European countries trying to keep Iran's nuclear deal with world powers alive said Tuesday that a system they set up to enable trade with Tehran has finally concluded its first transaction, facilitating the export of medical goods.
Britain, France and Germany conceived the complex barter-type system dubbed INSTEX, which aims to protect companies doing business with Iran from American sanctions, in January 2019. The move came months after President Donald Trump unilaterally withdrew the United States from the nuclear deal that Tehran struck with world powers in 2015 and reimposed sanctions.
Since then, officials have struggled to get the system up and running. On Tuesday, however, Germany's foreign ministry said the three European countries “confirm that INSTEX has successfully concluded its first transaction, facilitating the export of medical goods from Europe to Iran.”
“These goods are now in Iran,” it said in a statement that gave details neither of the goods nor of who was involved in the transaction. It didn't specify what the intended medical purpose was.
Iran has been hard hit by the coronavirus pandemic, but supplying medical goods to Iran already was a concern before the outbreak.
“Now the first transaction is complete, INSTEX and its Iranian counterpart STFI will work on more transactions and enhancing the mechanism,” the German foreign ministry statement said.
The transaction comes over a year after the European trio announced the creation of INSTEX — a non-dollar direct payment channel officially called the Instrument in Support of Trade Exchanges — in an effort to keep Iran’s nuclear deal with world powers alive.
The apparatus was designed to circumvent the sanctions that the United States re-imposed against Iran after leaving a nuclear deal with the Islamic Republic, the trio, plus Russia and China.
However, the Europeans have not been able to operationalize the non-dollar trade mechanism under pressure from the US.
The system was launched after Iran complained about the European countries failing to maintain trade with the country as mandated under the nuclear deal, and bowing insteadto Washington’s pressure.
In May, Iran initiated a set of countermeasures against Washington’s withdrawal from the nuclear agreement, officially known as the Joint Comprehensive Plan of Action (JCPOA), and following the European partners’ failure to guarantee Tehran’s business interests under the agreement.
Iran had accepted the nuclear limits voluntarily as part of the deal, despite not being obligated by the UN nuclear agency to commit to any such restrictions.
Tehran has vowed to reverse all its nuclear activities as soon as the other JCPOA signatories begin fully implementing their obligations.