, as President Mahmoud Ahmadinejad is hoping to leave behind a political legacy that will continue his policies (he is barred from serving as president again unless he waits a term). Along with Ahmadinejad's aspirations, there is also a struggle taking place in the last few months between his supports and the movements supporting Khamenei, while the liberal movements, who advocate a change in the regime, are being pushed aside. To further ensure that the opposition does not undermine the elections, the government has been trying to prevent the opposition from rallying by cutting off Internet access, monitoring the Internet, slowing down surfing speed and penetrating email and Twitter accounts of those deemed "suspects."
Yet while Iran wishes to prove that the sanctions do not harm its nuclear program and technological development, there is no doubt that its economic situation has deteriorated over the last year. Iran's currency has lost over half its value in less than three months, while conversely, prices have risen. It is very difficult to obtain raw materials for factories, and the government is now asking some subsidized industries to give up governmental aid.
On the other hand, Iranian economists point to the fact that a similar crisis took place in the mid-90s, when the currency's value also dropped by 50 percent. Iran's citizens, they say, adjusted to the situation rather quickly. At the same time, economists and parliament members prefer to blame Ahmadinejad's government for its failed economic policy – which has emptied the treasury's reserves – than to point their finger at the sanctions.
And yet Iran has foreign currency reserves worth about 120 billion dollars and approximately 907 tons of gold, while its foreign debt amounts to between 12 and 22 million dollars (depending on who you ask). Although the budget Ahmadinejad submitted to the parliament included certain cuts of 6.5 percent, he has also declared he intends to increase the development sector's budget by 20 percent. The most important aspect of that budget is that it calculated oil prices at 85 dollars per barrel, while today a barrel is worth more than 110 dollars. These discrepancies may translate into significant profit for the state, and may give Iran room to maneuver if hit with more sanctions.
In light of this economic data, it seems that despite the pressure being felt by the middle class these days – a class that does not support the president anyway – it is doubtful that the current scope of sanctions can change the government's policies, especially during an election year.
Israel can still take some comfort in a survey conducted by the American Pew Research Center, which found that 39 percent of Americans think the U.S. should help Israel take action against Iran (meaning a military strike). According to the poll, most of the Americans (62 percent) who support military action against Iran are Republicans, while a third who oppose such action are Democrats and Independents. If President Barack Obama takes these numbers seriously, it is unlikely that Israel will be given a green light to attack Iran during his term.
Haaretz
Italian police said on Friday they had seized about $6 trillion of fake U.S. Treasury bonds in Switzerland, and issued arrest warrants for eight people accused of international fraud and other financial crimes.
The operation, co-ordinated by prosecutors from the southern Italian city of Potenza, was carried out by Italian and Swiss authorities after a year-long investigation, an Italian police source said.
The fake securities, more than a third of U.S. national debt, were seized in January from a Swiss trust company where they were held in three large trunks.
The eight alleged fraudsters are accused of counterfeiting bonds, credit card forgery, and usury in the Italian regions of Lombardy, Piedmont, Lazio and Basilicata, police said.
The Swiss Federal Prosecutor’s office said Zurich state prosecutors had worked on the investigation at the request of the Italian prosecutor. The Swiss handed over their findings in July of last year.
In 2009, Italian financial police seized $742 billion of fake U.S. bearer bonds in the northern Italian town of Chiasso, near the Swiss border.
Financial Post
North Korea's military has warned South Koreans living on islands near disputed Yellow Sea waters to evacuate the area to avoid possibly being shelled. Pyongyang is threatening retaliation if shells fired during the South's planned naval exercises Monday cross into the North's territorial waters.
A Sunday radio broadcast carried a message from North Korea's military with an unusual “open notice” to those residing on five South Korean-held islands: leave by nine a.m. Monday to avoid possibly being shelled.
That, according to the announcement, is when South Korea is to begin a maritime firing exercise. The notice was aired on radio broadcasts from Pyongyang and was also carried by the North's official news agency (KCNA).
The announcer, reading the statement attributed to a regional military command, says there will be an immediate and merciless counter-attack if even a “single column of water” is monitored in North Korean waters during the drill.
The broadcast says South Korea's government should not forget the lessons of November 23rd, 2010, when a fatal artillery barrage landed on Yeonpyeong island.
Seoul's semi-official Yonhap news agency quotes an unnamed official of the joint chiefs of staff as saying South Korea and the United States will proceed with a live-fire anti-submarine drill in the Yellow Sea Monday, despite the North's warning.
The official says North Korea was notified earlier Sunday of the annual routine exercise through South Korea's representative at the truce village of Panmunjom.
Analysts and U.S. military officers contacted by VOA News say North Korea's evacuation advisory to islanders is unusual. But they also note that threats of retaliation against South Korean military drills are common and not necessarily cause for any undue alarm.
North Korea also warned it will conduct a military retaliation if there are any acts of aggression during two upcoming joint U.S.-South Korean exercises, scheduled to begin February 27. South Korean and U.S. military officials have stressed those maneuvers are not a prelude to an attack, as Pyongyang has claimed.
The two Koreas have technically remained at war since 1953. That is when an armistice was signed halting a three-year civil war that involved U.S. and U.N. forces supporting the South Koreans and the Chinese military on the side of the North Koreans.
VOA
(Reuters) - Belgium-based SWIFT, which provides banks with a system for moving funds around the world, bowed to international pressure on Friday and said it was ready to block Iranian banks from using its network to transfer money.
Expelling Iranian banks from the Society for Worldwide Interbank Financial Telecommunication would shut down Tehran's main avenue to doing business with the rest of the world - an outcome the West believes is crucial to curbing Iran's nuclear ambitions.
SWIFT, which has never cut off a country before, has been closely following efforts in the United States and the European Union to develop new sanctions targeting Iran that would directly affect EU-based financial institutions.
The United States and EU have already moved to sanction Iran's central bank.
"SWIFT stands ready to act and discontinue its services to sanctioned Iranian financial institutions as soon as it has clarity on EU legislation currently being drafted," the company said in an emailed statement.
The United States has been pushing the European Union to force SWIFT to evict the Iranian firms but it was unclear whether the EU would reach an agreement.
For one, SWIFT's home country, Belgium, does not think the global banking firm should be the only company of its kind required to comply with sanctions.
The Obama administration said it welcomed SWIFT's intention to stop transactions involving designated Iranian banks. "We will continue to be in contact with our EU partners to urge action on this issue," a U.S. Treasury official said.
SWIFT, with headquarters just outside the Belgian capital Brussels, is vital to international money flows, exchanging an average 18 million payment messages per day between banks and other financial institutions in 210 countries.
The United States and Europe accuse Iran of seeking to develop nuclear weapons. Iran maintains its nuclear program is for peaceful purposes.
The United States recently enacted sanctions that would punish countries and institutions if they do not reduce their purchases of Iranian oil by mid-year.
The National Iranian American Council, an advocacy group, criticized efforts to expel Iranian firms from SWIFT.
"Kicking Iran out of SWIFT is both unprecedented and another dangerous step toward turning a financial war into a military conflict," said Reza Marashi, the council's research director.
Nineteen banks and 25 affiliated institutions from Iran sent and received some 2 million messages in 2010. They included banks the U.S. accuses of financing Iran's nuclear program or terrorism - Mellat, Post, Saderat and Sepah.
SWIFT, founded in 1973, said its decision reflected the extraordinary circumstances of international support for the intensification of sanctions against Iran.
The company said it had informed its regulators, the world's largest central banks, of its decision.
SWIFT's general counsel is slated to visit Washington next week to meet with lawmakers who have proposed new sanctions targeting its services.
Greece's future in the eurozone is the subject of a crucial meeting in Brussels later as violence erupted in Athens.
The so-called Eurogroup, made up of the 17 countries which use the single currency, will discuss whether the Greek government has done enough to trigger a second 130bn euro bailout.
In a sign of just how seriously the beleaguered nation is taking the gathering, Greek leader Lucas Papademos will accompany his finance minister Evangelos Venizelos.
Senior government sources told Sky News his presence there is in case "decisive decisions for the country need to be taken".
Last week, the coalition government withstood a cross-party rebellion over a 3.3bn euro austerity package, which slashes 15,000 public sector jobs this year alone, cuts the minimum wage by 22% and trims spending from defence and health budgets.
A laser pointer shines on a policeman's face during Sunday's protests in Athens
However, even these measures were not considered to be enough by certain hardline countries within the eurozone, particularly those which have the strongest credit ratings in the EU.
Finland, Austria, the Netherlands and Germany asked for further assurances from Athens that the savage cuts will continue to be implemented after the general election, which is likely to be held this spring.
Political leaders signed letters to that effect last week, but not before Wednesday's meeting of the Eurogroup was cancelled, suggesting patience in Brussels was running low.
US Treasury secretary Tim Geithner said America would encourage the International Monetary Fund to support an agreement on Greek economic reform implementation.
On the weekend, another piece of the jigsaw required to release the bailout fell into place, although it still has to be signed off by the Eurogroup.
Negotiators for private holders of Greek debt, including banks and hedge funds, have agreed to take a massive loss on the bonds they hold in order to reduce the country's debt mountain.
In exchange, they will receive bonds of a lower value and cash sweeteners in a restructuring deal which has now been scheduled for between March 8 and 11.
That is just over a week before Greece has to service a bond redemption of 14.5bn euro. At the moment, it does not have the money.
More than 40 members of the ruling Greek coalition refused to back reforms
Failure to settle its debt would be considered a so-called credit event, where insurance policies - credit default swaps - would be triggered.
That could start a chain reaction similar to that seen after the collapse of Lehman Brothers in 2008.
The fear for Mr Papademos is that some of the countries around the table today have decided a big enough buffer zone has been built around banks and countries exposed to Greek debt to withstand a default.
Meanwhile, amid a recent upsurge in violence in Athens, further scuffles occurred on Sunday evening as protesters engaged in running battles with riot police outside parliament.
On Tuesday, union members affiliated with the communist party are expected to hold their own protest rally and march to parliament.
Sky News
A second regiment of the Teikovo Missile Division in central Russia will be fully equipped with Yars mobile ballistic missile systems in 2012, Strategic Missile Forces (SMF) spokesman Col. Vadim Koval said on Thursday.
Russia fully deployed the first Yars regiment consisting of three battalions in August 2011, and put two battalions of the second regiment on combat duty on December 27 last year.
“The deployment of the third battalion of the second regiment will complete the rearming of the Teikovo division with Yars systems,” Koval said.
Two regiments will consist of a total of 18 missile systems and several mobile command posts.
Two more missile divisions will start receiving the Yars systems in 2012. The Novosibirsk division (in Siberia) will receive mobile Yars systems, while the Kozelsk division (in central Russia) will be armed with the silo-based version of the system.
The Yars missile system is armed with the RS-24 intercontinental ballistic missile that has considerably better combat and operational capabilities than the Topol-M (SS-27 Stalin).
The SMF said last year that the Topol-M and RS-24 ballistic missiles would be the mainstay of the ground-based component of Russia's nuclear triad and would account for no less than 80% of the SMF's arsenal by 2016.
RIA Novosti
Russia would use nuclear weapons in response to any imminent threat to its national security, Chief of the Russian General Staff Gen. Nikolai Makarov said on Wednesday.
“We are certainly not planning to fight against the whole of NATO,” Makarov said in an interview with the Ekho Moskvy radio, “but if there is a threat to the integrity of the Russian Federation, we have the right to use nuclear weapons, and we will.”
The general said Russia’s nuclear deterrent is the cornerstone of strategic stability and serious efforts are being taken by the Russian government to modernize the country’s nuclear triad.
The Russian Defense ministry is planning to acquire at least 10 Borey class strategic nuclear submarines, thoroughly modernize its fleet of Tu-160 Blackjack and Tu-95 Bear strategic bombers, and equip its Strategic Missile Forces with formidable Yars mobile ballistic missile systems.
Makarov also stressed the importance of maintaining highly-efficient, mobile conventional forces.
“Unfortunately, we are facing threats from a number of unstable states, where no nuclear weapons but well-trained, strong and mobile Armed Forces are required to resolve any conflict situation," Makarov said.
The Russian government has allocated 22 trillion rubles ($730 billion) on the state arms procurement program until 2020.
RIA Novosti
