South Korea assesses impact of new US sanctions targeting Iran

The United States has launched "Operation Economic Outcast," a new round of sanctions aimed at crippling Iran's economy by targeting countries that conduct business with it. Treasury Secretary Scott Bessent declared the operation's goal is to "foreclose every other option available to the Iranian regime."

“

Today, we are launching Operation Economic Outcast to foreclose every other option available to the Iranian regime.

The sanctions will impose secondary penalties on entities engaging in business with Iran across five key sectors: digital assets, technology, gold, aviation, and shipping. This move follows the Trump administration's 2018 withdrawal from the JCPOA and subsequent re-imposition of sanctions, which had already significantly curtailed trade between South Korea and Iran.

South Korea's Ministry of Foreign Affairs stated it is closely monitoring the US actions and will conduct a thorough examination of the potential impact on domestic businesses and financial institutions. However, officials noted that most South Korean companies had already withdrawn from Iran, and trade has been largely halted, with only limited transactions in food and pharmaceuticals remaining. South Korea-Iran trade has fallen dramatically from a high of $17.4 billion in 2011 to approximately $150 million currently.

“

The plan is to conduct a close examination with related agencies on the impact that the new sanctions plan will have on South Korea, including the five new sanction areas.

While major economies like China, Russia, Turkey, and India are expected to be more significantly affected, some experts, like former South Korean Ambassador to Iran Yun Kang-hyeon, expressed skepticism about the sanctions' effectiveness. He suggested the US would face difficulties pressuring China and that Turkey might not fully comply with the US demands, potentially limiting the sanctions' overall impact.

“

The focus of the US’ sanctions is on countries that have played a lifeline role to Iran in spite of the previous sanctions, namely China, Russia, India, and Turkey, but the Trump administration will have trouble applying much pressure against China, and Turkey isn’t simply going to go along with what the Trump administration says either.