While French Minister of Finance, Bruno Le Maire, said Thursday, July 4, he hoped the first trade transaction with Iran under INSTEX will be conducted in a few days; an Iranian official has insisted that the European special purpose vehicle is merely a "claim" at the moment, and it would not solve any problem.
The instrument in Support of Trade and Exchanges, or INSTEX, is a new European payment system for barter-based trade with Iran designed to circumvent U.S. sanctions imposed on Tehran.
Speaking to a local state-run website, Young Journalists Club (YJC) on Friday, July 5, Iranian former Foreign Minister, Kamal Kharrazi (1997-2005) reiterated that while INSTEX had positive aspects, it did not go further than a "claim" at the moment, and would not address any problem.
Referring to the recent Joint session of the remaining signatories of the nuclear deal (JCPOA) in Vienna, Kharrazi admitted that there were no definitive assessments of the meeting, but with only several millions of euros of credit that the Europeans had allocated to INSTEX, business would definitely be impossible.
Kharrazi who heads Iran's Strategic Council on Foreign Relations and is close to Supreme Leader Ali Khamenei had earlier warned that Tehran would stop its commitments under JCPOA.
Since the United States left the nuclear agreement in May 2018 it has imposed crushing sanctions on Iran. Consequently, Tehran is pressuring Europe to normalize trade; going against a pivotal policy of the Trump administration.
In a meeting with the British Middle East Minister, Andrew Murrison on June 24, in Tehran, Kharrazi warned him, "Be sure that if the opposite side (Europe) does not undertake an appropriate measure within the next two weeks, we will take more steps to stop implementing our commitments."
Kharrazi's latest comments on Friday, July 5 were a response to French Finance Minister, Bruno Lumaire, who had expressed hope that the long-awaited European mechanism, INSTEX, will be soon implemented.
Without providing further details, Lumaire had insisted on Thursday, "This first transaction will be modest but it is a starting point, and we expect INSTEX to be an effective tool. As it's a first, we need time to do bigger things."
However, implementing INSTEX has recently been tied to Iran's JCPOA commitments.
The Islamic Republic's Supreme National Council (SNSC) on May 8 declared Tehran's exit from "certain" obligations under the landmark 2015 agreement and gave a 60-day deadline to JCPOA signatories to protect Iran's interests against U.S. sanctions, or it will restart high-level uranium enrichment.
Days later, President Hassan Rouhani, who also presides over SNSC, threatened that Iran would begin enriching Uranium beyond the current 3.67 percent concentration allowed by the JCPOA, adding that Tehran will no longer respect the 300-kilogram limit for stockpiling enriched Uranium.
Responding to Rouhani's threat, the three Europeans party to the JCPOA, Britain, France, and Germany cautioned Tehran to refrain from actions that would weaken the nuclear deal.
The latest JCPOA joint commission, attended by the representatives of Britain, China, France, Germany, Iran, and Russia, was held on Friday, June 28, in the Austrian capital, Vienna.
Iran's representative and Deputy Foreign Minister, Abbas Araqchi, said after the meeting, "INSTEX is operational, but Iran's expectations have not been fully satisfied yet."
Minutes after the meeting, the Secretary-General of the European External Action Service (EEAS), Helga Schmid also confirmed the reports that the European financial mechanism to work with Iran is operational.
"INSTEX is now operational, first transactions being processed and more E.U. Members States to join. Good progress on Arak and Fordow projects," Helga Schmid twitted on Friday, June 28.