Iran has started using a barter-style system for Iran China barter trade to avoid US sanctions and bypass the international banking system. According to a foreign news agency report, the arrangement allows Tehran to continue selling oil while obtaining various goods from China.
The report cited two senior Iranian sources and people familiar with the trade sector. They said Iran is using the system to secure billions of dollars worth of Chinese goods in exchange for Iranian oil while avoiding direct transactions through the international financial system.
Under the reported arrangement, Iran receives credit for Chinese imports in exchange for its oil. The system has reportedly helped Iran obtain medicines, vehicles and communications equipment from China. Manufacturers of those goods, however, were not directly conducting financial transactions with Iran.
The report said the mechanism was also used at least once during the past year in deals involving the supply of air defence equipment worth millions of dollars. The sources did not provide further details about the alleged transactions or the parties involved.
People familiar with the arrangements said Iran China barter trade is not the only method Tehran uses to avoid the international banking system. Iran also reportedly obtains goods and services from Chinese companies through other mechanisms designed to avoid direct banking transactions.
However, the news agency said it could not independently verify the reported transactions. China’s Foreign Ministry also said it was not aware of the specific situation described in the report when asked about the barter-style arrangements.
China’s Foreign Ministry reiterated that Beijing opposes unilateral sanctions. Meanwhile, Iran’s missions to the United Nations in New York and Geneva did not respond to requests for comment. The reported Iran China barter trade arrangements therefore remain subject to independent verification.
