Majid-Reza Hariri, the deputy head of Iran-China Joint Chamber of Commerce, was quoted by the media as saying that the two countries were in early talks over the scheme, adding that they were yet to work out its related technicalities. Hariri said it was not clear which specific model of currency swap China plans to use for its trade activities with Iran. “The payments in yuan will both help strengthen the Chinese currency against the dollar and will also help Iran dodge the limitations that the sanctions have created. Nevertheless, both Tehran and Beijing still have a long road ahead to turn into a working mechanism,” the official added.
On a related story, Ali-Asghar Haji, Iran’s Ambassador to China, had told reporters last week that the Islamic Republic had just received the text of the agreement of swapping currencies with China. Haji said Tehran was determined to make this mechanism operational and would try to prepare the grounds for its implementation. He further emphasized that the agreement could be signed – among many other documents – during an upcoming state visit by the Chinese President Xi Jinping to Tehran.
China reportedly owes Iran over $20bn in outstanding oil payments. The cash has been frozen in overseas banks after the US-led sanctions made it difficult for Beijing to transfer money to Tehran. Accordingly, the two countries have reportedly reached a deal to settle a part of the frozen money through China’s funding of Iranian petrochemical projects. Iran said past Friday that China had started the proceedings to provide funds as much as €16bn for the development of Iran's petrochemical projects. However, the red-tape should be largely blamed for the delay in China's provision of financial facilities to Iran's petrochemical projects, said Amir Hassan Fallah, the director for investment affairs of Iran's National Petrochemical Company (NPC).
SH/PR