Tehran, Baku may ditch US dollar in bilateral trade

Tehran, Baku may ditch US dollar in bilateral trade
A recent announcement by the Central Bank of Iran on the country’s plan to stop using the US dollar in its official statements has strengthened the speculations on the possibility of employing national currencies of Iran and Azerbaijan in bilateral trade between the two countries.

A source familiar with the ongoing financial talks between Iran and Azerbaijan, who asked to remain anonymous, has told Trend that the option on using the national currencies between the two countries is on the table and the sides are studying the issue.

Valiollah Seif, the governor of the Central Bank of Iran, has earlier said that the Islamic Republic would either replace the US dollar with a new common foreign currency or use a basket of currencies in all official financial and foreign exchange reports from the beginning of the new Iranian calendar year (March 20, 2017).

Meanwhile there has been an agreement between Iran and Azerbaijan to use the Swiss franc’s rate for setting ticket prices for the Nakhchivan-Mashhad train, launched in late December 2016.

The anonymous source also told Trend that there is a "proposed protocol”, but the discussions between Tehran and Baku on the issue have not produced a concrete result so far.

The source added that the protocol was proposed after Turkish President Recep Tayyip Erdogan last December called for making trade payments with Russia, China and Iran in national currencies.

Last August, Iranian President Hassan Rouhani visited Baku where the sides agreed to expand financial cooperation and signed several documents.

During the visit, Iran's Central Bank chief Valiollah Seif, who accompanied the president, told Trend that the central banks of the two countries have agreed to open settlement accounts.

Trade turnover between Azerbaijan and Iran amounted to $210.76 million in 2016, $49.68 million of which accounted for the export of Azerbaijani goods to Iran, according to the State Customs Committee of Azerbaijan.