Russia Wants To Use Instex For EU Trade

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Russia’s Foreign Ministry has stated that it wants to have a role in the Instrument in Support of Trade Exchanges (Instex), a special mechanism launched since earlier this year to facilitate trade between Iran and the European Union at the time of increased US economic pressure on Tehran. It is possible it could also be extended after time to facilitate EU trade with Russia.

“Russia is interested in close co-ordination with the European Union on Instex, the more countries and continents involved, the more effective the mechanism will be.” The statement comes as Iran and the EU still differ on how to use Instex to offset the impacts of a series of tough US sanctions imposed on Tehran since Washington withdrew from the Iran nuclear agreement last year. Iran believes that major EU powers Britain, France and Germany have not done enough as part of the payment channel to restore trade and business ties. Tehran says Instex should either be funded through Iran’s oil sales or that there should be abundant credits, through various parties willing to trade with Iran, to keep business smooth and running between the two sides.

Authorities in Russia, a party to the 2015 nuclear deal between Iran and major international powers, echoed similar concerns, saying Instex should not be limited to the EU and others should also play a role.

“The full potential of Instex will only be able to be deployed if it will be open to the participation of countries which are not members of the European Union.” said the Russian foreign ministry.

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Under Instex, European exporters and importers dealing with Iran will be ensured that their due payments will not be affected by US sanctions. A mirror company in Iran would do the same for exporters and importers dealing with European entities.

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