No Change in Finance Deals After US’ JCPOA Withdrawal

EghtesadOnline: The Economy Ministry has issued a statement, denying that the finance deals signed by Iran with other countries are jeopardized or dead, now that the US has decided to pull out of the multilateral agreement.

News ID: ۷۸۲۶۳۳

19 May 2018

It also criticized sources disseminating negative news and giving the impression that the US move has changed the odds against Iran on the international front.

The statement, published on the ministry’s website on Monday, was issued in response to media reports that cast doubt over the fate of finance deals and credit lines negotiated or agreed upon by Iran in recent years, with some claiming that those deals have been revoked, according to Financial Tribune.

“Following inquiries from the Organization for Investment, Economic and Technical Assistance of Iran and the Central Bank of the Islamic Republic of Iran and based on data, so far no sign indicating a change in attitude of countries that are party to finance deals with Iran has been detected,” the statement added.

It emphasized that only announcements made by OIETAI as the entity responsible for attracting and negotiating foreign finance and CBI as the banking coordinator regarding finance deals are credible.

The Joint Comprehensive Plan of Action (the formal name of the nuclear deal) curbed Iran’s nuclear activities in return for the lifting of sanctions that had been imposed by the UN, the US and the European Union.

In the post-sanctions era, Iran has negotiated billions of dollars worth of finance with Europe, China and Russia, among others.

In January, Iran and Italy signed a major framework credit agreement to fund development and industrial projects in the Islamic Republic.

Italy’s Economy Ministry put the value of the agreement at €5 billion ($6 billion) and said it was signed in Rome between the Bank of Industry and Mine and Middle East Bank of Iran, and the investment arm of Italian state-owned holding Invitalia.

The credit agreement with Italy followed similar moves with several European banks over the past few months. The latest involved an agreement between four Iranian banks and the Eximbank of Russia to provide “unlimited funds” for development projects to be carried out by domestic and international contractors in Iran.

Last year, Austria’s Oberbank signed a major finance deal with over a dozen Iranian banks, based on which it would provide €1 billion in credits to Austrian companies investing in the Iranian economy.

Oberbank’s initiative–as the first of its kind in many years–was followed the same day by a similar agreement between Denmark’s Danske Bank and several Iranian banks.

Accordingly, Danske Bank would allocate a credit line of €500 million for investments by Danish businesses in Iran.

On a related front, France’s state investment bank Bpifrance announced in September that it planned to provide funds to French companies that invest in the Iranian economy in 2018.

US President Donald Trump announced on May 8 Washington’s withdrawal from JCPOA despite earlier international warnings and pleas for the White House not to attack yet another international agreement.

Trump has said the US would be reinstating the anti-Iran bans lifted under the JCPOA and reimposing the “highest level” of economic sanctions on Tehran, prompting anger among other parties to the Iran deal, which unanimously denounced Washington and vowed to keep their end of the deal.

Reacting to Trump’s decision, Tehran has said it would for now stay in the deal, pending talks with Russia, China and the three European signatories before deciding on the future of the accord.