Source: Wikipedia / The Iranian rial (Persian: ریال ایران‎ Riâl Irân  is the Currency of the Islamic Republic of Iran

By Gary Raynaldo   DIPLOMATIC TIMES

Germany, France and the UK Thursday set up a payment channel with Iran called INSTEX, to help continue trade and circumvent US sanctions against the  Islamic Republic.   The new entity acts as a euro-denominated clearing house for Iran to conduct trade with European companies, reports DWTV.  INSTEX works as a barter arrangement operating outside of the US-dominated global financial system. Trade is initially expected to focus on non-sanctionable essential goods such as humanitarian, medical and farm products. It is not expected to address oil-related transactions, which have dropped off since last year and are Iran’s primary source of foreign currency, according to DWTV.

Statement by High Representative/Vice-President Federica Mogherini on the creation of INSTEX, Instrument for Supporting Trade Exchanges:

“The International Atomic Energy Agency (IAEA) has confirmed in thirteen consecutive reports that Iran is fully abiding by its commitments under the agreement. I welcome today’s registration of INSTEX SAS (Instrument for Supporting Trade Exchanges), a Special Purpose Vehicle with France, Germany and the United Kingdom as initial shareholders. The lifting of sanctions is an essential dimension of the JCPOA (Joint Comprehensive Plan of Action), the Iran nuclear deal. The instrument launched today will provide economic operators with the necessary framework to pursue legitimate trade with Iran.”

 The United States went before the International Court of Justice in The Hague in October 2018  to confront Tehran at the UN’s top court over billions of dollars in frozen assets. The court appearance comes a week after the ICJ ordered the  US to ease sanctions re-imposed after President Trump pulled out of 2015 nuclear deal with Iran. 

The Iranian currency, the rial, has lost half its value against the dollar, the monthly inflation rate has risen to 10.2%, and unemployment stands at 12.5%

“The official announcement by the USA of the re-imposition of sanctions, including extraterritorial sanctions, has already not only accelerated the devaluation of the Rial, but also produced very significant damage to Iran’s economyand to Iranian nationals and companies. Since the decision was made public, multiple US and foreign companies and nationals have also announced the withdrawal from activities in Iran including the termination of their contractual relations with Iranian companies and nationals,” 

Islamic Republic of Iran.

Trump  Pulls  The  US Out  Of  2015  Nuclear  Deal  With  Iran

Source: by Chip Somodevilla Getty Images / U.S. President Donald Trump holds up a memorandum that reinstates sanctions on Iran after he announced his decision to withdraw the United States from the 2015 Iran nuclear deal in the Diplomatic Room at the White House May 8, 2018.

U.S. Not Happy About European Union’s Circumventing Iran Sanctions With New Financial Channel:

The State Department is “closely following” reports on the European mechanism.

“As the president has made clear, entities that continue to engage in sanctionable activity involving Iran risk severe consequences that could include losing access to the U.S. financial system and the ability to do business with the United States or US companies,”

the State Department said in a statement.