UAE banks step up pressure on Iran

Lenders freezing assets and refusing to deal with merchants doing business with Islamic Republic.
Mon 27 Oct 2008 05:19 PM

Local banks in the United Arab Emirates have stepped up pressure on Iranian firms by freezing their assets and refusing to deal with merchants doing business with Iran, a newspaper reported on Monday.

Most local Emirati banks have stopped serving Iranian businessmen whose merchandise was headed for or dispatched from Iran, Hamid Hosseini, a member of Iran's Chamber of Commerce, told Sarmayeh newspaper.

He added that among 12 local banks only two or three would open letters of credit for Iranians "under very difficult circumstances".

Iran is under international banking sanctions over its controversial nuclear programme and the United States, which is leading efforts to thwart the atomic drive, has pressured its Arab allies to restrict their ties with Iran.

"Some local Emirati banks open accounts for these [Iranian] firms but they seriously control them and recently froze the assets in these accounts under the pretext of suspicious transactions," Pedram Soltani, a member of Tehran Chamber of Commerce, said.

He added that international banks are refusing to open accounts for UAE-registered intermediary firms whose investors or chief executives are Iranian.

UAE is Iran's top trading partner and there are an estimated 450,000 Iranians living there. About 10,000 Iranian firms operate in the country, chiefly Dubai, according to Iranian figures.

Iranian statistics put bilateral trade at $11.7 billion in the Iranian year ending in March 2007, with imports from the UAE forming the bulk of the exchanges at $9.2 billion.

Iran denies Western allegations of trying to develop nuclear weapons, insisting its atomic programme is peaceful. It has pressed on with the nuclear work despite sanctions.

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