South Korea in Talks With US to Resume Humanitarian Exports to Iran

EghtesadOnline: South Korea is in talks with the United States over Iran's call for Seoul to resume exports of humanitarian goods to Tehran, after tougher US sanctions virtually halted such trade.

News ID: ۷۸۵۱۳۷

16 December 2019

Financial transactions between Seoul and Tehran for shipments of food and medical items became effectively impossible after Washington toughened sanctions against the Central Bank of Iran in September, requiring third countries to provide information on trade with the Middle Eastern country, South Korea's Yonhap news agency reported.

Tehran has called on the South Korean ambassador to Iran to lodge a complaint, urging Seoul to resume humanitarian trade with the country.

"The Iranian side expressed its position that it hopes for the humanitarian trade to be resumed and is discussing the matter with us," Financial Tribune quoted a South Korean Foreign Ministry official as saying.

"We are in talks with Iran and the US frequently so that the shipments of humanitarian goods like medical supplies can be resumed using the won-based transaction system."

Officials from the foreign, finance and industry ministries in South Korea reportedly visited Washington last week and held talks with US officials over the issue, according to sources familiar with the matter.

The US decided in April this year to end sanctions waivers for imports of Iranian oil by South Korea and other countries. Since then, South Korean companies have faced difficulties in selling medicine, medical equipment and other humanitarian products to Iran through a bilateral transaction system using the South Korean currency, the won.

The Iranian central bank has won-based accounts at Woori Bank and the Industrial Bank of Korea in Seoul for payments of not just oil imports but also products that are not subject to sanctions.

In June, Seoul officials visited Washington to ask for US cooperation on the export of humanitarian goods to Iran.

Crimes Against Humanity

Iran's Health Minister Saeid Namaki in separate letters to the United Nations Secretary-General Antonio Guterres and the heads of two of its affiliated organizations, namely the World Health Organization and the United Nations Children's Fund, recently called on the international community to break the silence on the humanitarian crisis resulting from US unilateral sanctions against Iran.

In his letters to Guterres, WHO chief Tedros Adhanom and UNICEF chief Henrietta H. Fore, Namaki said the sanctions have severely impeded Iran's ability to import food, drugs and medical equipment, despite US claims that humanitarian goods are exempt from sanctions, IRNA reported.

"Innocent people have been the first to have fallen victim to such US measures," the minister said.

In practice, prohibitive measures against any transactions with Iran have scared away exporters of humanitarian goods to Iran.

"By sanctioning the Iranian nation, the United States has not only committed economic terrorism but also crimes against humanity," he said, noting that many patients are at risk amid the ongoing shortage of medicine in Iran.

US sanctions have especially impeded manufacturing radiotherapy drugs for cancer, making cobalt fuel, cyclotron and PET, Gamanayev and even wound care dressing for EB patients, he added.

"Iran witnessed the silence of international community against the atrocities of Saddam Hussein when the former Iraqi regime used chemical weapons against the Iranians," he recalled, adding that he hopes history won't repeat itself this time.

"The UN officials ought to be responsible against violations of human rights and principles of world diplomacy as well as unilateralism," the Iranian minister said.

Namaki made similar remarks in his address to the opening ceremony of the 66th Session of the World Health Organization’s Regional Committee for the Eastern Mediterranean held in Tehran in October.

Swiss Humanitarian Channel to Iran Seen Within Months

Pascale Baeriswyl, Swiss state secretary for foreign affairs, and US Ambassador Edward McMullen spoke in separate interviews in the Swiss capital last week, days after a rare Swiss-brokered prisoner swap by arch-foes Iran and the US.

“Our role is really to be able to provide food and health goods to the Iranian people. And, therefore, we are working hard on establishing that humanitarian channel,” Baeriswyl said.

US clarifications announced in October on how to verify and certify such deals—bypassing Iran’s central bank and ensuring that no payments are transferred to Iran—helped advance the project so as to safeguard Swiss exporters, Reuters reported.

“Ultimately, that depends on companies and banks wanting to participate ... We have made progress recently,” Baeriswyl said.

Asked whether the mechanism could be operational in the first half of 2020, she said: “I hope so, but it is very difficult to predict since it is not entirely in our hands.”

McMullen was also upbeat. “Fortunately, I think we are at that point now where we are working with Switzerland on the final details. And, hopefully, we’ll be seeing some kind of finality to that conversation in the near future,” he said.

Big Swiss companies like Nestle and drugmakers Roche and Novartis already produce in Iran. The new channel could encourage smaller players to export food and medicine to Iran.

France has led efforts for more than a year to set up a separate European trade mechanism for humanitarian and food goods with Iran, which has stalled.

Baeriswyl said, “If this [Swiss] model works, it would be great if others could follow ... It’s not a competing instrument, just a slightly different approach.”

January marks the 40th anniversary of Switzerland taking on a mandate of a neutral “protecting power”, representing US diplomatic interests in Iran since Washington and Tehran cut ties shortly after the 1979 Islamic Revolution.

Baeriswyl, who held talks in Geneva with Iranian Foreign Minister Mohammad Javad Zarif in October that were revealed in Twitter posts, met him again in Zurich recently for the handover of US and Iranian prisoners.

“We stand ready—if both parties ask us to—to facilitate more [exchanges], of course,” she said.