Iranian, Russian banks enter post-sanctions era

Iran’s economy is shifting from a policy of « resistance » – started by Iranian Supreme Leader Ali Khamenei to counter sanctions – to one of « development » in accordance with the Nuclear Deal signed in June 2015 and the subsequent end of international sanctions against Iran in January 2016.

As the stance of the United States about Iran remains uncertain – chiefly as the two presidential candidates Hillary Clinton and Donald Trump said they’d opt for a tougher one if they were elected – Iran has been keen on developing trade relations with foreign countries in the meantime. Although it was already the most important partnership in the past, Russia-Iran economic ties have found even more room to grow, especially in the banking sector.

In line with “very good (bilateral) cooperation” and previous MoUs signed between Iran and Russia, both countries have stepped up their efforts to expand their bilateral trade volume. On September 1, 2016, a Russian delegation led by Central Bank of Russia (CBR)’s Deputy Governor Dmitry Skobelkin and an Iranian one led by the Vice Governor of Iran’s Central Bank (CBI) Gholamali Kamyab confirmed their mutual interest “in long-term strategic partnership.”

According to Skobelkin, “the CBR focused (since January 2016) most of its attention and efforts on the development of trade and economic relations with Iran.” Russian state Bank for Development and Foreign Economic Affairs (Vnesheconombank) has been a central actor in such developments. In November 2015, as Russia’s official lender, Vnesheconombank has entered into multiple MoUs with Iran, from oil and gas to financial support up to EUR 2 billion for industrial projects.

In March 2016, Gazprombank started activity in Iran just two months after the SWIFT international banking system announced the lifting of the sanctions regime and Iranian banks reconnected as a result. For greater bilateral trade, Iran is now focusing on easing financial transfers with Russia, in all currencies except US dollar (USD), since related measures taken so far have been insufficient, Kamyab said.