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World

Iran Unfreezes Bank Assets With Iran Nuclear Deal In Place

RACHEL MARTIN, HOST:

There are a lot of very big consequences to the implementation of the Iran nuclear deal. Here's one. Iran had billions of dollars' worth of funds that were parked in banks, unable to be accessed. Now those once-frozen assets are flowing again. Iran's economy had been crippled by economic sanctions related to its nuclear program, so those now-unfrozen assets are going to be most welcome.

To better understand where this money goes now, we reached Elizabeth Rosenberg. She's a senior fellow at the Center for New American Security and a former senior adviser at the U.S. Department of Treasury. Thanks so much for being with us.

ELIZABETH ROSENBERG: Glad to be with you.

MARTIN: How much money are we talking about here?

ROSENBERG: Well, there have been different estimates out there about how much money Iran now has access to. People have said 150 billion. The treasury secretary of the United States said 55 billion. But the Iran central bank governor said recently that they moved 32 billion, so it's not clear what's going on with the rest of the money. Have they not had access to it yet? It's still waiting to get unwound as the plumbing of the international financial system gets put back together after Iran's been unfrozen. Or maybe more of it is tied up than we thought in some of these terrible assets and nonperforming loans.

MARTIN: Let's talk about the nature of this money. Where did it come from in the first place? Is this oil revenue? What generated it?

ROSENBERG: So mostly we're talking about money that's frozen that was associated with people who were blacklisted on the U.S. sanctions list. People and companies that were on that list, their assets were frozen. And now, after about 400 entities have been taken off that list last Saturday, on implementation day, their assets are now free to go, free to move around.

MARTIN: This was money, though, that was linked to specific individuals. So does it go back to them, or does it go to the Iranian government?

ROSENBERG: Also linked to the Central Bank of Iran. And in a highly state-controlled economy, the government has access to or control over plenty of it.

MARTIN: Can you give us an economic picture of Iran right now? The country had been in severe recession, in part because of these crippling economic sanctions related to the nuclear program. What are the most acute economic needs there?

ROSENBERG: Iran's economy is in pretty rough shape. Import's falling. Inflation is a concern. Unemployment is a concern. That's a pretty poor outlook for a country that's just been brought in from the cold.

MARTIN: Do we have a sense of, then, where this money is going to be used? I mean, there's been a lot of criticism from people on Capitol Hill who have pointed at this deal and said it's a bad idea, in part because all this money is now going to flow back into the Iranian government, and we can't be sure how they're going to use it. And critics have said - what's to prevent the government from using this money to build up its military and further destabilize the region, instead of using it domestically for - to create jobs programs, to build up infrastructure?

ROSENBERG: Right. And they have a track record of doing so. It's a state sponsor of terror. We're clear about their financing for Hezbollah, their financing for the Houthis, their active involvement in destabilizing the region. And it doesn't necessarily take a lot of money to fund low-level conflict that can be a major problem in the region. It's not possible to ensure that Iran won't spend a penny on that kind of destabilizing, concerning activity, although what's abundantly clear is that they have lots of needs for infrastructure investment, for access to this liquidity to help them manage their currency as well as, you know, basic jobs development, subsidy rollbacks. There's more needs than that 55 billion or 100 billion, if you're so inclined to think that way, can help support.

MARTIN: Elizabeth Rosenberg of the Center for New American Security, thanks so much.

ROSENBERG: Thanks very much. Transcript provided by NPR, Copyright NPR.