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Khartoum/Tehran: Driving through the traffic-choked streets of Khartoum and Tehran, you could forget that Sudan and Iran have been hit by years of US sanctions.
Leaving Sudan's main airport, one of the first things you see is the ultimate symbol of American capitalism - the classic form of a Coca-Cola bottle printed on multi-coloured banners, next to a huge hoarding for rival Pepsi.
Pop into Paytakht shopping centre in Iran's capital and you can snap up a new Dell laptop, choose from a range of Motorola handsets and compare them with the latest Apple iPhone.
These products are among prominent US brands that have stayed on shop shelves in Sudan and Iran in the face of some of the toughest trade restrictions ever imposed.
Smugglers, like those who zip across the Strait of Hormuz in speedboats from Oman to Iran, and "grey-market" traders, who operate outside the manu-facturers' authorised trading channels, ship in western goods from a variety of sources.
Legal channels
But their enterprise has been matched by a handful of mainstream US corporations who have found their own way into both countries' huge markets, while staying within the law.
US soft drinks giants Coca-Cola Co and PepsiCo have both secured export licences from the US Treasury's Office of Foreign Assets Control (OFAC), using legislation that allows blacklisted states to buy US agricultural commodities, medicines and medical equipment.
Coca-Cola said the syrup on which the company's beverages are based qualified as an agricultural product. Pepsi said that its brands were produced in Sudan under "an OFAC licence" and declined to comment on the Iranian arrangement.
Both companies export the base syrup to companies in Sudan and Iran, which then produce the drinks in their own factories, selling them in bottles and cans identical to Coke and Pepsi's branded containers elsewhere.
Coca-Cola spokesman Dana Bolden said the primary motive for operating in Sudan and Iran was quality control.
"We want to ensure quality control and protect our trademarks with the independent bottler," he said.
Coke is not permitted to provide the local bottlers with any on-the-ground marketing support, has no investments in those bottlers, and no direct dealings with the governments.
He also said Coke is currently reinvesting all proceeds from its sales in Sudan to programmes to benefit the country.
"We have committed more than $5 million over the next three years for programmes aimed at building communities in Sudan."
Criticism
In Iran, analysts and shopkeepers say there is huge demand for western products despite decades of Islamic rule and anti-American "Great Satan" rhetoric, particularly from clerical leaders.
"The Iranian mentality is very close to the American mentality in [terms of] consumption," said Iranian political and economic analyst Saeed Laylaz. "The American style of life is very famous in Iran."
Laylaz estimated that goods worth more than $6 billion were smuggled into Iran each year, and a "significant" proportion were US products, including household appliances like refrigerators.
US sanctions against Iran, imposed shortly after the 1979 Islamic revolution, have grown even tighter in response to Tehran's disputed nuclear plans. The United Nations Security Council has also imposed several rounds of sanctions.
The United States imposed economic sanctions on Sudan in 1997 over its human rights record and alleged sponsorship of terrorism. It slapped fresh unilateral sanctions on Africa's largest country in May 2007 over the conflict in Darfur, which President George W Bush has called genocide.
Five years of violence in Darfur have claimed around 200,000 lives and displaced around 2.5 million, according to international experts. Khartoum rejects the term genocide and puts the death toll at 10,000.
Human rights campaigners have criticised foreign companies that do business in Sudan. Coca-Cola has also been slammed for its sponsorship of this year's Beijing Olympics, because of China's support for Sudan's government.
Coke says it believes the Games are a "force for good".
"I think that Coca-Cola should make a point of doing everything in its power to deny Coca-Cola products to Khartoum. And the same should be true of all foreign companies investing in Khartoum," said Eric Reeves, a US academic and member of actress Mia Farrow's Dream for Darfur pressure group which targets sponsors of the Beijing Olympics.
Adam Sterling, director of the Sudan Divestment Task Force, which urges investors to withdraw funds from some businesses in Sudan, said his campaign did not target Coke or Pepsi because they did not fit with the campaign's main focus - companies involved in oil, power production, mining and the military.
"The other reason is that we don't feel that these are companies that are investing in Khartoum at the expense of the people of Sudan," Sterling said.
Neither Coke nor Pepsi gave figures for sales in Sudan and Iran but in the three months to end-March 2008, Coke's Africa division recorded net operating revenues of $314 million, just over four per cent of the quarterly total.
PepsiCo's Middle East, Asia and Africa (MEAA) division accounted for 12 per cent of its sales of $39.47 billion last year and seven per cent of its $7.92 billion operating profit, according to its annual report. Pepsi International accounted for 26 per cent of total 2007 revenue.
Smugglers, like those who zip across the Strait of Hormuz in speedboats from Oman to Iran, and 'grey-market' traders, who operate outside of the manufacturers' authorised trading channels, ship in western goods via trading hubs.
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