BoI and AIB retain restrictions on Iranian transactions

Ireland's two main banks still refuse to facilitate financial transactions with Iran – the Middle East's second largest economy – despite the lifting of EU and UN sanctions more than three months ago.

As representatives of Bord Bia, the Department of Agriculture and 17 Irish food companies take part in a trade mission to Iran this week, AIB and Bank of Ireland confirmed that their restrictions on processing Iranian money remain in place.

The restrictions could see Ireland lose ground to European rivals in the race to secure trade with Iran.

While international sanctions imposed over Tehran’s nuclear activities were lifted in January, US sanctions relating to terrorism and human rights are still in force.

As a result, many European banks remain wary of handling financial transactions that originate in Iran, fearing they may still fall foul of the existing measures.

Bank of Ireland said that while certain sanction restrictions in relation to Iran had been lifted, ongoing requirements and regulations remain, including the continued application of US primary sanctions.

Can’t process

“For these reasons, Bank of Ireland is not in a position to process Iranian-related transactions,” it said.

AIB said it has restrictions on financial transactions involving Iran but would keep the issue under review.

With 80 million people, for years cut off from trade, Iran is seen as one of the great untapped markets of the world.

In recent weeks the country has signed major trade deals with France, Italy and South Africa and will host trade delegations from Germany and Russia in the coming months.

Yesterday Bord Bia brought together more than 100 Iranian food buyers to meet with 17 Irish food exporters for a seminar and one-to-one business meetings in Tehran.

With the beef market sown up by Brazil, Iran’s fast-growing appetite for dairy, particularly milk powders, butter and cheese, is seen as the best potential source of exports for Ireland.

Ireland’s food and beverage exports to Iran, which were not covered by sanctions, amounted to €3.6 million last year. They consisted mainly of fizzy drink concentrate, butter and prepared foods.

Opportunities

“The lifting of international sanctions on Iran opens the way for Irish food exporters to explore trading opportunities in the second largest economy in the Middle East,” said Bord Bia chief executive

Aidan Cotter

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“As the economy grows and demand for premium food products outstrips domestic supply, Iran is looking to countries like Ireland to supply high quality, safe and sustainably produced food,” he said.

Next month Enterprise Ireland will front another trade mission to Iran. The focus will be on possible tie-ups in healthcare, technology and financial services.