Russia Wants to Use National Currencies in Iran Trade Deals

Moscow and Tehran have started talks on using national currencies in trade deals between the two countries, Russia’s Ambassador to Iran Levan Dzhagaryan said.

According to the ambassador “central banks” working groups have met several times.

“As far as we can understand, negotiations are underway,” Dzhagaryan said, according to Iran Daily.

“We hope that in 2018 we shall achieve progress and will be able to use widely the favorable conditions we may have if we manage to approach final decisions,” he added.

Last year, during the visit of Iranian President Hassan Rouhani to Moscow, the two sides agreed to continue cooperation aimed at “stabilizing the global energy market and ensuring sustainable economic development.” They said they will be working on favorable conditions for using national currencies in settlements. Moscow and Tehran have also discussed developing inter-bank cooperation between the two countries and ensuring an increase in trade and investments.

Putin and Rouhani also focused on the potential creation of a free-trade zone between Iran and the Eurasian Economic Union, which consists of Russia, Belarus, Armenia, Kazakhstan, and Kyrgyzstan. Rouhani told journalists that such a trade zone could significantly improve the trade situation and “create new conditions” in regional trade.

In November, Iranian Supreme Leader Ali Khamenei said that the best way to beat U.S. sanctions against Iran and Russia is joint efforts to dump the American currency in bilateral trade.

He told President Putin that by using methods such as eliminating the U.S. dollar and replacing it with national currencies in transactions between two or more parties, the sides could “isolate the Americans.”

In 2016, the volume of trade between Russia and Iran increased by 70 percent in comparison with the previous year, reaching $2.2 billion, most of which comprised of Russian exports of machinery, equipment, transport, food and metals. Iranian food exports to Russia made up just $0.3 billion of the trade balance.