EU’s INSTEX Postures Are Tired Clichés

(Wednesday, May 15, 2019) 12:11

The Governor of the Central Bank of Iran criticized European governments for the procrastination over launching the trade mechanism know as Instrument in Support of Trade Exchange (INSTEX).

In an Instagram post late Monday,  Abdolnasser Hemmati censured European officials repeating old and tiring statements like “[we] are trying to launch the mechanism,” calling the remarks “lip service and “threadbare.”  France, Germany and the United Kingdom (E3), party to the landmark Iran nuclear deal, announced in February the creation of a financial mechanism for non-dollar trade with Iran.  

INSTEX is aimed at facilitating trade with Iran by circumventing sanctions re-imposed by the United States after President Donald Trump pulled out of the 2015 nuclear deal a year ago.Two months later, Iran officially created a corresponding entity for INSTEX, known as the Special Trade and Finance Institute (STFI). 

Despite the birth of INSTEX, the long-awaited European mechanism is not yet operational as was expected by businesses in and outside Iran. This is while the CEO of the Iranian company says STFI is ready to start trading with Europe. Referring to EU concerns in recent days over the “complexity of operationalizing” INSTEX, Hemmati said putting into effect the trade mechanism “is not as complicated as it seems.”  

He asked the Europeans to start the mechanism by allowing oil imports from Iran or opening credit lines for European traders wanting to export to Iran.“One simple way to put both trade channels into operation is for Europe to allow Iran oil imports or open a line of credit for their own companies wanting to export to Iran,” he wrote.