TEHRAN – From China through Russia to Iraq, Iran proactively takes measures to boost its economic ties with countries around the world as the United States doubles down on its renewed efforts to isolate Iran from the global financial system.

Over the past few weeks, while the U.S. officials were busy preparing new sanctions on Iran, several Iranian officials were planning visits to many countries to cement Iran’s economic and financial ties with a world that the White House wants it to isolate Iran.

Russia was the first destination for Iranian officials. In September, Foreign Minister Mohammad Javad Zarif paid a two-day visit to Russia to discuss various issues, including the implementation of agreements and the process of developing cooperation between the two countries.

Russia is a close ally of Iran, which firmly opposed the U.S. push to restore all UN sanctions on Iran lifted under the 2015 nuclear agreement. In addition to their cooperation on issues related to the nuclear deal between Iran and world powers, Russia and Iran are also in the process of negotiating over upgrading a decades-long bilateral agreement and turning it into a strategic partnership. During a meeting in early August with Leonid Slutsky, chairman of the International Affairs Committee of Russia’s State Duma, Zarif said Iran plans to extend a 20-year agreement with Russia. Tehran and Moscow signed a cooperation agreement nearly 20 years ago.

This agreement will expire in the coming months. Zarif has said Iran is willing to extend and upgrade the agreement to a strategic level. Since July, he has visited Moscow twice. During his visit to Russia on July 20, the foreign minister said, “Iran-Russia relations are strategic.”

It’s expected that Russia and Iran hold more discussions about establishing a strategic partnership as the decades-long agreement nears its end.

Similarly, Iran also is pursuing a 25-year comprehensive strategic partnership plan with China. On October 9, Zarif arrived in the southern Chinese province of Yunnan. One day later, Zarif met with his Chinese counterpart Wang Yi. Following the meeting, Zarif tweeted, “Fruitful talks in beautiful Tengchong with my friend Wang Yi on Iran-China Comprehensive Strategic Partnership.” He added that Iran and China “rejected U.S. unilateralism, and the U.S. attempts to create a unipolar world.”

On the other hand, China’s Foreign Ministry spokesperson Hua Chunying has said Beijing was willing to deepen its strategic partnership with Tehran.

Speaking at a regular press conference on October 9, she said, “During Iranian Foreign Minister Zarif's upcoming visit to China, he will have talks with State Councilor and Foreign Minister Wang Yi. We want to work with Iran to deepen our bilateral comprehensive strategic partnership.”

Zarif also discussed the ways to facilitate the trade between Iran and China, according to Reza Zabib, an assistant to the foreign minister.

The assistant told the Islamic Republic of Iran Broadcasting (IRIB) news agency that facilitating the trade between Iran and China was the first issue that Zarif discussed in China.

“Unfortunately, the [U.S.] sanctions are putting pressures everywhere, but fortunately, we are in an excellent position to do business with China,” Zabib pointed out ahead of Zarif’s trip to China.

He added, “We hope that Mr. Zarif’s visit to China will be a major step toward institutionalizing the 25-year cooperation document between the two countries, which will be a good basis for boosting economic relations. Concerning the 25-year cooperation plan between Iran and China, there have been continuous contacts between the two countries' experts since last year.”

Assets unblocked, sanctions ignored

As Zarif returned from China to Iran, Abdolnasser Hemmati, the governor of the Central Bank of Iran, visited Baghdad on Monday to hold talks with the Iraqi authorities over Iranian assets in frozen bank accounts in Iraq. The central banker met with his Iraqi counterpart Mustafa Ghaleb, Iraqi Finance Minister Ali Allawi, Salem Jawad al-Chalabi, the head of the Trade Bank of Iraq, and Iraqi Prime Minister Mustafa al-Kadhimi.

The chief banker’s talks resulted in an agreement with Iraq to unblock the Iranian assets, a move that came a few days after the U.S. imposed sanctions on eighteen Iranian banks to cut off Iran’s ties with the global financial system.

Hemmati said in an Instagram post that he held “intense negotiations” with the Iraqi officials, leading to reaching a deal with Iraq to unblock the Iranian assets.

“During these negotiations, especially at the joint trilateral meeting with the heads of Central Bank and Trade Bank of Iraq, we have reached good agreements to unblock the CBI assets and using them in providing our country with basic and necessary goods. We held detailed discussions on trade exchanges,” Hemmati stated.

According to Hemmati, Iran has significant financial assets in Iraqi banks due to its gas and electricity exports to Iraq.

Under the agreements, Iran will be able to withdraw these assets according to its needs.

Hemmati also said that during his meeting with al-Kadhimi, the Iraqi prime minister expressed satisfaction at the agreements and instructed the Central Bank and the Trade Bank of Iraq to accelerate the agreements' implementation.

The release of the Iranian assets came when the U.S. is ramping up its economic pressures on Iran to isolate it from the global financial system. To this end, on October 8, the U.S. introduced sweeping sanctions on the remaining eighteen Iranian banks.

“Today U.S. Treasury took further action to isolate the Iranian economy from the global financial system as the regime uses the financial sector to advance its malign agenda,” tweeted U.S. Secretary of the Treasury Steven Mnuchin.

The U.S. Treasury issued a statement that explained the implications of the new sanctions.

“All property and interests in property of designated targets that are in the United States or the possession or control of U.S. persons must be blocked and reported to OFAC. OFAC’s regulations generally prohibit all dealings by U.S. persons or within the United States (including transactions transiting the United States) that involve any property or interests in property of blocked or designated persons,” the statement said.

However, the Iran-Iraq agreements on the release of assets highlighted the little impact of these sanctions. Iran and Iraq have not only agreed to cement banking ties but also to resume border trade.
According to the Iraqi news website al-Eqtesad News, the central banks of Iran and Iraq have signed a commercial memorandum of understanding.

One day after Hemmati visited Baghdad, Iran and the Kurdistan region of Iraq reached an agreement on resuming Iranian fuel export to Iraq. The two sides also agreed to hold further talks on boosting border trade between Iran and Iraq through the Iraqi Kurdistan region.

The new measures taken by Iran to strengthen economic ties with countries worldwide are part of Iran’s efforts to mitigate the effects of the U.S. economic sanctions and turn Donald Trump’s “maximum pressure into a maximum disgrace.”

On Monday, the Leader of the Islamic Revolution, Ayatollah Seyed Ali Khamenei, said the Islamic Republic of Iran is determined to turn the U.S. policy of “maximum pressure” against Iran into a “maximum disgrace” through boosting the production capacity of the Iranian economy.