Iran and Russia have officially abandoned the US dollar for mutual settlements after the countries finalized an agreement to trade in the ruble and the rial, Iranian news agency IRNA reported this week. The agreement was sealed during a meeting in Russia between the heads of the central banks of the two countries, the outlet said.
“The establishment of new financial and banking platforms has opened a ‘new chapter’ in relations between Iran and Russia,” IRNA reported, citing the Iranian central bank. The arrangement allows banks and entrepreneurs to use alternative financial and banking platforms, such as non-SWIFT money-messaging systems, and also involves the establishment of bilateral brokerage relations in national currencies.
Iran and Russia, both subject to US sanctions, first announced plans to use their respective national currencies instead of the US dollar in mutual trade in July 2022. Earlier this week, members of the Russia-led Eurasian Economic Union (EEU) signed a full-fledged free trade agreement with Iran.
In July, Iranian President Ebrahim Raisi called for the dollar to be abandoned in global trade, saying that the US currency has been used as an instrument of Western hegemony.
Over the past year, Moscow and Tehran have significantly bolstered economic cooperation in the face of Western economic sanctions. Bilateral trade turnover has nearly tripled from $1.6 billion in 2019 to $4.6 billion in 2022, according to official data.
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