Forex policies, independent from EU mechanism: Iran Central Bank

IRNA – Governor of Central Bank of Iran (CBI) says the country’s foreign exchange rules and policies are independent from Europe’s Special Purpose Vehicle (SPV) the block is going to set up to facilitate Iran global commerce under US sanctions.

Attending a TV program in Tehran Tuesday evening, Abdolnaser Hemmati said Iran hopes Europe will soon implement the special purpose vehicle (SPV) for trade with Iran.

‘I am proud to say that today Iran is on the path toward social and economic sustainability and it has overcome the big world power which is waging a war against the country using all the tools available,’ Hemmati said.

‘Today we have overcome fluctuations in the forex market,’ he added.

Referring to the international marketing of Iranian oil, the CBI governor said cutting Iran oil imports by some buyers temporarily interrupted the flow of foreign exchanges into the country.

But presently Iran has deposited tens of billions of dollars of working foreign exchange reserves in foreign banks which are completely accessible, he added.

Despite the world’s criticism over Washington’s anti-Iran measures, Trump reinstated unilateral sanctions on Tehran on November 5, few months after leaving the July 2015 nuclear deal, and imposed as he claimed the “highest level” of economic bans on Iran.

Analysts believe that sanctioning Iran’s oil for a long period will lead to an oil price hike and weaken [US] dollar in the international arena, which will ultimately lead to the US defeat and its withdrawal from its unilateral decisions.

According to Hemmati, the obstacles created by the enemies will enable Iran achieve goals set by the Economy of Resistance and reduce reliance on petro dollars.

Under current conditions, reliance on domestic products will increase, and this will improve welfare of the people, he said.

He went on to say that the CBI has set up expert teams to reform the country’s banking system.

Pointing to the European financial mechanism, known as the SPV, Hemmati said Europeans have a technical problem.

‘They (Europeans) say the United States imposes sanctions on whatever they do,’ he said.

But Iran has devised all its financial policies regardless of the SPV, he stressed.

However, the CBI welcomes Europeans’ practical measure which Iran predicts will be taken in the near future in order to save their reputation, he added.

Elsewhere, Hemmati talked of country’s move to join Combating the Financing of Terrorism (CFT) and Palermo conventions, and said the glob banks expect Iran to join the Financial Action Task Force (FATF).

FATF introduces itself as an inter-governmental body established in 1989 by the Ministers of its Member jurisdictions. The objectives of the FATF are to set standards and promote effective implementation of legal, regulatory and operational measures for combating money laundering, terrorist financing and other related threats to the integrity of the international financial system. The FATF is therefore a “policy-making body” which works to generate the necessary political will to bring about national legislative and regulatory reforms in these areas.

Presently, Iran exports daily one million barrels of its oil while Japan has recently resumed importing oil from the country, Hemmati said.

On Jan 21, Hemmati wrote in his Instagram page ‘In addition to tens of billions of dollars of the CBI’s active resources with foreign banks, new oil revenues will gradually join the business cycle which is regarded as a strong and reliable support for our Iran’s trade.’

Touching upon the issue of slashing four zeros from Iran’s national currently, Hemmati said the move is not on CBI’S priorities, but it is being followed up alongside with other plans.

He added the implementation of decision on lopping four zeros from the Iranian currency takes about two years.

Hemmati also reassured the Iranian people that the CBI is making efforts to control inflation and bring about stability to the forex market.