Financial Tribune - In response to recent complaints of Iranian petrochemical companies regarding difficulties in transferring money from China to their accounts in Iran, the head of Iran-China Chamber of Commerce enumerated money laundering concerns as the main reason behind the problem.

“Iranian petrochemical companies issue their bill of lading from the ports of Fujairah or Abu Dhabi, therefore due to money laundering issues, Chinese companies claim that the money should be transferred to a bank in Fujairah or Abu Dhabi and not to Iran,” Asadollah Asgaroladi was also quoted as saying by ILNA.

However, Asgaroladi noted that legally speaking, Chinese companies are right in doing so since a shipment that was supposed to be sent from Iran was sent from UAE.

“The mistake originated from our own petrochemical companies,” he said.

The head of Iran-China Chamber of Commerce also pointed to problems facing Iranian students in China and Malaysia, as their families have traveled to these countries to visit their children but they have also purchased significant amounts of goods and shipped them back to Iran.

“Many of these families have bought about $100,000 worth of goods from China and shipped them to Iran without paying any kind of duties and that issues related to Iranian students in China have nothing to do with US President Donald Trump’s visit to China,” he added.

Asgaroladi noted that a representative from the Central Bank of Iran has visited China and negotiated with their banks, therefore the issues of petrochemical companies and students should be resolved soon.

Ahmad Mahdavi Abhari, secretary of the Association of Petrochemical Industry Corporation, also complained about the process of money transactions as they expected that after the implementation of the Joint Comprehensive Plan of Action (the formal name of Iran’s nuclear deal with world powers), things would get better but currently, the same old problems have resurfaced and petrochemical companies are receiving their due the way they did during the nuclear sanctions.

“International banks still refuse to issue letters of credit for Iranian petrochemical companies and we still have to transfer our money through ways we did during the sanctions, which increases our costs significantly,” Abhari also told Fars News Agency.

However, Mahdavi noted that fortunately their issues with Turkey and South Korea have been addressed and petrochemical companies can now freely export their products to these countries, but the issue of transferring the revenues remains a problem and needs to be resolved.

“South Korea owed us a small amount of money, which we managed to transfer to our country. But as the process is exactly the same as they were before the sanctions, we expect  the Ministry of Foreign Affairs to follow up on these issues because European and Asian countries are still afraid of engaging in financial transactions with Iran,” he added.

Hossein Yaqoubi, director general of International Affairs Department at the Central Bank of Iran, had said last week that that there are no significant banking issues with China and the UAE, as hurdles with Turkish Halkbank are also being removed.

“About two months ago, there were reports that the bank accounts of Iranian petrochemical companies in China are being blocked, but the issue was resolved after a series of negotiations,” he had said at the time.