Iran-China Banking Channel Resumes Transactions

Speaking to media on Saturday, an informed source, who wished to remain anonymous, said banking ties have resumed between Iran and China.

The source said cases are being reviewed with scrutiny due to strict rules affecting Chinese banks because of the US sanctions, and as such, the process is slow but it has not stopped.

Given China’s exemption from US sanctions on Iran’s oil sales for at least three months, China's Bank of Kunlun and other Chinese banks have a little more leeway with doing financial transactions with Iran, said the source, adding that despite this, Iran’s financial transactions are under the US Treasury spotlight, and for this reason, foreign banks, fearing stricter penalties, are treading even more cautiously now than they did during the previous period of sanctions against Iran.

Last week, Asadullah Asgarowladi, Chairman of the Iran-China Chamber of Commerce, said China's Bank of Kunlun would resume financial transactions with Iran in early December.

The Chinese bank, affiliated with China National Petroleum Corporation and in charge of processing payments to Iran, suspended financial transactions between the two sides as Iran stopped selling oil to China last month.

Meanwhile, there are speculations that an Iranian bank has been introduced to work with economic agents for financial transactions with China, which may cost less for the Iranian side than working with other banks.

Last Tuesday, Governor of the Central Bank of Iran (CBI) Abdolnasser Hemmati held a meeting with Chinese Ambassador to Iran Pang Sen, and discussed ways to broaden banking relations between Tehran and Beijing. 

Abdolnasser Hemmati and Pang Sen called for increasing economic ties between the two countries and accelerating the process of solving related banking problems.

The Chinese envoy said that his country is eager to boost strategic ties with the Islamic Republic in the long run, adding that different programs are on the agenda of the Chinese government in this regard.

For his part, Hemmati said that despite the US efforts to cut Iran’s financial relations, different countries are coming up with various solutions to continue and expand their banking ties with the Islamic Republic.

Iran and China are enjoying strong bilateral relations, and earlier in September, the two countries launched a 9,000-kilometer-long railway within the framework of new Silk Road Program between the two countries.

The new Iran-China railway used by cargo and service trains connects China's Inner Mongolia to the city of Bam in Southeastern Iran.

During the opening ceremony of the new railway, a cargo train moved from Inner Mongolia logistic and industrial town to the city of Bam. It is estimated to arrive in Bam in 15 days.

The train consists of 41 containers carrying equipment, machineries and car spare parts. The consignment is worth $1.5 million.

In another development, a cargo train left the city of Bayannur in Western Inner Mongolia for the Iranian capital city of Tehran.

The two railways are part of a larger rail network which is to connect China to the Europe via Iran.