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"A war between America and Iran loses billions of dollars to the Kurdistan Region"


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Iraq Allows Iranian Traders to Open Accounts in Its Banks

Iran Front Page 
7th February 2019, 05:13 GMT+11

 

Iranian traders can open accounts with Iraqi banks to carry out their transactions under a new payment system between the two countries, Iran's central bank governor Abdolnaser Hemmati said Wednesday.

According to an agreement reached with the Central Bank of Iraq, Iranian exporters can operate through Iraqi banks, and in this regard, Iranian banks can have dinar-denominated accounts in Iraqi banks, he said.

On Tuesday, Iran and Iraq agreed on a payment mechanism that will enable the two neighbors to do business in the face of US sanctions on Tehran.

The mechanism was discussed in a meeting between Hemmati and his Iraqi counterpart Ali Mohsen Ismail al-Alaq in Baghdad and the details were signed off on a document Tuesday night.

Hemmati met Iraqi bank directors, members of chambers of commerce and traders on Wednesday, saying the two sides had reached good agreements.

According to the agreement, the Central Bank of Iran will have euro- and dinar-denominated accounts in Iraqi banks and gas and oil exchanges will be carried out via these accounts, he said.

Iraqi companies can also open accounts in Iranian banks and do trade in dinars, said Hemmati who also announced that he agreedwith a request for Iraqi banks to open branches in Iran.

Therefore, with these agreements and the blessing of the Iraqi prime minister, banking relations between Iran and Iraq will be much stronger, and the expansion of trade relations between the two countries will take shape on this basis, he added.

Hemmati arrived in the Iraqi capital on Tuesday to discuss banking relations and a payments backlog related to Irans gas and electricity exports to the Arab country, he wrote on his Instagram account.

Iraq is Irans biggest trade partner, but their relations are increasingly coming under pressure from the US which imposed unilateral sanctions on Tehran in May after abandoning an international nuclear agreement.

On Tuesday, Minister of Petroleum Bijan Zangeneh summed up the tricky situation.

Every month, $200 million worth of Iranian gas is exported to Iraq which does not pay it, saying you are under sanctions. At the moment, we have $2 billion owed by Iraq for the gas and electricity sold to the country, he said.

"We had an oil swap from Kirkuk. After the sanctions, the Iraqis stopped that too," Zangeneh told a news conference in Tehran.

The swap deal was agreed at the end of 2017, under which Iraq was about to truck 60,000 barrels per day (bpd) of crude oil to Kermanshah in western Iran. Iraqs southern Basra port would receive the same amount of crude from Iran either by tanker or pipeline.

The Iraqis made several batches of shipments but stopped them prior to Washingtons sanctioning of Irans oil sector on November 5.

Nevertheless, Iraq relies on Iran for electricity and consumer goods and trade ties are still strong.

Gas imports from Iran generate as much as 45 percent of Iraq's 14,000 megawatts of electricity consumed daily. Iran transmits another 1,000 megawatts directly, making itself an indispensable energy source for its Arab neighbor.

Basra was hit by violent protests which spread to other cities last summer, partly because of a halt of Iranian electricity exports.

Iranian officials have said the country is pushing forth witha 2025 vision planto raise its exports to Iraq to $20 billion a year despite US pressures on Baghdad to keep Tehran at arms length.

Foodstuff, livestock, construction material and plastic products constitute the bulk of Irans exports to Iraq. Iranian vehicles and food items are a ubiquitous sight in Iraq.

 

 

LINK: https://www.bignewsnetwork.com/news/259415535/iraq-allows-iranian-traders-to-open-accounts-in-its-banks

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So the Iranians, have been cut off basically from using the USD as a means of purchasing goods and services, and trading correct? If that is the case and they are now officially able to use Iraqi Banks to deposit their funds and pay for items correct? If that is true and they are accustomed to using the USD that has much more purchasing power, wouldn't it be a significant downgrade for that country to use the IQD, unless............... 😀

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miquel, I was thinking the same thing. Logic would say that Iraq would need to RV their currency before they started trading it to Iran. 

They signed the papers today so you would think if this is the plan that the RV should be imenant. 

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  • yota691 changed the title to The Central Bank discussed with his Iranian counterpart the mechanisms of paying Iraq's debt to Tehran
BAGHDAD / Al-Ghad Press: 

The Central Bank, on Thursday, that he discussed with his Iranian counterpart mechanism to pay Iraq's debt to Tehran. 

"The Central Bank of Iraq held meetings with the Central Bank of Iran in the capital Baghdad on the sidelines of the visit of the Governor of the Central Bank of Iran and his accompanying delegation to Iraq."

"The meetings focused on discussing the executive mechanisms to pay the debt owed by the Republic of Iraq to the Islamic Republic of Iran in light of the exceptions granted to Iraq from the sanctions imposed on Iran," he said. 

He stressed that "the mechanisms that have been discussed and agreed upon come within the framework of the permitted and agreed technical with the Ministries of Foreign Affairs and the Treasury of the United States," noting that "the Central Bank of Iraq stressed his keenness and his constant work to protect the Iraqi banking system and its international banking relations."
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Editorial date: 2019/2/7 13:31  151 times read
Central Bank: Mechanism to pay Iran's debt in the light of the exceptions granted to Iraq
The author of an official source at the Central Bank of Iraq said Thursday that the latter held meetings with the Central Bank of Iran in the capital Baghdad on the sidelines of the visit of the Governor of the Central Bank of Iran and his delegation to Iraq, focused on the search mechanism to pay the debt to Iran in light of the exceptions that Granted to Iraq from the sanctions imposed on Iran.
"The meetings focused on examining the executive mechanisms to pay Iraq's debt owed to the Islamic Republic of Iran in light of the exceptions granted to Iraq from the sanctions imposed on Iran," the source said in a statement. 
"The mechanisms that were discussed and agreed upon are within the framework of the permitted and agreed technical framework with the Ministries of Foreign Affairs and the US Treasury." 
The Central Bank of Iraq, according to the statement, "his keenness and his constant work to protect the Iraqi banking system and its international banking relations."
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An Iranian-Iraqi agreement allows the banks of the two countries to deal with the dinar and the euro

 
Spread Thursday , 07 February 2019
 

An Iranian-Iraqi agreement that allows the banks of both countries to deal with dinars and euros

DUBAI (Reuters) - Iranian exporters can do business with Iraqi banks after an agreement allows Iranian banks to open assets in Iraqi banks and deal with them, the central bank governor said. In the dinar and euro currencies, according to the Iranian news agency (Mehr).

 

"Based on the agreements concluded on Wednesday, the Central Bank of Iran is scheduled to have balances in euros and dinars, where oil and gas transactions will be carried out through these balances, and Iraqi companies can also open balances in Iranian banks and carry out banking transactions in dinars," Hamati said.

 

The head of the Central Bank of Iran, Abdul Nasser Hamati, and his Iraqi counterpart Ali al-Alaq signed an agreement to determine the mechanism of financial payment between the two countries to solve the problems experienced by exporters in financial exchanges.

 

Hamati explained that the agreement will work to remove the obstacles that hinder the payment of Iraq's debt to Iran, related to exports of gas and electricity, according to the official Iranian news agency (IRNA).

"With regard to Iraq's debt on Iran's gas and electricity exports, we signed after 4 hours of talks, an important agreement with the Central Bank of Iraq to address the obstacles of transfer of funds and debt repayment."

He noted that the Central Bank of Iran has signed agreements, with Russia, Turkey, India and China, on a bilateral mechanism for payment of money.

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Wed Feb 06, 2019 2:27
 
Iran, Iraq Seal Deal on Bilateral Financial Channel

 
TEHRAN (FNA)- Central banks of Iran and Iraq finalized an agreement to establish a bilateral payment mechanism to ease trade and the flow of money between the two neighboring countries.

Governor of the Central Bank of Iran Abdolnasser Hemmati and Governor of the Central Bank of Iraq Ali Mohsen Al-Allaq met on Tuesday in Baghdad where they signed an agreement on a payment mechanism which is to facilitate the settlement of Baghdad’s debts to Tehran.

The deal mainly focuses on a payment channel that is to facilitate the settlement of the Arab country’s debts to Tehran over gas and electricity imports, inter alia.

The two sides inked the agreement following negotiations between members of their delegations in Baghdad’s Al Rasheed Hotel.

Upon arrival in the Iraqi capital on Tuesday, Hemmati said that his trip was aimed at removing the obstacles that hinder the settlement of Iraq’s debts to Iranian exporters.

“Currently, we’re witnessing a considerable volume of exports (from Iran to Iraq) in both public and private sectors, but there are shortcomings in banking and monetary exchanges, which have created problems for (Iranian) exporters,” he said.

Following Washington reinstated its unilateral sanctions on Tehran, Iran is establishing different bilateral and multilateral financial channels with its major trade partners in the world to bypass the pressures posed by the US.

Earlier on January 01, Hemmati met with India’s Ambassador Saurabh Kumar, in a farewell meeting at the end of the envoy’s mission in Tehran.

In the meeting, Hemmati and Kumar discussed banking relations between the two countries, and announced that the rupee payment mechanism between the 2 countries will become operational within days.

India’s ambassador to Iran said that the financial mechanism between the two countries is prepared and the two sides will carry out their business and banking operations in the coming days on the basis of the exemptions received by the Indian government.

Also in the meeting, the two sides discussed facilitating banking affairs and the implementation of India's investment in Southeastern Iranian port of Chabahar.

Kumar confirmed that the two countries’ banking mechanism has been created earlier, as both sides will do business in coming days, and added that Iran’s oil revenues are exempted from taxes which are commonly imposed on foreign accounts in Indian banks. 

Also the European Union has established a payment mechanism between the member states of the bloc and Iran.

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Chief bankers of Iran, Iraq sign deal on payment mechanism

Wed Feb 6, 2019 12:21AM [Updated: Wed Feb 6, 2019 12:25AM ]

Governor of Iran's Central Bank Abdolnasser Hemmati and his Iraqi counterpart Ali Mohsen Al-Allaq sign an agreement on a payment mechanism aimed at facilitating the settlement of Baghdad's debts to Tehran. (Photo by IRNA)

Governor of Iran's Central Bank Abdolnasser Hemmati and his Iraqi counterpart Ali Mohsen Al-Allaq sign an agreement on a payment mechanism aimed at facilitating the settlement of Baghdad's debts to Tehran. (Photo by IRNA)

Governors of the central banks of Iran and Iraq on Tuesday signed an agreement on a payment mechanism which is to facilitate the settlement of Baghdad’s debts to Tehran.

The deal, signed in Baghdad by Iran’s Abdolnasser Hemmati and Iraq’s Ali Mohsen Al-Allaq, mainly focuses on a payment channel that is to facilitate the settlement of the Arab country’s debts to Tehran over gas and electricity imports, among others.

The two sides inked the agreement following negotiations between members of their delegations in Baghdad’s Al Rasheed Hotel.

Upon arrival in the Iraqi capital Tuesday, Hemmati told IRNA that his trip was aimed at removing the obstacles that hinder the settlement of Iraq’s debts to Iranian exporters.

“Currently, we’re witnessing a considerable volume of exports [from Iran to Iraq] in both public and private sectors, but there are shortcomings in banking and monetary exchanges, which have created problems for [Iranian] exporters,” he said.

In addition to natural gas and electricity, Iraq imports a wide range of goods from Iran including food, agricultural products, home appliances, and air conditioners.

The value of Iranian imports to Iraq was about $6 billion for the 12 months ending March 2018, about 15 percent of Iraq’s total imports for 2017.     

The energy contracts between the two countries also contributed to a volume of trade of $12 billion last year.

Iran is currently Iraq's top trade partner, having sharply increased their trade exchanges in recent months despite US sanctions on the Islamic Republic.

The US government in November re-imposed unilateral sanctions against the Islamic Republic of Iran and urged all countries in the world to stop doing business with Iran.

However, in a bid to meet its energy needs, Baghdad requested the US to exempt the Arab country from its unilateral sanctions against the Islamic Republic, and was finally granted a 45-day waiver, which was later extended for another three-month period.

 

After giving the waiver, the US said that Iraq could continue to import natural gas and energy supplies from Iran as long as it did not pay Iran in US dollars.

Therefore, the country officially removed the US dollar in trade with Iran, and started working on the use of local currencies in its economic ties with Tehran.

 

Iran’s Tuesday deal with Iraq on facilitating financial exchanges came a few days after the European signatories to the 2015 Iran nuclear deal formally announced the launch of a long-awaited direct payment mechanism meant to safeguard their trade ties with Tehran in the face of the "toughest ever" American sanctions.

Following months-long preparations, foreign ministers of France, Germany and Britain finally unveiled the mechanism -- officially called the Instrument in support of Trade Exchanges (INSTEX) -- on Thursday following a summit in Bucharest.

 

"France, Germany and the United Kingdom, in accordance with their resolute commitment and continued efforts to preserve the Joint Comprehensive Plan of Action (JCPOA) endorsed by United Nations Security Council resolution 2231, announce the creation of INSTEX SAS (Instrument for Supporting Trade Exchanges), a Special Purpose Vehicle (SPV) aimed at facilitating legitimate trade between European economic operators and Iran," the three foreign ministers said in a joint statement," they said in a joint statement.

France, Germany and the UK are the initial shareholders of the INSTEX mechanism for trade with Iran, which has been registered in the French capital, Paris, with a capital of 3,000 euros, and will be governed by a German banking expert, according to AFP and German media.

INSTEX is designed to pave the way for European firms to do business with Iran while evading the strict sanctions the US re-imposed against Iran last year after leaving the 2015 multinational nuclear deal, formally called the Joint Comprehensive Plan of Action (JCPOA).

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127226.jpg?width=750&&height=375

 
02/07/2019 09:35
  • Number of readings 47
  • Section: Arab and World
  •  

Central Iranian: understand the problems of the world in dealing with us because of the embargo

BAGHDAD (Reuters) - Iran's central bank governor Abdel Nasser Hamati said his country understands the problems and conditions of state banks in the world because of the US embargo, adding that his country is exerting its struggle to continue its economic and banking activities without causing any harm to the other party.

Iranian media quoted Hamati as saying that "obstacles will be removed from the way to pay Iraq's debts to Iran related to gas and electricity exports, based on the agreement signed between the two countries recently."

Hamati said that during the visit, he said, "During this visit, as well as the establishment of a mechanism for financial payment between the two countries, the agreement to remove the problems related to the transfer and return of returns of Iranian exporters to Iraq from hard currency," adding that " I am confident that these mechanisms will gradually become more fluid and overcome problems. "

"With regard to Iraq's debts to Iran's gas and electricity exports to Iran, we signed after 4 hours of talks an important agreement with the Central Bank of Iraq to address the obstacles of money transfer and debt repayment."

He pointed out that "based on the consensus, the monetary and banking relations between us and Iraq will be within the framework of the euro and dinar, where the Central Bank of Iran will calculate in Iraq on the basis of the dinar and the euro will be completed banking transactions through Iraqi banks."

Follow the obelisk_ agencies

 

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Iran Claims Iraq Will Pay Its Debts, But U.S. Sanctions Make It Hard

3 hours ago

Iran's central banker Abdolnaser Hemmati (L), with his Iraqi counterpart in Baghdad-- Feb 6 2019
Iran's central banker Abdolnaser Hemmati (L), with his Iraqi counterpart in Baghdad-- Feb 6 2019
 

One day after Iran's Oil Minister Bijan Zanganeh complained that Iraq has not paid billions of dollars for its imports from Iran after the re-imposition of U.S. sanctions, Iran's Central Bank Governor told reporters that he has reached an agreement with his Iraqi counterpart about the payments.

The chief banker Abdolnasser Hemmati arrived in Baghdad Tuesday evening for negotiations regarding bilateral banking relations and the payment of Iraq's debts for the electricity and natural gas provided by Tehran.

Hemmati told Tasnim news agency on Wednesday that a mechanism for the payments has been finalized thanks to an agreement he signed with his Iraqi counterpart Ali al-Alaq. The agreement, Hemmati said, also covers payments for Iraq's other imports from Iran.

He said that based on the arrangements made, payments for natural gas, electricity and other commodities sold to Iraq by Iran will be made based on "payment orders" issued by the Central Bank of Iran. Iran’s Tasnim news agency quoted Hemmati as saying that the central bank will create accounts in Euros and Iraqi dinars to facilitate payment for exported natural gas and electricity.

In addition, Iranian companies can work through Iraqi banks and Iranian banks can open dinar accounts in Iraq. He was quoted as emphasizing that these measures will expand banking cooperation between Iran and Iraq.

But no further explanation was provided as to the exact mechanism, if any, of actual fund transfers and a timetable for Iraqi late payments.

U.S. sanctions prohibit importers of Iranian products to repatriate cash money. Iran can sell its oil or natural gas but the money stays in the importing country and Iran can only use the funds to buy food and medicine as allowed under the sanctions’ regime.

What will Iran do with Iraqi dinars even if accounts are opened at Iraqi banks and payments made? This remains unclear. Iraq is not known as having surplus food or being a major medicine producer.

The Iranian Central Bank governor also said that "The U.S. has waged an economic war against Iran in order to disrupt Iran's economic and political situation," adding that sanctions have created problems for Iranian exporters.

On Tuesday, Iran's oil minister Bijan Zanganeh said Iraq imports monthly $200 million worth of natural gas from Iran but Baghdad has not been paying its debts after the United States re-imposed its sanctions on Iran last autumn.

Zanganeh added that Iraq owes Iran some two billion dollars but Iraqi officials say Baghdad is unable to pay its debts because of sanctions.

Speaking on Iran-Iraq cooperation in developing their shared oil fields, Zanganeh said: "We suggested to Iraqis that we could develop the Khorramshahr and Naftshahr oil fields together but they rejected the offer."

He said, "Iraq is not sanctioned and has no limitation for working with international companies," however, he doubted whether Iraq would sign an agreement with Iran as this might subject Baghdad to secondary sanctions.

He also said that Iraq has unilaterally terminated its oil swap arrangement with Iran based on which Iraq delivered oil from Erbil to Iran across the border and Iran sold some oil in the Persian Gulf on behalf of Iraq.

Iraq's total commercial transactions with various countries are around $190 billion per year, out of which 14 billion dollars is trade with Iran, which includes buying electricity and gas from Tehran.

The United States has given a waiver to Baghdad until the end of March, which makes it exempt from the ban on trading with Iran, so that Iraq could purchase its electricity and gas requirements from Iran. However, international energy market experts say Iraq needs a year before stopping its gas purchase from Iran and finding alternative suppliers. The question is that having waiver, why Iraq is not paying Iran.

Iraq buys 10 billion cubic meters of natural gas from Iran annually and more than 5 terawatts of electricity (5billion megawatts) for a total of nearly $3 billion a year. Since last March, Iraq has also imported $7.5 billion of Iranian rpoducts.

On January 1, the Iranian Parliament's National Security and Foreign Policy Committee Chief, Heshmatollah Falahatpisheh criticized Iran's "negative economic performance in Iraq and warned that Iran as a player will be replaced by Turkey and Saudi Arabia in Iraq's market.

Referring to the outcomes of a recent committee meeting entitled "Iran's economic strategy in Iraq and Syria," Falahatpisheh said that if Iran loses its economic links in those two countries, whatever Tehran has gained in the political and military arena there will be lost.

 

https://en.radiofarda.com/a/iran-claims-iraq-will-pay-its-debts-but-us-sanctions-make-it-hard/29756530.html

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8 minutes ago, Butifldrm said:

What will Iran do with Iraqi dinars even if accounts are opened at Iraqi banks and payments made? This remains unclear.

 

only place ro spend the iqd is iraq good question next question ,,,,, thanks butifldrm  all the best

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This is really good news to me...CBI meeting with CBI and signing agreement using dinars instead of US dollars. Now that this is out of the way, iam very certain(100 percent) that both central banks had already calculated the rate for the iqd...hopefully we will see this rate or rv this month. Don't forget CBI just bought 20 trillion worth of treasury notes to move market...as I mentioned before, this move will increase the iqd rate. Iam very positive that this is why the CBI(central bank of Iran) met up n settled this agreement with central bank of Iraq cause they will benefit from the revaluation of the Iqd and help their economy. Cheers dv

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  • yota691 changed the title to "A war between America and Iran loses billions of dollars to the Kurdistan Region"

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