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UNDER SECRETARY WENDY SHERMAN: Thank you very much, Mr.Chairman, Ranking Member Crapo, Senators.
Good morning and thank you for inviting me to testify with my colleagues about a top
foreign policy and national security priority, Iran. From an illicit nuclear program, to
support of terrorism, to abusing human rights. The Iranian government continues to ignore
its international obligations and responsibilities, and defy the consensus of the global international
community. Their costly and destructive decisions threaten international security, increase
tensions in one of the most vital parts of the world, and stifle the great potential
of the Iranian people. In confronting these challenge, the US Government and the State
Department draw on a full range of tools. This includes holding Iran accountable on
the world stage, directly empowering the Iranian people to hold their own government accountable
and strengthening our alliances with partners to show Iran the world is united in its concerns.
Under the President's and Senator Kerry's leadership, this is an all hands effort. Every
day, every Bureau in the Department of State has their eye on Iran. Even as we speak, the
IAEA board of governors is meeting in Vienna. Along with our P5+1 partners, we will urge
Iran to comply without delay with its nuclear obligations. On Iran's nuclear ambitions,
the President has been clear. First, the United States will prevent Iran from acquiring a
nuclear weapon. Second, Iran's leaders have a choice, live up to their international obligations
and become a player on the global stage, or continue down the path toward isolation. We
know which path Iran has chosen so far, so we've put in place a dual-track policy, ratcheting
up pressure while pursuing a diplomatic solution. Pressure to incentivize Iran to seek a deal
that addresses the International communities legitimate concerns, engagement to give Iran
a way to negotiate that deal, if they choose to take it. On the engagement side we have
offered Iran the opportunity to move forward toward a negotiated solution. Unfortunately,
as you all know, so far the Iranians have fallen far short with their response. We are
clear eyed in our approach to the P5+1 talks, and seek concrete results. After all, while
the window for negotiation is still open, it will not remain so forever. We have an
obligation to give diplomacy every chance to succeed, but the onus is on Iran. On the
pressure track, we have worked closely with Congress and our allies to level sanctions
on Iran, that carry real consequences. Since 2008 there have been 5 UN Security Council
resolutions, 9 Executive Orders by the Executive Branch, and 4 wide-ranging laws passed by
the United States Congress. These sanctions carry real consequences for Iran. Those measures
have worked to make sure that Iran understands there is a cost to their behavior. Iran is
increasingly isolated and is under one of the toughest most comprehensive sanctions
regimes ever. The oil sanctions, [cough] which we have been implementing for 18 months have
resulted in Iran exporting over 1 million fewer barrels of crude oil each day than it
did in 2011, costing Iran between $3-$5 billion per month. To date, all 20 importers of Iranian
oil have either significantly reduced or eliminated oil purchases from Iran. In these cases the
exceptions have served as an artful point of leverage and incentive with importers of
Iranian oil. Countries can't go to zero overnight and we need to make sure that Iranian oil
is withdrawn from the market in a timed and phased way that does not raise global oil
prices. But exceptions require real and a substantial action by our partners. This action
puts pressure on Iran and at our coalition and is a manifestation of our success. With
that in mind, exceptions for 9 economies will expire tomorrow. The Secretary is still reviewing
the final documents, but as always, my staff will be ready to brief you on the results
in a classified hearing. Put simply, the Iranian economy is in a downward spiral, as we saw
the candidates themselves say in a Wall Street Journal article of June 1 and 2, "Candidates
Air Grim Views of Iran Economy". The Rial has depreciated more than 50% in the last
year. Foreign investment has decreased dramatically. With yesterdays Executive Order, we are applying
additional pressure on Iran's automotive sector, and expanding sanctions on Iran's petrochemical
sector. I understand Under Secretary Cohen will speak further to this Order momentarily.
One reason we have succeeded is that we're not acting alone. The EU has imposed its own
sanctions including an oil import ban that resulted in all 27 EU member states ceasing
oil purchases from Iran. Australia, Canada, Norway, South Korea, Japan, and others have
enacted their own measures. And, even among partners who are skeptical of unilateral sanctions,
we have seen robust implementation of UN Security Council resolutions and cooperation on specific
sanctions issues. We must not backslide from this progress, the effectiveness of our sanctions
depends on our partners, so we have to guard against measures that would put too great
a burden on those partners. Sanctions must be felt by Iran, not by us or our allies.
And Iran would surely exploit any sign of division. Beyond Iran's nuclear ambitions
we are also concerned about the stabilizing Iran influence is casting across the entire
Middle East and beyond. Support to the Assad regime, Iran's closest ally, is sustaining
the campaign of violence against the Syrian people. Its aid to terrorist organizations
like Hezbollah is threatening our ally Israel and innocent civilians worldwide. That's why
we're deepening our military partnerships across the region, particularly with Israel
and Gulf-States, to defend against attacks from the very groups supported by Iran's leaders.
If I may Mr. Chairman, I'll take one more minute. I also want to reiterate our commitment
to seeking the safe return of Robert Levinson, Amir Hekmati and Saeed Abedini, US citizens
missing or detained in Iran. We will continue to raise these cases as we pursue all available
options until all three of these Americans are united with their families. And of course,
we are deeply concerned about the campaign of repression Iran's leaders are raging against
their own people. Iranian's are owed their rights, freedoms, and dignity that we cherish
here, as bedrocks of our nation that all people around the world deserve. So we are helping
Iranian's break through the electric curtain, creating virtual spaces for those voices that
are suppressed, and leveling sanctions to hold the individuals and organizations behind
the repression accountable. Just last week, the Treasury and State Departments worked
together to announce a novel initiative to make personal secure communications tools
more easily available for the Iranian people. I'll finish by saying that we are closely
watching the upcoming election ahead of which we are again seeing increased repression.
As Senator Crapo said, Iran's unelected and unaccountable Guardian Council, has disqualified
hundreds of candidates based on vague criteria and reiterated that women, who make up half
of Iran's population, are barred from serving as President. While Iran's supreme leader
called for a "epic election", to demonstrate Iran's strength. Instead we've witnessed a
process that appears to be unfair, unjust, and unrepresentative of the Iranian people,
who deserve better from their leaders and from their government. I conclude by saying
I am confident we can continue to work together in dealing with this threat to our security
and global stability and developing smart and effective measures, measures that increase
pressure on the regime, allow us to maintain the strong coalition we have built, measures
that will force Iran's leader to make better choices, and empower the Iranian people to
hold their government accountable. Thank you for your partnership, I look forward to answering
your questions.