So far, (to my knowledge), only Iran, Venezuela, and Russia have expressed interest in trading oil in euros, but the idea looks better and better every day. -- Yoshie
<http://www.nytimes.com/2006/09/17/world/middleeast/17paulson.html?> September 17, 2006 U.S. Asks Finance Chiefs to Limit Iran's Access to Banks By STEVEN R. WEISMAN SINGAPORE, Sept. 16 — The United States pressed the top finance officials of the world's leading industrial nations on Saturday to crack down on what Treasury Secretary Henry M. Paulson Jr. said was the exploitation of their banking systems by at least 30 Iranian front companies involved in illicit activities. Mr. Paulson said he had told the finance and economic ministers that the front companies were identified by American intelligence agencies as funneling money to terrororist groups using banks in Europe and elsewhere, many of them "blue chip banks." Mr. Paulson said that many leading trading companies in Iran with legitimate business operations were also involved in the illicit activities, and that it behooved any legitimate bank to realize that it was risky to continue doing even legitimate business with the companies. He called on banks around the world to be "vigilant" in opposing such risks and to avoid "inadvertently facilitating the kinds of activities that they wouldn't want to facilitate." "Iran is a country that has broad, deep and commercial relationships with much of the world that have gone on for some time," Mr. Paulson told reporters here. "This was nothing more than an educational briefing to prepare financial institutions for dealing with some of the risks that are out there." He said banks around the world also needed to stop doing business with North Korea, but added that North Korea was already almost entirely isolated from the world's financial system. By contrast, Iran is still a major player globally. The Treasury chief's comments came after he met with his counterparts from Britain, France, Germany, Italy, Canada, Japan and the European Union, who had come for the annual gathering of the World Bank and the International Monetary Fund. The comments appeared to reflect the emerging Bush administration strategy on Iran as efforts to impose sanctions by the United Nations Security Council have faltered. The administration charges that Iran has a secret nuclear weapons program, a charge that Iran denies. Iran is also accused of transferring funds to Hezbollah and other Islamic militant organizations through regular commercial banks. Last week, in what administration officials call a major escalation in the effort to squeeze Iran economically, the Treasury Department announced that Bank Saderat, a major bank in Iran, would no longer have even indirect access to the United States financial system. Banking experts say that the decree means that Iran will have difficulty selling anything for dollars through Bank Saderat, because any commercial exchange that uses dollars normally obtains them from an American bank. Oil in particularly is always traded in dollars. Many banking experts say the administration may make other banks off-limits soon. After the announcement on Bank Saderat, two senior Treasury officials visited Europe to try to persuade regulators and banks to stop doing business with Bank Saderat and any other banks that are alleged to be involved in illicit activities. Some European banks have already curtailed their activities with Iran, but many leading banks have refused. Stuart Levey, under secretary of the Treasury for terrorism and financial intelligence, visited Britain, France, Switzerland, Italy and Germany, and the deputy Treasury secretary, Robert Kimmitt, went to Germany. France, Italy and Germany have extensive commercial relations with Iran and its trading companies. The Treasury Department has declined to say whom they met with. Iran was only one of many subjects in Mr. Paulson's meetings with the finance ministers. Also on the agenda was a discussion of the world economy, which Mr. Paulson said had grown in recent years at rates that he and others had not seen in a generation. Despite that, he acknowledged risks arising from the failure of recent global trade talks, high energy prices and the problem of what are called "economic imbalances." That phrase is a euphemism for a broad set of problems, including the fact that the United States imports much more than it exports and has thus become the world's leading debtor, owing hundreds of billions of dollars to China, Japan and other trading partners. The United States says this problem can be remedied by the trading partners importing more from the United States and also by China allowing its currency to rise in value in relation to the dollar. In a statement Saturday, the finance ministers of the leading industrial countries said, "Greater exchange rate flexibility is desirable in emerging economies with large current-account surpluses, especially China." As the finance ministers hold their meetings, representatives of more than 500 nongovernmental groups — many of them dissenting from the policies of the bank, the fund and rich countries — are holding meetings on the sidelines. But Singapore's initial refusal to allow many of the representatives into the country gave them too little time to get here, even after Singapore relented under political pressure. As a result, several of the most outspoken critics of globalization are not at the meetings. -- Yoshie <http://montages.blogspot.com/> <http://mrzine.org> <http://monthlyreview.org/>
