Media Inquiries: Véronique Rodman
vrodman@aei.org (202.862.4870)

FOR IMMEDIATE RELEASE: May 9, 2007

Talk or Bomb? The U.S. popular debate on what to do about Iran's growing nuclear threat has been framed in the context of these two solutions. But diplomatic engagement versus military action are not the only options. Iran is more vulnerable to outside pressure than it would appear at first glance.

Up to now, international efforts to derail Tehran's drive toward nuclear weapons have met with little success, as unilateral American sanctions and limited multilateral sanctions appear to have fallen flat. Yet, the use of economic measures as a viable source of pressure against the Islamic Republic has not been fully explored.

Foreign investment in Iran is the key because its economy is almost entirely dependent on trade and business transactions with the outside world. In 2007 alone, the value of reported business dealings with Iran amounted to more than $45 billion. Without investment in its oil sector, financial support, generous lines of credit, and the respectability afforded by normal trade relations, the Tehran regime would be isolated.

In an effort to gauge the depth and breadth of Iran's economic ties with the outside world, AEI introduces Global Investment in Iran: Interactive (www.aei.org/IranInteractive), an innovative tool useful in assessing the extent of worldwide investment in Iran. Compiled by AEI researchers, this wide-ranging research project on corporate, banking and export credit investment in Iran includes data about major financial transactions with Iran between 2000 and 2007. The findings are based entirely on publicly available sources and organized by year, country, sectors of the economy, and company or bank, with helpful charts tracking trends.

Global Investment in Iran: Interactive documents more than $150 billion worth of major contracts and both private and government lines of credit--over 300 separate worldwide transactions--that have taken place with public and private Iranian entities since 2000. In 2006 alone, according to published reports, nine countries--Belarus, China, France, Germany, Hungary, Italy, Japan, Russia, and Turkey--did significant business with Iran in four major sectors of the economy: energy, construction, military, and transportation. Ten companies and organizations invested at least $4.3 billion, with the biggest investments made in Iran's energy sector. 2007 promises to be an even richer year for investment in the Islamic Republic.

For interviews or information about Global Investment in Iran: Interactive, please contact AEI Vice President for Foreign and Defense Policy Danielle Pletka at dpletka@aei.org or 202.862.5943 and AEI research associate Omeed Jafari at omeed.jafari@aei.org or 202.862.5948.

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