The U.S. Department of the Treasury has imposed new sanctions against the Russian "VTB" bank and a network known as "A7". This step has been taken due to the role of these entities in creating mechanisms to circumvent sanctions and money laundering. According to the Treasury Department, the Iranian government uses these mechanisms to transfer money and revenue from oil sales.
Details of the Sanctions and Their Objectives
The new sanctions, which were implemented on September 30 of this year, are part of the U.S. efforts to prevent Iran and Russia from using informal financial systems. The U.S. Treasury has described this network as a "shadow banking network" and believes that it helps the Iranian government evade sanctions.
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In recent years, Iran and Russia have attempted to reduce their dependence on the dollar and instead use their national currencies, namely the rial and the ruble. However, statistics show that these efforts have not been very successful, and there are still issues regarding the settlement of transactions.
Imbalance in Bilateral Trade
Published statistics indicate that the value of bilateral trade between Iran and Russia in 2023 was about four billion dollars. This includes 2.7 billion dollars in Russian exports and 1.3 billion dollars in Iranian exports. However, the two countries are not very keen on holding each other's currencies, and the Central Bank of Russia has described the rial as an unstable and non-convertible currency.
It is said that Iranian exporters convert rubles to dirhams as soon as they receive them and refrain from accepting this currency. While agreements have been signed to establish a currency exchange line between the central banks of Iran and Russia in recent years, no significant progress has been observed in this regard.
Future Developments and Their Implications
Given the new sanctions and the imbalance in trade, it is unclear whether Iran and Russia can achieve their economic goals. Additionally, reliance on national currencies and informal mechanisms may lead to more challenges in the future. This issue could directly impact the trade and economic relations of the two countries and necessitate a reevaluation of their financial and trade strategies.
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