The director of the strategic communications department at the Ministry of Foreign Affairs in the UAE (Mofa), Afra Al Hameli, stated that the decision was taken \u201cin light of the regional escalation that has undermined regional and international peace and security\u201d.<\/p>\n
The move comes after the UAE defence ministry said its air-defence systems detected two ballistic missiles launched from Iran<\/a> towards its territory, in what would be Tehran\u2019s first direct attack on the Gulf state since May. It triggered an emergency phone alert to the UAE\u2019s residents.<\/p>\n The defence ministry said assessments showed the missiles had been targeting maritime traffic but also stated one weapon fell into the sea outside the UAE\u2019s territorial waters while another fell within.<\/p>\n As the UAE contended with the missile threats, it also sent out a threat alert to its residents, asking them to seek cover. \u201cDue to the current situation, potential missile threats, immediately seek a safe place in the closest secure building,\u201d read the phone alert, which was lifted shortly afterwards.<\/p>\n Tuesday\u2019s alert was the first such since a false alarm in June and an alert in July for an attack that ultimately did not enter UAE territory. Before that, the last missile warning came in early May.<\/p>\n Iran denies involvement in the UAE attack<\/p>\n Following the UAE\u2019s announcement that it was suspending all trade and financial activities with Iran, Tehran denied any involvement in the missile attacks.<\/p>\n Esmaeil Baghaei, spokesperson for Iran\u2019s Ministry of Foreign Affairs, said the allegation was \u201ccontrary to the principle of good neighbourliness and undermines ongoing efforts to strengthen trust among the countries of the region\u201d.<\/p>\n A little later, Iran added that the UAE was \u201ccarrying out US Treasury Secretary Scott Bessent\u2019s order for economic warfare against Iran\u201d, calling the UAE\u2019s missile attack \u201cfake news\u201d. The Islamic Republic added that the UAE\u2019s move was the official start of Bessent\u2019s operation following his announcement last week of applying “measures that have never been seen in history\u201d against Iran.<\/p>\n Last Thursday (August 13), Treasury Secretary Scott Bessent noted that the United States was planning to inflict more economic damage on Tehran later in the week. The US would apply measures that have \u201cnever been seen in the history of economic isolation on a country\u201d, Bessent said.<\/p>\n At the time, the Trump administration hadn\u2019t said what it was planning to do, but experts had noted that there were still pressure points that Bessent\u2019s Treasury Department could hit.<\/p>\n A woman walks by a mural depicting Iran’s late Supreme Leader Ayatollah Ali Khamenei, on a street in Tehran, Iran. Reuters<\/p>\n Iran to pay heavy price after UAE suspends trade<\/p>\n The UAE\u2019s decision to halt trading with Iran is a significant move and could hurt the Islamic Republic\u2019s already struggling economy.<\/p>\n Why?<\/p>\n The UAE is Iran\u2019s second-largest trading partner behind China. Before the war, annual trade between Iran and the UAE stood at around $27 billion, about 80 per cent of it Emirati exports to Iran. As Salman Al-Ansari, a political researcher, wrote on X, \u201cThe significance is enormous. The UAE has been Iran\u2019s second-largest trading partner after China, with bilateral trade reaching around $27 billion. Earlier this year, Emirati official @Dhahi_Khalfan described the UAE as \u2018the lung through which Iran breathed under sanctions\u2019. That lung now appears to have been cut off, if the suspension is truly and fully enforced.\u201d<\/p>\n Moreover, Dubai has served as a financial backdoor for Iran, helping it bypass sanctions and access global markets despite restrictions on systems like Swift<\/a>. According to the Eurasian Review, Dubai has long served as an important commercial and financial gateway for Iranian businesses, making any broad suspension of trade and financial activity potentially consequential for companies and markets on both sides.<\/p>\n UAE\u2019s move to suspend trade with Iran also has significant ramifications for the smuggling and money-laundering networks that keep Iran\u2019s government running, as many of these operations conduct transactions within the UAE\u2019s opaque \u201cfree zones\u201d.<\/p>\n In an Al Jazeera report, Mark Kimmitt, retired general and former US assistant secretary of state, said the UAE\u2019s suspension of trade with Iran could carry more weight than US sanctions, given the Gulf country\u2019s role in Iran\u2019s economy.<\/p>\n \u201cI don\u2019t think that you can overstate or understate the importance of the trade, both financial and goods trade, between Dubai and Iran,\u201d Kimmitt said in the Al Jazeera report. \u201cRight now, Dubai, UAE, is the largest seller of import goods to Iran, exceeding China, exceeding Turkey. So, one-third of Iran\u2019s imports in any given year come from the UAE.\u201d<\/p>\n Kimmitt added that Dubai\u2019s role as a financial hub has also long given Iran a channel to circumvent sanctions. \u201cIn many ways, the embargo being put on by the UAE is even more significant than the embargo being put on by the United States,\u201d he said.<\/p>\n Iran-UAE tensions amid war<\/p>\n The move by the UAE is a new escalation in the war which started in February when the US and Israel launched missiles at Tehran, killing Ayatollah Ali Khamenei. In retaliation, the Islamic Republic began to attack all US allies in the region, namely the UAE, Bahrain and other Gulf countries.<\/a><\/p>\n![\"explainers\"](\"https:\/\/images.firstpost.com\/dlxczavtqcctuei\/news18\/static\/images\/fp\/revamp_v1\/explainers.svg\")
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