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Iran Officially Launches Trade Mechanism To Match Europe's INSTEX


German head of The Instrument in Support of Trade Exchanges (INSTEX), Per Fischer (second from right) poses with the envoys of Britain, France and Germany in Iran, March 11, 2019.

Iran on April 29 announced the establishment of a company designed to match a mechanism European countries have set up to facilitate trade despite U.S. sanctions.

Earlier on March 20, the Governor of Central Bank of Iran (CBI) Abdolnaser Hemmati had announced that a mechanism similar to Europe’s Instrument for Trade and Exchanges (INSTEX) has been registered.

The mechanism, called the Special Trade and Finance Institute (STFI) was introduced after technical and expert negotiations between Iranian delegations and representatives from three European countries (Britain, France and Germany).

STFI has been devised to work in tandem INSTEX, designed to alleviate facilitate limited trade with Iran.

The newly established Iranian company has started its activity with one billion rials (about $24,000) capital.

France, Germany and the UK set up INSTEX on January 31, 2019, following the U.S. withdrawal from the deal with Iran in 2018, to help Tehran with limited trade despite U.S. sanctions.

However, the Islamic Republic's Supreme Leader, Ayatollah Ali Khamenei has repeatedly called INSTEX a "meaningless" measure and "a bitter joke," adding that "Europeans should have stood up to the U.S. after it left the JCPOA and should have lifted all sanctions against Iran."

The U.S. Representative to the EU, Gordon Sondland, also reiterated on April 11, that the era of the U.S.-Europe dispute over the Joint Comprehensive Plan of Action (JCPOA) or Tehran's nuclear deal with world powers is over.

"The SPVs (INSTEX) are Europe's attempt to appease Iran by showing that they are still trying their very best to facilitate proper transfers of payments to Iran. We believe that those SPVs are really nothing more than, and I've said it before, a paper tiger," said Gordon Sondland.

The formal announcement of STFI's establishment has been followed by another round of attacks by Iranian officials on the EU and on what they describe as the "EU3 procrastination."

Parliament speaker Ali Larijani insisted on Monday, April 29, that Iran no longer cares about Europe’s demands as European governments have let it down in countering "hostile U.S. policies".

“We are trying to find out why European leaders and the European Union only support us in rhetoric or only express regret at America’s actions,” Larijani said during a meeting with Wolfgang Gerstl, the head of Austria-Iran parliamentary friendship group in Tehran on Monday.

“Sure, you might say there are problems because of U.S. pressure and it might sound logical, but we look at this from our own point of view and the most important thing for us is that this behavior has raised questions about EU’s credibility and it means that the EU lacks the weight to solve problems,” local news outlets cited Larijani as saying.

Larijani expressed his dissatisfaction with the EU3 to the extent that he stressed, "We do not need Europe’s help in getting back at Washington. We will get even with America."

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