EU Unveils New Trade Mechanism for Trade with Iran: INSTEX

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EU Unveils New Trade Mechanism for Trade with Iran: INSTEX

In a joint statement on Thursday, French, German and UK Foreign Ministers announced the establishment of ‘INSTEX’ the long-awaited mechanism created for facilitating trade with Iran.

“The E3 together with INSTEX will continue to work on concrete and operational details to define the way the company will operate; the E3 will also work with Iran to create an effective and transparent corresponding entity that is required to be able to operationalise INSTEX,” reads the statement.

INSTEX will initially focus on the sectors such as pharmaceutical, medical devices and agri-food goods.

Development of the SPV was a key element of EU’s effort to keep Iran from quitting the Joint Comprehensive Plan of Action, after the US unilaterally pulled out of the deal in May and has since reimposed sanctions.

Foreign Minister Mohammad Javad Zarif welcomed the measure in a tweet.

Abbas Araghchi, Iran deputy foreign minister also welcomed the step as a “first step” by the EU in fulfilling its commitments toward Iran.

Araghchi told the State TV that while the channel is initially used for non-sanctioned trade with EU, Iran expects it to cover other trade as well which is why the mechanism was launched in the first place.

Total trade between Iran and European Union members from Jan. to Nov. 2018 amounted to €17.25 billion, which shows a 1.66% fall compared with the similar period of last year.

Trade between Iran and the 28 EU member states declined by 66.02% year-on-year to stand at €679.55 million in November 2018.

“INSTEX aims in the long term to be open to economic operators from third countries who wish to trade with Iran and the E3 continue to explore how to achieve this objective.”

According to the statement, INSTEX will function under the highest international standards with regards to anti-money laundering, combating the financing of terrorism (AML/CFT) and EU and UN sanctions compliance. In this respect, the E3 expect Iran to swiftly implement all elements of its FATF action plan.

Source: FINANTIAL TRIBUNE

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Iran’s Non-Oil Trade With Eastern Europe Rises to $2.2 Billion

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Iran’s Non-Oil Trade With Eastern Europe Rises to $2.2 Billion

Iran traded 3.6 million tons of non-oil commodities worth $2.23 billion with the member states of the United Nations’ Eastern European Group during the first nine months of the current fiscal year (March 21-Dec. 21) to register a 29.69% and 33.04% growth in tonnage and value respectively compared with last year’s corresponding period.

Latest data released by the Islamic Republic of Iran Customs Administration also show that Iran’s exports totaled 2.01 million tons worth $945.88 million during the period, indicating a 43.97% and 31.84% increase in tonnage and value respectively year-on-year.

Imports stood at 1.59 million tons worth $1.2 billion, up 15.18% and 33.94% in tonnage and value respectively YOY.

The Eastern European Group, also known as Countries with Economies in Transition, is one of the five unofficial UN regional groups that act as voting blocs and negotiation forums.

Source: FINANTIAL TRIBUNE

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Japan and Importing Iranian Oil

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Japan has started process of importing Iranian oil, according to Tehran

Japan has started the process of importing Iranian oil, which was suspended due to U.S. sanctions, the governor of Iran’s central bank said on Monday.

The resumption of oil imports comes after Tokyo was granted a waiver from U.S. sanctions that went into effect in November.

Iran is the fourth-largest oil producer among the members of the Organization of the Petroleum Exporting Countries.

“After China, South Korea, India and Turkey, Japan also started the process of importing Iranian oil, ” Abdolnaser Hemmati was quoted as saying by the state news agency IRNA.

Iran’s oil exports have fallen sharply since U.S. President Donald Trump said in May 2018 the United States would withdraw from a pact curtailing Iran’s disputed nuclear program and reimpose sanctions on Tehran.

However, exemptions have been granted to Iran’s biggest oil clients — Japan, China, India, South Korea, Taiwan, Italy, Greece and Turkey — which allow them to import some oil for another 180 days.

Iranian oil accounted for 5.3 percent of Japan’s total crude imports in 2018.

Source: REUTERS

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Turkey resumes oil imports from Iran

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Turkey resumes oil imports from Iran

TEHRAN, Jan. 08 (MNA) – Turkey has resumed imports of Iranian crude oil after a one-month pause in November when US sanctions on Iran came into force.

Turkey is allowed to import 60,000 barrels per day (bpd) under the waiver granted to the country by the United State.

According to Reuters on Tuesday, Turkey used to import about 200,000 bpd of Iranian crude before Washington pull out from Iran nuclear deal knwon as the JCPOA and reimpose sanctions.

Turkey had reduced its imports from Iran in the months prior to sanctions coming into force in early November. Its imports fell to zero in November.

But in December Turkey took delivery of two tankers carrying Iranian crude, equivalent to about 54,000 bpd during December, according to a shipping and trading source familiar with the matter.

The Solan tanker delivered into the port of Aliağa, while the Sea Topaz I discharged at Tütünçiftlik.

Reuters added that Turkey is set to receive a cargo from the Iranian-owned tanker Sinopa in January.

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‘EU’s Channel for Trade with Iran to Become Operational Soon’

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‘EU’s Channel for Trade with Iran to Become Operational Soon’

The European Union’s long-awaited mechanism known as the Special Purpose Vehicle (SPV) to keep financial ties with Iran under the US sanctions is set to become operational in the near future, said a spokesperson of the bloc.

In an interview with IRNA, the spokesperson said the EU is completely committed to the Iran nuclear deal as a sign of its respect for all international and security treaties in the world.

“The EU expects the Islamic Republic to play a constructive role in this field and remain committed to its pledges under the nuclear accord,” he was quoted as saying.

The spokesman who spoke on condition of anonymity went on to say that the JCPOA is based on certain bases, and as the International Atomic Energy Agency (IAEA) has confirmed in 13 reports, Iran remains fully committed to its pledges under the deal.

“As the Islamic Republic of Iran has always underlined, its nuclear program is totally peaceful and the IAEA’s reports reveal no deviation in it,” he said.

The spokesman then noted that there is no peaceful alternative to the nuclear deal and that the EU has adopted effective strategies to preserve the JCPOA following the US withdrawal from the deal.

“We have already updated the regulations of blocking banking accounts as well as offering facilities by the European Investment Bank. Meanwhile, the European sides of the JCPOA, France, Germany and UK are fully committed to preserving the nuclear accord and continuing their trade ties with Iran through the Special Purpose Vehicle,” he said.

He underlined that the SPV is on the verge of becoming operational.

The Iran nuclear deal was signed in 2015 after marathon talks between Tehran and the P5+1 group of countries. But US President Donald Trump unilaterally left the deal in May 2018 and re-imposed his country’s sanctions on the Islamic Republic.

The remaining sides of the JCPOA have unanimously condemned the US for the illegal withdrawal and declared on various occasions their commitment to the deal. They also underlined that Iran should be able to reap the economic fruits of the deal.

To this end, the EU has already provided European firms with a legal chance to keep their ties with Iran without any concern about the US sanctions.

Meanwhile, the bloc is working on the special mechanism (SPV) to maintain its financial ties with Iran.

Mogherini Not to Attend Warsaw Conference on Iran

The spokesman then referred to the upcoming Iran-focused conference to be held in the Polish capital of Warsaw and said the European Union Foreign Policy Chief Federica Mogherini will not take part in the event due to her tight schedule.

Earlier, Iranian Foreign Minister Mohammad Javad Zarif lashed out at the conference due to be held by the US next month, describing it as a “desperate circus” that will disgrace the participants.

His comments came after US Secretary of State Mike Pompeo told Fox News in an interview that Washington will jointly host the global summit focused on Iran and the Middle East in mid-February in Poland.

Source: IRAN FRONT PAGE

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Iran’s ECA Reports 62% Growth in Export Guarantees in 9 Months

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Iran’s ECA Reports 62% Growth in Export Guarantees in 9 Months

EghtesadOnline: The Export Guarantee Fund of Iran, a state-owned export credit agency, issued $1.7 billion worth of guarantees for exporters of non-oil goods in the first nine months of current fiscal that ends in March, up 62% compared to the corresponding period last year, the EGFI chief said.

Afrouz Bahrami told IRIB news agency that the value of export guarantees is predicted to reach $2 billion by the yearend.

Pointing to EGFI’s mission to help shield non-oil exporters against US sanctions, Bahrami said the fund offers insurance for political and commercial risks.

“In light of the new US sanctions and the limitations of local banks in issuing [export] guarantees, the fund is willing and able to cover political and commercial risks for exporters in the framework of new insurance packages,” Financial Tribune quoted her as saying.

Recalling that the average global insurance coverage for export is 10%, she said the fund will reach that threshold by the end of the Sixth Five-Year Economic Development Plan in 2022.

She referred to East Asian nations like Japan, China, India, and South Korea as successful models in export credit systems that Iran should follow, calling on the government and parliament to boost the financial power of the fund.

She said EGFI is one of the supporting pillars of the export sector besides other organizations like the Trade Promotion Organization, National Development Fund of Iran and the Export Development Bank of Iran, saying that all the bodies are working in tandem to implement the support packages designed to ease problems plaguing non-oil exports.

The packages includes facilities to help marketing and launching centers for selling domestic products in the target countries, offering export incentives, helping establish rail, air and sea transportation lines, paying a part of expenses for registering Iranian trade names in the target markets and boosting EGFI capital.

The CEO also pointed to export in cash as a deficiency of the export sector which she said creates a competitive advantage for rival exporters in other countries.

“Our exporters should consider deals on credit to increase competitiveness [instead of cash].”

The EGFI is concentrating on issuing guarantees for Iranian contractors in foreign countries, offering credit lines for buyers and purchasing debts of exporters, she was quoted as saying.

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Iran-Iraq Trade Not Affected by US Sanctions, Baghdad Says

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Iran-Iraq Trade Not Affected by US Sanctions, Baghdad Says

TEHRAN (Tasnim) – The bilateral trade between Iran and Iraq has not been affected by the sanctions imposed by Washington against Tehran, an Iraqi official said.

Fadel al-Hamdani, head of the Iraqi-Iranian Chamber of Commerce, told Al-Monitor, “Trade between Iraq and Iran is still ongoing and has not been affected by the US sanctions imposed on Tehran given the ongoing negotiations between Iraq and the United States.”

“Financial transactions are ongoing as per the normal procedures, and it is traders who are behind the changes that may have affected such transactions,” he said, adding, “If the Iraqi government makes any decisions related to trade with Iran, then the Iraqi private sector will abide by such official decisions.”

Speaking at a joint press conference with his Iraqi counterpart, Barham Salih, in Tehran in November, Iranian President Hassan Rouhani said the value of trade and economic interaction between Tehran and Baghdad stands at around $12 billion, adding that the two neighbors have the potential for a $20-billion trade target.

Rouhani hoped that cooperation between Tehran and Baghdad would contribute to regional security and stability and peaceful settlement of the war on Yemen and the Syria crisis.

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Iran says despite U.S. sanctions, it has found new ‘potential’ oil buyers

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Iran says despite U.S. sanctions, it has found new ‘potential’ oil buyers

LONDON (Reuters) – All countries that were granted waivers from the United States to continue buying a certain amount of Iranian oil imports are complying with U.S. sanctions, a senior Iranian energy official said, noting that Tehran was hopeful to find new buyers.

The United States withdrew from a nuclear deal with Iran last year and snapped sanctions in place to choke Iran’s oil and banking industries, while temporarily allowing eight customers to keep buying crude from the Islamic Republic.

“China, India, Japan, South Korea and other countries that were granted waivers from America to import Iranian oil are not willing to buy even one barrel more from Iran,” Amir Hossein Zamaninia, Iran’s deputy oil minister for trade and international affairs, was quoted as saying by the Oil Ministry’s news agency SHANA.

However, without giving details, Zamaninia said: “Despite U.S. pressures on Iranian oil market, the number of potential buyers of Iranian oil has significantly increased due to a competitive market, greed and pursuit of more profit.”

The 180-day exemptions were also granted to Italy, Greece, Taiwan and Turkey.

Washington seeks to bring Iranian oil exports to zero in order to curb Tehran’s missile and nuclear programs and counter its growing military and political influence in the Middle East.

Iran has urged European countries, which are still committed to the nuclear deal, to oppose the sanctions by creating a financial mechanism that facilitates payments of Iranian oil sales.

Zamaninia said the mechanism, known as SPV (Special Purpose Vehicle for trade), would be “helpful but could not resolve the problems since U.S. influence will affect any European action”.

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Turkey Stands Firmly Against U.S. Sanctions On Iran

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Turkey Stands Firmly Against U.S. Sanctions On Iran

Following Wednesday’s unexpected and dramatic full and “immediate” withdrawal of all U.S. forces from Syria, Turkey has announced it will not play ball on Iran sanctions. According to a translation of the Turkish president’s words on Thursday during a previously planned summit with Iranian President Hassan Rouhani in Ankara, journalist Abdullah Bozkurt reports, “Turkish president Erdogan says Turkey won’t support U.S. sanctions on Iran which he claims puts regional security and stability at risk, vows to take all measures to minimize impact of sanctions on trade between the two countries, pledges support to Iran in difficult times.”

This is huge given that the complete U.S. reversal in policy comes following a phone call last week between President Trump and Turkish President Recep Tayyip Erdogan, wherein Erdogan is reported to have pressed the Kurdish problem and presence of U.S. troops. The United States needs Turkey as a key regional economy if it hopes to effectively strangle Iran through sanctions. Without Erdogan, analysts believe, Iran will be able to weather the storm long term.

For the past week Erdogan has threatened to launch a full-scale cross border assault on U.S.-backed Kurdish forces in Syria, which Turkey has long considered a terrorist extension of the outlawed PKK. Currently Turkey’s military is reportedly mustering forces and tanks along deployment points at the Syrian border. Turkish Defense Minister Hulusi Akar has said the military is “intensely” preparing for a major operation against Syrian Kurds in Manbij, Aleppo Governorate, and to the east of the Euphrates. Turkish Anadolu Agency reported the defense minister promised to “bury” the Syrian Kurds.

Prior to Trump’s announced Syria pullout, the promised large-scale assault and ongoing future operations would have eventually brought American troops and advisers under fire, who’ve found themselves in the awkward position since entering Syria of training Syrian Kurdish militias on the one hand and coordinating broadly with NATO ally Turkey on the other.

However, Trump’s announced troop withdrawal has defused the crisis of American troops being caught in the middle, and along with it the possibility of a U.S.-Turkey clash. Thus the U.S. withdrawal is considered a major concession for Erdogan, which no doubt Trump was hoping to maintain as a key ally against Iran. That hope has now been dashed with Erdogan’s speech Thursday.

This also comes a day after the U.S. approved the sale of $3.5bn in missiles to Turkey amid negotiations for Ankara to buy anti-air defense missiles from Russia. Last Wednesday the State Department informed Congress that the plan includes transfer of 80 Patriot missiles, 60 PAC-3 missile interceptors and related equipment. A number of analysts were quick to note the deal had been firmed up immediately prior to Trump’s announced Syria pullout.

But despite the multi-billion-dollar weapons sale, hawks in Congress and in the president’s own administration will use Erdogan’s Thursday announcement to “stand by Iran” as fodder for arguing against bringing the troops home, and continuing Syria ground operations in order to counter Iranian expansion.

Source: OIL PRICE

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REGULATIONS FOR PRIVATE EQUITY FUNDS FINALIZED

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REGULATIONS FOR PRIVATE EQUITY FUNDS FINALIZED

Iran Capital Market, Securities and Exchange Organization Deputy for Supervision on Financial Institutions, Saeed Falahpour, announced approval of the regulations for private equity funds by the board.

These funds aim to invest in private, non-listed, and listed companies in major stakes to obtain the voting rights, so to influence the decision-making process in the purchased companies to meet their investment goals. Falahpour underlined that the funds are allowed to invest in privately owned companies and SMEs.

The minimum required capital is set at 500 billion rials, with activity duration of seven years. Because of their type of investments, these funds impose higher levels of risks on their investors, so interested parties shall read the articles of association and prospectus diligently, and then sign a corresponding risk acceptance statement. The minimum investment level is set at one billion rials.

The interested parties shall send their fund application to the Iran Fara Bourse to be processed, and if the criteria are met, the establishment license will be granted.

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