Tuesday, August 2, 2016
Obama 'admin' allows South Korea to do Iran trade in euros.
Obama 'admin' allows South Korea to do Iran trade in euros. (Iranfrontpagenews).
Financial transactions are currently conducted in the local won currency between the two countries because US sanctions prohibit dollar-based trade with Iran.
Iran prefers a payment system in euros but South Koreans say it is impossible because they have to convert payments into dollars which could go against US law.
According to Korean media reports, the US government has indicated its readiness to allow payments in euro with Iran and Seoul will start trial run in the new system as early as next month.
The euro-based payment system will allow Korean financial institutions to make monetary transactions in euro via European banks as intermediaries, news reader and mobile content distribution platform Pulse reported.
“Under the system, when Korean companies would send money to European banks that would exchange won into euro before transferring the money to Iranian banks,” it said.
The new system will facilitate monetary transactions between Iran and South Korea which signed $45.6 billion of project deals in May and accelerate their revival of trade relations which shriveled under sanctions.
According to Pulse, South Korean companies have been under compliance of US sanctions and Seoul still needs to confer with Washington about the scope of reviving trade and launching new business ventures in Iran.