U.S. to ease sanctions on Iran, Libya, Sudan

WASHINGTON [MENL] -- The United States has decided to permit food and medicine sales to Iran, Libya and Sudan in what is being regarded as a major shift in the Clinton administration's sanctions policy.

U.S. officials on Wednesday said the decision will eliminate humanitarian items as a weapon of Washington's foreign policy as well as meet the demands of business lobbyists. The shift does not affect embargoes on Cuba or sanctions on exports to North Korea and Iraq.

Undersecretary of State Stuart Eizenstat said the new policy should not be seen as a gesture to Iran, Libya or Sudan. He said food and medicine exports do not "enhance a nation's military capability or ability to support terrorism."

The official said energy products also are not covered by the easing of sanctions policy.

Iran, Libya and Sudan join Cuba, North Korea, Iraq and Syria on the U.S. list of states sponsoring terrorism.

Officials said companies willing to export food and medicine to Iran, Libya and Sudan must still apply for a license by the U.S. Treasury Department. One application has been made by Niki Trading Co. which seeks to sell $500 million of mostly wheat to Iran.

"This [change of] policy does not necessarily mean that that license will be granted," Eizenstat said.