News & Views
Iranian central bank demands rescheduling of import payment bills
SEOUL, Feb 2 (AFP) - Iran, hit by currency shortages and falling oil prices, has asked South Korea to reschedule some 100 million dollars worth of import payments, officials said Tuesday.
Iran's central bank called for advance payment for oil imports from the South Korean government if debt rescheduling is impossible, Daewoo Corp. said.
The requests were contained in a letter from Aziz Farrashi, a senior Iranian central bank official, to two foreign banks and 14 South Korean firms including the trading arms of Daewoo, Hyundai and other conglomerates.
"Iran has asked us for an additional 18 months after it failed to remit overdue payments," a Daewoo Corp. spokesman told AFP.
For 430 million dollars worth of goods, imported from 14 South Korean firms in 1993, Iran promised to meet delayed payments in 18 quarterly instalments between 1995 and 1999, he said.
So far, Iran has paid 14 instalments. But it said it could not meet the last four payments, citing a lack of foreign exchange reserves, he said.
"We have yet to answer Iran because the deal must be approved by our government," the spokesman said, adding the 14 Korean firms and two foreign banks met Monday to discuss the issue.
He declined to name the foreign banks, but other sources said a Hong Kong institution took part in Monday's session.
"In view of Iran's difficult situation, we hope the government will advance payment," the Daewoo official said.
Commerce ministry officials said Iran was asking for pre-financing from the Seoul government, the central Bank of Korea and Korean firms concerned.
"We are trying to verify Iran's requests through diplomatic channels. We will take action if Iran's requests are considered unfair," the ministry said in a statement.
"If neeed (be), government agencies will map out concerted measures," it said.
Some 85 percent Iranian exports come from oil. South Korea, a major importer of Iranian oil, exported more than 700 million dollars worth of goods to Iran last year.
Some newspapers in Seoul expressed concern over Iran's worsening financial status. But Daewoo officials ruled out the possibility of Iran defaulting on debts or declaring a moratorium.
Yonhap news agency said South Korean traders were being asked to open credit accounts in other Middle East countries that are faring better for future exports to Iran.
Many Korean firms have been engaged in massive construction projects in Libya, Iran, Iraq and other Middle East nations.
On Monday, Hyundai Engineering and Construction Co. said that it had clinched a 49 million dollar contract to build a steel rolling mill in the United Arab Emirates.
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