Last updated: 29 February, 2012

Sanctions-hit Iran accepting gold for trade payments

Sanctions-hit Iran is to accept gold for trade payments, along with agreed currencies of other nations, the head of the central bank said, according to reports on Wednesday.

“Iran doesn’t only work with the dollar, and each country can pay with its own currency,” Mahmoud Bahmani was quoted as saying on Tuesday.

“If a country also wants to pay in gold, we will accept that too,” he said.

The remarks suggested Iran was broadening its payment system in the face of increasingly tough financial sanctions imposed by the West over Tehran’s controversial nuclear programme.

The sanctions have made it harder for Iran to be paid for its main export, oil, and to purchase imports by making it difficult to conduct international financial transactions.

The Islamic republic is responding by trying to find ways around the obstacle, notably by reducing its dependence on dollar transactions.

A deputy foreign minister, Abbas Araqchi, told the Fars news agency: “We have managed to find new methods and ways in our exchanges with other countries to, first of all, get rid of the dollar, and then to use local currencies, exchange methods and direct bartering and other means to get around the sanctions.”

At the same time, the government has ordered a ban on imported products that had Iranian-made equivalents, the reformist daily Etemad reported.