Iran hopes new INSTEX members will invigorate economic mechanism
Iran’s deputy Foreign Minister has expressed hope that the new European countries to join the financial mechanism, Instrument in Support of Trade Exchange (INSTEX) will invigorate the non-dollar trade mechanism.
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“We hope that the [six] countries’ participation in the financial mechanism lends new energy to INSTEX (Instrument in Support of Trade Exchanges), and leads to its further operationalization,” Iranian Deputy Foreign Minister Abbas Araqchi told IRNA on Saturday.
The official was speaking during a visit to Beijing, which he has made at the invitation of his Chinese counterpart to talk bilateral ties and follow up on consultations concerning the 2015 nuclear agreement, officially known as the Joint Comprehensive Plan of Action (JCPOA), which was reached between Iran and major word powers.
In a joint statement on Friday, Belgium, Denmark, Finland, the Netherlands, Norway, and Sweden said they would become new shareholders in INSTEX.
“In light of the continuous European support for the agreement and the ongoing efforts to implement the economic part of it and to facilitate legitimate trade between Europe and Iran, we are now in the process of becoming shareholders of the Instrument in Support of Trade Exchanges (INSTEX) subject to completion of national procedures,” their statement said.
The six countries said they attach the “utmost importance to the preservation and full implementation of the Joint Comprehensive Plan of Action (JCPOA)” on Iran’s nuclear program by all parties involved, noting that the nuclear agreement “was unanimously endorsed by the UN Security Council and is a key instrument for the global non-proliferation regime and a major contribution to stability in the region.”
Britain, France, and Germany had announced the establishment of the system in January. The apparatus is meant to circumvent the sanctions that the United States began re-imposing against Iran last year after leaving a nuclear deal with the Islamic Republic and the trio, Russia, and China.
Araqchi called it “an integrally valuable” matter that European states were still seriously seeking to maintain INSTEX as a means of preserving economic and trade relations with Tehran in the face of Washington’s bans. “The Europeans have sustained this will,” he added.
The trade system is in the last stages of taking effect, he added, and expressed hope that it assumes “a more serious operational status” following the joining of the six countries.
Meanwhile, Paris, London and Berlin also said they "warmly welcome" the decision taken by the six governments to join INSTEX as shareholders.
"This step further strengthens INSTEX and demonstrates European efforts to facilitate legitimate trade between Europe and Iran and is a clear expression of our continuing commitment to the Joint Comprehensive Plan of Action (JCPOA)," a joint statemetnt by the three major European powers said, adding that "full and effective implementation of the Joint Comprehensive Plan of Action is of the utmost importance."
The apparatus, he added, can prove instrumental for close to 20 percent of Iran’s economic relations, Araqchi said. He hoped that this margin improves in the future.
The official also lauded foreign countries’ attempt at distancing themselves from the dollar as a transactional staple and engaging in trade with others, especially Tehran, in their own currencies as “a very important.”
Araqchi said the Islamic Republic’s economic and commercial relations with various countries, including China, had assumed “a stable condition, and is improving by day.”
A Joint Commission comprising the JCPOA’s remaining signatories, which meets regularly in Vienna, would meet in the Austrian capital again next Friday, he added, noting that his ongoing trip to China sought to further converge Tehran and Beijing’s stances in the run-up to the meeting.
The next meeting, he announced, would address the latest developments concerning the nuclear accord, including Tehran’s actions to balance its level of commitment to the deal with that of the other partners and the other parties’ measures to live up to their obligations.
This May, Iran began a set of countermeasures in reaction to the US’s withdrawal from the JCPOA.
The retaliatory steps have also sought to prompt the deal’s European side to protect Iran’s business interests, as it is contractually obliged, despite the US’s hostile actions. Tehran has invariably asserted that these steps are reversible once the other parties start living up to their JCPOA commitments completely.