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When Iran Hedges Closer, US Pushes Away

Despite an embargo, the US is Iran's biggest trading partner, and many Iranians see US efforts to isolate Iran as a double standard

By Lamis AndoniSpecial to The Christian Science Monitor / April 7, 1995


HUGE black letters pronounce ''Down with the USA'' in the lobbies of all first-class hotels in Iran's capital. Newspaper editorials and Islamic Friday sermons claim the United States conducts ''arrogant policies against the oppressed.''

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At a public level, fervor against what Iran calls ''the Great Satan'' is nearly as high as the days after the 1979 revolution when the overthrow of the US-backed Shah was celebrated and 59 Americans were held hostage for 444 days.

Animosities revived last month when President Clinton prevented a US oil firm, Conoco Inc., from developing an Iranian oil field. And now Mr. Clinton is threatening to ban all US companies from trading with Iran, citing Iran's opposition to the Israeli-Palestinian peace process, its sponsorship of Mideast terrorist groups, its arms buildup in the Gulf, and its apparent drive to develop a nuclear capability by buying reactors from Russia.

Nonetheless, Iran's top leaders are eager to improve ties with Washington to help their country fully reintegrate with the world economy, say Tehran-based diplomats and analysts.

But from Tehran's perspective, every time President Hashemi Rafsanjani tries to set the stage for better relations, the US takes steps that anger hard-line religious leaders who strongly oppose ties with the US. Clinton's latest move on trade is expected to weaken attempts to modify the hard-liners' position.

A US trade ban would strip Tehran from a major source of income at a time when its economy is worsening. Foreign diplomats in Tehran estimate trade between Iran and US companies at $3.5 billion, making the US Iran's biggest trading partner.

The US government reimposed an embargo on the import of Iranian oil in 1987 in response to Iran's sponsorship of international terrorism, and further banned the export of high-technology equipment. But many US companies have found a way to the Iranian market through foreign subsidiaries. ''The US has managed to dominate the Iranian market before and after the revolution,'' notes one West European diplomat.

Until Clinton's attempts to further isolate Iran economically, the US pursued a double-standard policy of allowing US firms a large stake in the Iranian market but containing Iran in other areas. ''How do you explain that the US is persistently pressuring other countries not to deal with Iran, while its companies have the biggest share in the market?'' asks an East European diplomat.

High hopes 'in Clinton'

Moderate Iranians were hopeful for better relations with the US when Clinton became president in 1993, believing that they might be rewarded for not siding with Iraq during the Gulf war. The US, however, took this for granted, not expecting Iran to side with its old enemy, especially after the 1980-88 Iran-Iraq war.

Their hopes were dashed when a Clinton adviser on the Mideast, Martin Indyk, now the ambassador to Israel, announced a ''dual containment'' policy to isolate both Iran and Iraq. ''When Clinton announced his policies, we felt that we were punished and not rewarded for our position during the Gulf war,'' says Hadi Samata, a political science professor at Tehran University.

The US stepped up its campaign to isolate Iran this year after Iran signed an agreement with Russia to develop a nuclear reactor that Iranian leaders insist will be used for peaceful purposes. The US and Israel say that it is part of a nuclear-arms build-up, adding to the threat of Iran's missile buildup in the Persian Gulf.

''Iran has signed the Nuclear Non-Proliferation Treaty, while Israel refuses to do so,'' says Hussein Sheikh al-Islam, deputy foreign minister for Mideast affairs in Tehran. ''The US attitude proves that the aim of the campaign against Iran is to justify the fact that Israel is and will remain the only country that possesses a nuclear arsenal in the region. The US is trying to transform Iran as the major threat in the region to force Arab states and people to accept a peace with Israel.''