0627 GMT January 27, 2020
On Friday, Finland, Belgium, Denmark, Netherlands, Norway, and Sweden said in a statement that they would join the Instrument in Support of Trade Exchanges (INSTEX).
“In light of the continuous European support for the agreement and the ongoing efforts to implement the economic part of it and to facilitate legitimate trade between Europe and Iran, we are now in the process of becoming shareholders of the Instrument in Support of Trade Exchanges (INSTEX) subject to completion of national procedures,” the joint statement said.
The six EU member states joining the mechanism reiterated that they “attach the utmost importance to the preservation and full implementation of the Joint Comprehensive Plan of Action on Iran’s nuclear program by all parties involved”.
They also urged Iran to return to full compliance with the terms and provisions of the nuclear agreement.
INSTEX was born as the brainchild of France, Germany and the UK in January 2019. It was created as a special purpose vehicle to help EU companies do business with Iran and facilitate non-USD transactions to avoid breaking US sanctions against the country.
The system was expected to circumvent the sanctions that the US began reimposing against Iran after leaving the nuclear deal with Iran, France, Britain, Russia, China and Germany.
Iran’s Deputy Foreign Minister Abbas Araqchi expressed hope that the recent decision by six European countries would lead to further operationalization of the European financial mechanism for Iranian trade.
Araqchi said that the fact that the Europeans are still serious about the INSTEX financial system and consider it as a mechanism to keep financial ties with Iran and bypass American sanctions, is valuable by itself.
The system came into force after Iran complained why the European countries did not keep up their trade with the country as the nuclear deal mandates them to, and instead bow under the US sanctions targeting the Islamic Republic.
In May, Iran initiated a set of countermeasures against Washington’s withdrawal from the nuclear agreement and the European deal partners’ failure to guarantee Tehran’s business interests under the agreement.
Iran says its reciprocal measures will be reversible as soon as Europe finds practical ways to shield the Iranian economy from unilateral US sanctions.
The European signatories have expressed vocal support for the deal, but failed to provide meaningful economic incentives as required under the nuclear agreement.