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Korea refutes Iran's announcement of assets transfer

Korean Ambassador to Iran Ryu Jeong-hyun, right, has talks with Abdolnasser Hemmati, center, the governor of the Central Bank of Iran, over how to transfer and use part of the Iranian assets in Korean banks. Captured from Iranian Government website
Korean Ambassador to Iran Ryu Jeong-hyun, right, has talks with Abdolnasser Hemmati, center, the governor of the Central Bank of Iran, over how to transfer and use part of the Iranian assets in Korean banks. Captured from Iranian Government website

By Kang Seung-woo

Korea denied Tuesday claims made by Iran the previous day that Seoul had agreed to unfreeze and transfer to Tehran the assets it has at Korean banks. Diplomatic observers say Iran's announcement was made to pressure Korea to urge the U.S. to lift its sanctions on the country.

Currently, Iranian assets of $7 billion (7.7 trillion won) from oil sales have been held in two Korean banks due to the U.S. sanctions, re-imposed in 2018 after former U.S. President Donald Trump withdrew from the 2015 Iran nuclear pact, also known as the Joint Comprehensive Plan of Action (JCPOA).

On Monday, while Iran announced that the two sides had reached a deal under which its frozen funds would be transferred to its desired destinations, the Iranian government added that Korea is prepared to take all the measures required to enable Iran to use all of its assets in Korea. It also said the Iranian central bank had informed Korea of the amount of money it wants to be transferred.

However, the South Korean foreign ministry immediately issued a statement denying Iran's claim.

"The government has been in negotiations with the Iranian side over the frozen assets and Iran expressed its agreement with Korea's proposals during a Monday meeting between Korean Ambassador to Iran Ryu Jeong-hyun and Iran's Central Bank Governor Abdolnaser Hemmati," the foreign ministry said without providing further details of the proposals.

"The actual unfreezing of the assets will be carried out through consultations with related countries, including the U.S."

The frozen assets have emerged as a controversial issue between the two countries and Iran has made repeated complaints about the Korean government's failure to release them. Last July, the Iranian foreign ministry threatened Korea with legal action at the International Court of Justice.

In addition, speculation is rampant that Iran seized a Korean oil tanker and its crew members last month because of its discontent over the frozen funds.

Early this month, Iran said it would release the sailors, but not the captain, which coincided with Korea's confirmation of progress in talks with Washington about using the frozen money for United Nations dues.

In addition, to facilitate trade with Iran of humanitarian items, such as medicine and medical equipment, Korea has been seeking to use a Swiss channel backed by the U.S., known as the Swiss Humanitarian Trade Arrangement. The arrangement aims to ease the sale to Iran of medicine and medical devices manufactured by Swiss companies.

However, despite Iran's push, it will not be easy for the Korean government to release the frozen funds.

"It seems unlikely that Korea will get a U.S. exception to unfreeze the Iranian assets due to the U.S. government's firm stance against Iran's nuclear enrichment," said Park Won-gon, a professor of international politics at Handong Global University.

"As the Joe Biden administration's position is not to lift sanctions on Iran unless the country returns to the JCPOA, with Iran showing no signs of compliance with the nuclear accord, the frozen asset issue is expected to drag on."

Park also said the Iranian government's abrupt announcement has to do with its desire for Korea to persuade the U.S. to lift the sanctions.

"I think it is kind of an act of using the media aiming at both Korea and the U.S. toward releasing the assets," he added.


Korean Ambassador to Iran Ryu Jeong-hyun, right, has talks with Abdolnasser Hemmati, center, the governor of the Central Bank of Iran, over how to transfer and use part of the Iranian assets in Korean banks. Captured from Iranian Government website
Korean Ambassador to Iran Ryu Jeong-hyun, right, has talks with Abdolnasser Hemmati, center, the governor of the Central Bank of Iran, over how to transfer and use part of the Iranian assets in Korean banks. Captured from Iranian Government website

By Kang Seung-woo

Korea denied Tuesday claims made by Iran the previous day that Seoul had agreed to unfreeze and transfer to Tehran the assets it has at Korean banks. Diplomatic observers say Iran's announcement was made to pressure Korea to urge the U.S. to lift its sanctions on the country.

Currently, Iranian assets of $7 billion (7.7 trillion won) from oil sales have been held in two Korean banks due to the U.S. sanctions, re-imposed in 2018 after former U.S. President Donald Trump withdrew from the 2015 Iran nuclear pact, also known as the Joint Comprehensive Plan of Action (JCPOA).

On Monday, while Iran announced that the two sides had reached a deal under which its frozen funds would be transferred to its desired destinations, the Iranian government added that Korea is prepared to take all the measures required to enable Iran to use all of its assets in Korea. It also said the Iranian central bank had informed Korea of the amount of money it wants to be transferred.

However, the South Korean foreign ministry immediately issued a statement denying Iran's claim.

"The government has been in negotiations with the Iranian side over the frozen assets and Iran expressed its agreement with Korea's proposals during a Monday meeting between Korean Ambassador to Iran Ryu Jeong-hyun and Iran's Central Bank Governor Abdolnaser Hemmati," the foreign ministry said without providing further details of the proposals.

"The actual unfreezing of the assets will be carried out through consultations with related countries, including the U.S."

The frozen assets have emerged as a controversial issue between the two countries and Iran has made repeated complaints about the Korean government's failure to release them. Last July, the Iranian foreign ministry threatened Korea with legal action at the International Court of Justice.

In addition, speculation is rampant that Iran seized a Korean oil tanker and its crew members last month because of its discontent over the frozen funds.

Early this month, Iran said it would release the sailors, but not the captain, which coincided with Korea's confirmation of progress in talks with Washington about using the frozen money for United Nations dues.

In addition, to facilitate trade with Iran of humanitarian items, such as medicine and medical equipment, Korea has been seeking to use a Swiss channel backed by the U.S., known as the Swiss Humanitarian Trade Arrangement. The arrangement aims to ease the sale to Iran of medicine and medical devices manufactured by Swiss companies.

However, despite Iran's push, it will not be easy for the Korean government to release the frozen funds.

"It seems unlikely that Korea will get a U.S. exception to unfreeze the Iranian assets due to the U.S. government's firm stance against Iran's nuclear enrichment," said Park Won-gon, a professor of international politics at Handong Global University.

"As the Joe Biden administration's position is not to lift sanctions on Iran unless the country returns to the JCPOA, with Iran showing no signs of compliance with the nuclear accord, the frozen asset issue is expected to drag on."

Park also said the Iranian government's abrupt announcement has to do with its desire for Korea to persuade the U.S. to lift the sanctions.

"I think it is kind of an act of using the media aiming at both Korea and the U.S. toward releasing the assets," he added.


Kang Seung-woo ksw@koreatimes.co.kr


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