U.S. sanctions on Iran are preventing Iraq from paying a $200 million debt to Tehran, the minister Raad Shallal said.Shallal said there was no “intermediary bank” which would accept to transfer the money to Tehran.
As a result, he added, imports of electricity from Iran, essential for the country with the approach of summer months, could be suspended.“The absence of a mechanism to pay has raised our concerns since the debts will accumulate and force the Iranian side in the future to stop supplying Iraqi with power,” Shallal said.
It is the first time a high-ranking Iraqi official speaks of the adverse impact U.S. sanctions on Iraq are having on trade between the countries.Iran has emerged as Iraq’s top trading partner with the value of trade expected this year to hit $10 billion. Shallal did not say how the massive trade exchange was carried out despite the sanctions.
Despite the restrictions, Shallal said his ministry was determined to expand relations with Iran, promising to boost electricity exports to as much as 1000 megawatts.Iranian firms are involved in Electricity Ministry’s projects worth hundreds of millions of dollars to build power plants and upgrade the country’s national grid.
In his remarks, made during a meeting with a high-level Iranian energy delegation, the minister said Iraq was importing gasoline and gas oil from Iran.“Iranian prices are competitive and (quality) of Iranian goods matches international standards,” he said.
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