Expansion of Unconventional Trade; The 'Barter' Locomotive Arrives in Pakistan

According to the Director General of South Asia at the Trade Development Organization, the conditions for 'barter' trade with Pakistan will soon be finalized. Hadi Talebian Moghadam mentioned the latest developments in barter trade with Pakistan, stating that we will soon invite the Pakistanis to negotiate and reach an agreement on the barter process. The oil-for-goods and food policy is currently being implemented in Iran through barter, with the latest instance being the Iranian Oil Minister stating on June 21 that settlements with Venezuela are being made through 'bartering oil for processed shipments' received from that country's refineries. Javad Owji also emphasized barter with Cuba, stating that good progress has been made in Cuba through bartering oil for medicines such as vaccines, equipment, and drugs needed by the Ministry of Health. On June 24, news emerged about bartering oil for tea between Iran and Sri Lanka, with the spokesperson for the Iranian Oil, Gas, and Petrochemical Products Exporters Union stating, 'Sri Lanka has owed Iran for a long time, and it is better to resolve this issue as soon as possible.' Javad Owji, the Iranian Oil Minister, previously mentioned on April 5 regarding the settlement of 'Iraq's gas debts to Iran,' stating that [Iraqi officials] have conditions that the received funds should be exclusively allocated for 'the purchase of medicines and essential goods.' Shortly thereafter, Iraqi government officials confirmed this and announced that no monetary repayment would be made against Tehran's currency claims, and only food and hygiene items would be sent. Meanwhile, on December 10, 2021, the secretariat of the Iran-China Joint Chamber of Commerce announced Mongolia's readiness to export 'natural wool' to Iran based on a 'barter deal' in exchange for 'receiving oil.' Abdul Razak Dawood, senior advisor to the Prime Minister of Pakistan on trade and investment, previously stated in a meeting with Iranian officials that 'we are aware of Iran's sanctions conditions,' adding, 'Pakistan has rice, and Iran has oil and petrochemicals, which we can barter.' The severe increase in 'stagflation' in Iran's economy and market, along with a noticeable decrease in foreign liquidity and the failure to fulfill the electoral promises of Ebrahim Raisi in June 2021, has led the Islamic Republic to openly resort to the barter mechanism of 'oil for food and medicine.' Previously, following the issuance of 'Resolution 986' by the United Nations Security Council in April 1995 and subsequent international sanctions against the Ba'ath regime in Iraq, the Oil-for-Food Program was implemented for Baghdad and continued until November 2003 when Saddam Hussein's regime fell. John Bolton, former U.S. National Security Advisor, recently discussed various topics, including the impact of sanctions against the Islamic Republic, in an interview with the Persian section of Voice of America. Bolton stated regarding the impact of international sanctions on the Islamic Republic and Iran's economy, 'Keep in mind that Iran's economy is currently in very bad shape. Sanctions are only one reason for this situation. The main reason is really economic mismanagement by the Ayatollahs.' The continuation of the 'barter' policy in the Islamic Republic; from tea and rice to medicine and wool. Pakistan is bartering goods with Iran, Afghanistan, and Russia. The ongoing challenge of currency transfer; the Central Bank of Iraq does not allow the transfer of dollars to Iran. The collection of Iraq's $11 billion debt to Iran remains uncertain. A member of parliament confirmed; an agreement with China for 'bartering' oil for housing. The Ministry of Defense retreated, the Chinese entered; oil in exchange for housing.