Iran’s Trade Ties at Risk Without FATF Membership

TEHRAN (Iran News) Speaking to the chamber’s public relations office, Najafi-Manesh emphasized that FATF is an international body with nearly universal membership, except for a few nations. He noted that the organization and its regulatory framework are widely recognized as legitimate and essential for global financial transactions.

Iran’s failure to join FATF has left it on the organization’s blacklist, which has severely impacted its trade and financial exchanges. According to Najafi-Manesh, despite Iran’s membership in organizations like the Shanghai Cooperation Organization and BRICS, other member states expect Iran to comply with FATF regulations to facilitate smoother trade relations.

“As an example, establishing clear and efficient banking relations with China remains a challenge, largely due to FATF-related restrictions. Without joining FATF, even trade with friendly nations will become increasingly difficult, causing Iran to lose out on key economic opportunities,” he explained.

Addressing arguments that Iran could bypass FATF by relying on alternative trade mechanisms, such as barter agreements, Najafi-Manesh dismissed this as unrealistic. He pointed out that these workarounds significantly increase transaction costs—sometimes by 5% to 15%—which translates into billions of dollars in additional expenses for Iran’s economy.

“With an annual financial turnover of around $100 billion, why should we unnecessarily incur an extra $15 billion in costs? Every dollar counts in the current economic climate,” he stated.

Najafi-Manesh also stressed that Iran’s non-compliance with FATF has eroded international trust, discouraging many foreign companies from engaging in business with the country. He argued that by joining FATF, Iran could access global markets with better pricing and product quality, boosting economic efficiency.

He concluded by asserting that, like many private-sector leaders, he believes Iran’s accession to FATF is a necessity. “If we do not align with international regulations, we will not only face additional costs but also lose out on the benefits of global trade. Furthermore, failing to join FATF damages Iran’s global reputation, making it imperative to resolve this issue as soon as possible.”