Iran, Europe Pressuring U.S. to Grant Tehran Access to Financial Markets

Obama administration had claimed Iran would be prevented from accessing the markets

EU foreign policy chief Federica Mogherini and Iranian foreign minister Javad Zarif. / AP
April 18, 2016

Iranian and European officials say that they are pushing the United States to grant the Islamic Republic unprecedented access to American financial markets and the U.S. dollar, working against promises by top Obama administration officials who had claimed Iran would never be granted such access, according to recent remarks.

Iranian Foreign Minister Javad Zarif, speaking at a joint press conference this weekend with European Union foreign policy chief Federica Mogherini, said that officials are pressuring the U.S. to grant Iran access to American markets.

"Iran and the EU will put pressure on the United States to facilitate the cooperation of non-American banks with Iran," Zarif was quoted as saying at a briefing with reporters and Mogherini.

Both Iran and the EU said in a joint statement later in the day that the United States must work hard to uphold its obligations under the recent nuclear deal. The White House has argued that it is not mandated to provide dollar access under the agreement.

"It's essential that the other side, especially the United States, fulfill its commitments not on paper but in practice and removes the obstacles especially in banking sector," according to the Iranians.

The EU is making further moves to help Iran become a member of the World Trade Organization, and has said it would seek to open a diplomatic mission in Tehran.

Europe has key economic interests to pursue in Iran, according to Mogherini, who disclosed that she is "pressuring the Obama administration" to sooth the impasse with Iran over access to the U.S. Dollar.

"The main message that I have delivered here is the fact that we Europeans have as much as an interest as the Iranians that this issue is solved," she said over the weekend. "We have an economic interest also in coming back here as the first trading partner. … In order to do that we need our banks to be present here."

The EU is also slated to begin joint work with Iran on civil nuclear projects.

Iran and its European allies are likely to hit roadblocks in the United States as they seek to give Tehran access to the U.S. financial system.

American officials are reportedly split over the issue, with the uncertainty causing concern in Congress.

Treasury Department officials have worked in recent days to assure skittish lawmakers that Iran will not gain access to the U.S banking system.

"We aren’t planning on allowing access to the U.S. financial system or making sure that Iran gets U.S. dollars," the Treasury Department wrote to Congress, the Free Beacon recently reported.

Officials will instead instruct foreign banks on how to release billions of dollars in frozen assets to Iran that have been freed up as a result of the nuclear agreement.

"We will continue to work with banks to make sure they know what is allowed pursuant to the relief that Iran received but also, more importantly, what is still prohibited," the Treasury Department said. "Those prohibitions are extensive as all of the sanctions except the nuclear sanctions are still in effect, including the secondary sanctions on" the Iranian Revolutionary Guard Corps.

The Treasury Department left open the possibility that foreign and U.S. business will be granted licenses that exempt them from current sanctions on Iran.

"I can’t flatly say that [Office of Foreign Assets Control, or OFAC] won’t be issuing any licenses," the department said. "As a matter of regular business OFAC issues licenses for otherwise prohibited activity. For example, as part of the [nuclear deal] civilian aircraft parts might be sold and would require a license."