Iran, Russia committed to boost banking relations: Envoy

Tehran, May 4, IRNA – Iran and Russia banking officials have agreed to boost banking ties by creating joint accounts, Iran’s Ambassador to Moscow Mehdi Sanaei said.

He made the remarks in a meeting with the Iran-Russia Joint Chamber of Commerce.

Central Bank of Iran (CBI) has agreed to open rial accounts for a number of Russian banks, the envoy added.

He said that representatives of two Russian banks visited Iran last week and held talks with Iran’s CBI officials.

Iranian and Russian banks have agreed to establish joint accounts, Sanaei noted.

He said trading with the help of Mir Business Bank is another tool for expansion of ties.

Mir Business Bank was incorporated in early 2002, in the name of Bank Melli Iran, and then in 2010 received the current name. It is fully controlled by Iran’s largest bank — Bank Melli Iran (100% owned by the government of Iran).

Iran’s envoy to Moscow hailed the current government’s efforts to boost bilateral ties, adding that Tehran-Moscow commercial relations had 20 percent increase in the past Iranian calendar year (ended March 20, 2015).

Since Russia has been sanctioned by the West, Iran has the potential to become a major partner for Moscow, he underscored.

Sanaei referred to meeting between Iranian and Russian presidents in the past one year four times and said that 900 economic and political delegations have been exchanged between the two countries during the past Iranian calendar.

Iran and Russia are planning to switch their bilateral trade to national currencies for which the states are going to create a joint bank or a mutual account.

Both sides plan to create a joint bank, or joint account, so that payments may be made in rubles and rials.

Moscow and Tehran are considering the possibility of creating a visa-free regime by signing a memorandum of understanding in 2015.

Russia already has a currency swap agreement with China, which could potentially lessen the US dollar’s influence on the global energy and other markets.

Iran, Russia, China, and several Latin American countries are not the only ones looking to ditch the US dollar in their trade. The Eurasian Economic Union, which also includes Belarus and Kazakhstan, is planning to create a single market for financial services by 2025 which will simplify switching to dollar-free trading. Late last year, the Russian State Duma proposed the creation of a single area for payment in national currencies. Such measures are expected to minimize Western influence on the economy of the EEU.

Last July, the group of emerging economies signed the long-anticipated document to create the US$100 billion BRICS Development Bank, and a reserve currency pool worth over another $100 billion. Both will counter the influence of Western-based lending institutions and the US dollar.