The CBI boss Abdolnasser Hemmati underscored the need for Iran’s “swift access" to the resources long held in Iraqi banks. The two sides reviewed options to transfer the money and facilitate the CBI’s access, a press release published on the CBI website said.
In the Tehran meeting the TBI head Salem Chalabi said Baghdad had recently reimbursed a part of debts to Iran and that the process would be expedited.
The senior banker accompanied a delegation headed by Iraqi Foreign Minister Fuad Hussein, who arrived in Tehran on Saturday.
Due to the economic and banking blockade imposed by the United States, billions in Iranian assets, mainly from gas and electricity exports to the Arab nation, are blocked in Iraq.
A year ago an agreement was reached between the Central Bank of Iran, Central Bank of Iraq and the Trade Bank of Iraq to Iran's currency assets.
The two sides agreed in February 2020 to settle Iraqi arrears via a trade mechanism to supply goods to Iran. US restrictions on paper exempt trade in humanitarian goods, like food and medicine, from the sanctions. As such, such transactions should not be subject to the blockade. But that has not been the case so far apparently due to banking hurdles.
In December, the National Iranian Gas Company said Iraq owed more than $6 billion. Debts include $2 billion in arrears and $1 billion in contract violations. Apart from that $3 billion is blocked and inaccessible in the Trade Bank of Iraq.
Iraq is the biggest importer of electricity from Iran. It needs more than 23,000 MW (per day) to meet growing domestic demand. Besides importing electricity, Iraqi power plants depend on Iranian gas to generate power.
Iran has exported close to 65 billion kilowatt hours of electricity to Iraq since 2005 worth more than $6.2 billion. The neighbor also is the biggest regional market for Iranian exports.