A special financial mechanism to maintain trade relations between Switzerland and Iran is ready for implementation. It was announced by Sharif Nezam-Mafi, head of the joint chamber of commerce.
He told the news agency IRNA that the new clearing house will be used to facilitate Iran’s oil transactions with its major Asian commodity customers – India, China and South Korea.
The head of the Iran-Swiss Chamber of Commerce stated: “At present, there is no money in Europe that belongs to Iran. The bulk of Iranian money goes to India, China and South Korea, which import Iranian crude oil.”
According to Nezam-Mafi, the Swiss financial channel will start operating as soon as Iranian oil money flows from Asia to Europe. The Swiss Ambassador in Tehran, Marcos Lightner, told IRNA that both sides are preparing an independent payment channel in addition to the Special Purpose Vehicle (SPV).
He pointed out that although Switzerland is not a member of the European Union, Switzerland consistently implements the SPV. The diplomat stressed that European countries are currently trying to uphold the Iranian nuclear deal in the face of US pressure.
The new payment channel between Iran and Switzerland is designed to circumvent US sanctions against the Islamic Republic, after Washington abrogated the 2015 nuclear agreement with Tehran last year.
The European Union is also working on a financial mechanism to facilitate non-US dollar trade with Iran to bypass US sanctions. It hopes that the SPV announced in September will keep the nuclear contract alive.
Foreign companies should be given an opportunity to trade with the country without violating Washington’s sanctions. Three European diplomats confirmed to Bloomberg that the official unveiling of the SPV could come as early as Monday.
The SPV is a key element to stop Iran from quitting the Joint Comprehensive Plan of Action, the 2015 deal made in exchange for sanctions relief.
The EU, led by France, Germany and the UK has struggled to find a government willing to host the SPV, which would anger the Americans. The Trump administration has complained that the SPV circumvents its “maximum pressure” campaign on Iran.
The US plans to hold accountable any individuals or countries that undermine them, an administration official who spoke on condition of anonymity, told Bloomberg.
The EU diplomats who commented on the SPV all declined to be named because of the sensitivity of the matter, including the timing of the launch, for fear of an American backlash.