15771. Iran-South Korea Humanitarian Trade Requires U.S. Assurances
- Author:
- Katherine Bauer and Kevin Mathieson
- Publication Date:
- 07-2020
- Content Type:
- Policy Brief
- Institution:
- The Washington Institute for Near East Policy
- Abstract:
- Tehran is pressing Seoul regarding the billions in Iranian oil revenues held by South Korean banks, creating an opportunity to expand the U.S. humanitarian trade mechanism. On July 21, South Korea’s Foreign Ministry summoned the Iranian ambassador to lodge a complaint over Tehran’s heightened rhetoric regarding access to funds frozen in South Korea. The week before, Iran’s Foreign Ministry spokesperson had accused Seoul of having a “master-servant relationship” with Washington, while the governor of the Central Bank of Iran (CBI) had previously threatened legal action to access the funds, which Tehran says it plans to use for humanitarian purchases. Although the U.S. government authorized use of the funds for such purposes in February, South Korean banks appear hesitant to move forward without additional U.S. assurances—a reluctance compounded by the $86 million fine that U.S. regulators levied on the Industrial Bank of Korea (IBK) in April for failing to identify large-scale Iranian money laundering. With COVID-19 cases on the rise again in the Islamic Republic, Washington should work with Seoul to ensure that trade for medicine, equipment, and other humanitarian items moves forward—albeit with strict oversight.
- Topic:
- Foreign Policy, Government, and Trade
- Political Geography:
- Iran, Middle East, Asia, South Korea, and United States of America