Iran Secures Correspondent Relations With 900 Banks

International sanctions hampered Iran's ability to connect with the global banking network, but the country now has secured correspondent relations with 900 banks across the world, announced the minister of communications and information technology.

"Barely a year has passed since JCPOA [Iran's nuclear accord with world powers] was implemented, but we managed to establish ties with foreign banks with each passing month and now we have correspondent relations with 900 banks," Mahmoud Vaezi was also quoted as saying by Banker.ir.

On July 14, 2015, P5+1 (China, France, Russia, the United Kingdom, and the United States, plus Germany) and Iran reached a Joint Comprehensive Plan of Action regarding Iran's nuclear program.

October 18, 2015 marked its Adoption Day, the date on which the accord came into effect and participants began taking steps to implement their commitments. January 16, 2016, marks the Implementation Day of JCPOA.

However, since sanctions were lifted in January, the world's major banks continued to stay away because they fear being penalized by remaining US sanctions over issues such as money laundering. This has slowed Iran's efforts to rebuild its foreign trade and lure investment.

The minister said while the financial state of President Hassan Rouhani's administration is currently improving, "we will inject liquidity into the banks and insist that the banks do not take up [irrelevant] business ventures and allocate loans to serve the country's manufacturing output".

Speaking at an event in the northern province of Mazandaran, which was attended by businessmen, exporters and manufacturers, Vaezi commended the performance of state banks of the province in allocating loans to production units.

"The private banks must also support the private sector just like their public-sector peers," he added.

Reassuring manufacturers that the government is striving to solve the problems facing them such as the shortage of working capital and the prevalence of unnecessary regulations, the official warned producers against "expecting the government to solve their problems overnight".

Vaezi said all administrations that came to power since the 1979 Islamic Revolution have pursued the goal of supporting the private sector and the current government is no exception.

"The current administration has stressed strengthening the country by helping the private sector from the outset," he said.

"The private sector must gradually become strong enough to engage in exports and as long as we do not have exports, we will not know the true meaning of trade."

The World Bank in its latest analysis forecast Iran’s economy to grow at an annual average rate of 4.5% in 2016–18.

According to the bank, the oil and gas sector is projected to grow by 14.5% in 2016 up from 12.9% in the spring.