Page 17 - IRANRptAug19

5.0 External Sector & Trade
5.1 Balance of payments and current account
Time runs out for Europe’s Instex trade mechanism as Iran ups uranium enrichment
Instex still not ready for sanctionable trades
Iran’s Deputy Foreign Minister Abbas Araqchi has said Europe’s failure to launch its Instex mechanism allowing for sanctions-protected trade between Iranian and European companies will force the Islamic Republic to exit the nuclear deal, Tasnim News Agency reported on June 26.
Europe’s major powers have repeatedly requested Tehran tolerate delays in preparations for the launch of Instex (Instrument in Support of Trade Exchanges). However, after repeated reassurances that a start-date would be forthcoming, and after a 30-day deadline set out by Iran in May for Europe to provide Tehran with significant assistance in its battle against heavy sanctions imposed by the US, Instex remains active only on paper.
Slovakia’s State Secretary of the Ministry of Foreign and European Affairs, Lukas Parizek, who arrived in Iran for bilateral political consultations, was the first to be briefed on Iran’s movement towards departing from the nuclear deal (formally called the Joint Comprehensive Plan of Action, or JCPOA).
"Sadly, the balance between the Islamic Republic of Iran’s obligations and rights under the JCPOA has been upset, and considering the European side’s unfulfilled pledges, there remains no reason for the implementation of Iran’s one-way commitments. However, Iran has kept the window of diplomacy open by [only] gradually reducing its commitments," Araqchi said.
Parizek, in response, said Slovakia and the European Union remained committed to the nuclear deal and Instex.
"We are determined to strengthen reciprocal ties, particularly the bilateral economic and trade cooperation, and are ready to hold a joint commission meeting in the near future to that end,” he said.
Meanwhile, in Brussels, EU foreign relations chief Federica Mogherini said on June 26 in a meeting with a visiting Pakistani delegation that Instex would “soon be ready”, but she failed to give a date for when that may be.
"We are trying all we can, and we continue to do all we can to maintain the implementation of the Iran nuclear deal, keeping it intact. We will continue to do so in these days, the most difficult days for the nuclear deal you can imagine," Mogherini said.
"The deal in itself has mechanisms and steps that can be taken in case of non-compliance with the agreement but the focus is to keep the agreement in place," she said.
Instex, in which France, Germany and the UK play participatory roles, has not even been readied to the point according to which trade deals subject to US sanctions could be processed. Officials envisage it first assisting with flows of food and medicine which are not sanctionable.
Late on June 26, the Guardian reported that European states will announce a multi-million-euro credit line to ease trade between the EU and Iran in a last-minute and “probably doomed effort” to persuade Tehran not to take the
17 IRAN Country Report August 2019 www.intellinews.com