Europe activates the INSTEX mechanism to provide Iran with medical equipment

The main European powers have successfully carried out the first shipment of medical equipment to Iran through the INSTEX system, a tool that makes it possible to carry out transactions with the Iranian nation avoiding the economic sanctions imposed by the United States in relation to breaches of the nuclear agreement signed in 2015 and from which the American giant left in 2018 arguing irregularities committed by the regime of the ayatollahs. 

The Instrument for the Support of Trade (INSTEX) is a European mechanism established in 2019 and designed to enable exchanges with the Islamic Republic of Iran that are not in U.S. dollars and not through the SWIFT interbank system, so as not to violate the sanctions decreed by the U.S., France, Germany and the United Kingdom established this procedure in January 2019, and it was also joined by Belgium, Denmark, the Netherlands, Finland and Sweden. This special procedure is operational only for humanitarian reasons, such as the purchase of medical or food products covered by the embargo. 

Paris, Berlin and London have confirmed the implementation of this unique system to supply Tehran in the fight against COVID-19. “France, Germany and the United Kingdom confirm that INSTEX has successfully completed its first transaction, facilitating the export of medical goods from Europe to Iran. The goods are already in Iran,” according to a statement by the German Foreign Ministry. The official note adds that INSTEX and its Iranian counterpart, the Special Trade and Finance Facility (STFI), “will work on further transactions and on strengthening this mechanism”. “INSTEX will be used in other transactions” with Iran, the ministry added, explaining that the method “will be further developed”, without giving further details. The French and British ministries later confirmed the information.

The Iranian Foreign Ministry already indicated on 14th March that it had received medical teams and financial aid from countries such as Azerbaijan, Germany, the United Arab Emirates, France, China, the United Kingdom, Japan, Qatar, Russia and Turkey stressing that the government and the Iranians would never forget their “friends in difficult times”.

INSTEX is a procedure that was designed to allow Iran to continue to sell oil and import other products in exchange for this raw material. But until now, it has not served as a framework for any exchange.

The atypical INSTEX method was created a year ago, after the US government led by President Donald Trump abandoned the nuclear agreement sealed in 2015 in 2018 with Iran and other nations such as the United Kingdom, France, Germany, China, Russia and the EU, which limited the Persian atomic program in order to prevent its arms development. The US argued that the Middle East country had failed to comply with the commitments of the so-called Comprehensive Joint Action Plan (CJAP) by imposing punitive measures at the political and economic level, among which those related to oil trade, the main source of Iranian funding, stood out. 

Following the US withdrawal in 2018 and the embargo applied, Iran, in the words of its President Hassan Rohani, threatened to violate the main points of the JCPOA, mainly those related to uranium enrichment and heavy water treatment, and to block maritime traffic in the Strait of Ormuz, the main passage area for world oil trade. 

During the following months, incidents concerning cargo ships in Gulf waters and attacks also on oil and airport infrastructures in Saudi Arabia, a great regional enemy of Iran and the highest representative of the Sunni branch of Islam, as opposed to the Shiite branch sponsored by the Ayatollahs' regime, occurred. Offensives for which the Persian nation and pro-Iranian agents were blamed, such as the Houthis, Shiite militias fighting in Yemen's war against the international coalition led by the Saudi kingdom in order to undermine the internationally recognized Yemeni government. 

The European Union (EU) has tried during the last few months to safeguard the JCPOA and reach agreements with Tehran, in spite of the confrontation with Washington; and within this strategy, INSTEX was established, an 'original' way of avoiding the sanctions decreed by the US, which has finally been activated now allowing medical material to be sent to Iran, one of the countries most affected by the spread of the coronavirus. 

The COVID-19 has already left more than 41,000 dead and more than 823,000 cases in practically the whole world. In fact, the number of deaths in Iran has already reached 2,900, with more than 45,500 cases diagnosed. 

After its creation in January 2019, INSTEX was seen as a key element in saving the JCPOA and, as has been assured from Paris, London and Berlin, this means a “sustainable and long-term solution for legitimate trade between Europe and Iran” on which the parties involved will work to “strengthen it”. 

However, it was also recalled that Iran must “respect the obligations” and cooperate “fully” with the International Atomic Energy Agency (IAEA), which is monitoring the Iranian nation to ensure that it complies with the terms agreed in the nuclear pact.