Economy, Business And Markets

Austria’s OeKB Raises Iran Trade Cover to €1b

The Austrian Federal Ministry of Finance has defined terms for covering transactions with Iran.The Austrian Federal Ministry of Finance has defined terms for covering transactions with Iran.

Austria’s export credit agency, OeKB, has raised the cap for covering transactions with Iran from €280 million to €1 billion, said Austrian Federal Minister for Finance Hans Jorg Schelling on Tuesday.

Schelling made the announcement during a meeting with Central Bank of Iran Governor Valiollah Seif in Vienna.

“Austria is ready to take necessary measures for normalizing banking relations with Iran and remove any obstacles,” CBI’s website quoted him as saying.

“We are also keen on expanding correspondent banking relation with Iran.”

Earlier in February, the Austrian Federal Ministry of Finance and OeKB defined terms for covering transactions with Iran. The ECA also covers Austrian investments in Iran.

In the post-sanctions era, Tehran and Vienna have been working to increase bilateral trade, which currently stands at about $300 million per annum by exchanging high-level trade missions.

In early April, a 110-strong business delegation of Iranian private sector business representatives visited Vienna and met with Austrian chamber members and their president, Christoph Leitl.

During the visit, representatives of private businesses from both sides signed memorandums of understanding worth over $2 billion in the fields of auto, steel, medicine and engineering services.


Banking Ties

Seif travelled to Vienna earlier this week to discuss expansion of banking ties with the European country.

A couple of top bankers also accompany Seif, including CEOs of Bank Pasargad Iran, Tejarat Bank and Bank Melli Iran.

He visited the Joint Vienna Institution that agreed to help train Iranian bankers and support upgrading Iranian banking system in accordance with international standards.

The top bankers of Iran and Austria were also set to discuss technical issues for enhancing collaborations on Wednesday.

Austrian and Iranian bankers are meeting in Vienna on Wednesday to discuss the resumption of trade financing, people familiar with the discussion told Bloomberg.

Bottom of Form

The meeting will take place at the Austrian central bank after the governors of the two nations’ central banks, Ewald Nowotny and Seif, met on Tuesday, according to the people who asked not to be identified because the talks are private.

Austria’s top three banks, namely Erste Group Bank AG, UniCredit Bank Austria AG and Raiffeisen Bank International AG, are among the participants.

Major European banks have kept their distance from Iran, despite the nuclear deal between Iran and world powers, for fear of running afoul of remaining US sanctions.

Iran’s Seif said on Tuesday progress with foreign banks has been “slow”, IRNA reported.

"Raiffeisen has been looking into the option of reopening its office in the country," Chief Executive Officer Karl Sevelda said in January.

European banks and firms should use their influence in the United States to speed up the implementation of financing projects with Iran, the CBI chief said on Wednesday.

"We expect European banks and companies to help us explain to US authorities that they must keep their side of the nuclear deal," Seif said in an interview with Austrian news agency APA in Vienna where he met his Austrian counterpart on Wednesday.


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