In an interview with Tasnim, Sa’ad Jawad Qandil said Iraq does not recognize the US sanctions on Iran or their legitimacy, adding that, as a reason, the Arab country has come under pressures from the US.
The envoy said the unilateral US sanctions have created problems for trade between Baghdad and Tehran.
Qandil noted that the sanctions have affected Iraq’s imports of gas and electricity from Iran by hampering the payment mechanisms.
The Baghdad government has devised plans to pay off its outstanding debts to Iran, the ambassador said, adding that the central banks of the two countries have launched talks to that end.
He said one of the proposals for settling the debts and maintaining trade with Iran is to establish a so-called “Iraqi INSTEX”, noting that the channel would provide Iran with humanitarian supplies.
According to Qandil, another solution to bypass the US restrictions and keep trade with Iran is to use the Iraqi dinar or currencies other than the US dollar for trade.
Back in February, the governor of the Central Bank of Iran unveiled plans for using non-dollar accounts for oil and gas trade with Iraq.
In December 2018, Chairman of Iran-Iraq Chamber of Commerce Yahya Ale-Eshaq said the central banks of Iran and Iraq were finalizing negotiations to begin trade in their own currencies.
Iraq’s Foreign Minister Mohamed Ali Al-Hakim has made it clear that his country cannot cut off trade ties with Iran under the US sanctions, saying the value of annual trade between Iran and Iraq amounts to $12 billion.
