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Iran’s resort to barter with Russia points to banking problem

Business Materials 27 July 2015 18:14 (UTC +04:00)

Tehran, Iran, July 27

By Mehdi Sepahvand -- Trend:

An Iranian expert says the fact that Iran has resorted to bartering goods with Russia is that Russia has many problems in establishing banking relations with other countries.

These comments follow Iran 's negotiations with Russia on bartering Russian goods for Iranian petrochemicals. Over recent weeks, a couple of Iranian and Russian delegations have traveled between the two countries' capital cities. Russian companies have announced readiness to import urea, methanol, and polymer products from Iran.

Iran has always been interested in trade with Russia, Central Asia, and Caucasus, Mohammad Reza Behzadian, former president of the Tehran Chamber of Commerce told Trend July 27.

But the socialist system has preserved monetary regulations in former USSR states, causing serious problems for these countries in conducting banking relations with other countries, Behzadian pointed out.

"Under sanctions, Russia is sure to understand the situations Iran has experienced in the past ten years. If the right situations had existed, Iran would have had billions of dollars trade with those countries," he stated.

The problem with Iran 's northern neighbors is their tariffs, customs regulations, etc., which have necessitated barter, deferred payment and other methods as replacements for cash payment, according to Behzadian.

Therefore, the barter contracts, if fulfilled, are hoped to make up for the money transfer problems, Behzadian concluded.

Earlier Rajab Safarov, the general director of the Russian-Iranian business council said trade turnover between Russia and Iran could reach $2-2.5 billion in 2015. He added that current economic cooperation between Russia and Iran is nearly zero.

"Iranian export to Russia totaled $260 million in 2014 while Russia exported goods valued at $600-700 million. We've probably reached the bottom of the turnover decline," Safarov said.

Edited by CN

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