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US to block Iran's request for $5bn IMF loan to fight coronavirus

Iranian President Hassan Rouhani says IMF will be guilty of discrimination if it withholds money
Coronavirus has killed more than 3,800 people in Iran and infected more than 62,500 (Mizan news agency/AFP)

The United States plans to block Iran's request for a $5bn emergency IMF loan to respond effectively to the country's coronavirus outbreak, claiming that the funds would be used to support its "adventurism abroad, not to buy medicine for Iranians".

The US, which effectively holds a veto at the IMF, said if it were to allow Iran to tap IMF coffers, Tehran would divert the money to help its economy, which has been weakened by years of sanctions.

"The world's leading state sponsor of terrorism is seeking cash to fund its adventurism abroad, not to buy medicine for Iranians," an official in the Trump administration told Middle East Eye on Wednesday.

"The regime's corrupt officials have a long history of diverting funds allocated for humanitarian goods into their own pockets and to their terrorist proxies. 

"Iranians themselves know this best, which is why many dissidents and former political prisoners have written to the IMF requesting that they deny providing direct financial support to the regime, which would not go to help the Iranian people."

The Islamic Republic is battling one of the world's deadliest coronavirus outbreaks, which it says has killed more than 3,800 people and infected more than 62,500.

There has been speculation abroad that the real number of deaths and infections may be far higher.

'The world will judge them'

Earlier on Wednesday, President Hassan Rouhani pleaded with the IMF for the $5bn emergency loan, saying it would be guilty of discrimination if it withheld the money.

Iran's central bank wrote to the IMF last month requesting the funds from its Rapid Financing Instrument, an emergency programme that aids countries faced with disasters, including natural ones. 

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According to the IMF, a Rapid Financing Instrument "is available to all member countries facing an urgent balance of payments need".

In Wednesday's televised cabinet meeting, Rouhani said the country needed the funds to respond effectively to the virus.

"I urge international organisations to fulfill their duties… We are a member of the IMF," Rouhani said.
 
"There should be no discrimination in giving loans," he added, saying that such bias would be unacceptable.

"If they do not act on their duties in this difficult situation, the world will judge them in a different way".

'Economic terrorism'

In a tweet on Sunday, the secretary of Iran's Supreme National Security Council, Ali Shamkhani, accused Washington of "crimes against humanity", after reports emerged that Washington was planning to block the loan request.

"US opposition to granting Iran's requested facilities from IMF to provide items needed to deal with coronavirus is a real case of crimes against humanity," Shamkhani said in a tweet.

The coronavirus outbreak has devastated Iran's economy, already battered by US sanctions re-imposed in 2018 when Washington withdrew from the Joint Comprehensive Plan of Action (JCPOA), otherwise known as the Iran nuclear deal, and unilaterally launched its "maximum pressure" campaign.

According to Human Rights Watch, the sanctions have devastated Iran's flagging healthcare system, hindering the ability for ordinary Iranians to access healthcare.

'It will go down in history that the White House, which was engaged in economic terrorism so far, is now a terrorist in health issues, too'

- Hassan Rouhani, Iranian president

Sanctions have also more broadly impacted Iranians by crippling private businesses and forcing the value of Iran's currency, the rial, to plummet.

Iran has repeatedly called on the Trump administration to reverse its sanctions policy, which has been opposed even by US senators and America's allies.

Medicine and medical equipment are technically exempt from US sanctions, but many banks and companies have refrained from taking part in any such ventures out of fear of incurring large penalties in the United States.

"The US sanctions on Iran are economic and medical terrorism ... They are in violation of international medical conventions," Rouhani said.

"It will go down in history that the White House, which was engaged in economic terrorism so far, is now a terrorist in health issues, too."