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DATE=3/17/2000 TYPE=CORRESPONDENT REPORT TITLE=U-S/IRAN SANCTIONS (L) NUMBER=2-260289 BYLINE=NICK SIMEONE DATELINE=WASHINGTON CONTENT= VOICED AT: INTRO: The United States is easing some sanctions against Iran in the biggest step Washington has yet taken toward ending two decades of hostility between both countries. In addition to allowing Americans to purchase Iranian goods ranging from carpets to caviar, Correspondent Nick Simeone reports the Clinton Administration is expressing regret for some of the darker chapters in U-S relations with Iran over the past half century. TEXT: Three years after Iran's reformist President Mohammad Khatami took power -- and a month after reformists gained the upper hand in parliamentary elections -- Washington is telling Iran the time is right for a thaw in relations that have been frozen for the past 20 years. Speaking before an audience of Iranian-Americans in Washington Friday, Secretary of State Madeleine Albright announced a further lifting of sanctions, designed to show the Iranian people the United States bears them no ill will. /// ALBRIGHT ACT /// I am announcing a step that will enable Americans to purchase and import carpets and food products such as dried fruits, nuts and caviar from Iran. /// END ACT /// The easing of sanctions amounts to a further broadening of commercial ties between both countries. Washington recently decided to allow Iran to purchase American medicine and food as well as aircraft parts. Left in place, though, is a ban prohibiting American investment in Iran's oil industry. That isn't likely to be lifted until Tehran ends its alleged support for terrorism and its pursuit of nuclear weapons. Still, the White House is eager to show its support for last month's elections that saw reformist candidates sweep Iran's parliament, giving further backing to President Mohammed Khatami against hard- liners who oppose greater personal freedoms and stronger ties with the West. Secretary Albright wanted to send a message directly to Tehran that America now seeks a clear break from the past -- and its past behavior, describing as short-sighted U-S support for Iraq during its eight- year war with Iran, and expressing regret for a U-S decision a half century ago to support the overthrow of Iran's popularly elected prime minister, Mohammad Mossadegh. /// ALBRIGHT ACT /// The Eisenhower administration believed its actions were justified for strategic reasons. But the coup was clearly a setback for Iran's political development and it is easy to see now why many Iranians continue to resent this intervention by America. /// END ACT /// Washington doesn't expect an overnight improvement in U-S/Iranian relations. But Gary Sick, who played a central role on President Carter's National Security Council during the 1979 hostage crisis, thinks it's conceivable both countries may be moving toward face- to-face discussions about the fundamental issues blocking normal relations, including Iran's alleged support for terrorism and its opposition to the Middle East peace process. /// SICK ACT /// We could ask Iran for specific assurances about certain things. We could talk to them about things that we see as threatening and ask them to do it and they could tell us things that they see as threatening in our behavior that they would like to see change. That's what negotiations are all about, and I think once we get to the point where we stop playing that "Alfonse-Gaston" game of who is going to take the first step, who is going to agree to sit down together -- once we get past that, I think we'll discover that both of these countries have a great deal to talk about. /// END ACT /// Early reaction from the Iranian government to the U-S overture is positive, with a Foreign Ministry spokesman welcoming the easing of sanctions and expanded trade. (SIGNED) NEB/NJS/JP 17-Mar-2000 13:01 PM EDT (17-Mar-2000 1801 UTC) NNNN Source: Voice of America .