March 20, 2019
Tehran announced this week that the Central Bank of Iran (CBI) has launched a mechanism similar to the EU’s Instrument in Support of Trade Exchanges (INSTEX) trade channel, to be called the Special Trade and Finance Institute (STFI), to circumvent US sanctions.
The Iranian official news agency, IRNA, reported on the newly established mechanism, involving Germany, France and Britain, including a number of banks and companies, without giving further details.
IRNA also cited Abdolnasser Hemmati as confirming that at “a meeting with the INSTEX manager and representatives of France and the UK, CBI authorities have fully explained the STFI mechanism,” and that it is set to facilitate business between Europe and Iran.
Hemmati, however, stopped short of elaborating publicly on the details of the mechanism.
The announcement comes after nearly ten days of negotiations by the German head of INSTEX, Per Fischer, with Iranian officials. For the first stage, the STFI is supposed to focus on goods that are not currently subject to US sanctions, such as medicines, medical supplies, foodstuffs and consumer goods.
But the spokesperson of Iran’s foreign ministry, Bahram Ghasemi, told the local Young Journalists’ Club website on March 19, “You should not have hopes for the trade mechanism to do miracles”.
“We have not been waiting for Europeans, and we have pursued other mechanisms with other countries”.
He added that countries such as China, Turkey, India and Russia have been mulling over trade with Iran using their national currencies.
For Iran, the economic crisis has only worsened since US President Donald Trump decided to withdraw from the nuclear deal last May. Five months ahead of the US pullout, Iran witnessed a wave of protests that saw more than 80 Iranian cities take-to-street against skyrocketing prices with protesters chanting anti-corruption and anti-government slogans.
As living conditions deteriorated, Iranians rebelled against the Rouhani administration failing to fulfill its promise on creating more jobs and improve living conditions in the country.