Iran's economic woes expected to worsen after being put on financial blacklist

The Islamic Republic of Iran’s deep economic problems will likely get worse now that an international watchdog group has put the Middle East government on its financial blacklist.

The Financial Action Taskforce added the Iran government to the list after years of warning leaders about financing terror groups. The guidelines for such reform are included in the Paris-based taskforce’s Palermo and Terrorist Financing Conventions that Republic leaders have failed to sign.

The taskforce’s 39-member body made the decision about putting the Republic on the list after a week-long meeting.

As a result, the taskforce is asking member nations to use greater scrutiny in financial transactions with Iran, which is expected to make it increasingly difficult for the Republic to borrow from the few foreign banks that still lend it money.

“The consequence of (Iran’s) inaction is higher costs of borrowing and isolation from the financial system,” a Western diplomat told Reuters. The United States reportedly supports the taskforce’s decision.

Secretary of State Mike Pompeo purportedly said in a statement that Iran “must face consequences for its continued failure to abide by international norms.” 

The blacklisting also could advance the United States’ efforts to put more financial pressure on Iranian leaders to get them to curtail their nuclear ambitions and support of terror activities.

Iranian Foreign Ministry spokesman Abbas Mousavi described the taskforce’s decision to blacklist Iran as a “politicized act” and said the “stigma of money-laundering and financing terrorism has nothing to do with Iran," according to the Islamic Republic News Agency."