To get Iran the assistance it needs, the IMF can take steps to address the Trump administration’s concerns.
According to an article by Bloomberg, the Fund can account for the unease of US regulators by excluding dollars. Iran could even agree to accept the loan in euros alone, given that the EU is its primary supplier of medical goods.
Second, the loan could be paid into an account maintained in Europe by the Central Bank of Iran. This would mean that the funds are spent within the European financial system, the article adds.
In this scenario, IMF would reallocate some portion of Iran’s 1.55 billion in SDR holdings (valued at approximately $2.1 billion) to the buyer, which would then make a payment to Iran in a foreign currency, such as euros, to an account maintained by Iran’s central bank outside the country.
The article maintains that such a transaction would not require approval from the IMF board of governors.
In an Instagram post in mid-March, 2020, CBI governor Abdolnaser Hemmati said he had written to the IMF’s head, Kristalina Georgieva, to stress Iran’s “right to benefit from the fund’s $50-billion Rapid Financing Instrument (RFI),” to help it cope with the coronavirus pandemic.
The request, however, was opposed by the US.
Iran is one of the countries most affected by the pandemic and the US sanctions are hampering the country’s efforts to contain the virus.
According to Iran’s Health Ministry on Sunday, the death toll from the coronavirus outbreak in Iran has risen to 4,474 with 71,686 confirmed cases.
MNA/PR