Sanctions Against Iran May Cause Small Business Closures

Sanctions Against Iran May Cause Small Business Closures

Sarah Coffey
Aug 10, 2010
Peace Industry Rugs Workshop in Iran

We received an email today from San Francisco-based Peace Industry Rugs that their store will likely close after the expanded sanctions on Iran go into effect on September 29th, 2010. Peace Industry owners Melina and Dodd Raissnia own and operate their own 100% wool carpet workshop in Iran and import rugs into the US, where they have a Hayes Valley storefront. Tighter restrictions on trade are causing them and other Iranian carpet importers to prepare to close up shop.

A Brief Background on the Sanctions
On June 9, the United Nations Security Council voted 12 to 2 (with one abstention) to impose additional sanctions on Iran. A statement released by the Security Council explains, "Expressing deep concern about Iran's lack of compliance with its previous resolutions on ensuring the peaceful nature of its nuclear programme," the Security Council voted to tighten "restrictions on financial and shipping enterprises related to "proliferation-sensitive activities."

On June 24, Congress passed the "Comprehensive Iran Sanctions, Accountability, and Divestment Act of 2010" (CISADA), and on July 1, President Obama signed the Act into law. The new Act re-introduces previous bans on the importation of rugs and other goods. According to a report prepared for Congress by Kenneth Katzman, Specialist in Middle Eastern Affairs, a pre-existing trade ban was eased in 2000 "to allow U.S. importation of Iranian nuts, dried fruits, carpets, and caviar." With the adoption of stricter sanctions, that article (CISADA 103) which effectively bans rug imports was reinstated.

What It Means for Rug Makers and Sellers
The impact of sanctions on economies and national security is debatable and controversial. Rug News reports that imports of Iranian wool carpets amounted to just over $43 million in 2009, but in an earlier article from 2007, the same publication reported that US sanctions on Iranian rug imports would have minimal impact on the industry overall, as "most mainstream rug importers are only minimally involved with Iran."

Peace Industry is a small business, and impact on their store is direct and immediate. In a letter to Congresswoman Nancy Pelosi, Melina Raissnia writes, "I have a very successful and beloved felt rug store in San Francisco. My husband and I have revitalized an ancient felt rug tradition from Central Asia and the workshop that supplies our store is in Iran. It is the only one in the world. Thus, these new sanctions, if adopted as is, would effectively put us out of business." She is asking supporters of the store to email their representatives on the store's behalf "if only to have it on the public record."

SOURCES AND MORE INFORMATION
A Sad Day for Peace Industry from the Peace Industry Rugs Blog
U.N. Approves New Sanctions to Deter Iran from the New York Times
Iran Sanctions, Kenneth Katzman, prepared for Congress, April, 9, 2010
Security Council Imposes Additional Sanctions on Iran from the UN Security Council
Tightening the Grip from the Public Affairs Alliance of Iranian Americans
Factbox: EU, UN, and US Sanctions Against Iran from Reuters
Sweeping US Sanctions Against Iran Will Affect Rug Imports from Rug News
Will Persian Rug Embargo Impact Local Businesses? from Aspen Daily News

Top Photo: Peace Industry Blog

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