Iran bans dollar in trade

Iran wants to stop all imported goods that are paid for in dollars, the Iranian Ministry of Industry, Mining and Trade announced. This measure follows Iran’s earlier decision to switch to the euro as an international trade currency.

According to Mehdi Kasraeipour of the Iranian central bank, this prohibition is unlikely to cause major problems, as most merchants have already switched to transactions in other currencies. Because of the Western sanctions Iran could not do business with American banks and it was difficult to make payments using dollars. In a statement to Russia Today, he said the following about this:

“It has long been the case that Iran’s banking sector cannot use dollars because of the sanctions, and given that Iran is locked from the dollar and that traders use different currencies for transactions, there is no longer any reason to invoice in dollars.”

No payments in dollars

Iranian companies that do business abroad have to inform their suppliers that it is no longer possible to invoice in dollars for the delivery of goods and services, so that the goods can be imported without any problems.

Iran has been working to reduce their dependency of the dollar for some time. At the beginning of 2016, a major step was taken when the country announced that oil could only be settled in euros. A year later, the country decided that the dollar should be replaced by the euro in all economic reports and last summer, Iran announced that the euro had become the country’s most important trade currency.

In addition, Iran has also made agreements with a number of countries to use the local currency in bilateral trade, for example with China and Turkey. The government in Tehran is also negotiating with Russia to use the national currency for mutual trade.

Last November, Ali Khamenei, Iran’s highest leader, said in a meeting with Russian President Putin that the use of local currency is the best way to avoid the US sanctions against both countries.


Share this article: