CBI: US Sanctions Promoting Dollar-Less Trade among Countries

Governor of the Central Bank of Iran (CBI) Abdolnasser Hemmati said on Wednesday that many countries in the world are establishing trade relations based on local currencies thanks to the US unilateral sanctions against some counties, adding that Iran is following suit to circumvent SWIFT limitations.

 FARS- Speaking on the sidelines of a cabinet meeting today, Hemmati said that the US’ sanctions regime has helped remove dollar from trade transactions between various countries.
He added that Tehran is making efforts to further strengthen trade transactions via national currencies, and render SWIFT – the Society for Worldwide Interbank Financial Telecommunication – practically useless.
“Our recent talks with officials from Turkey and Russia centered around ditching dollar and bypassing SWIFT in our trade transactions,” he said.
“Accordingly, we are moving toward using alternative payment systems and conducting our business through national currencies,” he added.
Noting that at the moment, a major part of Iran’s transactions with Russia, Turkey and Iraq is done via the use of national currencies, the CBI governor said “we made a proposal to the Russian side for using an alternative payment system with the Eurasian Economic Union (EAEU) member states now that Iran is a member, too, and the Russian president welcomed the proposal.”
“New conditions will be formed in the banking transactions of regional countries,” Hemmati promised.
SWIFT suspended access for several Iranian-based banks in November in the wake of US sanctions against the Islamic Republic.
On Friday, Russian Presidential Aide Yury Ushakov told reporters that Russia and Iran are organizing cooperation between the Russian financial messaging system and Iran's SEPAM as an alternative to making payments through SWIFT for protection against third countries' sanctions.
"To protect bilateral trade and economic ties from the sanctions of third states, we are taking measures to expand direct settlements, use national currencies, and to establish interaction between the Russian financial messaging system and Iran's SEPAM, as an alternative to making payments through SWIFT", Ushakov said.
The Society for Worldwide Interbank Financial Telecommunication, known as SWIFT, announced in November that it would sever ties with individual Iran-based banks for the sake of the "global stability of the system," without elaborating.
The announcement came on the same day as the US Treasury Department imposed sanctions against the Iranian economy's energy, banking and shipping sectors. Several days earlier, the US had warned that SWIFT, like any other entity, must abide with the US sanctions regime against Iran, or risk falling under secondary US sanctions.

Publish Date: Sep 19, 2019