Tehran transfers some of its frozen assets overseas as ordinary Iranians await benefits from nuclear deal
By NASSER KARIMI and JON GAMBRELL, Associated Press
TEHRAN, Iran (AP) — Iran successfully transferred some of the billions of dollars’ worth of frozen overseas assets following the implementation of the nuclear deal with world powers, the head of the country’s central bank said Tuesday. But ordinary Iranians are still waiting to see how their daily lives will improve and how fast Iranian companies will gain access to financial markets worldwide.
Credit cards still don’t work in the Islamic Republic and its ATM machines remain separated from the rest of the world. That is not likely to change soon as many of the world’s major financial services companies operate in the United States.
Iranian state television quoted Valiollah Seif, the head of Iran’s central bank, as saying that Tehran transferred funds from banks in Japan and South Korea to other banks in Germany and the United Arab Emirates.
He did not say how much money was involved in the transfers, though he said the nuclear deal would give Tehran access to $32 billion in overseas assets and lower international currency transactions for the country by 15 percent.
The Mideast commercial hub of Dubai would be the most likely place in the seven-state Emirates federation for Iran to move its funds. The port city is home to a large Iranian expatriate community and has a long trading history with nearby Iran.
Emirates NBD, the largest bank in Dubai, declined to tell The Associated Press whether it was doing business with Iran now that nuclear-related sanctions have been lifted, citing a policy of confidentiality regarding potential or existing customers. However, it said “various regulatory authorities” have released guidance since the deal was implemented on Saturday. The bank said it is reviewing that guidance to better understand the obligations and restrictions that apply to banks in the UAE.
“Any engagement with potential customers in previously sanctioned countries would take place in several stages and would require updates to policies, procedures, systems and controls as well as ongoing communication with regulators and correspondent banks,” it said.
Meanwhile, Seif also pledged to address the parallel exchange rate for Iranian rials and foreign currencies on the black market, which trade 20 percent higher than their official values. The black market rate is 36,000 Iranian rials to the dollar while the official rate is 30,000 rials for a dollar.
Iranian President Hassan Rouhani, whose moderate administration pushed through the nuclear deal, said Iran now needs to attract foreign investment and liberalize its largely state-run economy.
“Government should withdraw from the economy in favor of the private sector, step by step,” Rouhani said.
Iran expects an economic breakthrough after the lifting of crippling sanctions, and in particular, accessing its overseas assets and being able to sell crude oil more freely abroad.
The U.S. Treasury put out guidance to America-based companies after the deal, reminding them that “U.S. persons — including U.S. companies — continue to be broadly prohibited from engaging in transactions or dealings with Iran or its government.”
That includes companies like payment processors MasterCard Inc. and Visa Inc., both based in the U.S. and thus rendering their branded credit cards useless in Iran.
That also includes online payment options like those offered by U.S.-based PayPal Inc., which in March agreed to pay $7.7 million in a settlement with U.S. regulators over payments involving countries including Iran. Money-transferring companies like Western Union Co. and MoneyGram International Inc. also don’t operate in Iran.
“Our interpretation of current U.S. law is that U.S. companies like Western Union still may not offer remittance services to and from Iran,” Jean Claude Farah, Western Union’s president for the Middle East, Africa, Asia-Pacific, Eastern Europe and Russia, said in a statement to the AP.