Russia & Iran almost fully rely on national currencies in trade – Kremlin

Russia and Iran have almost fully phased out using foreign currencies in bilateral trade, the Kremlin has said ahead of the BRICS summit in the Russian city of Kazan. The two nations cover more than 96% of mutual settlements in rubles and rials, the statement said.

Bilateral trade volume has grown by 12.4% in the first eight months of this year alone, Moscow said, adding that, in 2023, it amounted to more than $4 billion. “Both nations’ leadership pays priority attention to developing trade and economic relations,” the statement said.

According to the Kremlin, Russia and Iran are currently jointly developing several major projects in the field of transport and energy, including construction of new generating units at the Bushehr nuclear power plant in the Islamic Republic and the North-South international transport corridor set to link the Russian Baltic Sea port city of St. Petersburg and India’s port city of Mumbai.

Relations between the two nations are “on the rise,” Moscow believes. The Kremlin expects them to reach the level of a “comprehensive strategic partnership” in the future.

Russian President Vladimir Putin is scheduled to meet his Iranian counterpart Masoud Pezeshkian on the sidelines of the BRICS summit that will be held between October 22 and October 24. The two have already talked by phone and met in person at a summit in Turkmenistan’s capital of Ashkhabad earlier in October.

Russia has been actively reducing the use of dollars in its international transactions. More than 95% of mutual settlements between Russia and its biggest trading partner, China, are carried out using national currencies (the ruble and yuan), Russian Prime Minister Mikhail Mishustin said in August.

According to Russian Finance Minister Anton Siluanov, the BRICS countries will proceed even further to reduce the share of the US dollar in mutual transactions in favor of national currencies. The group includes Russia, Brazil, India, China and South Africa, as well as Egypt, Iran, the United Arab Emirates and Ethiopia.

Last week, Reuters reported that Moscow plans to present its plan of creating a new international financial system at the upcoming BRICS summit. The system would particularly involve a new international payment mechanism that would allow the participating nations to effectively bypass dollar in international transactions and rely on national currencies instead.

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