Iran (IMNA) - The global economy is undergoing a historic transition from traditional, centralized financial structures under Western dominance toward multilateral and decentralized mechanisms. Emerging groupings such as BRICS, with initiatives focused on independent payment systems and settlements in national currencies, have created opportunities to reduce the financial vulnerability of developing economies. However, making effective use of these opportunities inside Iran depends largely on monetary and structural reforms and the removal of domestic barriers.
Kambiz Mirkarimi, Vice Chairman of the Iran-Russia Joint Chamber of Commerce, told IRNA’s economic reporter that strengthening financing mechanisms and using the capacities of the BRICS Development Bank could help address one of the main obstacles facing Iranian businesses: the lack of access to the SWIFT system.
He said the lack of access to SWIFT has made financial transfers more risky and increased transaction costs, adding that any mechanism that facilitates or reforms this process would contribute to improving trade relations.
Referring to sanctions against Iran and Russia and the financial restrictions faced by both countries in accessing SWIFT, Mirkarimi said Iran and Russia could benefit significantly from BRICS financial mechanisms, while other member states could also benefit by increasing their bargaining power and gaining access to additional financial tools.
He said one component of this mechanism is the proposed BRICS Pay system, through which independent payment systems separate from SWIFT could be established based on settlements in national currencies. He added that creating a common currency remains a long-term vision requiring substantial further work, while national currencies can currently be used for settlements.
Iran already conducts transactions and settlements with some trading partners, including China and Russia, using national currencies. Mirkarimi said that if BRICS members establish a multilateral centralized clearing and settlement mechanism, trade imbalances between individual countries could be addressed more effectively.
He gave Iran-Russia trade as an example, noting that Iran currently imports more from Russia than it exports to the country, which can create a shortage of rubles for Iranian importers. Under a multilateral arrangement in which central banks coordinate settlements, however, trade surpluses and deficits could be settled and transferred directly between central banks, facilitating the use of national currencies.
Can Iran place the rial in the BRICS basket?
Regarding the possibility of reducing Iran’s dependence on the Western financial system, Mirkarimi said the objective is achievable through accounting and settlement in national currencies and by obtaining the necessary credits.
He noted that partner countries are also prepared to allocate financing. Russia, for example, has provided credits, some of which were governmental, while China has allocated financing for numerous projects. He said a number of projects implemented in Iran have already benefited from such mechanisms.
According to Mirkarimi, investment projects can therefore be implemented through these mechanisms, and BRICS member states have the necessary tools and capacities. The fundamental question, however, is which currencies should form the basis of settlement and how their stability can be ensured.
He said BRICS members are willing to conduct trade using their national currencies, but if Iran seeks to include its national currency in the group’s calculation basket, it must meet certain requirements and ensure monetary stability.
Mirkarimi said the Russian ruble has demonstrated relative stability and that member countries and companies have no major difficulty trading in rubles or Chinese yuan. If the Iranian rial is also to be included in the calculation basket, he added, Iran must take steps to stabilize the value of its national currency. Such a move, he said, would ultimately reduce costs.
The Iran Chamber of Commerce member also pointed to domestic regulations as a major part of the challenge. He said multiple exchange rates, existing foreign exchange regulations and administrative rules have meant that, despite the availability of technical infrastructure for foreign exchange settlements — including bilateral financial channels and the possibility of settling transactions in national currencies — businesses still tend to use intermediary currencies such as the dollar and euro and rely on third countries.
While sanctions have an undeniable role, he said, a significant part of the challenge is related to reforming Iran’s own foreign exchange regulations and domestic rules.
Mirkarimi said that for years, the technical structure, banking channels, correspondent relationships and settlement platforms for transactions in rubles and rials have been established between Iran and Russia.
He explained that an Iranian exporting company can currently conclude a contract with a Russian counterpart and officially include its rial bank account in Iran in the contract without opening an account abroad. The Russian buyer deposits rubles into a Russian bank account, while the Iranian exporter receives the equivalent amount in rials.
The main issue, he said, is the exchange rate. Because exchange rates in Iran are subject to multiple pricing mechanisms and there is a persistent gap between the free-market and official rates, the Central Bank can determine, directly or through regulations, the rate at which Iranian banks conduct conversions.
Such intervention and administratively determined pricing create uncertainty, he said, and this uncertainty makes economic actors cautious about using national currencies.
Iran’s BRICS trade reaches $60 billion annually
Mohammad Sadegh Ghanadzadeh, Deputy Head of Iran’s Trade Promotion Organization for Trade Services Affairs, said Iran’s annual trade with BRICS members amounts to about $60 billion.
He stressed that Iran’s membership in groupings such as BRICS, the Shanghai Cooperation Organization and the Organization of Islamic Cooperation should move beyond political participation and develop into tangible economic cooperation.
Speaking to IRNA, Ghanadzadeh referred to the achievements of the Iranian president’s participation in the BRICS summit, saying that the development of international corridors, payment mechanisms, trade and financial cooperation were among the issues discussed, while Iran also expressed its readiness to participate in these areas.
He said bilateral consultations were also held on expanding trade and transit routes and developing appropriate solutions for financial exchanges among participating countries.
Despite restrictions caused by sanctions, war conditions and problems affecting transportation and flights, Iran has maintained its presence in BRICS economic events, Ghanadzadeh said, adding that this presence should be used to expand trade relations.
He emphasized that Iran should use the opportunity to increase economic interaction with BRICS members and move cooperation from political consultations toward concrete projects in trade, transportation, payments and investment.
Ghanadzadeh said Iran’s trade with BRICS members includes about $23 billion in exports and $37 billion in imports.
He noted that a significant share of the world’s population lives in BRICS member countries and that their share of the global economy has increased in recent years, making BRICS an influential grouping in international economic equations.
Cooperation with Iran in transit routes, trade facilitation, customs and standards coordination, and payment mechanisms has been placed on the agenda, he said.
The use of national currencies in trade is also among the issues discussed in recent years, Ghanadzadeh said, adding that the focus has now shifted toward establishing practical and operational mechanisms for their use.
He said the use of local currencies can be expanded in bilateral trade among member states, and that such experience could eventually contribute to the development of broader financial instruments among BRICS countries.
Although BRICS accounts for a significant share of Iran’s foreign trade, Ghanadzadeh said the country has not yet fully utilized the economic capacities created by its membership.
He reiterated that Iran’s participation in BRICS, the Shanghai Cooperation Organization and the Organization of Islamic Cooperation should go beyond political presence and translate into tangible economic cooperation.
Expanding trade relations with major economies, he added, can open new channels for Iran to continue its foreign trade despite sanctions and reduce some of the pressures created by international restrictions.
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