Ambivalence surrounds INSTEX for Iranian businesses

Financial Tribune – Europe unveiled its long-awaited mechanism for facilitating trade with Iran by circumventing US global financial dominance on Thursday and the move received a mixed response in Tehran’s commercial corridors.

Businesses, who are the ultimate beneficiaries of INSTEX, mostly say they have to wait for the mechanism to become operational before they can pass judgment. But what is known so far from statements released by the foreign ministers of Germany, France and the UK, is that the channel is meant to be used, at least in the early stages, only for humanitarian trade.

The US claims that it has exempted Iran from a wide-range of sanctions re-imposed last year when it unilaterally abandoned the international nuclear deal Iran signed with six world powers in 2015. But food merchants in Iran say due to the reluctance of many banks to handle payments to and from Iran, food trade has become too costly, riskier and time consuming.