Worldwide Angers Erupts Over D’Amato-Kennedy Act

by Patrick Seale

An unprecedented international outcry has greeted U.S. attempts to stiffen sanctions against Iran and Libya by penalizing foreign companies investing in the oil and gas sectors of these two statesstates which President Clinton has denounced as dangerous centers of world terrorism.

The D’Amato-Kennedy bill (the Iran and Libya Sanctions Act of 1996), signed on March 12, has joined the Helms-Burton Bill (Cuban Liberty and Democratic Solidarity “Libertad” Act) signed on Aug. 5 as a target for abuse and derision around the world.

Protests at the D’Amato-Kennedy bill have come from a great many quarters, including from members of the European Union, from Japan, Canada, Australia, Russia and China, and also from Egypt and other Middle Eastern states known to have little sympathy for either Iran or Libya.

For example, the semi-official Cairo daily Al-Ahram wrote on Aug. 8 that “The United States is seeking to impose its will on its allies by waving the flag of the fight against terrorism,” while the opposition daily Al-Wafd declared in more strident terms: “By signing this bill, the U.S. president has relinquished his position as head of the world’s leading democracy, moved us back to the Middle Ages, and put on the tiara of a Roman Catholic pope by excommunicating any foreign company investing more than $40 million in oil or gas production in Libya or Iran.”

Several trading partners of the United States have openly threatened reprisals and counter-measures if the new law is applied against their nationals.

Objections have taken three main forms:

• First, and most widespread, is the view that the U.S. has no right unilaterally to extend its own domestic legislation to foreign countries. This is a major point of principle which almost all the protesters have underlined.

• Second is the view that the U.S. is unwise to demonize and boycott countries with which it is in dispute as “rogue” or “backlash” or “pariah” states, and demand that others do likewisewithout producing convincing evidence of their misdeeds. Most Europeans consider America’s policy toward Iranand its obsessions with Tehran’s alleged “terrorism”as wholly irrational.

When asked on French TV on Aug. 5 about Iran’s role in international terrorism, French Foreign Ministry spokesman Yves Doutriaux declared: “The problem in this matter is that there is no evidence.”

• The third objection focuses on America’s true motives in passing the Iran and Libya Sanctions Act. Some leading protesters are convinced that Washington’s current crusade against “international terrorism” is little more than a cynical U.S. device to steal a march on its commercial and industrial competitors.

Some are convinced U.S. sanctions are driven by economic rather than diplomatic motives.

In a striking example of this way of thinking, on Aug. 23 the prestigious French daily Le Monde carried a front-page article by Serge Marti entitled: “Terrorism, an alibi for a trade war.”

Of all the protesters, France has probably been the most vocal and systematic, beginning with French Foreign Minister Hervé de Charette, who spoke out on the day after the signature of the Sanctions Act. Commenting on both Helms-Burton and D’Amato-Kennedy, he declared in an Aug. 6 interview with the French daily, the Parisien:

“These American laws have nothing to do with the fight against terrorism. I am totally opposed to one state changing the rules of international trade to its own advantage and unilaterally imposing this change on others.”

In the view of Hervé de Charette and other senior French officials, U.S. sanctions are driven by economic rather than diplomatic motives. They believe America’s anti-terrorist campaign cloaks an ambition to conquer world markets.

To underline the link between the Sanctions Act and international terrorism, Bill Clinton signed the bill at a televised ceremony in the presence of relatives of victims of PanAm 103, downed over Lockerbie, Scotland in December 1988. But a few hours later, State Department spokesman Nicholas Burns gave the game away: “Total [a French oil company] took Conoco’s place [in Iran] and secured a contract which would have been very profitable for Conoco. We want to punish companies which take this sort of attitude in the future.”

As some 20 percent of Western Europe’s oil imports come from Iran and Libya, which rank 4th and 15th, respectively, among world producers, the immediate objective of the Sanctions Act would seem to be to induce French oil companies to withdraw from Iran and Italian oil companies from Libya, and seek crude supplies elsewhere.

Last year Total signed a contract worth more than 3 billion francs ($600 million) with Iran to work on the Sirri oil field, while the French Elf group has recently responded to an Iranian invitation to tender for the Dorud concession. In Libya, Total has invested more than 7 billion francs ($1.4 billion) over the past 20 years.

Repercussions and Responses

The European Union has already made it clear that it will not bend to Washington’s will. In an interview with French TV on Aug. 6, French Industry Minister Franck Borotra declared: “The American decision is clearly not enforceable under international law. Today I do not believe that the U.S. decision will have any repercussions for French companies. But if indeed there are repercussions, an appropriate response will need to be made.”

The following day, French radio reported that President Jacques Chirac had threatened Washington with immediate reprisals if French companies were affected by the Sanctions Act. France, he was reported as saying, would adopt appropriate legislation so that negotiations with the United States could take place on an equal footing.

There have been numerous other reactions in a similar vein from around the world. The Russian Foreign Ministry said that the U.S. bill was “unacceptable” and “will not help to stabilize the situation in the Middle East. Nor will it be effective in fighting terrorism. The extra-territorial thrust of the law runs counter to international law.” Australian Trade Minister Tim Fischer said the U.S. law was “wrong in principle,” while Canada’s Foreign Affairs department rejected the bill “because it implies extra-territoriality, or legislating beyond one's borders.” At least 12 Canadian companies were doing business in Libya last year. Ireland’s Foreign Minister Dick Spring said that the American legislation was “extremely worrying and unhelpful to European relationships with the U.S.”

The most concrete rebuff to the United States came from Turkey, a NATO ally and third largest beneficiary of American aid [after Israel and Egypt].

On Aug. 11, less than a week after Bill Clinton signed the Sanctions Act, Turkey’s new Prime Minister Necmettin Erbakan, in Iran on a much publicized visit, signed a US $23 billion gas deal.

Under the contract, Iran will supply Turkey with 3 billion cubic meters of gas a year beginning in 1999, rising to 10 billion cubic meters in the final years of the 20-year contract. A gas pipeline is to be built from Tabriz in northwest Iran to the Turkish frontier. The deal will boost Iran’s revenues by $800 million to $1 billion a year. Iran and Turkey have also agreed to increase their two-way trade from its current level of $960 million a year to $2.5 billion.

No one on this side of the Atlantic wants to engage in a “trade war” with the United States or risk falling victim to American sanctions. But neither do the Europeans, Canadians, Chinese and the rest of them want to give ground before what they see as an aggressive American commercial assault on world markets.