South Africa last hurdle for Iran sanctions at U.N.

UNITED NATIONS (Reuters) - South African proposals to strip main elements of proposed sanctions against Iran for its nuclear program were the last major hurdle to a U.N. Security Council vote on the package.

Indonesia and Qatar have also submitted amendments to a resolution drawn up by Germany and the five permanent council members with veto power -- the United States, Britain, France, Russia and China. But negotiators said these amendments were general and many could be accommodated.

"I think more challenging for the permanent five is the South African amendments, much more challenging," China's deputy U.N. ambassador Liu Zhenmin told reporters on Wednesday.

He said negotiators were aiming for a vote this week "but it seems that this week is not possible."

But France's U.N. Ambassador Jean-Marc de la Sabliere said he hoped for an early vote, perhaps by this weekend. "There is a lot of support for the text in the council, but as I have said, we would like to have if possible a consensus," he said.

Iranian President Mahmoud Ahmadinejad has made plans to speak to the council on the day of the vote.

The resolution can be adopted without Pretoria's consent. However, the major powers would like a unanimous vote and no abstentions from an influential country like South Africa and want the support of Islamic nations like Indonesia and Qatar.

South Africa favors restricting the sanctions to nuclear-related programs only although its proposals call for a 90-day "time-out" on all penalties.

It presented a list of amendments that would delete nearly all the new resolution's main provisions, including an embargo on conventional arms Iran can export and most of the list of people and institutions whose financial assets abroad would be frozen. These include Iran's Revolutionary Guards and the state-owned Bank Sepah.

Pretoria's U.N. Ambassador Dumisani Kumalo said he would explain to the Security Council members later on Wednesday the purpose of his proposals.

"I'm not gutting the resolution. I'm improving it," Kumalo said, adding that his country was serious about the amendments, most of which are certain to be rejected.

U.S. Secretary of State Condoleezza Rice spoke to South African Foreign Minister Nkosazana Dlamini-Zuma on Friday, spokesman Sean McCormack said, and other nations are expected to do the same. But Iran's foreign minister, Manouchehr Mottaki paid a personal visit to South Africa this week and saw President Thabo Mbeki, Kumalo said.

The new resolution is a follow up to one adopted in December banning trade in sensitive nuclear materials and ballistic missiles as well as a freezing of assets of individuals and institutions associated with atomic programs.

The United States and leading Europeans say Iran is trying to develop an atom bomb under the guise of a civilian nuclear program. Tehran says its program is for power generation. Uranium enrichment can be used for energy or for bomb making.

The resolution also calls on nations and international institutions to restrict new credits and loans to Iraq.

Rice told a Congressional committee that Iran is already suffering financially.

"I think you've seen that there has been a decrease in investment presence for Iran, that they're having trouble getting investment in some of their oil and gas activities. These are all pressures I think on the Iranian government," she said.

Russia, which was instrumental in drafting the resolution, is building a light-water reactor at Bushehr in southern Iran. Moscow denies it had told Tehran it would not deliver fuel if Iran did not meet council demands to suspend uranium enrichment, which can be used to make bombs. But diplomats told Reuters that Russia had given warned Iran.

(Additional reporting by Michelle Nichols and Jeremy Pelofsky)