Many South Korean SMEs have gone bankrupt following the unilateral US sanctions on Iran, joint Iran-South Korea Chamber of Commerce says as Seoul keeps waiting US order on whether or not it can keep buying Iranian oil.
“After the sanctions, many big South Korean companies were forced to take caution in dealing with Iran. Also Woori Bank and Industrial Bank of Korea (IBK) faced many problems in handling financial transactions with Iran,” Joint Iran-South Korea Chamber of Commerce President Hossein Tanhai was cited by Tasnim News Agency on Saturday.
Early November, soon after the Administration of US President Donald Trump reintroduced economic sanctions on Iran, Reuters reported that these two banks would review payment for Iranian oil imports and other purchases from Iran.
“Also, many shipping companies weren’t ready to cooperate with Iran because insurance for cargo headed for Iran was also sanctioned,” Tanhai added, stressing that “such problems have resulted in the fact that many Small and Medium-Sized Enterprises (SMEs) have filed for bankruptcy as the trade ties between Iran and South Korea saw a deep fall”.
However, he hasn’t named any South Korean company that has gone bankrupt after the US sanctions.
Sout Korean economy is very much entangled with the US market, that is Washington-Seoul bilateral trade is 25 times bigger than that of South Korea and Iran, according to the businessman. “That led to a 70% cut in trade ties between the two Asian countries,” Tanhai stressed.
South Korea was one the eight countries that obtained waivers from the US sanctions on buying Iranian energy. The country resumed imports of Iranian oil in January after a four-month hiatus, according to a Reuters report in February that showed shipments were down 76 percent from the same month last year.
The country has been reportedly in talks with the White House to extend it waiver however a recent Reuters report says Seoul has begun testing super-light U.S. oil sold by the US Anadarko Petroleum Corp as a substitute for Iranian crude while it awaits word from Washington on whether it can keep buying oil from the Middle Eastern nation.
The current US waivers are expected to expire in May.