Iran trying run-around on U.S. economic sanctions

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Iran is working to take control of the Iraqi banking system so that it could "sell" its oil there, and get paid in euros – all in an effort to bypass the economic sanctions imposed by the United States that are intended to create obstacles to its nuclear weapons development, a report explains.

"In advance of Iranian President Hassan Rohani's upcoming visit to Iraq next week, Iranian regime and banking officials in Baghdad have held preliminary meetings, during which the Iranian regime ensured that it would control the Iraqi banking system in a way that would allow Iran to circumvent the U.S. sanctions," the report from the Middle East Media Research Institute confirms.

A plan had been announced by the Iranian news agency Tasnim that an Iran-Iraq payment system had been set up that would allow Iran "to evade the U.S. sanctions that threaten its economy."

MEMRI said according to Iranian documentation of the work on those strategies, the goal is for Iran to "export its oil and natural gas to Iraq and receive euros in exchange."

"To this end, it was agreed that the Central Bank of Iran would open euro and dinar accounts in Iraq through which payments for the oil and gas would be made," it reported.

While Iran obviously has an interest in manipulating the procedures so that it can cash in on its petroleum production, the report indicates that even Iraq was in support of the maneuver.

"Iraqi Prime Minister Adel Abd Al-Mahdi, a Shi'ite supported by the U.S., personally committed to the agreements obtained and is a fervid supporter of continued bilateral negotiations with Iran. Central Bank of Iraq governor Ali Al-'Alaq seeks to remove the obstacles to economic cooperation, in particular to allow foreign currency to flow into Iran," the report said.

"It should be noted that the U.S. administration has warned that if Iraq becomes a channel for transferring foreign currency to Iran, the U.S. would respond with sanctions on Iraqi banks, and would block their access to dollars," MEMRI reported.

Tasnim reported that Central Bank of Iran governor Abdolnasser Hemmati had been holding "banking talks" in Baghdad, and was meeting with Iraqi counterparts.

He "expressed hope that the level of financial relations between the two countries would increase. He said: 'Iraq is Iran's largest trade partner, and the durability of this relationship between the two countries requires banking relations. America is conducting an extensive effort to thwart Iran's economic and political situation by waging economic war on Iran, but fortunately the enemy's plots are being neutralized by means of the arrangements that Iran came up with, and now the required stability prevails in Iran's economy.'"

In the Iranian daily financial report, Taadol, Hemmati was reported saying, "According to the agreement that was attained, the Central Bank of Iran expects to have accounts in euros and dinar, and gas and oil exchanges will be conducted based on these accounts. According to the agreements, Iranian exporters can operate by means of the Iraqi banks and, accordingly, the Iranian banks can hold dinar accounts. Therefore, the Iran-Iraq banking relationship will be strengthened by these agreements, and the agreement of the Iraqi prime minister and the expansion of trade relations between the two countries will take shape based on this. Iraqi companies can also open accounts in Iranian banks and conduct their business in dinars."