STFI, INSTEX being tested: CEO

President of the Iranian payment channel as well as the European special trade vehicle with Iran are being tested by both sides in a bid to pave the way for their first transactions.

6 July 2019
ID : 22091
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President of STFI, the Iranian counterparty to INSTEX, says the two channels are coordinating their first pilot transaction, stressing that the payment must come either from Iran oil sales or the dividends of the country’s crude sales.

“One pilot import has been coordinated with INSTEX. Its payment is dependent on selling oil or the credit line should be opened by Iran oil sales revenues,” STFI’s President Ali Asqar Nuri told Iran Chamber Newsroom.

“Currently we are asking the Europeans to introduce a bank that will be a mediator between Iranian and European trades people. Efforts have been taken in this regard but the bank hasn’t been introduced to us formally,” he added.

Special Trade and Financing Instrument between Iran and Europe (STFI) was created in March and set up in April to facilitate bilateral economic exchanges in the wake of US withdrawal from the nuclear deal of 2015 and reimposition of sanctions.

The INSTEX’s capital should be provided by Iran’s oil sales. “If we want to import something from Europe, the Europeans should buy our crude so its export money is deposited to it and then we import”, he mentioned.

"Part of the INSTEX capital can be provided by the European countries. If Europe can’t buy our oil, we should open a credit line, meaning Europe should give us facilities and consequently, they be paid from Iran oil sale,” according to Nuri.

The former private banker added that “it’s the European’s problem” to come up with its capital. “It can’t be like that the Europeans open a company and not have a solution to make it operational,” he stressed.

Set up by France, Britain and Germany, INSTEX is a barter trade mechanism that aims to avoid direct financial transfers by offsetting balances between importers and exporters on the European side.

The Instrument in Support of Trade Exchanges (INSTEX) is aimed at making it possible for trade between European Union (EU) members and Iran to continue in the face of stiff US sanctions since Washington quit a 2015 nuclear accord between Tehran and world powers last year.

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