Exclusive: Iran ramps up food imports via Turkish banks: trade

Reuters ^ | Fri Mar 23, 2012 11:07am EDT | Jonathan Saul and Michael Hogan

[Olog-hai]

Almost half a million metric tonnes of grain has arrived at Iran's major food port and Turkish banks are being used by the Islamic Republic as an alternative trade financing route to sidestep Western sanctions, trade sources say.

Iran has been shopping for wheat at a frantic pace, ordering a large part of its expected yearly requirement in a little over one month and paying a premium in non-dollar currencies to work around toughened sanctions and avoid social unrest.

"With any number of unknowns out there—a potential attack on its nuclear facilities, the possibility that a different administration takes office in the United States, the regime is prudently laying aside (food) stocks in the event things go very wrong," said J. Peter Pham, a director with U.S. think tank the Atlantic Council.

Food shipments are not targeted under western sanctions aimed at Iran's disputed nuclear program, but financial measures have frozen Iranian firms out of much of the global banking system. State-run Government Trading Corporation (GTC) has stepped in to make recent purchases as private Iranian buyers have been sidelined.

"There is not a problem with payments, things are settling down using non-sanctioned banks," one trade source said. "The GTC is using Turkish banks to make payments."

Iran bought around 2 million tonnes of wheat just last month from Russia, Germany, Canada, Brazil and Australia. …

Trade sources said Iran was making payments in euros and also U.S. dollars via non-sanctioned banks.

"Apart from Turkish banks, Iran is also facilitating deals via Switzerland and is also using cash in smaller trades as well as even gold," another trade source said. "They are working around the restrictions." …

[Olog-hai]

Real clever idea those sanctions, i.e. versus warfare. See how well they work?

[Buckeye McFrog]

Reminds me of an old interview with the guy who used to be in charge of getting around sanctions for the apartheid government of South Africa.

Basically he said there was not a sanction he could not get around by using intermediaries, offshore banks, and paying a bit of a premium when he had to.

[BlackVeil]

Sanctions never seemed to do much damage to the South African economy. Some things worked in their favor - for instance they had to buy oil on the spot market - which turned out on average cheaper.

[SunkenCiv]

Thanks Olog-hai. The mullahs and their regime lackeys become more and more corrupt in the eyes of Iranians as they continue to enrich themselves in the upward-spiralling prices of everything. The Turks meanwhile are making serious money from it. Iranians will be relieved when war finally does break out.