Iran openly expresses discontent over frozen assets in Korea

13-Apr-2021 Intellasia | KoreaTimes | 5:02 AM Print This Post

Iran has amped up its pressure on Korea to release its money held frozen by two Korean banks, with its vice president slamming Seoul in public, Sunday.

Diplomatic observers say such acts from Tehran are likely to continue before it renegotiates a nuclear deal, known as the Joint Comprehensive Plan of Action, with the United States which is the root cause for the frozen funds from oil and gas sales.

The funds held in the banks have been a hot-button issue between the two countries with Iran lambasting the government here for its years-long failure to release the $7 billion. The Korean administration counter-argues that it cannot accept Iranian demands due to US sanctions re-imposed in 2018. Last July, the Iranian foreign ministry threatened Korea with legal action at the International Court of Justice

The open criticism occurred during a press conference between prime minister Chung Sye-kyun and Iran’s First vice President Eshaq Jahangiri after their talks in the Iranian capital. Chung has been on a three-day trip to the country to discuss ways to settle the issue and other pending bilateral matters.

“We call on the Korean government to release Iran’s financial resources as soon as possible and to solve the problems of recent years through practical compensatory measures,” Jahangiri said.

“Unfortunately, in the last three years, due to Korea’s compliance with illegal sanctions against the Iranian people, which lack international legitimacy, relations between the two countries have stagnated. The relations between Iran and Korea have decreased while there have been no international sanctions, including the United Nations, against the Iranian nation.”

The Iranian vice president also said the action of the Korean banks in reusing to transfer the money has seriously damaged bilateral relations and prevented the country from buying drugs and medical equipment amid the COVID-19 pandemic.

“This move by the Koreans has deprived the Iranian government of its major foreign exchange resources for the purchase of drugs, medical equipment and other basic needs of the country, and even Korean companies from selling drugs and medical equipment to Iran,” Jahangiri said.

He added that Korea’s freezing of the money has undermined the status of Korea in the eyes of the Iranian people.

“As a result of these actions of Korea, the image and position of this country, which has always been positive and friendly to the Iranian people, was severely damaged. Of course, I hope that the Korean prime minister’s visit to Iran would improve Korea’s image among Iranian people,” Jahangiri said.

In response, the government says it was in negotiations with the US about the frozen funds, although nothing has happened so far.

“Korea will step up cooperation with related nations including Iran (to settle the issue),” Chung said during the meeting.

“Today’s visit shows Seoul’s serious determination to develop bilateral relations,” he said.

It remains to be seen if Iran’s pressure on Korea will pay dividends as the issue fully depends on the US government’s stance on the sanctions.

Iran seized a Korean oil tanker and its crew members in early January, and it is believed the country did so due to the frozen funds issue although its government said the seizure had nothing to do with this. Last week, Iran released the vessel and remaining crew.

Shin Beom-chul, director of the centre for Diplomacy and Security at the Korea Research Institute for National Strategy, said the Iranian government could increase pressure on Korea regarding the issue given that the country is scheduled to hold a presidential election in June, in a move to appeal to local voters.

“The Iranian government seems to be angered by Korea’s breach of promise to transfer $1 billion from the Iranian funds to Swiss banks,” Shin said.

The two countries have been consulting over how to release part of the funds through a Swiss humanitarian trade arrangement designed to facilitate the flow of humanitarian goods to Iran.

The vice president expressed regret that the transfer of $1 billion to the Swiss banks for the purchase of coronavirus vaccine has not materialised, despite Korean officials’ promises, according to the Iranian government website.


Category: Korea

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