One of my goals for this blog is to inform people of the wider political, social and economic context of nuclear issues. The negotiations between members of the UN Security Council and Iran over the Iranian nuclear program have passed the deadline at the end of June but participants are hopeful that they will soon reach and acceptable deal. One of the major issues is the removal of crippling trade sanctions. Iran has serious economic difficulties brought on by the trade sanctions and is eager to find a way to get rid of them.
The Iranian Revolutionary Guard Corps was created in 1979 by Ayatollah Khomeini during the 1979 Islamic revolution which saw Americans taken hostage by the Iranians. However, what many in the U.S. don't know is that the Corp is not just a military organization. It is also an industrial "empire" with significant political power. The business of the IRGC has grown tremendously over the last decade because of the support of a former president who was a member of the Corp and also from business opportunities created by Western trade sanctions. As Western companies pulled out of Iranian businesses such as the oil industry, the Iranian government awarded huge no-bid contracts to companies controlled by the IRGC.
A recent estimate of the annuals revenues from all of the IRGC's economic activities is over ten billion dollars. That would be as much as seventeen percent of Iran's GDP. The IRGC controls major Iranian companies in tourism, transportation, energy, construction, telecommunications and other market sectors. Many of the businesses that profit the Corps are not owned directly by the Corps but are operated by front companies and individuals connected to the Corps. not directly owned by the Crops.
If the Western Trade sanctions are lifted, the Iranian economy will boom and so will the fortunes of the IRGC empire. Lifting of trade sanctions will result in lower insurance, shipping and commission costs will allow Corp businesses to import spare parts, equipment and technology from international companies. To do business in Iran, foreign companies will have to be connected to Iranian companies many of which are be indirectly controlled by the Corps. This will be important because Corps companies such as Khatam Al-Anbia, a huge construction consortium with over eight hundred affiliated companies is itself on a list of banned companies because it is a "proliferator of weapons of mass destruction."
Considering all this, it is not surprising that the Corps has been a public supporter of the nuclear negotiations. In addition, even though the Corps has proven resourceful in circumventing international trade restrictions, some projects could not be undertaken because Iranian companies lacked technology and expertise required. The removal of the trade sanctions will allow the Corps and its front companies to flourish. Even though the Corps friendly president is gone from office there are still high officials of the Iranian government connected to the Corps. Regrettably, although the Corps is pro-trade, some of its other political positions with international ramifications are considered "hard-line." Lifting the trade sanctions will result in increasing the power of the IRGC.
Flag of the Iranian Revolutionary Guard Corps:
