Trade With the World Impossible Without Financial and Banking Relations

TEHRAN (Iran News) Speaking at the Regional Economic Diplomacy Summit in Shiraz on Thursday, attended by the Foreign Minister and consuls from Gulf countries, Mohammad Reza Farzin emphasized the necessity of financial relations for international trade.

“If we want to trade with the world, we are obliged to have monetary and banking relations,” Farzin stated. “No trade can happen without them. For example, last year, Iran’s trade volume exceeded $200 billion. Comparing this to our GDP, over 40% of our economy is trade-related — a ratio even higher than that of Japan.”

He added that despite all the difficulties Iran faces in financial exchanges, it remains on the path of expanding its trade. “To develop our position as an open economy, given our historical and regional standing, we must expand monetary and banking relations,” he said.

Farzin underscored that Iran is focusing on trade with global partners, especially its main trading allies. “To this end, we have removed the US dollar from our transactions. For instance, banking relations between Iran and Russia have already been established.”

He continued, “We have implemented a model with Russia, and if we can replicate it with our other trade partners, we can introduce a new global trade framework. Even countries facing Western sanctions can benefit from this approach.”

Referring to foreign currency bond sales as a modern tool for advancing the country’s financial sector, Farzin noted, “We began selling foreign currency bonds at the exchange center last year. So far, $460 million has been sold, and we plan to increase this to $2 billion by the end of the year. We also aim to expand these sales to foreign stock exchanges.”

Farzin reiterated that achieving economic development hinges on international trade, which in turn requires financial interactions. “The mechanisms we designed during the sanctions have been highly effective,” he said. “Through our tailored systems, we have created new ways of engagement. However, we still need to intensify efforts, especially in attracting foreign investment.”

“To support this,” he continued, “we introduced a policy last year to convert our 50 overseas branches into centers for attracting foreign resources. These branches are staffed with experienced personnel who have strong knowledge of the countries they operate in.”

During the National Development Fund Conference, Farzin also highlighted a major issue in the country’s economic planning. “I raised the matter of credit allocation, which has now become a pressing concern. We have not directed credit properly, leading to unnecessary projects in certain regions. There are serious shortcomings in national land use planning and our industrial strategy.”

He emphasized the need to develop an industrial strategy based on Iran’s competitive advantages to properly allocate credit, funds, and resources. “The new Central Bank law views justice through the lens of equitable credit distribution — meaning banking resources and liquidity should be allocated in line with the advantages of each region across the country.”

The summit, which started on Thursday and runs through Friday, is part of a series of provincial economic diplomacy events led by the Ministry of Foreign Affairs. In addition to speeches by the Foreign Minister, provincial governors, and officials, the event features academic panels on the capacities and challenges of participating provinces.

According to the report, the Ministry of Foreign Affairs plans to host five such summits across the country to bolster regional economic diplomacy. Fars Province, given its significant potential and role as the liaison for Gulf countries, was selected as the host of the first summit.

The event is co-organized by the Fars Provincial Government in collaboration with the Chamber of Commerce, Shiraz City Council, and the Municipality of Shiraz.