First Published: 2008-02-06

 
Iran says Gulf shields its banks from US pressure
 

Iran: US pressure not likely to make Gulf states sacrifice beneficial economic ties with Tehran.

 

Middle East Online

By Daliah Merzaban - MANAMA

Money talks

US allies such as Bahrain and the United Arab Emirates are helping shield Iran's banking system from Washington's "financial terrorism", the governor of Iran's central bank said on Tuesday.

The United States has been trying to cut Iran's access to the global financial system, including by putting pressure on Gulf Arab governments to isolate Iran, which it accuses of seeking nuclear weapons.

The pressure is not working because cultural, political and economic ties between Gulf oil producers were too strong, Tahmasb Mazaheri told the Reuters Islamic Finance Summit.

"Neither us nor our neighbors will sacrifice our long-term interests because of the unilateral pressures," Mazaheri said.

"Particularly in the region, Bahrain and the Emirates and other neighbors all around Iran's borders, we have a lot of partners who are working with us in the long term," he said.

He did not explain what form their assistance took.

Iran, which denies the nuclear charges, has long had close economic ties with Gulf states, especially in the UAE and Bahrain, Arab allies of Washington and home to the Middle East's biggest financial centers.

Even so, banks in the world's top oil-exporting region have bowed to pressure from the United States to make doing business with the Islamic Republic more difficult.

Bahrain's largest lender by market value, Ahli United Bank AUBB.BH, had "frozen" banking activity with Iran, where it operates an affiliate Future Bank with two Iranian partners, two sources familiar with the matter said last month.

Lenders in the UAE, meanwhile, have been holding off on issuing letters of credit to Iranian companies, bankers in the second-largest Arab economy said last month.

Foreign banks have been yielding to pressure, too. France's BNP Paribas and Calyon, the investment banking arm of Credit Agricole, stopped offering Letters of Credit on Iranian fuel imports because of pressure from Washington.

"The pressure is a unilateral pressure," Mazaheri said.

"I call it kind of financial terrorism in the financial industry ... and it cannot be tolerated by the global financial system," he said.

"The central bank assists Iranian private and state-owned banks to do their commitments regardless of the pressure on them," he said.

The US, which has a naval base in Bahrain, is pressing the United Nations to tighten sanctions on Iran, the second-largest oil producer in the Organization of Petroleum Exporting Countries.

Iran, also holder of the world's second-largest reserves of natural gas, was retaliating by diversifying its more than $72 billion of reserves away from the weak US currency, Mazaheri said.

"We have tried to avoid keeping dollars and giving the dollar the benefit (of demand from our reserves)," he said, declining to give a breakdown of the reserves.

The central bank's motivations for diversifying its reserves were both "political and also because of the trend of the weakening dollar", Mazaheri said. The dollar fell to record lows against the euro and a basket of major currencies last year.

 

Iraq troops prepare for final assault on ISIS-held Fallujah

Iran moderate conservative retains parliament speakership

Without clear roadmap, Libya unity government fails to bring change

Iran blames Saudi Arabia for Hajj impasse

In Iraq town, fans of Real Madrid gather in 'challenge to ISIS'

Saudi Arabia accuses Iran of sowing ‘sedition’ in Iraq

Israel police send Netanyahu spending file to prosecutors

Bahrain court upholds life terms for five 'spies'

Investigators need 12 days to recover EgyptAir black boxes

Iraq Kurdish forces launch offensive east of Mosul

Shipwrecks in Mediterranean claim up to 700 lives in one week

ISIS offensive triggers mass displacement in northern Syria

Iran delegation leaves Saudi Arabia without Hajj deal

Hundreds of civilians flee Fallujah area in Iraq

Khamenei urges Iran lawmakers to resist Western 'schemes'

ISIS-rebel clashes grip northeast Syria town

New US law could sanction Hezbollah officials

Thousands of protesters gather in central Bagdad

99 lashes for partying Iranian students

100,000 Syrians trapped after shock IS advance in Aleppo

Iran sticking to nuclear deal: UN watchdog

Turkey party seeks constitutional change to boost president's powers

Turkey accuses US of 'hypocrisy' on Kurdish militia in Syria

Israel environment minister resigns from 'extremist government'

US-led coalition pounds IS near Raqa

Tunisia mulls allowing women to serve in army

US-backed fighters battle IS near Syria stronghold

Tunisia tourism sees 'slight recovery'

UN envoy calls for economic rescue plan for Yemen

Bahrain jails 19 for attacks on police

Up to 30 dead in shipwreck off Libya

UN says Syrians will 'starve' unless aid improves

Christian homes set ablaze in Egyptian village 'love story'

Kuwait's main opposition group ends polls boycott

Twin offensives on IS edge forward in Syria, Iraq

Private firms to help in hunt for Egyptair black boxes

New Israeli defence minister's tough talk to be put to the test

Syria most dangerous place for health workers

Concern for civilians trapped in Iraq's Fallujah

Brent rises past $50 a barrel

Iraq PM urges protesters to stay home

Juncker warns Ankara against migrant deal threats

Israeli air force carries out strikes on Hamas sites in Gaza

Annual Jewish pilgrimage starts in Tunisia

Sudan accuses UN official of 'false' reports on displaced