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08 June 2023

China cuts business with Iranian banks

By Agencies

Chinese banks have cut back business with Iranian banks due to US pressure over Tehran's disputed nuclear programme, a senior Iranian Foreign Ministry official was quoted as saying in comments published on Saturday.


The United States, which is spearheading efforts to isolate the Islamic Republic over activities which Washington fears are ultimately aimed at making bombs, has urged international banks and companies to stop doing business with Tehran.


China has growing commercial ties with oil-rich Iran and has been reluctant to impose tough economic sanctions on the country. Tehran says its nuclear programme is a peaceful drive to produce energy.


"Because of America's pressure, China's banking system has cut its cooperation with Iranian banks for four months now," the Etemad daily quoted Deputy Foreign Minister Mahdi Miraboutalebi as saying, without giving details.


It was not clear whether all or just certain transactions had been halted and Iranian officials were not immediately available for comment.


Asadollah Asgaroladi, the head of the Iran-China chamber of commerce, said in December that Iranian traders had faced difficulties in opening letters of credit with Chinese banks, restricting a key instrument in trade.


Saturday's Etemad report said Asgaroladi called China's banking action unacceptable and that an Iranian delegation would visit China in order to remove such obstacles to business ties.


China has become an increasingly important trading partner with Iran as expanding UN and US sanctions over Iran's nuclear activities have encouraged Western firms and banks particularly to scale back dealings with the Islamic Republic.


During a visit to Tehran late last year, Chinese Foreign Minister Yang Jiechi was quoted as saying Beijing wanted to expand ties with Tehran.


China and the four other permanent members of the UN Security Council as well as Germany last month agreed on a draft new sanctions resolution against Iran over its refusal to halt sensitive atomic work.


The draft, a watered down version of what Washington wanted because of resistance by Beijing and Moscow, calls for extended freezing of assets and travel bans on specific Iranian officials. But it falls far short of the kind of tough measures the US wanted imposed on Iranian banks. (Reuters)