China to Resume Banking System with Iran; Beneficial for Mining Industries

Iran recently witnessed second wave of economic sanctions from US which targeted Banking, Insurance and Shipping industry of Iran. Many countries suspended their banking operations with Iran, among these countries, China also suspended their banking system with Iran. Nearly after a 1 month prohibition of banking system owing to US sanctions, China is resuming its banking relations with Iran.

According to Mr. Asadollah Asgaroladi, President of Iran-China Chamber of Commerce and Industries "the resumption of banking ties would apply to merchants and Iranian expats and students who reside in China." The main bank would be Bank of Kunlun, a bank established in 2006 as a city commercial bank in Karamay.

Mr. Asgaroladi added, "In addition to Bank of Kunlun, a second Chinese bank will also handle Iran payments which will be named later." Bank of Kunlun will be again processing Iran payments as of December 3 after the US granted waivers to China to buy Iranian oil.
According to the market sources, the contracts with Bank of Kunlun are in euro as a way to avoid the US financial system but could be later be converted to yuan.

Iran a Major Iron Ore and Chrome Ore Exporter to China

Iran is one of the major iron ore exporter to China, the nation has exported 21.13 MnT iron ore to China in CY'17. In CY'18(Till Nov), Iran has already exported 14.39 MnT iron ore to China.

China continued to be the largest importer of Iranian iron ore for Nov'18 at 1.27 MnT, contributing 96% of total Iranian export share. The export to China witnessed 14% decrease on monthly basis as against being 1.49 MnT a month before.

Iran exported 0.37 MnT chrome ore to China in CY'17, during CY'18 Iran has exported 0.22 MnT to China.

Inputs taken from Financial Tribune