The Iraqi government will free $125 million in debt to Iran to pay for Iran's Covid-19 vaccine order, the energy minister said in Tehran on Saturday.
"The money will be transferred through a Swiss bank to the Covid Vaccination Global Access (COVAX) program for 16 million doses," Reza Ardakanian was quoted Saturday as saying by the Energy Ministry news website.
Backed by the World Health Organization and the Global Alliance for Vaccines and Immunization, the initiative aims to distribute 2 billion vaccines by the end of 2021. The minister said money transfer is expected to be completed within a week.
In December the National Iranian Gas Company said Iraq owes more than $6 billion in unpaid energy bills. The debts include $2 billion in arrears and $1 billion in contract violations. Three billion dollars are blocked by the Trade Bank of Iraq, due to the US economic blockade and banking restrictions.
Iran exported 65 billion kilowatt-hours of electricity to Iraq since 2005 worth an estimated $6.2 billion. The neighbor is one of the biggest regional markets for Iranian exports. Twenty million cubic meters of gas is also exported every day (worth $200 million a month).
Iraq is the biggest importer of electricity from Iran. It needs more than 23,000 MW (per day) to meet growing domestic demand. Besides electric power, Iraq also depends on Iranian gas for its power plants.
Ardakanian made the statement after meeting Ali Abdul-Amir Allawi, Iraq’s finance minister, Majid Mahdi Hantoush, the visiting electricity minister and Salem Chalabi, the CEO of Trade Bank of Iraq in Tehran on Saturday.
"We hope the Iraqi government will clear its debts to Iran soon," Oil Minister Bijan Namdar Zanganeh was quoted as saying, adding that Iran is willing to increase gas exports to the neighbor.
According to Shana, officials of the two countries are scheduled to meet again this week to discuss the debt repayment issues.
Earlier this month Ardakanian said Baaghdad would pay for Tehran’s order to buy Russia's Sputnik-V Covid vaccine as a part of an agreement to settle its debts.
Iran has placed orders for 62 million doses of the Russian vaccine. It is stepping up its own vaccine rollout as it receives more of the delayed shipments of the jabs under COVAX.
COVAX delivered 1.452 million shots of the Italian-manufactured AstraZeneca jabs to Iran last week, taking the total vaccines given by the global organization to 2.23 million, out of the 16.8 million COVAX it has agreed to deliver.
The total number of Covid infections in Iran surpassed 2.89 million on Saturday. Reports say over 508,672 Iranians have been fully vaccinated and 3.33 million-plus have received the first dose.
Iran administered 3.8 million jabs since the start of the national inoculation drive. The Health Ministry reported 173 coronavirus deaths on Saturday, taking the national toll to 79,741.
