Washington, DC–US sanctions on Iran have carried a significant cost to the US trade and economy, a new report published by the National Iranian American Council (NIAC) finds. The report “Losing More Billions – The Cost of Iran Sanctions to the US. Economy” reveals that between 1995 and 2014, the U.S. sacrificed at least $203 billion and as much as $272 billion in potential export revenue to Iran.
According to the report, the losses to the US economy will decrease if the process of sanctions relief continues under the Iran nuclear deal. They will increase if the incoming Trump administration scuttles the agreement.
These estimates reflect losses solely from export industries and do not include the detrimental economic effects of other externalities of Iran-targeted sanctions, such as higher global oil prices. Consequently, the full cost to the US economy is likely even higher. Moreover, the model does not take into account the approximately $41.6 billion that would be lost if the recently announced Boeing deal were canceled.
“Just in the last two years, an additional $97 billion was lost, as Europe and Asia entered the Iranian market after the nuclear deal and the U.S. was left behind,” said NIAC Research Director Reza Marashi, one of the report’s co-authors.
There is also a human element, measured in terms of jobs needed to support higher export levels. On average, the lost export revenues translate into between 73,000 and 97,000 lost job opportunities each year. In 2008, the number reached as high as 315,000-422,000 lost job opportunities.
Europe also absorbed a significant cost during the years it sanctioned Iran. Germany was hit the hardest, losing between $37.9 and $150.3 billion between 2010 and 2014, with Italy and France following at $21.4-$85.0 billion and $14.8-$58.8 billion respectively.
“Between 2010 and 2014, trade revenue losses to the EU were 220% higher than losses to the United States. However, this will not be the case going forward as Europe – unlike the U.S. – has lifted its nuclear-related sanctions on Iran,” said Jonathan Leslie, the report’s lead author.
The political significance of the losses to the US economy has grown considerably as a consequence of the uncertainty surrounding the Iran nuclear deal under the Trump administration.
“Understanding the cost of sanctions to the US is critical mindful of the ongoing debate within the Trump transition team on whether to keep or scuttle the Iran deal,” said Trita Parsi, President of NIAC and one of the report’s three authors. “What is at stake is not only the $41.6 billion Boeing deal and the tens of thousands of jobs it would support, but additional massive export revenue gains that would support another 73,000-97,000 job opportunities.”
“Mindful of Trump’s promise to create American jobs, the President-elect simply cannot ignore $272 billion in lost export revenue or 200,000 lost American job opportunities in one year,” Parsi added.
The report can be downloaded in its entirety here.