US S. Korea Working To Release Iran’s Frozen Funds - Seoul Officials
South Korean media say Seoul and Washington are mulling over ways to release Iran’s $7 billion funds frozen due to US sanctions on Tehran.
South Korean media say Seoul and Washington are mulling over ways to release Iran’s $7 billion funds frozen due to US sanctions on Tehran.
In an article on Tuesday, the Korea Economic Daily said the move will help Seoul resume its business ties with Tehran as well as President Joe Biden in the 2024 US presidential election.
Citing diplomatic and government sources in Seoul, the conservative business daily said Korean and US government officials are involved in working-level discussions under Washington’s leadership to unfreeze the Iranian funds.
South Korea has blocked $7 billion which it owes for importing Iranian oil prior to full imposition of US sanctions in May 2019. Bilateral ties between Iran and South Korea are frayed because of Seoul's refusal to release the Iranian money held at two commercial banks – Woori Bank and the Industrial Bank of Korea.
South Korea was previously one of Iran's biggest crude oil buyers in Asia. Before the reimposition of US sanctions, South Korean oil companies paid for their oil imports in their own national currency the won through the Iranian central bank account in Seoul and paid government companies involved in selling the oil in rials.
The report quoted unnamed sources familiar with the matter as saying that the release, if implemented, will come “under stringent conditions that Iran use the funds only for public purposes such as UN dues and purchasing COVID-19 vaccines.”
Previously, there have been reports that the US would agree to the release of the funds solely for humanitarian needs, but Washington has never confirmed the existence of such a plan.
“If all goes to plan, we expect our strained relationship with Iran to improve significantly,” a Seoul government official told the newspaper.
According to the source, if talks turn out to be successful, the frozen money will be allowed to be transferred to Iranian bank branches in neighboring Middle Eastern countries, not directly to Iran, to monitor the flow and use of the funds.
The report came three days after Iran International reported that “the Islamic Republic is expected to free hostages with dual nationality in exchange for its assets in South Korea and show more flexibility on issues related to its nuclear program in exchange for the release of its funds in Iraq.”
Currently there are three dual nationals with American citizenship and two individuals with US permanent residency held by Iran on trumped-up charges of espionage. The three citizens are Siamak Namazi, Emad Sharghi and Morad Tahbaz, while Jamshid Sharmahd and Shahab Dalili are US permanent residents.
Confirming the report by Iran International and those of “some local media in the Middle East,” the South Korean outlet also said a transfer of Iranian funds in Seoul would come with conditions that Tehran release “a US hostage held in Iran on spying charges” and limit uranium enrichment levels during nuclear development at 60%.
As South Korea-Iran relations turned sour, Tehran once incited a boycott of Korean products in Iran, targeting Samsung Electronics Co. and Revolutionary Guards briefly seized a Korean oil tanker in 2021.In 2022, a newspaper funded by Supreme Leader said Iran must close the Strait of Hormuz to South Korean vessels until Seoul releases $7 billion frozen funds.
Seoul’s relations with Tehran apparently worsened earlier this year when President Yoon Suk Yeol described the Islamic Republic as the “enemy” of the United Arab Emirates during his trip to the UAE, comparing the threat the UAE faces from Iran to the threat South Korea faces from North Korea. Yoon said, “The enemy of the UAE, its most-threatening nation, is Iran.”
The report quoted Sung Il-kwang, a Korea University professor, as saying that “There is nothing South Korea can gain from becoming an enemy of Iran... Korea will benefit from gaining access to Iran’s huge market.”
“The government of Azerbaijan has misunderstood the self-restraint and good-neighborliness policies of the Islamic Republic of Iran as its weakness and inferred out country’s determination to avoid conflict with itself,” the report released by MEK-affiliated Telegram account GhyamSarnegouni (Uprising till Overthrow) Monday says.
The group released a trove of secret and top-secret document on Monday that it said were obtained by hacking the government’s servers.
Describing Baku’s actions as “serious threats,” the report provides a summary of recent developments in bilateral relations and a summary of Azerbaijan’s relations with other regional players, Turkey and Israel, in the context of its relations with the Islamic Republic of Iran and says failing to redefine relations will lead to “increased hostility” from Azerbaijan.
“Undoubtedly, the Zionist regime will be the principal beneficiary of heightened tensions between the two sides,” the report says.
The report, which MEK claims was among thousands of other documents it acquired, was apparently made by the foreign intelligence and security department of the ministry. The undated report, possibly a draft, is marked as “very confidential” but does not bear a reference number or signature.
An official of the presidential office, Mohammad-Mehdi Rahimi, claimed Monday afternoon that the presidency website had only temporarily been deactivated to carry out site security maintenance for a new version launched last week.
Tensions have been high between Iran and Azerbaijan since November 2022 when both sides accused each other of engaging in terrorism and espionage in the other’s territory.
Iran has suggested Azerbaijani involvement in the October 26 attack in Shiraz claimed by the Islamic State group (Isis-Daesh) and, also in the report accuses Baku of harboring Israeli intelligence and military elements that plan to use its territory in a possible attack against Iran’s nuclear facilities.
The two countries in early May expelled each other’s diplomats after incidents that Baku also dubbed as "terrorist attacks". These included a gunman’s attack on Azerbaijani diplomatic mission in Tehran in January after which Baku shut down the embassy and an attack on Azerbaijani lawmaker Fazil Mustafa in March, who is an outspoken critic of the Islamic Republic.
Ethnic and religious issues complicate relations between Tehran and Baku and both parties have been using these factors against each other.
Around a quarter of Iran’s population is Turki-speaking Azari, with analysts and activists disagreeing over the closeness of their cultural-linguistic links to their neighbors to the north. Iran fears separatism in its northwestern regions encouraged by Azerbaijan.
On the other hand, Azerbaijan has a large Shiite population that is susceptible to agitation by the Islamic Republic, which considers itself the leader of the Shiite world. Supreme Leader Ali Khamenei is often referred to as the "leader of world Muslims".
The Albania-based opposition group claimed it had breached 120 servers of the presidential office and accessed internal communications and minutes of meetings as well as President Ebrahim Raisi’s online conference platforms and about 1,300 computers inside the office.
Hackers posted images of MEK leaders, Maryam Rajavi and her husband Masoud who has not been seen in public since 2003, and defaced pictures of Supreme Leader Ali Khamenei and President Ebrahim Raisi on the compromised websites.
Without any details, some Iranian news websites reported -- a few hours after the MEK’s announcement Monday that they had hacked the website of the presidency – that the website could not be reached.
In early May the group released hundreds of identification documents, minutes of meetings, copies of correspondence, phone numbers of foreign ministry officials, and the names of 11,000 employees.
Traditionally, Oman works as a mediator between Iran and Western countries, and it also plays a role in facilitating relations between Tehran and Arab countries. It was one of the key players in the talks which eventually led to Iran and Saudi’s détente.
Given that this time the Sultan himself has come to Iran, there is no doubt this is a vital visit. Almost all of the reports by Iranian state media on the first day of the visit were focused on bolstering economic cooperation between the two countries, with some discussion on recent developments in the region. However, no details about trade or regional diplomacy were released.
The joint statement released after Oman’s sultan meeting with the Iranian president abounds with clichés such as “strengthening friendly and brotherly relations on the basis of common interests, especially in the fields of trade, energy, investment and culture.”
On the second day of the trip, Sultan bin Tarik met with the Supreme Leader, apparently delving deeper into Iran’s détente with its classic rivals Saudi Arabia and Egypt. The only takeaway from the readout of the meeting by Khamenei’s office, was the Supreme Leader’s welcoming of better relations with Egypt.
Khamenei's comments came as Middle Eastern countries including Egypt are taking steps to ease regional tensions and relations between Egypt and Iran have often been fraught in recent decades although the two countries have maintained diplomatic contacts. In March, regional rivals Sunni Saudi Arabia and Shiite Muslim Iran ended years of hostility and agreed to restore diplomatic relations under a China-mediated deal.
The presence of Iran’s top nuclear negotiator Ali Bagheri-Kani during Oman’s sultan meeting with Khamenei, which is somewhat unusual, indicates that there must have been a nuclear aspect to the meeting, despite a possible media ban on this aspect of the talks.
The seeming lack of openness about the nuclear side of the talks has drawn suspicion from global Iran watchers who are looking to Oman to mediate in the possible revival of talks on the 2015 nuclear deal, which has fallen apart. There are also rumors that the US and the Islamic Republic are about to reach a deal in the near future, which could be among the secret topics discussed during the visit by Oman’s sultan.
Former diplomat Fereydoun Majlesi told Fararu on Monday that Oman has a respected position in the Persian Gulf. "Oman speaks on behalf of all the countries of the Persian Gulf and what is in the interest of Oman is in the interest of all Arab countries in the region,” he said, noting that minimizing the risks of tensions or wars and unease between the Islamic Republic and the US and Israel plays an important role in that.
“These countries are worried that any kind of conflict between Iran and its long-time enemies would overshadow all the peace and security they have achieved during the last half century," added Majlesi who said that Iran’s foreign minister has recently assessed the revival of the JCPOA as “important and vital and expressed willingness to restore the deal”.
Ali Bigdeli, another pundit, told Fararu that the most important possible reason for Sultan of Oman's visit to Iran is mediating for exchange of dual-national prisoners.
A source told Iran International last week that talks between Iran and the US on the release of Tehran's frozen assets could result in a deal soon.
Apparently, the talks that have made progress focused on Iranian funds held in Iraq and South Korea. Iran is apparently expected to show more flexibility on issues related to its nuclear program in exchange for the release of its funds in Iraq, and free hostages with dual nationality in exchange for its assets in South Korea.
Currently there are three dual nationals with American citizenship and two individuals with US permanent residency held by Iran on trumped-up charges of espionage.
Also on Monday, Israel’s state television channel Kan 11 reported that a deal between Tehran and Washington will be finalized in the coming weeks.
During an interview with Reshet Bet on Monday, Israeli opposition leader Yair Lapid expressed alarm about reports of the imminent nuclear agreement, saying: "Such an interim agreement is dangerous. Every effort must be made to prevent this from happening.”