Iran bans trade finance on UAE imports

Iran has prohibited the opening of letters of credit for importing products from UAE Iran has prohibited the opening of letters of credit for importing products from United Arab Emirates due to the Arab country’s “illogical behavior,” the semi-official Mehr news agency quoted a lawmaker as saying Friday.
“Based on the government’s recent decision, opening letters of credit for imports from United Arab Emirates has been banned,” parliamentarian Gholam-Reza Mesbahi-Moghaddam was quoted as saying.
While Western countries have imposed tight sanctions on trade with Iran over its disputed nuclear program, the United Arab Emirates has served as a convenient conduit for other countries’ business.
But pressure may be mounting on the UAE and other of Iran’s neighbors to limit that trade.
“Iran’s neighboring countries such as UAE should resist the meaningless pressure imposed by arrogant powers so that they can continue their economic relations with the Islamic state,” Mesbahi-Moghaddam said.
According to recent data from the UAE customs authority, re-export trade between Iran and the UAE – goods sent to the UAE for on-shipment to Iran and Iranian goods sent to the UAE for on-shipment to other countries – tootled 19.5 billion dirhams ($5.3 billion) in the first six months of this year, up from 14.3 billion dirhams a year earlier.
Dubai has a large community of Iranian traders.
Iranian media reported Tuesday that the Islamic Republic had suspended all trade with UAE, one of its top trading partners, “until further notice” in reaction to hostile actions of the Arab country.
Iranian authorities denied the reports later that day.
Sanctions imposed on Iran are meant to coerce Tehran into suspending sensitive nuclear work.