(Bloomberg) -- Treasury Secretary Steven Mnuchin signaled on Wednesday the U.S. may impose “very strong” sanctions on Iran as President Donald Trump seeks to renegotiate a multinational accord that curbs the Islamic Republic's nuclear program.
Mnuchin, testifying before a House appropriations subcommittee, said there will be “primary and secondary sanctions” against Iran, referring to penalties for the country itself and entities that do business with it.
Speaking to reporters after the hearing, Mnuchin said he was referring both to a possible fresh round of sanctions, as well as the return of previous sanctions that have been periodically waived as part of the nuclear deal.
“If the president doesn't sign the certification, the sanctions snap back into place,” Mnuchin said, referring to the waiver process. “I do think the primary and secondary sanctions would have an important impact on the Iranian economy, and that's something he's thinking about and balancing as he makes his decision.”
As for additional sanctions independent of the nuclear deal, Mnuchin told reporters “you can assume we continue to do work on that.”
Trump has set a May 12 deadline to improve or scrap the accord -- made by his predecessor Barack Obama -- that waived sanctions on Iran in exchange for curbs on the country's nuclear activities. Unilateral abrogation would almost certainly trigger a diplomatic crisis between the U.S. and the other signatories -- Britain, China, France, Germany and Russia.
The Trump administration has accused Iran of fomenting instability and violence across the Mideast, and the deadline gives the White House and Congress limited time to forge legislation punishing the country for that behavior without directly ending the nuclear accord.
Trump “wants a better deal,” Mnuchin said.
To contact the reporter on this story: Saleha Mohsin in Washington at smohsin2@bloomberg.net.
To contact the editors responsible for this story: Alex Wayne at awayne3@bloomberg.net, Joshua Gallu, Mike Dorning
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