Eleven vessels from Iran’s Islamic Revolutionary Guard Corps Navy (IRGCN) came dangerously close to US Navy and Coast Guard ships in the Persian Gulf, the US military said on April 15, describing the incident as “dangerous and provocative.”

Relations between the Trump administration and Tehran remain volatile, with the day also bringing news that the US may prevent the International Monetary Fund (IMF) from deploying a new allocation of Special Drawing Rights (SDRs) that could help countries including Iran fight the impact of the coronavirus (COVID-19) health and economic emergency.

Iran is already angry that despite support from Europe, US officials are standing in the way of the IMF potentially approving $5bn in emergency funding requested by Tehran to help it address its virus outbreak, the worst in the Middle East. As regards the SDRs, the White House doesn’t want Iran and China to have access to billions of dollars in new resources with no conditions, two sources were quoted by Reuters as saying.

April 15 also brought a scathing tweet from Iranian Foreign Minister Mohammad Javad Zarif, who hit out at US President Donald Trump’s decision to suspend American funding for the World Health Organization (WHO) while his officials investigate claimed shortcomings in how it has addressed the COVID-19 pandemic. “The world is learning what Iran has known & experienced all along: US regime's bullying, threatening & vainglorious blathering isn’t just an addiction: it kills people. Like “maximum pressure" against Iran, the shameful defunding WHO amid a pandemic will live in infamy,” Zarif wrote.

Georgieva rebuffed

IMF managing director Kristalina Georgieva first raised the prospect of an SDR allocation in March, but she was quickly rebuffed by US officials, who hold an effective veto over major IMF decisions. "There hasn't been interest in pursuing SDRs from the US side, in fact they went that far to say that they are not favouring SDRs," she said on April 10 in a podcast here produced by the Economist magazine.

Economists, finance ministers and non-profit groups have swung behind the creation of new SDR rights by the IMF, which would be a move akin to a central bank “printing” new money. It could provide as much as $500bn in urgently needed liquidity for the IMF’s 189 member countries. Advocates for the SDR move include investor George Soros and U2 lead singer Bono’s ONE anti-poverty organisation, along with trade unions and faith-based groups.

“If ever there was a moment for an expansion of the international money known as Special Drawing Rights, it is now,” former US treasury secretary Larry Summers and former UK PM Gordon Brown wrote in an op-ed in the Washington Post on April 15. “If global money is to stay in balance with the domestic monetary expansion in rich countries, an increase in SDRs of well over $1 trillion is urgently needed.”

Georgieva added that the US wanted the IMF to use all available tools and she did not expect Washington to block countries from “donating” existing SDRs to supplement IMF lending facilities for poor countries.

'Within 10 yards'

The naval encounter in the Persian Gulf saw the Iranian ships approach six US military ships while they were conducting integration operations with Army helicopters in international waters, according to the US military. At one point, the Iranian vessels came within 10 yards of the US Coast Guard cutter Maui, it added.

The US ships were said to have issued several warnings through bridge-to-bridge radio, blasts from the ships’ horns and long-range acoustic noise maker devices.

The Iranian ships left after about an hour, the statement added.

“The IRGCN’s dangerous and provocative actions increased the risk of miscalculation and collision, [and] were not in accordance with the internationally recognized Convention on the International Regulations for Preventing Collisions at Sea,” the US military’s statement also said.

In early January, on the direct order of Trump, Qasem Soleimani, the de facto head of Iran’s armed forces and second most powerful Iranian officials, was assassinated in a drone strike at Baghdad airport. Iran’s retaliation has included a missile attack on Iraq’s Ain al-Asad base where US forces were stationed. No US troops were killed, but more than 100 were later diagnosed with traumatic brain injury.