US extends sanctions relief under Iran nuclear deal

Iranian President Hassan Rouhani in the capital Tehran on April 14, 2017.
Iranian President Hassan Rouhani in the capital Tehran on April 14, 2017.PHOTO: AFP

WASHINGTON (REUTERS) - US President Donald Trump on Wednesday (May 17) extended wide sanctions relief for Iran called for under a 2015 international nuclear deal even as he imposed narrow penalties on Iranian and Chinese figures for supporting Iran's ballistic missile programme.

The dual actions, announced by the Departments of State and Treasury, appeared designed to signal toughness on Iran even as Trump continued predecessor President Barack Obama's policy of carrying out the pact under which Iran agreed to limit its nuclear programme in return for sanctions relief.

While Trump criticised the nuclear pact as a presidential candidate - at one point saying he would "dismantle the disastrous deal with Iran" - Wednesday's actions demonstrated that he has decided, at least for now, to keep it.

"The United States continues to waive sanctions as required to continue implementing US sanctions-lifting commitments in the Joint Comprehensive Plan of Action," the State Department said in a statement, referring to the deal by its formal name.

The United States brands Iran as a "state sponsor of terrorism" and says Tehran's support for Syrian President Bashar al-Assad in a civil war in Syria, Houthi rebels in Yemen's civil war and the Hezbollah Shi'ite political party and militia in Lebanon, have helped to destabilise the Middle East.

"This ongoing review does not diminish the United States' resolve to continue countering Iran's destabilizing activity in the region, whether it be supporting the Assad regime, backing terrorist organizations like Hezbollah, or supporting violent militias that undermine governments in Iraq and Yemen," the statement said.

Separately, the Treasury Department said it had sanctioned two senior Iranian defense officials, an Iranian company, a Chinese man and three Chinese companies for supporting Iran's ballistic missile programme.

The decision on the sanctions waiver represents a major early policy choice on the nuclear deal for the Trump administration, which has said that it is engaged in a wider policy review on how to deal with Iran.

In Iran's presidential election on Friday, President Hassan Rouhani, a pragmatist cleric whose administration negotiated the nuclear deal, is battling a conservative challenger and trying to convince voters he can deliver on promises of economic growth.