The latest development comes a week after the United States and Iran reached a Qatari-brokered agreement for a prisoner swap.
Iran’s frozen assets in South Korea were reportedly transferred to Switzerland’s central bank last week following the announced prisoner exchange deal between Washington and Tehran, South Korean media reported on Monday.
“According to the Seoul Foreign Exchange Market on the 21st, 8 trillion won worth of Iranian frozen funds tied up in Industrial Bank of Korea and Woori Bank were transferred to the Swiss central bank account last week and ready for exchange and remittance,” Yonhap Infomax revealed, referring to Iran’s frozen $6 billion funds.
An official in the foreign exchange confirmed to Yonhap that all Iranian funds may be converted into dollars “in about five weeks.”
The Swiss National Bank plans to exchange the Iranian assets from won to dollars at the Seoul Exchange every business day, before converting it to euros to transfer them to an overseas bank account held by Iran.
The split transfer is taking place in order to protect the domestic foreign exchange market, Yonhap explained.
If the Korean won is exchanged for dollars in one go, the exchange rate will rise due to a “supply and demand instability”. Iran would then suffer a significant exchange loss.
The latest development comes more than a week after the United States and Iran reached a Qatari-brokered agreement to release five American citizens in the Islamic Republic.
The breakthrough was announced on 11 August following two and a half years of “shuttle diplomacy” between the two countries, the CNN reported.
The five prisoners are currently under house arrest at a hotel in Tehran until the anticipated swap takes place, a US-based lawyer told the Associated Press on 12 August.
“It’s a positive step that they were released from prison and sent to home detention. But this is just the beginning of a process that I hope and expect will lead to their return home to the United States,” US Secretary of State Antony Blinken said after the transfer was announced.
Under the deal, Iranian assets frozen in South Korea are to be released and transferred to an account in Qatar before Iran then takes ownership of the funds.
Last week, Qatar’s foreign ministry spokesperson Dr. Majed Al Ansari told the press that the Gulf state “played a major and effective role in achieving consensus between the two sides”.
“The role played by Qatar as a vital and decisive mediator through which it was keen to establish realistic controls that are acceptable to both parties to return the frozen funds, pointing out that this deal was preceded by intensive and shuttle visits by Qatari officials to Washington and Tehran,” the foreign ministry said in a statement.
Meanwhile, the Iranian Foreign Ministry had issued a statement saying Tehran received the necessary assurances from the US regarding the process to release the Iranian assets that were frozen by Washington in South Korea.
If approved, the released funds would be solely accessible for essential needs like food and medicine due to existing sanctions on Iran.
Meanwhile on Monday, Iran’s Foreign Ministry Spokesperson Nasser Kanaani said the prisoner swap process will take up to two months.
“A specific time frame has been announced by relevant authorities, and it will take a maximum of two months for this process to take place,” Kanaani told the press in Iran.
The US had imposed crippling sanctions on Iran’s economy following its unilateral withdrawal from the 2015 nuclear deal, formally known as the Joint Comprehensive Plan of Action (JCPOA).
The move occurred under the former Donald Trump administration as an attempt to apply “maximum pressure” on Iran. Washington further intensified its sanctions on Tehran recent years as indirect negotiations aimed at reviving the JCPOA stalled.
The sanctions have significantly affected the health of Iranians, especially those in need of essential medication and treatment such as chemotherapy, numerous rights groups warned.
The recent prisoner swap has been widely viewed as a critical point in the nuclear file and is likely to pave the way for the revival of talks to revive the historic deal.
Qatar’s foreign ministry spokesperson said he hoped the prisoner exchange “will lead to greater understandings related to the Iranian nuclear file.”
