Relations between Iran and South Korea have suddenly become tense recently.
On January 10th local time, Choi Jong-jian, the first official (vice minister) of the South Korean Ministry of Foreign Affairs, met with Iranian Deputy Foreign Minister Aragazi in Tehran, the capital of Iran.
The two sides discussed issues such as the detention of South Korean tankers by Iran and the freezing of Iranian funds in South Korea, but the two sides failed to narrow their differences of opinion.
At the same time, Iran is also putting pressure on South Korea. Yonhap quoted Iranian media reports that Iran believes that “the freezing of Iranian funds in South Korea is not caused by the cruel sanctions imposed by the United States on Iran, but by South Korea’s lack of political will”.
On the other hand, experts from the American think tank warned that the United States still plays an important role in this matter and requires a clear statement from the United States before Iran and South Korea can hope to solve the freezing of funds.
U.S. sanctions behind the freezing of funds
According to previous reports, affected by U.S. sanctions, $7 billion of Iran’s oil exports have been frozen in two banks in South Korea. Iran has repeatedly proposed to use part of the funds to buy medical equipment and coronavirus vaccines.
On January 4 this year, Iran’s Islamic Revolutionary Guard Corps has detained a Korean tanker for “repeatedly violating environmental regulations and causing environmental pollution”.
Some people believe that Iran’s detention of South Korean ships is actually “mast” in order to resume obtaining the above-mentioned frozen funds.
An Iranian government spokesman refuted this statement.
Recently, Iran’s Ministry of Foreign Affairs also said that the arrest of the ship had nothing to do with the frozen funds in South Korea, and stressed that unfreezing the funds would be the main topic of Choi Jong-jian’s trip.
However, on the use of frozen funds, both Iran and South Korea should be scrupulous about the attitude of the third-party United States.
According to a Yonhap report on January 10, Choi Jong-jian said that the funds involved U.S. sanctions, which is also the difference between Iran and South Korea.
Choi Jong-kyeong said that he would learn more about Iran’s claims after arriving in Iran, and judge what can and cannot be done in this regard, and what parts need to be consulted with the United States.
According to a press release issued by the Iranian government on January 10, Aragazi believes that South Korea’s freezing of $7 billion in Iranian funds is an act of succumbing to the United States, which Iran cannot accept.
He also said that “after the relevant issues are resolved, it will be meaningful to enhance bilateral relations between Iran and South Korea”.
Can the United States make a clear statement?
In fact, the influence of the United States on this matter has always played a decisive role.
An article in the Financial Times on January 11 pointed out that South Korea’s Foreign Ministry had previously said that the United States agreed to South Korea’s request to use part of the frozen Iranian funds to obtain vaccines through the “Coronavirus Vaccine Implementation Plan” (COVAX).
In the past year, a small part of the frozen funds have been used to deliver drugs and medical equipment to Iran.
However, Iran is still worried that the funds will be blocked by the United States again when it is used to buy vaccines, so Iran has not pushed forward a larger vaccine deal.
“We have experience in unfair judgments of Iranian assets by U.S. courts, so we cannot put Iranian people’s money at risk of confiscation.” Abdolnaser Hemmati, the governor of the Central Bank of Iran, said last month that he was worried that cash from South Korea would be frozen again.
In response to Iran’s concern, the U.S. State Department hinted in response to the Financial Times that the United States has “always made it clear” that sanctions are not targeted at legitimate humanitarian transactions, including vaccine transactions.
In response to this slightly “obscure” statement, Kyle Ferrier, a researcher at the Korea Economic Institute, a US think tank, believes that the United States can send a clear and “spoken statement” to Iran and its financial institutions.
The signal of vocal that these transactions will not violate the sanctions.
“South Korea can’t solve this problem by itself.” Ferrier told the Financial Times.
The report also quoted Saeed Laylaz, an economist closely related to the government of Iranian President Hassan Rouhani, as saying that no one knows how much money Iran still has in overseas banks.
According to his speculation, there are “about $100 billion to 120 billion dollars.
Still overseas, the funds belong to state-owned institutions such as the Central Bank of Iran and the Ministry of Oil.
And these funds can only be unfrozen if the United States lifts sanctions.
According to Iranian media reports, a South Korean government delegation will meet with the Governor of the Central Bank of Iran on the 11th to continue to discuss the unfreezing of Iranian funds in South Korea.