Panama deserves sanctions, not the Security Council presidency

This month, Panama holds the rotating presidency of the U.N. Security Council — a position that confers moral authority, policy influence and global prestige as the representative “face” of the Council. But given Panama’s longstanding and conscious role in undermining sanctions on Iran, this honor is deeply wrong and misguided.

In fact, Panama should not be elevated — it should be sanctioned. A country that enables Iran’s sanctions evasion should not be rewarded with the symbolic leadership of the very body charged with upholding those sanctions.

Despite its protestations, Panama is neither a champion of the rules-based international order nor a true ally to the U.S. Panama’s acquiescence to Chinese “Belt and Road Initiative” ambitions in controlling the Panama Canal is only the latest sign of Panamanian duplicity that place it squarely at odds with the values and objectives of the council.

For years, Panama has allowed its flag — akin to a passport for ships — to be used by vessels transporting illicit Iranian oil, the key revenue stream for a regime that continues to defy international nuclear restrictions.

Panama is not ignorant or unaware of this problem. In January 2024, a bipartisan group of 31 U.S. Senators led by Senators Marco Rubio (R-Fla.) and Bob Casey (D-Pa.) urged the Panama Maritime Authority to “cooperate with the United States and conduct investigations into a significant number of ships registered in Panama which are alleged to transport Iranian oil in violation of U.S. sanctions…” They sought Panama’s explicit commitment to investigate some “189 Panamanian-flagged vessels of concern,” constituting “nearly half” of all the vessels aiding Iran.

Two months later, then-Special Envoy to Iran Abram Paley visited Panama “to ensure that the vessel registry is not abused by entities seeking to evade our sanctions on Iran. … Iran and its affiliated groups are trying to evade sanctions here in Panama, they are trying to abuse the flag registration of ships.”

According to analysis by our organization, United Against Nuclear Iran, of the 542 foreign-flagged vessels that have carried in excess of $200 billion worth of Iranian oil since 2020 (mainly to China), some 289 have at one stage or another flown the 100-year old Bandera de Panama. As of this week, we identify 116 vessels currently flying the Panamanian flag that are implicated in carrying Iranian oil.

This has all occurred despite repeated warnings to Panama over the last five years about this behavior by our organization, which has been praised for producing “the best public data we have.” This is more than an oversight — it is tantamount to complicity.

At the same time, the Islamic Republic of Iran is a nemesis to the UN Security Council, repeatedly violating council resolutions stretching back to 2006, when Iran was instructed to suspend all enrichment-related activities. Since then, Tehran has violated resolutions relating to nuclear activities, arms embargos, ballistic missile testing, and a resolution endorsing the failed Iran nuclear deal.

Most recently, a top Iranian advisor issued what sounded a lot like a personal threaten against the head of the UN’s nuclear watchdog, Rafael Grossi, following years of stonewalling UN nuclear inspectors. Now, two decades and one moribund nuclear deal later, Iran is still insistent on enriching nuclear fuel to the threat of world security. 

Iran has never been interested in nuclear compliance. Today, with key nuclear sites severely degraded by Israel and the U.N. in last month’s strikes, Iran has insisted it will never give up its “inherent right” to enrichment. Efforts to reconstitute and to develop the missiles needed to carry nuclear warheads require money, which in Iran’s case will come in large part from illicit oil sales moved by tankers — tankers that Panama helps shield from scrutiny.

These “Ghost Fleet” vessels engage in deceptive maritime practices designed to obscure the origin and destination of oil — actions that violate international norms and often amount to criminal conduct. They switch off transponders, manipulate automatic identification systems, and conduct dangerous ship-to-ship transfers in international waters.

These actions form the backbone of Iran’s sanctions-evasion playbook. And Panama plays along.

The UN Security Council is the body tasked with upholding international peace and security, including through the enforcement of sanctions. It was the council that imposed multiple rounds of sanctions on Iran over its nuclear program. But the council’s credibility suffers when one of its rotating presidents enables, with impunity, the very violations those sanctions were designed to deter.

The world is entering a still-more-volatile phase in its dealings with Iran as it braces for renewed nuclear provocations. Now is the moment for the international community — embodied by the United Nations — to close ranks, not reward enablers of sanctions evasion.

Thus, Panama’s presidency at this critical juncture sends an unfortunate message to every regime looking to flout global norms. Panama has had ample time to reform its maritime registry. Yet Panama-flagged ghost tankers continue to offer the most critical economic lifeline for the Tehran regime. Until that changes, Panama should be sanctioned, not promoted to a leadership post at the United Nations.

Mark Wallace, a former U.S. Ambassador to the U.N. for Management and Reform, is CEO of United Against Nuclear Iran, where former Florida Gov. Jeb Bush serves as chairman.