South Korea to unfreeze Iran money after ‘consultations’ with US

South Korea says the Iranian assets locked in the Asian country will be released after consultations with the United States.

The South Korean foreign ministry’s announcement on Tuesday came a day after reports said Iran had reached a deal with Seoul on how to transfer and use the frozen money.

Tehran is asking Seoul to unblock about $7 billion of its assets frozen in two South Korean banks. Seoul claims it has been in talks with Washington on ways to release the money without violating unilateral US sanctions on Iran.

According to Iran’s government website, the agreement was reached Monday during the meeting between Iran’s Central Bank Governor Abdolnaser Hemmati and South Korean Ambassador to Iran Ryu Jeong-hyun.

It said that the two sides agreed on the destinations for the transfer and that the Iranian central bank informed Seoul of the amount of the money it wants to be transferred.

South Korea’s official Yonhap news agency, however, appeared Tuesday to dispute the account.

“Our government has been in talks with Iran about ways to use the frozen assets, and the Iran side has expressed its consent to the proposals we have made,” it quoted the South Korean foreign ministry as saying.

“The actual unfreezing of the assets will be carried out through consultations with related countries, including the United States,” the ministry said.

Earlier this month, a foreign ministry official said Seoul was finalizing talks with Washington about using some of the frozen funds to pay Tehran’s UN dues in arrears.

In the past, South Korea has claimed it was seeking to use the Swiss Humanitarian Trade Arrangement (SHTA) channel to pay back Iran’s debt through Swiss companies’ sales of goods to Iran, but the promises have remained on shelves so far.